(1) Any licensee or applicant requesting an extension of time for nonuse of a license in accordance with 16-3-310, MCA, must furnish written evidence of the reasons for failure to place the license in operation within the time prescribed.

(2) The department may grant up to three extensions of nonuse status in increments not exceeding 90 days. If the license is not put into use within one year, the department will consider whether extenuating circumstances exist when determining whether further extensions of nonuse status may be granted. If the quota area is full, extreme and unforeseen hardship must be justified.

(3) The licensee shall be required to attend an informal conference conducted by the department in Helena to afford the licensee or person(s) holding a security interest in the license the opportunity to present evidence establishing justification for any further extension of nonuse status. If the department determines additional nonuse time is justified, a letter granting nonuse status will be issued. If the department determines continued nonuse status is not justified, the department will issue a notice to lapse the license.

(4) The department may deny requests for extensions of nonuse status if the licensee or those person(s) having a security interest in the license fail to establish any progress towards putting the license into use.

(5) Requests for extension of nonuse status based on voluntary closure due to adverse economic conditions or repeated requests based on a proposed sale of a license will not constitute sufficient grounds for extending nonuse status. An earnest money receipt signed by the proposed purchaser is needed for proof of a pending sale and is required for justification of nonuse status if the quota is full and the license has been inactive over one year. An application for transfer of ownership must be received within 30 days of receipt of proof of a pending sale to prevent lapse proceedings in accordance with ARM 42.13.108.

(6) Licenses denied extension of nonuse status are subject to the lapse provisions of 16-3-310, MCA.