USDA’s Agricultural Marketing Service is accepting input through June 24, 2019, for a study it is conducting on the feasibility of establishing a livestock dealer statutory trust. AMS’ study will assist Congress in determining if there is a need to establish a livestock dealer statutory trust for the financial protection of livestock sellers. Completion of the study is required by the 2018 Farm Bill, with a final report due within one year.
The study will:
- analyze how the establishment of a livestock dealer statutory trust would affect buyer and seller behavior in markets for livestock,
- examine how the establishment of a livestock dealer statutory trust would affect seller recovery in the event of a livestock dealer payment default,
- consider what potential effects a livestock dealer statutory trust would have on credit availability, including impacts on lenders and lending behavior and other industry participants,
- examine unique circumstances common to livestock dealers and how those circumstances could impact the functionality of a livestock dealer statutory trust,
- study the feasibility of the industry-wide adoption of electronic funds transfer or another expeditious method of payment to provide sellers of livestock protection from nonsufficient funds payments,
- assess the effectiveness of statutory trusts in other segments of agriculture, whether similar effects could be experienced under a livestock dealer statutory trust, and whether authorizing the Secretary to appoint an independent trustee under the livestock dealer statutory trust would improve seller recovery,
- consider the effects of exempting dealers with average annual purchases under a de minimis threshold from being subject to the livestock dealer statutory trust, and
- analyze how the establishment of a livestock dealer statutory trust would affect the treatment of sellers of livestock as it relates to preferential transfer in bankruptcy.
AMS invites customers and stakeholders to submit information and comments relevant to these objectives that will support development and completion of the study.
The notice soliciting public input for the study was published in the April 25, 2019, Federal Register. Comments may be posted at www.regulations.gov, or sent to: S. Brett Offutt, Chief Legal Officer/Policy Advisor, Packers and Stockyards Division; Fair Trade Practices Program, Agricultural Marketing Service, U.S. Department of Agriculture; 1400 Independence Avenue, SW; Room 2507, STOP 3601; Washington, D.C. 20250-3601. All comments should reference the docket number AMS-FTPP-19-0037, the date of submission, and the page number of the Federal Register issue.