After the director has declared a failure, the department shall process the claims of producers having paid or owing assessments who: (a) produce written evidence of transfer together with the amounts of their unpaid claims, and (b) have “stored for withdrawal” and provide written evidence of deposit.

      (1) The department shall give written notice to and provide a reasonable time of not less than thirty (30) days and not more than sixty (60) days for producers to file their written verified claims, including any written evidence, with the department.

      (2) The department shall investigate each claim and shall notify in writing each claimant, the seed buyer and the advisory committee of the department’s determination as to the validity and amount of each claim. A claimant or seed buyer may request a hearing on the department’s determination within twenty (20) days of receipt of written notification of the determination pursuant to chapter 52, title 67 , Idaho Code. Upon determining the amount and validity of the claim, the director shall pay to the claimant an amount equal to ninety percent (90%) of the approved claim from the seed indemnity fund. Prior to any payment from the fund to a claimant, the claimant shall be required to subrogate and assign to the department his right to any recovery from any other source. The claimant shall be entitled to seek recovery of the remaining ten percent (10%), which was not assigned to the department. The procedure to determine the value of any claim will be established by rules.

      (3) In the event of a shortage or inability to meet financial obligations, the department shall determine each producer’s pro rata share of available seed crops and any deficiency shall be the claims of the producers. Each type of seed crop shall be treated separately for the purpose of determining shortages.

      (4) The director shall not approve or pay any claim based on losses resulting from transactions with persons unlicensed pursuant to this chapter. The director shall not approve or pay any claim made on the seed indemnity fund if the claim is for the payment of interest, attorney’s fees, ancillary costs, or punitive damages. The director shall not approve or pay any claim based on losses resulting from uninsurable perils.

      (5) If a producer’s claim reveals that the assessment has not been paid or collected, and the claim is otherwise valid, the amount of the assessment shall be deducted from the claim payment.