California Milk Handler Bond
Know what the purpose of this bond is and how to obtain this bond ASAP!
What is a California Milk Handler Bond?
The Secretary of Food and Agriculture of the State of California enforces the law that requires milk handlers to submit this bond before purchasing any manufacturing or market milk from a producer.
The said milk handlers or manufacturing milk handlers are those that operate only one plant within California.
This bond is required so that any person (i.e. producer) who has been wronged by the milk handler or manufacturing milk handler can collect for damages.
This bond requirement is mandated by Sections 61405 and 62182 of the California Food and Agricultural Code.
How much does a California Milk Handler Bond cost?
The bond premium will depend on the milk handler’s credit score and the amount of the bond.
The bond amount will be based on the average daily quantity of manufacturing milk purchased by the handler during any calendar month during a license year.
| AVERAGE DAILY QUANTITY OF MILK PURCHASED | MINIMUM BOND AMOUNT |
|---|---|
| Less than 1,000 gallons | $5,000 |
| 1,000 gallons – 4,000 gallons | $10,000 |
| 4,000 gallons – 8,000 gallons | $15,000 |
| More than 8,000 gallons | $20,000 |
Milk handler that operates more than one plant within California should file a bond amount of $20,000 per plant operated by the milk handler.
For example:
- A milk handler operates 5 plants
- 5 plants X $20,000 = $100,000 is the total bond amount
- If the milk handler has an excellent credit score, the bond premium will be 1% of the bond amount, or $1,000.
GET YOUR FREE SURETY BOND QUOTE TODAY!
How can I get a California Milk Handler Bond?
Here’s a step-by-step bonding process that we have made easier so that you can get your bond in no time:
APPLY FOR THIS BOND
If you are ready to do this now, you may APPLY HERE!
One of our expert surety bond agents will guide you through the entire process – from the time you have applied until the bond is issued to you.
UNDERWRITING
Next, you will be asked to submit a few important information that our underwriter requires to assess the following:
- Your job or business history
- Your credit score
- Your financial strength
To avoid any delays, make sure that you have gathered the right information needed before submitting your application.
BOND ISSUANCE
After the indemnity agreement is signed, the bond will be issued and sent to you!
How does a California Milk Handler Bond work?
This bond has 3 parties:
Principal – milk handler
Obligee – State of California
Surety – surety bond provider
Under the terms of this bond, the Principal must comply with the relevant laws of the State as well as the conditions of the license. The Surety will assure the Obligee (beneficiary of the bond) that the Principal will fulfill all the obligations.
If not, the Obligee can file a claim against the bond. The Surety will first investigate the validity of the claim. Once the Surety has paid the Obligee, the Principal must reimburse the Surety of the full amount.
