South Dakota grain dealer Banghart Properties has successfully defended itself against accusations of violating state law. The South Dakota Public Utilities Commission (PUC) voted unanimously to dismiss the case, stating that Banghart did not exceed the $5 million grain purchase limit imposed by its license.
Banghart's legal team, led by attorney Robert Konrad, said that a significant portion of the commodities purchased by the company were intended for out-of-state destinations. As a result, these transactions should not be counted towards the $5 million limit. For example, sunflowers were delivered to North Dakota, and millet found its way to Colorado.
PUC staff had recommended a $70,000 fine against Banghart, but the commission decided against it. Instead, they renewed Banghart's Class B license, subject to a review of their current financial situation. The license, set to expire in June, was effectively extended.
Banghart, based in Gettysburg, South Dakota, is owned by Janice Banghart, with Jeremy Frost, her son, among the grain traders. Frost had faced regulatory issues with his Fearless Grain companies, which merged with Banghart Properties in 2021.
Banghart does not operate an elevator but collects grain directly from farms. The company specifies that ownership of the grain transfers upon reaching the destination, not upon delivery to Banghart.
Konrad emphasized that there had been no complaints from producers regarding non-payment. He clarified that Banghart is licensed in North Dakota and Colorado, where most of their transactions take place.
The PUC staff claimed that Banghart had significantly surpassed the $5 million limit, Konrad argued that when out-of-state transactions were excluded, the company remained within the threshold.
Banghart and Frost did not testify about the complaint, they did provide testimony regarding the license decision. Frost acknowledged some communication issues but expressed a commitment to comply with PUC information requests.
Banghart expressed openness to establishing an advisory board if required by the PUC, although it was not made a condition for license renewal.
Banghart and PUC staff will collaborate on adding language to contracts to inform farmers that transactions outside of South Dakota may not be covered by a state bond.
Photo Credit: gettyimages-ziviani
Categories: South Dakota, Crops