Bond or certificate of deposit prerequisite; amount; form.

(1) Before any license is issued, the applicant therefor shall make and deliver to the department a surety bond or certificate of deposit in the amount of at least $5,000 or in such greater amount as the department may determine. No bond or certificate of deposit may be in an amount less than $5,000. The penal sum of the bond or certificate of deposit to be furnished to the department by an applicant for license as a dealer in agricultural products shall be in an amount equal to twice the dollar amount of agricultural products handled for a Florida producer or a producer’s agent or representative, by purchase or otherwise, during the month of maximum transaction in such products during the preceding 12-month period. An applicant for license who has not handled agricultural products for a Florida producer or a producer’s agent or representative, by purchase or otherwise, during the preceding 12-month period shall furnish a bond or certificate of deposit in an amount equal to twice the estimated dollar amount of such agricultural products to be handled, by purchase or otherwise, during the month of maximum transaction during the next immediate 12 months. Such bond or certificate of deposit shall be provided or assigned in the exact name in which the dealer will conduct business subject to the provisions of ss. 604.15-604.34. Such bond must be executed by a surety company authorized to transact business in the state. For the purposes of ss. 604.19-604.21, the term “certificate of deposit” means a certificate of deposit at any recognized financial institution doing business in the United States. No certificate of deposit may be accepted in connection with an application for a dealer’s license unless the issuing institution is properly insured by either the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation. Such bond or any certificate of deposit assignment or agreement shall be upon a form prescribed or approved by the department and shall be conditioned to secure the faithful accounting for and payment, in the manner prescribed by s. 604.21(9), to producers or their agents or representatives of the proceeds of all agricultural products handled or purchased by such dealer and to secure payment to dealers who sell agricultural products to such dealer. Such bond or certificate of deposit assignment or agreement shall include terms binding the instrument to the Commissioner of Agriculture. A certificate of deposit shall be presented with an assignment of applicant’s rights in the certificate in favor of the Commissioner of Agriculture on a form prescribed by the department and with a letter from the issuing institution acknowledging that the assignment has been properly recorded on the books of the issuing institution and will be honored by the issuing institution. Such assignment shall be irrevocable while the dealer’s license is in effect and for an additional period of 6 months after the termination or expiration of the dealer’s license, provided no complaint is pending against the licensee. If a complaint is pending, the assignment shall remain in effect until all actions on the complaint have been finalized. The certificate of deposit may be released by the assignee of the financial institution to the licensee or the licensee’s successors, assignee, or heirs if no claims are pending against the licensee before the department at the conclusion of 6 months after the last effective date of the license. No certificate of deposit shall be accepted that contains any provision that would give the issuing institution any prior rights or claim on the proceeds or principal of such certificate of deposit. The department shall determine by rule the maximum amount of bond or certificate of deposit required of a dealer and whether an annual bond or certificate of deposit will be required.

(2) The amount of such bond or certificate of deposit shall, upon the order of the department at any time, be increased, if in its discretion the department finds such increase to be warranted by the dollar amount of agricultural products being handled, by purchase or otherwise, by the licensee. In the same manner, the amount of such bond or certificate of deposit may be decreased when a decrease in the dollar amount of products handled, by purchase or otherwise, warrants such decrease. These provisions apply to any bond or certificate of deposit, regardless of the anniversary date of its issuance, expiration, cancellation, or renewal.

(3) In order to effectuate the purposes of this section, the department or its agents may require from any applicant or licensee verified statements of the dollar amount of the applicant’s or licensee’s business or may review the applicant’s or licensee’s records at the applicant’s or licensee’s place of business during normal business hours to determine the actual dollar amount of agricultural products handled, by purchase or otherwise. The failure of a licensee to furnish such statement, to make such records available, or to make and deliver a new or additional bond or certificate of deposit shall be cause for suspension of the licensee’s license. If the department finds such failure to be willful, the license may be revoked.

(4) The department may issue a conditional license to an applicant who is unable to provide a single bond or certificate of deposit in the full amount required by the calculation in subsection (1). The conditional license shall remain in effect for a 1-year period to coincide with the effective period of the bond or certificate of deposit furnished by the applicant. The applicant must provide at least the minimum $5,000 bond or certificate of deposit as provided in subsection (1) together with one of the following:

(a) A notarized affidavit limiting the handling of agricultural products, by purchase or otherwise, during their largest month to a minimum of one-half the amount of the bond or certificate of deposit provided by the applicant;

(b) A notarized affidavit stating that any subject agricultural products, handled by purchase or otherwise, exceeding one-half of the amount of the bond or certificate of deposit will be handled under the exemption provisions set forth in s. 604.16(2); or

(c) A second bond or certificate of deposit in such an amount that, when the penal sum of the second bond or certificate of deposit is added to the penal sum of the first bond or certificate of deposit, the combined penal sum will equal twice the dollar amount of agricultural products handled for a Florida producer or a producer’s agent or representative, by purchase or otherwise, during the month of maximum transaction in such products during the preceding 12-month period.

The department or its agents may require from any licensee who is issued a conditional license verified statements of the volume of the licensee’s business or may review the licensee’s records at the licensee’s place of business during normal business hours to determine the licensee’s adherence to the conditions of the license. The failure of a licensee to furnish such statement or to make such records available shall be cause for suspension of the licensee’s conditional license. If the department finds such failure to be willful, the conditional license may be revoked.