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Licensing and bonding protect New Jersey growers

The New Jersey Department of Agriculture requires any person buying or receiving produce from New Jersey growers on a credit basis to be licensed and bonded. Security must be filed with the department in an amount relating to the value of their credit purchases. The security is meant to provide financial protection to New Jersey producers in the event of a default on payment.

Acceptable securities for issuance of a license include surety bonds, as well as other securities, including but not limited to, irrevocable letters of credit, time certificates of deposit and U.S. government bonds. Securities received by the department range in value from a minimum of $5,000 to a maximum of $150,000.

New Jersey credit buyers must remember that state law requires that they be licensed and bonded each year, prior to purchasing produce from New Jersey producers on a credit basis. Prospective buyers receive applications in September that must be returned to the department by Nov. 1. Any person buying or receiving produce from New Jersey growers on a credit basis without first obtaining a license is subject to a fine of up to $3,000 per day for each day of operation and producers who knowingly sell to unlicensed buyers also may be subject to penalties.

For their own financial protection, New Jersey producers must determine whether or not the prospective buyer is licensed and bonded by the New Jersey Department of Agriculture prior to selling commodities on a credit basis. This can be accomplished by asking the buyer to show his/her license or by contacting NJDA.

Both buyers and sellers should direct questions regarding the law and their responsibilities to Anne Marie Ference at 609/777-0098, write to NJDA, Division of Marketing & Development, Licensing & Bonding Section, Box 330, Trenton, NJ 08625 or email [email protected].

For more information on the New Jersey Department of Agriculture Licensing & Bonding program, visit www.nj.gov/agriculture/divisions/md/prog/licensing.html.

Anne Marie Ference is a member of NJDA’s Division of Marketing & Development.

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