When the Iowa General Assembly reconvenes on Jan. 13, 2020, it will consider draft legislation produced by the Iowa Bankers Association that would increase the risk for agricultural buyers by converting the Iowa agricultural lienholder law from direct notice to central filing.
Under the current direct notice law, lenders send direct notice of their liens to buyers of agricultural commodities, including livestock. In turn, when a seller executes a sale, the buyer issues a multiple-party check that includes the names of the seller and lienholders taken from the direct notice received by the buyer.
Under the draft legislation, agricultural buyers would be required to check for lien filings in a central state database and issue multiple-party checks including the names of all filed lien holders. The stakes are high because buyers that miss a filed lien and issue a check without the lienholder(s) can be held responsible.
NGFA members: To find out how you can best engage on this legislative issue, please contact the Agribusiness Association of Iowa or the Iowa Institute for Cooperatives.