What is a Pennsylvania Milk Dealer’s Bond?

Pennsylvania Milk Dealer's BondThe Commonwealth of Pennsylvania is the third leading milk producing and consuming state in the United States and gives importance to the milk dealing profession.

To be a milk dealer in Pennsylvania, you must procure a surety bond as part of your license requirements before being able to produce, sell or distribute milk and certain milk products in the state.

The Milk Dealer’s Bond guarantees faithful compliance with state laws and provisions that govern the issuance of this license and permit requirement.

The bond ensures:

  • constant sufficient supply of pure, wholesome milk
  • proper handling of constant surpluses to meet emergency requirements
  • financial protection to producers
  • make quick and consistent delivery of their commodity immediately after it is produced
  • adequate technical personnel and physical facilities to receive and handle milk
  • payment for any milk purchased or acquired on consignment and taxes related to the sale of milk
  • against injurious acts to public health safety or public welfare

A milk dealer is defined as any person, who purchases, receives or handles on consignment or otherwise milk within the Commonwealth, for processing or manufacture and sale, on behalf of himself or others, or both. A producer who delivers milk to a milk dealer or handler is not recognized as a milk dealer.

Under the Milk Marketing Law of Pennsylvania, milk includes fluid milk and cream, fresh, sour or storage, skimmed milk, low-fat milk, flavored milk or milk drink, buttermilk, ice cream mix, and condensed or concentrated whole or skimmed milk except when contained in sealed containers.

 

What is the bond amount?

The bond amount must be equal to a minimum of 75% of the highest aggregate amount owed by the milk dealer to all producers for a 40-day period during the previous 12 months.

For “vested milk dealers,” they must file a bond in a sum equal to a minimum of 30% of the highest aggregate amount owed by the vested milk dealer to all producers for a 40-day period during the previous 12 months.

The cost of the bond is a percentage (bond premium) of the bond amount. The cost varies, depending on the determined amount by the Department and your credit score.

 

How do I get a Milk Dealer’s Bond?

We’ve made it easier for you! Just follow the simple steps below!

STEP 1: Apply for the bond

You need to submit a bond application to us. If you’re ready to apply now, get to know your bond costs and requirements by applying for a FREE quote HERE!

STEP 2: Underwriting          

We will ask you a couple of relevant information needed for the bond. This will include your credit score and financial statements.

You may provide a copy of the BOND FORM, which can be obtained from the Pennsylvania Milk Marketing Board.

An underwriter will carefully evaluate all those.

STEP 3: Bond execution

Once the underwriter is done with the underwriting process, we will immediately issue the bond and send it to you!

 

What are the bond conditions?

  • The Surety must be authorized to issue surety bonds in the Commonwealth of Pennsylvania.
  • The Principal (milk dealer) must act by the laws and provisions prescribed in the Milk Marketing Law, Milk Producers’ Security Act, and rules of the Pennsylvania Milk Marketing Board.
  • The bond is conditioned to conform to the provisions stated under the Milk Producers’ Security Act, § 626.7. Security Bonds.
  • If the Principal acts by all laws, rules, and provisions that govern his or her milk dealing license, the obligation will be null and void. Otherwise, it will remain in full force and virtue.

For fast, affordable, and hassle-free bonds, get your bonds by calling us now!

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