Tex. Agric. Code Section 14.031
Bond


(a)

In accordance with this section, each applicant for a license shall file or have on file a bond with the department.

(b)

The bond must:

(1)

be payable to the State of Texas;

(2)

be executed by the applicant as principal;

(3)

be issued by a corporate surety licensed to do business as surety in the State of Texas; and

(4)

be in a form and contain terms and conditions prescribed by the department.

(c)

The bond must be conditioned on faithful performance of:

(1)

each obligation of a warehouse operator as to receipted grain and open storage grain under this chapter and rules adopted under this chapter, from the effective date of the bond until the license is revoked or the bond is canceled, whichever occurs first, whether or not the warehouse remains licensed; and

(2)

except for a contract for the purchase of grain or to act as broker for the grain, each obligation of a warehouse operator under any contract with a depositor that exists on the effective date of the bond or is assumed after the effective date of the bond and before the license is revoked or the bond is canceled, whichever occurs first and whether or not the warehouse remains licensed.

(d)

The bond must be in an amount of not less than $35,000 and be based on 10 cents per bushel of storage capacity, not to exceed a maximum of $500,000.

(e)

If the actual net worth of an applicant equals less than the greater of either 25 cents per bushel of storage capacity or $200,000, the applicant shall file a deficiency bond in an amount equal to the difference between the actual net worth and the greater of either $200,000 or the amount determined by multiplying 25 cents times each bushel of storage capacity in the applicant’s warehouse. A deficiency bond is in addition to the bond required of an applicant by this section.

(f)

Except as provided by department rule, the applicant must give a single bond meeting the requirements of this section to cover warehouses licensed as a single facility or combination. A single bond may not be used to cover more than one individually licensed facility, more than one combination, or one or more individually licensed facilities and one or more combinations.

(g)

The liability of the surety of a bond required by this chapter is limited to the face amount of the bond and does not accumulate for each successive license period during which the bond is in force.

(h)

Subject to the approval of the department, a warehouse operator may deposit the following with the department, for the term of the license plus two years, in lieu of a bond required by this section:

(1)

cash;

(2)

an irrevocable letter of credit, payable to the State of Texas; or

(3)

a certificate of deposit from a federally insured bank or savings and loan institution authorized to do business in this state, assigned to the State of Texas.

(i)

The cash, letter of credit, or certificate of deposit under Subsection (h) must be in the same amount or have a value in the same amount as required for the warehouse bond.

(j)

Any interest or income earned on an assigned certificate of deposit accrues to the owner of the certificate during the time of the assignment.
Acts 1981, 67th Leg., p. 1048, ch. 388, Sec. 1, eff. Sept. 1, 1981. Amended by Acts 1987, 70th Leg., ch. 50, Sec. 2, eff. April 30, 1987. Renumbered from Sec. 14.009 and amended by Acts 2001, 77th Leg., ch. 1124, Sec. 1, eff. Sept. 1, 2001.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 168 (S.B. 248), Sec. 2, eff. September 1, 2011.

Source: Section 14.031 — Bond, https://statutes.­capitol.­texas.­gov/Docs/AG/htm/AG.­14.­htm#14.­031 (accessed Jun. 5, 2024).

14.001
Definitions
14.011
Limitation of Chapter
14.012
Business Information
14.013
Right to Intervene and Notification of Department
14.014
Receivership Affecting Warehouse Assets
14.015
Powers and Duties of Department
14.021
License Required
14.022
Licensing of Multiple Warehouses
14.023
Licensing Procedure
14.024
Requirement for Increasing Capacity
14.031
Bond
14.032
Additional Bond
14.033
Bond Cancellation
14.034
Cancellation of Letter of Credit
14.035
Cancellation of Certificate of Deposit or Cash
14.041
Casualty Insurance
14.042
Insurance Cancellation
14.043
Additional Insurance
14.051
Posting of License
14.052
Warehouse Operator Obligations
14.053
Receipt Forms
14.054
Issuance of Scale Weight Ticket or Receipt
14.055
Duplicate Receipts
14.056
Receipt for Grain Owned by Warehouse Operator
14.057
Records
14.058
Posting of Storage Rates or Tariffs
14.059
Inspections
14.061
Warehouse Receipt as Prima Facie Evidence
14.062
Invalid Receipts
14.063
Termination of Storage
14.064
Certain Loadout Fees Prohibited
14.065
Recovery on Bond
14.066
Appeal of Department Action by Warehouse Operator
14.071
General Penalty
14.072
Penalty for Operating Without a License
14.073
Penalty for Fraud
14.074
Penalty for Unlawful Delivery
14.075
Penalty for Fraudulently Issuing a Scale Weight Ticket or Receipt
14.076
Penalty for Changing a Receipt or Scale Weight Ticket After Issuance
14.077
Penalty for Depositing Grain Without Title
14.078
Penalty for Stealing Grain or Receiving Stolen Grain
14.079
Penalty for Interfering with Sealed Warehouse or Department Inspection or Investigation
14.081
Offense Is Violation
14.082
Discovery of Shortage
14.083
Denial, Revocation, Modification, or Suspension of License or Probation
14.084
Operation After Revocation or Suspension of a License or Probation
14.085
Injunction
14.086
Civil Penalty
14.087
Recovery of Court Costs
14.088
Venue

Accessed:
Jun. 5, 2024

§ 14.031’s source at texas​.gov