Senate committee advances bill tightening seed-dealer payment rules after farmers testify of unpaid contracts

State Rep. Anna Sharp (House District 23) told the Senate Committee on Natural Resources and Wildfire on Feb. 26 that House Bill 4,065 A would put the legislature's 30-day payment intent for seed-production contracts into statute and strengthen enforcement tools for growers who are not paid on time.

Sharp, the bill sponsor, described the measure as a technical fix to statutes first changed in 2011. She said HB 4,065 A would require any seed dealer who receives a delinquency notice from the Oregon Department of Agriculture to provide proof of payment to ODA within 30 days, update the statutory interest provision from 1% to the current market rate plus 1%, and double existing fees for payment verification and issuing delinquency notices to cover the agency's processing costs.

Why it matters: farmers testified that delayed payments cause severe cash-flow problems because growers invest in each season well before harvest. Sharp said the bill is not a comprehensive industry solution but a targeted step to ensure that ODA can act more quickly when dealers do not pay growers as contracted.

Two farmers told the committee their operations were directly harmed by unpaid contracts. Emily Woodcock, a fifth-generation grower in Benton and Lane counties, said her operation filed a slow-pay/no-pay claim after a dealer announced it would not pay the full contract price for about 750,000 pounds of seed, a loss she said equated to more than $90,000. Woodcock said ODA found her claim valid but that processing and enforcement took months without payment.

22Growers need protection from bad players,22 Woodcock said, urging lawmakers to pass the bill.

Dana Paratore, a fourth-generation farmer from Monmouth who farms in Polk and Benton counties, described the scale of seasonal investment and said HB 4,065 A's clearer payment timelines and stronger penalties would protect farms and keep responsible companies from being undercut by those who break agreements.

Sponsor background and intent: Sharp traced the statutes' history back to 1994 and the 2011 revisions and said recent market disruptions, including a failure to set prices in 2022 and an oversupply following the pandemic, exposed weaknesses in enforcement. She noted recent administrative fines imposed on at least one company for recordkeeping failures totaling nearly $300,000.

What the bill does: according to the sponsor and testimony, HB 4,065 A (1) requires proof of payment to ODA within 30 days of a delinquency notice, (2) increases statutory interest to a market-based rate plus 1% as a stronger deterrent to slow payment, (3) doubles certain processing fees so ODA can cover the cost of investigating claims, and (4) includes an emergency clause making the bill effective upon passage. Sharp said administrative-rule changes related to license actions remain the separate responsibility of ODA and would not be preempted by the bill.

Committee deliberations and vote: committee members asked whether 22seed dealer22 is interchangeable with 22seed company22 (the sponsor said yes), whether federal statutes like the Packers and Stockyards Act provide similar protections (members were told Oregon lacks bonding used in Idaho and Washington), and how proprietary seed varieties make collection and remedies legally complicated. After discussion, a committee member moved the bill to the floor with a do-pass recommendation. The clerk recorded affirmative votes from Senators Perozynski and Taylor, Vice Chair Sarah Nash and Chair Bolton; the measure was announced to have passed 5-0 (the transcript records four named 22aye22 votes and reports the final tally as 5 to 0). Vice Chair Sarah Nash was designated to carry the bill to the Senate floor.

Claims and evidence presented: Woodcock said ODA judged her claim valid and that she waited months for payment; Paratore and the sponsor alleged a large foreign-owned seed company intentionally reduced prices in breach of agreements, harming growers and Oregon-based firms. Committee members described the problem as primarily cash-flow related and expressed bipartisan support for the targeted statutory fixes.

What's next: HB 4,065 A will be carried to the Senate floor by Vice Chair Sarah Nash. The sponsor and witnesses characterized the bill as a narrow, technical statutory change; both emphasized that further industry conversations (for example, on bonding) may be needed outside this session.

Closing note: The committee also thanked legislative staff for their work; a staff member said she had accepted a position at the Department of State Lands.