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By Jared Strong
Several farmers seeking compensation because of a soybean dealer bankruptcy and whose claims to the state were partially or wholly denied will get reconsiderations of those claims next week.
The Iowa Grain Indemnity Fund Board is set to hold four appeal hearings that cover 11 claims on May 26.
Those appeals are in regard to about $230,000 worth of claims made to the indemnity fund, which for decades has provided payments to grain producers when dealers don’t pay them or when they are unable to retake their stored grain from warehouses.
Last month, the board weighed claims totaling about $3.2 million that were made in the wake of the bankruptcy of Global Processing Inc., of Kanawha in northern Iowa. The board rejected about $1.5 million worth of claims, mostly because they were for sales that occurred more than six months before the state suspended Global Processing’s dealer and warehouse licenses. That time frame for eligibility is prescribed by law.
Some of the sales dated back to 2019. It’s unclear why farmers did not seek compensation from Global Processing earlier. State law requires payments within 30 days.
The fund pays farmers for 90% of their loss, up to $300,000.
The claims — had some not been rejected — had the potential to bankrupt the indemnity fund. However, the fund balance after the approved claims are paid is expected to be about $370,000.
The fund is designed to operate with balances of between $3 million and $8 million. Because it has dipped below the lower threshold, a long-dormant fee on grain sales is poised to begin in September.
Current law would impose the fee starting in July, but legislation that was approved by state lawmakers would delay it two months. That legislation is awaiting the signature of Gov. Kim Reynolds.
Iowa Capital Dispatch is part of the States Newsroom, a network of similar news bureaus supported by grants and a coalition of donors as a 501c(3) public charity.
