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OFU lauds Hite, Senate for Indemnity Fund update

In a vote of 33-0, the Ohio Senate today passed a bill, SB 66, which will upgrade Ohio’s grain indemnity and handling law.

Updating the law, first passed in 1983, has been a priority of the Ohio Farmers Union for the past two years. Along with setting some rules for Ohio grain elevator operators, the law established the Ohio Indemnity Fund, which is a farmer-funded account set aside to protect farmers in the event of an elevator failure.

There are two primary changes in SB 66. First, the indemnity fund, currently capped at $10 million will be raised to $15 million. This is the first increase in the cap since 2004. Over the past few years, corn and soybean prices have significantly increased which has led to OFU and others to request a larger fund.

“There are fewer elevators holding more grain today in Ohio than in 1983 or 2004. The relative effect of an elevator going bust today is a potentially greater economic event for many farming communities and for the producers doing business with that facility,” said Roger Wise, OFU president.

Additionally, SB 66, sponsored by Senate Agriculture Committee Chairman Cliff Hite, (R-Findlay), clarifies the section in the grain handlers law which sets farmers as the primary lien holders in the event of elevator failures. Hite worked with officials at the Ohio Dept. of Agriculture who administer the grain indemnity program and other agricultural stakeholders for nearly two years to craft a bill that has broad support among Ohio producers and agribusiness interests.

“The Ohio Farmers Union wants to sincerely thank Sen. Cliff Hite for taking the time and showing the patience to work with all stakeholders to craft a bill that is a win for Ohio’s producers,” Wise said. “Many of us are old enough to remember a time when farmers were in danger of losing everything because their elevator went bankrupt. Ohio’s grain indemnity law has been a model for other states because producers fund it through an occasional levy on our grain. There are no tax dollars involved here and the interest from the fund pays for the ODA administration of the program.

“We’re grateful for the support of the entire Senate on this bill which is a big step toward ensuring the program’s future,” Wise said.

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