Processors of farm products.

(1) Existing law requires a processor of farm products, as defined, to be licensed by the Secretary of Food and Agriculture, and provides that an application for a license or for a renewal of a license that shows the applicant to be in an unsound financial condition is sufficient grounds to deny an application. Existing law provides that if the secretary is not satisfied that an applicant or licensee is financially responsible, the secretary may, in lieu of denying, suspending, or revoking the license, accept an irrevocable guarantee of the obligations of the licensee to all California farm product creditors. Existing law also requires a licensee or applicant to furnish and maintain an irrevocable guarantee if the secretary determines that, in the preceding 4 years, the person has engaged in certain conduct, including a violation that resulted in license revocation. This bill would specify that the irrevocable guarantee may include a personal or corporate guarantee, a certificate of deposit, a bank letter of credit, or a surety bond, as determined to be appropriate by the secretary, in an amount that is at least sufficient to pay the obligations of the licensee at the time the guarantee is issued. (2) Existing law requires a person found to be operating a business within the past 5 years without a license or who has a failed to pay a license fee pursuant to a certain schedule to pay additional penalties to the secretary, including paying an amount equal to that portion of the fees that were not paid for the last 5 years the business has operated. This bill would increase that penalty amount to 3 times the portion of the fees that were not paid for the last 5 years the business has operated. (3) Under existing law, the funds collected pursuant to the provisions regulating processors of farm products are deposited in the Department of Food and Agriculture Fund in the State Treasury, and are continuously appropriated for the administration and enforcement of those provisions. Because the additional penalties that would be authorized by this bill would be deposited in the Department of Food and Agriculture Fund in the State Treasury, the bill would make an appropriation. The bill would make other technical, nonsubstantive changes.