License to distributor; bond, letter of credit, or cash deposit

Sec. 406. (a) Concurrently with the filing of an application for a distributor's license, the department may require an applicant to file with the administrator a surety bond, a letter of credit, or a cash deposit: (1) in an amount of not less than two thousand dollars ($2,000) nor more than a three (3) month tax liability for the applicant as estimated by the administrator; and (2) conditioned upon the prompt filing of true reports and payment of all gasoline taxes levied by the state, together with any penalties and interest, and upon faithful compliance with the provisions of this chapter. (b) The administrator shall determine the amount of the distributor's bond, cash deposit, or letter of credit. If the applicant files a bond or a letter of credit, the bond or letter of credit must: (1) be with a surety company or financial institution approved by the administrator; (2) name the applicant as the principal and the state as the obligee; and (3) be on forms prescribed by the department.