[Federal Register Volume 61, Number 39 (Tuesday, February 27, 1996)]
[Rules and Regulations]
[Pages 7193-7206]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-4411]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
Prices of new books are listed in the first FEDERAL REGISTER issue of each
week.
========================================================================
Federal Register / Vol. 61, No. 39 / Tuesday, February 27, 1996 /
Rules and Regulations
[[Page 7193]]
DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
7 CFR Part 404
RIN 0563-AB13
Noninsured Crop Disaster Assistance Program
AGENCY: Federal Crop Insurance Corporation.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Federal Crop Insurance Corporation (``FCIC'') hereby
revises and makes final its regulations to provide a noninsured crop
disaster assistance program (``NAP'') to protect producers of crops for
which insurance is not available. NAP provides a level of protection
that, in most respects, is comparable to the catastrophic risk
protection program offered to producers of insurable crops.
EFFECTIVE DATE: February 22, 1996.
FOR FURTHER INFORMATION CONTACT: For further information and a copy of
the Regulatory Impact Analysis to the noninsured crop disaster
assistance program, contact Diana Moslak, Federal Crop Insurance
Corporation, Regulatory and Procedural Development Staff, U.S.
Department of Agriculture, Washington, D.C. 20250. Telephone (202) 720-
0713.
SUPPLEMENTARY INFORMATION:
Executive Order 12866 and Departmental Regulation 1512-1
This action has been reviewed under United States Department of
Agriculture (``USDA'') procedures established by Executive Order 12866
and Departmental Regulation 1512-1. This action constitutes a review as
to the need, currency, clarity, and effectiveness of these regulations
under those procedures. The sunset review date established for these
regulations is May 1, 2000.
This rule has been determined to be ``significant'' for the
purposes of Executive Order 12866 and, therefore, has been reviewed by
the Office of Management and Budget (``OMB'').
Regulatory Impact Analysis
A Regulatory Impact Analysis has been completed and is available to
interested persons at the address listed above. In summary, the
analysis finds that the final NAP rule incorporates three significant
changes when compared with the interim rule. First, the final NAP rule
defines an ``area'' for NAP triggering purposes as at least 320,000
acres, at least $80 million crop value, or the county, as determined by
the Manager, FCIC. The interim rule used only the 320,000-acre and $80
million value mechanisms. Second, the final rule allows different types
or varieties of a crop or commodity to be treated as separate eligible
crops. Previously, all types and varieties were treated as a single
eligible crop. Third, the interim rule only provided NAP coverage for
seeded forage crops. The final rule expands NAP coverage to include
both seeded and native forage, except on state and Federal lands where
NAP coverage is restricted to seeded forage.
Increasing the choices for defining NAP areas by adding a ``county-
level'' option, providing greater flexibility in the definition of a
crop, providing coverage for both seeded and native forage, and
including the retroactivity provisions will increase NAP outlays. Some
offset is provided by language that requires a five-producer minimum in
the definition of a NAP area. The expected annual outlays under these
regulations are about $95 million to $145 million, averaging $120
million. The cost associated with the forage issue depends on the
future of the Livestock Feed Program, as discussed in the analysis.
Although expected to result in higher Federal outlays, these
changes are designed to improve the equity in NAP payments among
growers. Experience in 1995 and interim rule comments indicate that
various areas and crop types would not receive NAP payments under the
interim rule, despite significant losses. In addition, some producers
may not have received payments due to perils that were omitted from the
crop insurance policy.
The improvements in equity are associated with changes in
administrative costs. Program administration will likely be easier for
FSA offices with the county designation added to the list of area
definition options. However, additional administrative costs will be
associated with the determination of losses by crop type, as well as
the determination of losses qualifying for payment due to NAP coverage
of both seeded and native forage.
Paperwork Reduction Act of 1995
This final rule amends the information collection requirements
previously approved by OMB under OMB control number 0563-0016 through
May 31, 1998. This rule increases the producer (respondent) audience
participation due to increased availability for NAP assistance for
seeded and native forage. This coverage excludes native forage on any
federal or state owned lands, and any crops for which insurance is
available in the county, that is affected by natural disaster and is
not insurable under the producer's crop insurance policy. All of the
forms cleared under OMB control number 0563-0016 represent the required
forms to determine eligibility and losses qualifying for payment due to
NAP coverage.
Revised reporting estimates and requirements for usage of OMB
control number 0563-0016 will be submitted to OMB for approval under
the provisions of 44 U.S.C. 35. Public comments are due by April 22,
1996.
The title of this information collection is ``Noninsured Crop
Disaster Assistance Program, Claim For Indemnity, Field Inspection And
Appraisal Requirements.'' The information requested is required for
proper administration of the Noninsured Crop Disaster Assistance
Program. The burden for the NAP Program is reported on an as needed
basis when disaster situations arise. The reporting burden for this
collection of information is estimated to average 42 minutes per
response for each of the 8.5 responses from approximately 15,172,500
respondents. The total annual burden on the public for this information
collection is 10,620,750 hours.
The comment period for information collections under the Paperwork
Act of 1995 continues through April 22, 1996. Comments are requested on
the
[[Page 7194]]
following aspects of the Information Collection: (a) Whether the
proposed collection of information is necessary for the proper
performance of the functions of the agency, including whether the
information shall have practical utility; (b) the accuracy of the
agency's estimate of the burden of the proposed collection of
information; (c) ways to enhance the quality, utility, and clarity of
the information to be collected; and (d) ways to minimize the burden of
the collection of information on respondents, including through the use
of automated collection techniques or other forms of information
technology.
Comments should be submitted to the Desk Officer for Agriculture,
Office of Information and Regulatory Affairs, Office of Management and
Budget (OMB), Washington, D.C. 20503 and to Bonnie Hart, Advisory and
Corporate Operations Staff, Regulatory Review Group, Farm Service
Agency, U.S. Department of Agriculture, Washington, D.C. 20250. Copies
of the information collection may be obtained from Bonnie Hart at the
above address. Telephone (202) 690-2857.
Executive Order 12612
It has been determined under section 6(a) of Executive Order 12612,
Federalism, that this rule does not have sufficient federalism
implication to warrant the preparation of a Federalism Assessment. The
provisions contained in this rule will not have a substantial direct
effect on states or their political subdivisions, or on the
distribution of power and responsibilities among the various levels of
government.
Regulatory Flexibility Act
This regulation will not have a significant impact on a substantial
number of small entities. Most producers will be able to certify to
their historical production levels at the time of application based on
existing records, or they may elect to base their initial coverage on
transitional or assigned yields. The amount of data collected from
applicants will only be that needed to establish an acceptable yield,
determine the number of acres planted, and determine the eligibility of
the producer, crop, and acreage. The information required and time of
collection is statutory. Therefore, this action is determined to be
exempt from the provisions of the Regulatory Flexibility Act (5 U.S.C.
Sec. 605) and no Regulatory Flexibility Analysis was prepared.
Federal Assistance Program
This program is listed in the Catalog of Federal Domestic
Assistance under No. 10.450.
Executive Order 12372
This program is not subject to the provisions of Executive Order
12372 which require intergovernmental consultation with state and local
officials. See the Notice related to 7 CFR part 3015, subpart V,
published at 48 FR 29115, June 24, 1983.
Executive Order 12778
The Office of the General Counsel has determined that these
regulations meet the applicable standards provided in sections 2(a) and
2(b)(2) of Executive Order 12778. The provisions of this rule will
preempt state and local laws to the extent such state and local laws
are inconsistent herewith. The administrative appeal provisions
published at 7 CFR part 780 and 7 CFR part 11, must be exhausted before
any judicial action may be brought regarding the provisions of this
regulation. The provisions of this rule that are not more restrictive
than the interim rule will be effective retroactive to May 18, 1995,
the date of publication of the interim rule. The provision in
Sec. 404.13 regarding the requirement that an ``area'' consist of a
minimum of five producers before it can be approved is not effective
retroactively.
Environmental Evaluation
This action is not expected to have any significant impact on the
quality of the human environment, health, and safety. Therefore,
neither an Environmental Assessment nor an Environmental Impact
Statement is needed.
National Performance Review
This regulatory action is being taken as part of the National
Performance Review program to eliminate unnecessary or duplicative
regulations and improve those that remain in force.
Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandate Reform Act of 1995 (UMRA), Pub. L.
104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector. Under section 202 of the UMRA, FCIC
generally must prepare a written statement, including a cost-benefit
analysis, for proposed and final rules with ``Federal mandates'' that
may result in expenditures to State, local, or tribal governments, in
the aggregate, or to the private sector, of $100 million or more in any
one year. When such a statement is needed for a rule, section 205 of
the UMRA generally requires FCIC to identify and consider a reasonable
number of regulatory alternatives and adopt the least costly, more
cost-effective or least burdensome alternative that achieves the
objectives of the rule.
This rule contains no Federal mandates (under the regulatory
provisions of Title II of the UMRA) for State, local, and tribal
governments or the private sector. Thus, this rule is not subject to
the requirements of sections 202 and 205 of the UMRA.
Background
On October 13, 1994, the Federal Crop Insurance Act was amended by
the Federal Crop Insurance Reform Act of 1994 (``Act''). This
regulation provides the provisions necessary to carry out the
noninsured crop disaster assistance program (``NAP'') requirements of
the Act. NAP replaces the Disaster Payment Program (7 CFR part 1477)
and the Tree Assistance Program (7 CFR part 1478).
On May 18, 1995, FCIC published an interim rule in the Federal
Register at 60 FR 26669 to add provisions to implement NAP. Following
publication of that interim rule, the public was afforded 60 days to
submit written comments, data, and opinions. On August 7, 1995, FCIC
extended the comment period for the NAP regulations to August 18, 1995
(60 FR 40055). The comments received and FCIC responses are as follows:
Comment: Sec. 404.5(b) Thirty-six comments received from state FSA
offices recommended that section 404.5(b) be amended to allow the
Administrator of FSA to review and approve or disapprove the state FSA
committee recommendation of area eligibility.
Response: The Act specifies that FCIC will make determinations of
area eligibility. The provision will not be changed.
Comment: Sec. 404.5(c) Thirty-six comments received from state FSA
offices recommended that section 404.5(c) be amended to allow county
and State FSA committees to establish yields and prices.
Response: The Act specifies that FCIC shall establish yields and
prices. The provision will not be changed.
Comment: Sec. 404.7(e) Five comments, two from trade associations
and three from other interested parties, were received suggesting that
the definition of ``Aquacultural species'' contained in section
404.7(e) be changed to allow aquaculture on lands that are not
[[Page 7195]]
privately owned or in waters that are not a ``controlled environment.''
One comment from an interested party requested clarification of
``private property in water in a controlled environment'' stating that
fish are grown for human consumption in privately owned net pens
(property) in sea water which is controlled by the net pens but owned
by the nation or state. The state leases the bedlands under the cages
to the private operator so that the cages can be set in place and
moored. FCIC was urged to reconsider the proposed definition to
explicitly allow caged fish and shellfish operations on state leased
lands and waters.
Response: The definition provides for coverage of aquaculture that
is produced in a controlled aquacultural environment. A controlled
environment may include net pens on leased lands provided that the
lease vests in the lessee all the rights and benefits of ownership of
the leased land and does not merely provide a license to gather the
aquacultural species found in the pen. Therefore, the provision will
not be changed.
Comment: Sec. 404.7(e) Two comments were received, one from a state
government office and one from a trade association, stating that the
definition of ``Aquacultural species'' excludes ornamental fish and
aquatic plant industries from the NAP. The state government official
recommended that section 404.7(e) be changed to include nonfood farm-
raised fish and aquatic plants.
Response: The Act limits NAP to crops produced for food or fiber.
The provision will not be changed.
Comment: Sec. 404.7(l) Four comments received from trade
associations stated that many floricultural, nursery, turfgrass sod,
and tree crops are produced in ``crop years'' ranging over several
``calendar years.'' The trade associations suggested that the
definition of ``crop year'' contained in section 404.7(l) be amended to
clarify that losses occurring in a given calendar year will be covered
even though the plant may not be harvested (or be ready to harvest)
during that given year.
Response: The definition has been modified to clarify and explain
how crops produced over multiple calendar years will be eligible for
NAP.
Comment: Sec. 404.7(n) Four comments received from trade
associations requested clarification of the definition of ``Eligible
crop'' contained in section 404.7(n) which states in part that ``In the
case of a crop that historically has multiple plantings in the same
crop year that are planted or are prevented from being planted on the
same or different acreage will be considered different crops for
determining NAP payments. This does not apply to a replacement crop.''
The trade associations stated that it is their interpretation that this
provision is to provide that a loss is ineligible for NAP coverage even
if the grower harvests other plantings in the same year.
Response: The definition has been modified to clarify that each
planting of a crop with multiple plantings in the same crop year will
be considered as a separate crop eligible for NAP payments.
Comment: Sec. 404.7(p) One comment received from an USDA agency
suggested that the definition of ``FCIC'' contained in section 404.7(p)
be changed to reflect FCIC as a separate and distinct corporate entity.
Response: By definition, FCIC is a separate and distinct corporate
entity. Therefore, no change is required.
Comment: Sec. 404.7(q) One comment received from a trade
association suggested that the definition of ``good farming practices''
contained in section 404.7(q) be changed to include alternative farming
practices and innovations that are supported by research or practice
appropriate to the type of farming undertaken.
Response: The definition allows alternative farming practices and
innovations that are supported by data from the Cooperative State
Research, Education, and Extension Service (CSREES). Therefore, no
change is required.
Comment: Sec. 404.7(r) and (ee) One comment was received from a
state FSA office regarding the definitions for ``Harvested'' which
excludes harvest by grazing except for ``Seeded pasture'' which is
limited to ``an annual crop intended for use as grazing only by
domestic animals,'' contained in sections 404.7(r) and 404.7(ee),
respectively. The state FSA official expressed concern that these
definitions exclude nearly all forage crops harvested by grazing. The
state FSA official suggested that eligibility for noninsured crop
disaster assistance be based on crop yields and losses, not the method
of harvest, and that grazing not be excluded from the ``Harvest''
definition.
Response: With respect to the definition of ``Harvested,'' the
intent is to define the term to include only those means of removing
the crop that result in costs being incurred by the producer. Section
404.9(c) authorizes FCIC to reduce the NAP payment as a result of costs
not incurred by the producer, such as harvesting. Because grazing does
not result in a cost to the producer, it is not considered as
``harvested''. With respect to the definition of ``Seeded pasture,''
FCIC has changed the term to ``Forage'' to include both seeded and
native forage crops that are harvested or grazed. Grazed forage will be
eligible for NAP payments at reduced rates. Forage is defined as land
covered with grass or other vegetation, produced under such range
management practices as are necessary to sustain sufficient quality and
quantity of grass or vegetation each year to be suitable for grazing or
mechanical harvest to feed livestock in a commercial operation. NAP
coverage for forage on any Federal or state owned lands is restricted
to seeded forage.
Comment: Sec. 404.7(r) One comment received from a congressional
office stated that the definition of ``Harvested'' contained in section
404.7(r) is silent on disaster assistance to producers of crops that
are harvested over multiple years and recommended a provision be added
to embrace disaster assistance for crops harvested over multiple years.
Response: The paragraph has been modified to clarify when crops
produced and harvested over multiple years are considered harvested.
Comment: Sec. 404.7(v) Two comments received from aquaculture
producers recommended that the NAP provisions cover loss of fish due to
storms causing low pressure and heaving, hot humidity; cloudy weather
causing low oxygen; high temperatures causing loss of appetite; drought
causing water evaporation and stale water; diseases; and failure of
equipment or down power lines due to lightening, storms, or wind
stopping the aeration of oxygen.
Response: To qualify for NAP assistance, the Act provides that
losses of the noninsured commodity be attributable to drought, flood,
or other natural disaster, as determined by the Secretary. The
definition of natural disaster has been modified to include eligible
crop losses that may be attributable to damaging weather or adverse
natural occurrences and related conditions.
Comment: Sec. 404.7(y) Two comments were received regarding the
definition of ``Prevented planting'' contained in section 404.7(y) as
follows:
(1) One comment received from a USDA state office requested
clarification of the definition of ``Prevented planting'' contained in
section 404.7(y) which states in part, ``The natural disaster that
caused the prevented planting may occur prior to the planting period
for the crop in the area, but must not occur earlier than the planting
period for such crop the prior crop year.'' The state government
official suggested that section 404.7(y) be
[[Page 7196]]
amended to specify whether a natural disaster that occurred in one year
and carried over into the next year will receive NAP coverage.
(2) One comment received from a trade association stated that the
requirement that ``most producers in the surrounding area must have
also been unable to plant the eligible crop in order for a producer to
be eligible for a NAP payment'' may impose an additional requirement
not supported by the Act especially when a producer is otherwise
eligible for NAP benefits and can show that planting was not feasible
due to a natural disaster. The trade association suggested that this
requirement be deleted from the definition of ``Prevented planting.''
Response: The definition has been modified to allow for the
coverage of prevented planting when the cause of the prevented planting
occurred after the final planting date of the previous crop year and
before the final planting date of the crop year for which a NAP payment
is requested. For crops with multiple plantings in 1 crop year, the
cause of the prevented planting must occur after the planting of the
previous planting period and before the final planting date of the
current planting period. Further the paragraph has been amended to
eliminate the requirement that most producers in the surrounding area
must have also been unable to plant the eligible crop or other crops
during the same planting period in order for a producer to be eligible
for a prevented planting payment.
Comment: Sec. 404.9(c) Five comments were received regarding
section 404.9(c) which specifies that ``FCIC will adjust the NAP
payment rate for crops that are produced with significant and variable
expenses that are not incurred because the crop acreage was prevented
from being planted or planted but not harvested'' as follows:
(1) Four comments received from trade associations suggested
section 404.9(c) be clarified by providing the criteria to be used in
determining potential reductions in the NAP payment rate for costs not
incurred by the producer as a result of the crop acreage being
prevented from planting or planted but not harvested The trade
associations also suggested that the regulations specify the person or
office ultimately responsible for making the NAP payment rate reduction
determinations as it relates specifically to specialty crops.
(2) One comment received from a USDA agency suggested that the rule
include specifics for calculating the adjustment in the NAP payment
rate and that the method used be similar to those included in the 1994
ad hoc disaster program.
Response: The Act requires the development of a payment rate for a
crop that is produced with a significant and variable harvesting
expense that takes into consideration the stage of the crop at the time
of loss; for example, not planted, planted but not harvested, or
harvested. Because of all the variations that exist between crops, it
is not possible to list all the factors that affect the costs
associated with producing all crops. FCIC will approve all variable
payment factors whether applicable to specialty or other crops. The
method used in determining payments under the 1994 ad hoc disaster
program will be taken into consideration.
Comment: Sec. 404.11(a) Fifty-four comments, one from a
congressional office, fourteen from producers, one from a trade
association, one from a county FSA committee, one from a state FSA
committee, and thirty-six from state FSA offices, were received
requesting section 404.11(a) be changed to allow NAP benefits for seed
crops, specifically grass, clover, alfalfa and legume seed crops and
any other crop grown commercially for seed. The one comment received
from the state FSA committee stated that legislation does not
specifically exclude seed crops which are ultimately used for the
production of crops for human consumption or livestock feed and,
therefore, should be added to the list of crops eligible for NAP
benefits.
Response: The Act specifies that the term ``eligible crop'' will
include each commercial crop or other agricultural commodity (except
livestock) that is produced for food or fiber. Seed crops are not
produced for food or fiber. Further, the Act specifically included the
exceptions to the food or fiber requirement. Crops not specifically
included in the exception are not eligible for NAP. The provision will
not be changed.
Comment: Sec. 404.11(a) One comment received from a producer
suggested that section 404.11(a) be changed to allow NAP payments by
crop type rather than treating as a single eligible crop all types and
varieties of a crop. This producer stated that the farmer who raises
several types of a crop, as opposed to a farmer who raises only one
type, may not qualify for a NAP payment if one type does not meet the
50 percent individual loss requirement. The producer also questioned
whether crops such as tomatoes, basil, or flowers grown in a greenhouse
would be eligible for NAP because pumpkins used for decoration are not
covered by NAP, but flowers are, and whether indian corn, strawberry
corn, or blue corn are eligible crops under the NAP. The producer
recommended all crops and corn grown outside be eligible for NAP
payment.
Response: The paragraph has been revised to allow FCIC to treat
different types and varieties of a crop or commodity as separate
eligible crops provided they have significantly different prices or
yields. The determination of whether a crop is eligible for NAP
payments is not based on whether a crop is grown indoors or outdoors.
The Act specified that crops grown for food or fiber, or included on
the list of exceptions, are eligible regardless of where grown. This
provision will not be changed.
Comment: Sec. 404.11(a)(3) One comment received from a timber
producer requested section 404.11(a)(3) be changed to include walnut
trees planted for timber purposes as a crop eligible for NAP benefits.
Response: FCIC cannot expand the list of crops eligible for NAP
payments beyond those crops designated by the Act. The provision will
not be changed.
Comment: Sec. 404.11(a) One comment was received from a FSA
district director regarding sections which specify that eligible crops
are those crops grown for food and fiber and then lists additional
crops such as floriculture, ornamental nursery crops, Christmas trees,
turfgrass sod, and industrial crops as eligible crops for NAP benefits.
The FSA district director suggested that all of the exceptions to the
crops produced for food or fiber be deleted or the provisions be
broadened to include all crops produced for commercial purposes.
Response: The named crops, in addition to crops produced for food
or fiber, are specified by the Act and, therefore, must be included.
Further, the list of named crops cannot be expanded beyond those
specified in the Act.
Comment: Sec. 404.11(b)(3) One comment was received from a USDA
agency regarding section 404.11(b)(3) which provides for NAP payments
in the case of delayed plantings caused by a natural disaster. The USDA
agency official states that since the Act provides ``that an eligible
crop means each commercial crop or other agricultural commodity (except
livestock) for which the Catastrophic Risk Protection (CAT) Plan of
Insurance is not available, and that is produced for food or fiber,''
there are no statutory exceptions. The USDA agency official recommends
that if a crop is insurable under CAT, there should be no exceptions to
cover losses from delayed plantings for NAP crops.
Response: The commentator may have misinterpreted the provision. A
crop
[[Page 7197]]
that is not insurable under CAT because the natural disaster causing
the damage was not an insurable cause of loss under CAT may be covered
for the natural disaster under NAP, provided that all the other
eligibility requirements are satisfied.
Comment: Sec. 404.11(b)(6) Four comments were received from trade
associations requesting FCIC to clarify the exemption contained in
section 404.11(b)(3). The trade associations stated that the Clean
Water Act and the swampbuster provisions provide exemptions from many
of the features of current wetlands policy that affect agriculture.
Perennial specialty crops were excluded from exemption resulting in
discrimination against a large segment of American agriculture without
any environmental benefit or preservation of wetlands. To avoid a
similar situation, the trade associations requested the FCIC to clarify
the exemption contained in this section to ensure past problems are not
repeated and that specialty crops are not inappropriately excluded from
NAP benefits.
Response: The regulations at section 12.5 of this title,
incorporated into this rule by reference, contain the exceptions
authorized by the Secretary for all USDA programs. It would be
inappropriate for a clarification of section 12.5 to appear in this
rule.
Comment: Sec. 404.13 Sixty-three comments, fifteen from producers,
three from trade associations, three from state government offices, two
from congressional offices, one from a county FSA office, one from a
county FSA committee, one from a state FSA committee, one from a
district director, and thirty-six from state FSA offices, were received
regarding section 404.13 which specifies the minimum area of 320,000
acres or a geographical area with a minimum average value of at least
$80 million for all crops produced annually and other interrelated
provisions contained in section 404.19.
(1) Fifteen comments received from producers, two from trade
associations, three from state government offices, one from a
congressional office, one from a county FSA office, one from a county
FSA committee, one from a state FSA committee, one from a district
director, and thirty-six from state FSA offices stated that the minimum
area requirement (320,000 acres or $80 million value) contained in
section 404.13 coupled with the 35 percent area-wide yield loss
requirement contained in section 404.19(c) is excessively large.
(2) One comment received from a producer recommended elimination of
the area stating that if a small farm is wiped out by hail damage and
the 35 percent area loss does not trigger, the farmer could possibly
lose 100 percent of his crop with no compensation. One FSA district
director stated that a producer would not be covered under the NAP for
crop losses resulting from isolated storms such as hailstorms or
thunderstorms. The FSA district director also stated that NAP
discriminates against producers of noninsured crops because of the
unavailability of insurance coverage in some states.
(3) Thirty-six comments received from state FSA offices recommended
elimination of the area if statutorily permissible. If not statutorily
permissible, the state FSA offices recommended the county FSA committee
with state FSA committee concurrence be given the authority to
delineate an area (with no minimum acreage) based on the agriculture in
the county and the natural disaster affected area. One of the state FSA
offices recommended using certain towns in determining the disaster
area and states and suggested that ``no disaster be smaller than a
single town and none larger than where the disaster actually
occurred.'' Another state FSA office stated that the 35 percent area
loss requirement is not comparable to the catastrophic level of
protection and recommended a smaller minimum area size or elimination
of the area and reconsideration of the 35 percent area loss
requirement.
(4) One comment received from a producer recommended the regional
FSA office define an area.
(5) One comment received from a producer recommended that FSA
committees decide if there is a payable loss.
(6) Three comments received from state government officials, one
from a county FSA office, and one from a state FSA committee
recommended the area be modified to provide assistance to localized
areas that cannot meet the minimum area and area eligibility
requirements.
(7) One comment received from a county FSA committee recommended
the NAP be administered more like the CAT whereby eligibility is on an
individual unit basis.
(8) One comment received from a trade association stated that the
current provisions for defining an ``area'' are too burdensome. The
trade association suggested the ``area'' be defined as a county with
added exceptions to address situations wherein part of one county and
part of another county could constitute an ``area.''
(9) One comment received from a congressional office stated that
producers should not be denied coverage because an insufficient number
of producers in the vicinity suffered similar losses. The comment
suggested that section 404.13(d) be changed to allow eligibility for
NAP benefits to be determined by local circumstances defined by the
county FSA committee so as not to use acreage to deny NAP coverage for
small diversified agricultural operations.
Response: The Act requires the average yield in the ``area'' be
reduced by at least 35 percent before a crop is eligible for NAP
payments. An area cannot be defined as a farm or town and comply with
the intent of NAP, which is to provide protection against widespread
disasters, not individual losses. The requirement that there be an area
affected by a disaster and the amount of loss cannot be changed
administratively. However, in response to comments received, the
provision will be amended for clarity and changed to include ``county''
as an option when defining the area. In order to maintain program
consistency, FCIC will continue to determine the expected area yield,
the approved yields, and approve the ``area'' designation. To ensure
program integrity, this section is also being amended to require that
an approved area within the United States consist of a minimum of five
producers of crops for which the area is designated.
Comment: Sec. 404.15(b) One comment received from a trade
association suggested section 404.15(b) be expanded to include special
yield determination examples for organic and nonorganic and sustainable
and traditional farming practices.
Response: FCIC is authorized to make yield adjustments based on
different farming practices, which would include organic and
nonorganic. Irrigated and nonirrigated are merely used as examples.
However, the provision will be revised to avoid the perception that
only irrigated and nonirrigated practices shall be considered.
Comment: Sec. 404.15(d) One comment was received from a state
government official regarding section 404.15(d) which states in part
that ``Approved yields for the eligible crop will be based on the
producer's actual production history in accordance with the provisions
of 7 CFR part 400, subpart G.'' The state government official states
that to require the submission of 4 consecutive years production for
producers who may have had a disaster in 2 consecutive years is not
fair. The state government official recommended
[[Page 7198]]
that section 404.15(d) be amended to allow a producer who has more than
4 consecutive years of production records on noninsured crops to submit
production records for any 4 of those years.
Response: The Act requires that approved yields be based on the
producers actual production history over a period of at least the
previous 4 consecutive years of production records and not more than 10
consecutive years of production records. Producers can only use
assigned yields when records are not available. If the producer has had
a disaster, production records will be available. Therefore, this
provision will not be changed.
Comment: Sec. 404.15(g) Three comments were received regarding
section 404.15(g) as follows:
(1) One comment received from a producer recommended section
404.15(g) be amended to allow the FSA committee to determine the
production records a producer must submit.
(2) One comment received from a trade association recommended
section 404.15(g) be amended to include some intent to defraud or
deceive when assessing criminal and civil actions against the producer
for failure to provide adequate records.
(3) One comment was received from a state FSA committee
recommending that section 404.15(g)(2) be changed to delete for use as
adequate records ``contemporaneous measurements, truck scale tickets,
contemporaneous diaries, etc.'' Justification for this change was that
such production information is not an adequate record for use in yield
determination, is not verifiable, and makes administering the program
more difficult. The state FSA committee suggested that unless the
producer can provide verifiable production evidence, this production
information not be considered as an adequate record for use in yield
determination.
Response: Producers are not required to submit a specific type of
record. The rule simply provides examples of record that may be
considered acceptable to FCIC for the purposes of substantiating claims
for NAP payments or yield certification. FCIC will consider all
available sources of information including recommendations from county
and state FSA committees; however, FCIC will make the determination as
to whether the documentation provided is adequate. The applicable
criminal and civil sanctions have an intentional or wilful requirement
with respect to the providing of false or inaccurate information,
including a false claim that records exist. In response to the
comments, the paragraph has been revised to require the producers to
submit records that are acceptable to FCIC. If the information is not
reliable or verifiable, the records will not be considered acceptable.
No other change to the provision will be made.
Comment: Sec. 404.17(b)(6) One comment was received from a producer
recommending section 404.17(b)(6) be changed to require the producer to
report planting dates only for those crops planted after the final
acreage reporting date and to allow the county FSA committee to
determine whether a producer planted late.
Response: It has been determined that if the acreage report does
not contain a certification as to the date the crop being reported was
planted, it will be difficult to determine if the crop was planted
after the final acreage reporting date or final planting date
established for insurance purposes. Information as to the date of
planting should be readily available when the acreage report for the
crop is filed. Accordingly, the paragraph is not changed.
Comment: Sec. 404.17(b)(8) One comment was received from a producer
recommending section 404.17(b)(8) be changed to allow a producer to
prove yields at the application for NAP benefits date rather than at
acreage reporting date.
Response: Because NAP payments are based on the actual production
history of the producer, it is necessary to require producers to
annually report the acreage and production of crops. Further, such
information will be used to develop insurance products for those crops
for which insurance is currently not available. Producers unable to
provide adequate documentation of their yield will have a yield
assigned in accordance with section 519 of the Act.
Comment: Two comments from trade associations were received
regarding section 404.19(a). The comments are as follows:
(1) One comment received from a trade association suggested section
404.19(a) address the standards the Secretary will use in determining
the natural disasters eligible for NAP payments. The trade association
raises this issue in light of complaints that sustainable and
alternative practices have been treated unfairly in the past.
(2) One comment received from a trade association suggested section
404.19(a)(3) address the standards that will be used to exclude NAP
assistance for the failure of the producer to follow good farming
practices. According to the trade association sustainable and
alternative agricultural practices are frequently and erroneously
labeled as not ``good farming practices'' simply because they may be
different from the traditional approach in the area. The trade
association suggested section 404.19(a)(3) provide specificity on this
point and provide producers with guidance as to what evidence they
should present in order to show that their alternative methods were
appropriate.
Response: The definition of ``natural disaster'' has been clarified
to include both weather related and other natural occurrences or their
consequences which may cause or accelerate the destruction or
deterioration of a crop. Further, the definition of ``good farming
practices'' allows alternative farming practices and innovations that
are supported by data from the Cooperative State Research, Education,
and Extension Service (CSREES). Therefore, a change is not required.
Comment: Sec. 404.19(c)(1) Six comments, five from trade
associations and one from a state FSA committee, were received
regarding section 404.19(c)(1) which specifies that ``The quantity will
not be reduced for any quality consideration unless a zero value is
established.'' One trade association recommended section 404.19(c)(1)
be changed to include quality adjustment for hay crops in the disaster
calculation for NAP payment. Four trade associations recommended FCIC
develop a more flexible approach that focuses on the value of the
damaged but not ``dead'' crop and whether the crop will be marketable
in the future at a reasonable price. The state FSA committee
recommended the same quality loss guidelines provided under CAT be also
available to producers under the NAP.
Response: Many of the crops eligible for quality adjustments under
the crop insurance program have generally accepted grades and standards
upon which to base such adjustments. There are no such generally
accepted grades and standards for most NAP crops. Therefore, no change
is made.
Comment: Seven comments, one from a state government official, one
from a producer, one from a FSA district director, and four from trade
associations, were received regarding section 404.19(c)(2). The
comments are as follows:
(1) One comment was received from a state government official
regarding section 404.19(c)(2) which states that ``A prevented planting
NAP payment will be made if the producer is prevented from planting
more than thirty-five percent (35%) of the total eligible acreage
intended for planting to the eligible crop.'' The state government
[[Page 7199]]
official recommended the provision be changed to specify the percentage
of guarantee that will be paid to a producer. The state government
official suggested the guarantee be specified at a rate of not less
than 65 percent for producers who are prevented entirely from planting
a crop.
(2) Two comments, one from a producer and one from an FSA district
director, were received regarding section 404.19(c)(2)(A) which states
that ``Eligible crop acreage will not exceed 100% of the simple average
of the number of acres planted to the crop by the producer in the loss
area during the years used to determine the approved yield, unless FCIC
has previously agreed in writing to approve acreage exceeding this
limit.'' The producer requested FCIC reconsideration of this provision
in light of crop rotations and the planting of other crops. The FSA
district director stated the provision discriminates against producers
of noninsured crops because a producer of an insured crop is not
subject to this restriction.
(3) Four comments were received from trade associations regarding
section 404.19(2)(D)(i) which specifies that NAP payments for prevented
planting will not be available for ``tree crops and other perennials.''
The trade associations stated it is arbitrary and capricious to exclude
turfgrass sod, floricultural, and ornamental nursery crops as
perennials ineligible for NAP prevented planting. Because many of these
crops can be produced in a period ranging from a few months to several
years, depending upon the area of the country and a wide variety of
agronomic considerations, the trade associations suggested a more
flexible approach be developed by FCIC.
Response: Section 519(d)(1) of the Act limits the production
eligible for payment to less than 50 percent of the producer's approved
yield. Section 404.23 is added to specify how losses will be paid to
producers eligible for prevented planting or reduced yield NAP
payments. In Sec. 404.19, paragraphs (c)(2) (A), (B), and (C) have been
deleted and acreage which was prevented from planting due to a natural
disaster, and the producer can prove was intended to be planted, may be
eligible for NAP payments. Tree crops and perennials may be eligible
for prevented planting NAP payments provided the producer can prove
adequate resources were available, or on order, to plant, grow, and
harvest the crop, if applicable.
Comment: Sec. 404.21(a). Two comments, one from a state FSA
committee and one from a trade association were received regarding
section 404.21(a) which specifies that ``Any person with a share in the
eligible crop who would be entitled to a NAP payment must make
application and provide a notice of damage or loss within 15 calendar
days after the occurrence of the prevented planting (the end of the
planting period) or damage to the crop.'' The state FSA committee
stated that the 15-day notification is too limiting and suggested the
provision be changed to allow for a 30- or 45-day notification period.
The trade association also stated that the 15-day notice of damage was
too restrictive.
Response: The time period for providing notice of loss is
comparable to the insurance requirement and allows for timely
inspection of the damaged crop, if necessary. Longer time periods may
make it difficult to accurately assess the extent of the damage and
prevent the producer from destroying the crop and putting the acreage
to another use.
Comment: Sec. 404.27(a). One comment received from a state
government official suggested that section 404.27(a) be amended by
replacing the words ``erroneously represented'' with the words
``knowingly misrepresented''. Justification for this change was that
the provision implies that a farmer who unwittingly benefited from
another's action could face cruel and unduly harsh penalties due to
acts of which he or she was totally unaware.
Response: The paragraph has been clarified to replace ``erroneously
represented'' with ``misrepresented.'' Further, the paragraph has been
revised to require that producers ``knowingly'' adopt, participate, or
benefit from a scheme or device to conform to the requirement of the
Act.
Comment: Sec. 404.27(c)(2). One comment received from a trade
association suggested section 404.27(c)(2) be amended to include the
``knowing'' or ``intentional'' submission of false information.
Response: Since section 404.27(a) has already been revised to
require a ``knowing'' adoption, participation, or benefiting from the
scheme or device, a change is not required here.
Comment: Sec. 404.29(a). One comment received by a trade
association suggested section 404.29(a) include a provision to provide
for refund of monies by the producer as a result of an FCIC error and
that such provision not require the producer to pay interest or pay the
money back ``on demand.'' The trade association suggested that after a
set period of time FCIC should not be allowed to recompute and correct
its own mistakes and should within that set period of time establish an
equitable repayment schedule agreed upon by the parties involved.
Response: There is a statute of limitation that governs the period
within which FCIC can bring an action to recover funds that are owed to
it. Further, since NAP is a government funded program, payments cannot
be made or retained that are not authorized by law.
Comment: Sec. 404.33. Two comments, one from a state government
official and one from a trade association, were received regarding
section 404.33 as follows:
(1) One comment from a state government official suggested that
this section be amended by removing the words ``The appeal,
reconsideration, or review of all determinations made under this part .
. .'' and inserting in its place the words ``Any determination made by
the agency, which the producer believes to be adverse to his or her
participation in the program, can be appealed, reconsidered, or
reviewed by the agency.'' The state government official also suggested
that the words ``must be in accordance with part 780 of this title or
the regulations promulgated by the National Appeals Division, whichever
is applicable'' be replaced with a new paragraph to read as follows:
``All appeals will be heard under the new regulations that are
published for the National Appeals Division, including the right of a
producer to participate in mediation with the agency. If the appeal is
in a state with a certified mediation program, then the agency must
notify the producer in writing, of his or her right to mediation.''
(2) One comment received from a trade association suggested this
section include appeal rights through the National Appeals Division on
whether the designation of an area is appealable. The trade association
also suggested that these regulations provide more specific guidance in
keeping with the National Appeals Division regulations particularly
notice provisions, timeframes, and any informal appeal options.
Response: Since the National Appeals Division has specific
jurisdictional requirements, no change is necessary. Further, the Act
requires that informal appeal processes in effect on the date of its
enactment remain in effect and producers are provided their choice of
forums. Mediation is available under 7 CFR part 780. Rules of general
applicability are not appealable and the area designation is a rule of
general applicability. Since the notice, timeframe, and informal appeal
options
[[Page 7200]]
are specifically stated in the referenced part and regulation, it would
be redundant to include them here.
Comment: One comment received from an USDA agency recommended that
participation in the NAP be linked to other price support, production
adjustment, conservation programs, and the CAT program. Justification
for this change was to provide equitable treatment to all producers and
to be consistent with the Act which requires the FCIC to establish a
NAP program to provide coverage equivalent to the CAT program.
Response: The Agency determined that it would not require linkage
between CAT and NAP unless specifically required by the Act.
Comment: One comment received from a USDA agency recommended an
administrative fee similar to the CAT program be charged producers
prior to the time they receive benefits under the NAP. Justification
for this charge was to ensure fair and equitable treatment of all
producers and to help cover administrative costs for delivering the
program.
Response: The comment cannot be implemented because the Act does
not authorize collection of fees from NAP producers.
Comment: One comment received from a USDA agency suggested that a
producer should have a history of growing the crop in order to receive
NAP benefits. Justification for this change was to ensure that a
producer has the knowledge, expertise, and intent to produce the crop.
Response: This suggestion would have the affect of penalizing new
producers. FSA's operating procedure delegates to the county committees
the responsibility of determining that good farming practices were used
in producing the crop. If good farming practices were not used or the
producer cannot prove that a crop was intended for planting, the
producer is ineligible for NAP payments.
Comment: One comment received from a USDA agency recommended limits
be placed on producers from receiving NAP benefits on acreages that
substantially increased over the previous year's planting.
Justification for this change was to help prevent producers from
significantly expanding planted acres on certain crops on the basis of
the NAP benefits available.
Response: The Act does not provide for limiting NAP benefits if a
producer increases acreage of a crop. The Act only limits the use of
assigned yields when the crop acreage in the county has significantly
increased from previous years.
Comment: One comment received from a trade association stated that
since producers must file annual acreage reports it is imperative that
they be notified on the availability of NAP. The trade association
suggested post-disaster sign-up for the first few years of this
program.
Response: The Act requires producers to annually provide records of
previous years acreage, yield, and production. Further, producers are
required to file acreage reports showing the current crop years planted
and prevented planted acreage. These requirements cannot be changed.
Under the Act, producers are not required to submit an application for
payment until the application deadline, which occurs after the loss has
occurred.
With the exception of a few minor editorial or technical
corrections, other changes made by FCIC are as follows:
(1) Removed the reference to the definitions for actual yield,
adjusted yield, and replacement crop at Sec. 404.7(b), (c), and (dd)
because those terms are not relevant to this program;
(2) Removed the reference to the definition for master yield at
Sec. 404.7(u) because there are no master yields under NAP;
(3) Added a definition for CAT, FSA, NASS; and NAP in Sec. 404.7
for clarity;
(4) Added a definition for ornamental nursery crop at Sec. 404.7 to
clarify which nursery crops are covered;
(5) Added a provision to Sec. 404.11 which makes NAP assistance
available for any crop for which insurance is available in the county,
that is affected by natural disaster that is not insurable under the
producer's crop insurance policy for clarity even though such coverage
was available under the interim rule;
(6) Revised Sec. 404.13 for clarity, added ``county'' as an option
for area designations, and require a minimum number of producers for
NAP areas within the United States;
(7) Added Sec. 404.23 to clarify how NAP payments are calculated
and redesignated the remaining sections accordingly.
Good cause is shown to make this rule effective upon public filing
with the Federal Register, and without the 30-day period required by
the Administrative Procedure Act. The interim rule implemented the NAP
requirements mandated by the amendments to the Federal Crop Insurance
Act by the Federal Crop Insurance Reform Act of 1994. This final rule
needs expedited implementation in order to facilitate the processing of
pending applications for NAP benefits. Therefore, good cause is shown
to make this rule effective in less than 30 days after publication.
List of Subjects in 7 CFR Part 404
Agricultural commodities, Disaster assistance, Reporting and
recordkeeping requirements.
Final Rule
Accordingly, 7 CFR Part 404 is revised to read as follows:
PART 404--NONINSURED CROP DISASTER ASSISTANCE PROGRAM--REGULATIONS
FOR THE 1995 AND SUCCEEDING CROP YEARS
Sec.
404.1 General statement.
404.3 Applicability.
404.5 Administration.
404.7 Definitions.
404.9 Coverage.
404.11 Eligibility.
404.13 Area.
404.15 Yield determinations.
404.17 Acreage report.
404.19 Loss requirements.
404.21 Application for payment and notice of loss.
404.23 Payments for reduced yield and prevented planting.
404.25 Multiple benefits.
404.27 Payment and income limitations.
404.29 Misrepresentation, scheme and device, and fraud.
404.31 Refunds to the Corporation.
404.33 Cumulative liability.
404.35 Appeals.
404.37 Exemption from levy.
404.39 Estates, trusts, and minors.
404.41 Death, incompetence, or disappearance.
404.43 OMB control numbers.
Authority: 7 U.S.C. 1506(l), 1506(p).
Sec. 404.1 General statement.
The Federal Crop Insurance Act, as amended by the Federal Crop
Insurance Reform Act of 1994, requires the Federal Crop Insurance
Corporation to implement a noninsured crop disaster assistance program
to provide eligible producers of eligible crops with protection
comparable to the catastrophic risk protection plan of crop insurance.
NAP is designed to help reduce production risks faced by producers of
crops for which Federal crop insurance under the Act is not available.
NAP will reduce financial losses that occur when natural disasters
cause a catastrophic loss of production or prevented planting of an
eligible crop. Payment eligibility is based on an expected yield for
the area and the producer's approved yield based on actual production
history, or a transitional yield if sufficient production records are
not available. Production for both the applicable area expected yield
and the individual
[[Page 7201]]
producer approved yield for the unit must fall below specified
percentages in order to be eligible for payments under this part.
Sec. 404.3 Applicability.
The provisions contained in this part are applicable to each
eligible producer and each eligible crop, acreage, or cause of loss for
which CAT coverage is not otherwise available.
Sec. 404.5 Administration.
(a) The NAP program will be administered under the general
supervision of the FCIC, and will be carried out through state and
county committees and offices of the Farm Service Agency, or other
local USDA offices as designated by FCIC.
(b) The state FSA committee will, in accordance with this part,
recommend the geographical size and shape of the area where a natural
disaster has occurred, and whether the area eligibility requirement has
been satisfied. The recommendation of eligibility must be approved by
FCIC.
(c) FCIC will determine all yields and prices under this part.
(d) No delegation herein to a state or county FSA committee will
preclude the FCIC Manager from determining any question arising under
NAP or from reversing or modifying any determination made by a state or
county FSA committee.
Sec. 404.7 Definitions.
Act--The Federal Crop Insurance Act as amended. (7 U.S.C. 1501 et
seq.)
Actual production history--Refer to 7 CFR part 400, subpart G,
except that the terms of subpart G will read as follows when referring
to NAP:
------------------------------------------------------------------------
Insurance Terms NAP Terms
------------------------------------------------------------------------
Agent..................................... Local office representative
Claim..................................... Application for payment
claim for indemnity....................... Application for payment
Indemnity payment......................... NAP payment
Insurable acreage......................... Eligible acreage
Insurable cause........................... Natural disaster
Insurable crop............................ Eligible crop
Insurance company......................... Provider
Insurance purposes........................ NAP purposes
Insured................................... Eligible producer
Insured producer.......................... Eligible producer
Uninsurable acreage....................... Ineligible acreage
Uninsurable production.................... Ineligible production
Uninsured cause of loss appraisal......... Assigned production
Uninsured production...................... Ineligible production
------------------------------------------------------------------------
APH--Actual production history.
Approved yield--An APH yield calculated and approved by FCIC, used
to determine any NAP payment in accordance with 7 CFR part 400, subpart
G.
Aquacultural species--Any species of aquatic organism grown as food
for human consumption or fish raised as feed for fish that are consumed
by humans, and which is propagated and reared in an aquatic medium by a
commercial operator on private property in water in a controlled
environment.
Area--The geographic region recommended by the state FSA committee,
and approved by FCIC in accordance with Sec. 404.13, where a natural
disaster has occurred which may qualify producers in the area for NAP
payments.
Assigned yield--A yield assigned for a crop year in the base
period, in accordance with 7 CFR part 400, subpart G, if the producer
does not file an acceptable production report by the production
reporting date.
Average market price--The price, or dollar equivalent on an
appropriate basis; for example, pound, bushel, ton, for an eligible
crop established by FCIC for determining NAP payments. Such price will
be on a harvested basis without the inclusion of transportation,
storage, processing, packing, marketing or other post-harvest expenses
and will be based, in part, on historical data.
CAT--A catastrophic risk protection plan of insurance offered by
FCIC authorized under section 508(b) of the Act and 7 CFR part 402.
CCC--The Commodity Credit Corporation.
County expected yield--The eligible crop yield established by the
State FSA committee and approved by FCIC for the county. Such yield
information may be obtained from NASS, CSREES, credible nongovernmental
studies, yields in similar areas, and similar reference material. For
planted annual crops, such yield will be based on the acreage planted
for harvest.
Crop year--The period of time within which the crop is normally
grown and designated by the calendar year in which the crop is normally
harvested in the area. For crops harvested over two calendar years, the
crop year will be the calendar year in which the majority of the crop
would have been harvested. For crops grown over more than two calendar
years, each year in the growing period will be considered as a separate
crop year designated by the calendar year in which the crop sustained a
loss. For crops for which CAT is available, the crop year will be as
defined by CAT.
CSREES--The Cooperative State Research, Education, and Extension
Service.
Eligible crop--An agricultural commodity for which CAT is not
available and which is commercially produced for food or fiber as
specified in this part. Eligible crop shall also include floricultural,
ornamental nursery, and Christmas tree crops, turfgrass sod, and
industrial crops. In the case of a crop that historically has multiple
plantings in the same crop year that are planted or are prevented from
being planted, each planting may be considered a different crop for
determining NAP payments. In the case of a crop that has different
varieties or types, each variety or type may be considered a separate
crop for determining NAP payments, if FCIC determines there is a
significant difference in price or yield between the varieties or
types.
Expected area yield--The eligible crop yield established and
approved by FCIC for the geographic area.
Forage--Land covered with grass or other vegetation, produced under
such range management practices as are necessary to sustain sufficient
quality and quantity of grass or vegetation each year to be suitable
for grazing or mechanical harvest to feed livestock in a commercial
operation. NAP benefits for forage produced on any Federal or state
owned lands are available only for seeded forage.
FCIC--The Federal Crop Insurance Corporation, a wholly owned
Government corporation within the Farm Service Agency (FSA), United
States Department of Agriculture.
FSA--Formerly the Consolidated Farm Service Agency; now the Farm
Service Agency of the United States Department of Agriculture.
Good farming practices--The cultural practices generally used in
the area for the crop to make normal progress toward maturity and
produce at least the individual unit approved yield. The practices are
normally those recognized by CSREES as compatible with agronomic and
weather conditions in the area.
Harvested--A single harvest crop is considered harvested when the
producer has, by hand or mechanically, removed the crop from the field.
Crops with multiple harvests in one year or harvested over multiple
years are considered harvested when the producer has, by hand or
mechanically, removed at least one mature crop from the field. The crop
is considered harvested once it is taken off the field and placed in a
truck or other conveyance. (Exceptions: Hay is considered harvested
when in the bale, whether removed from the field or not. Grazing is not
considered harvesting for
[[Page 7202]]
the purpose of determining a payment rate factor.)
Livestock--Any farm or other animal excluding aquacultural species
and, including but not limited to domestic avian, ruminant, equine, and
swine species grown or maintained for any purpose.
Local office--The FSA office or other USDA office designated by
FCIC.
NASS--The National Agricultural Statistics Service, an agency of
the United States Department of Agriculture.
Native forage--Grass or other vegetation occurring naturally
without seeding.
Natural disaster--Means damaging weather, including but not limited
to drought, hail, excessive moisture, freeze, tornado, hurricane,
excessive wind, or any combination thereof; or adverse natural
occurrence such as earthquake, flood, or volcanic eruption; or related
condition, including but not limited to heat, insect infestation, or
disease, which occurs as a result of an adverse natural occurrence or
damaging weather occurring prior to or during harvest that directly
causes, accelerates, or exacerbates the destruction or deterioration of
an eligible crop, as determined by the Secretary.
NAP--The noninsured crop disaster assistance program.
Operator--The person who is in general control of the farming
operation on the farm during the crop year.
Ornamental nursery crop--A decorative plant grown in a container or
controlled environment for commercial sale.
Person--A person as defined in 7 CFR part 1497, subpart B.
Prevented planting--The inability to plant a crop with proper
equipment during the planting period for the crop or commodity. A
producer must prove that the producer intended to plant the eligible
crop and that such crop could not be planted due to natural disaster
reasonably related to the basis for the area designation under
Sec. 404.13, as determined by the FCIC Manager. The natural disaster
that caused the prevented planting must have occurred after the final
planting date for the previous crop year and before the final planting
date for the crop year in which a request for NAP payment was made. For
crops with multiple plantings in a single crop year and one crop has
been harvested, the natural disaster must occur, after the harvest of
the harvested crop and before the end of the planting period for the
next planting of the crop.
Producer--A person who, as owner, landlord, tenant, or
sharecropper, is entitled to share in the production from the eligible
commodity or in the proceeds thereof.
Production report--A written record showing the commodity's annual
production and used to determine the producer's yield for NAP purposes.
The report contains yield history by unit, if applicable, including
planted acreage for annual crops, eligible acreage for perennial crops,
and harvested and FCIC appraised production for the previous crop
years. This report must be supported by verifiable written records,
measurement of farm-stored production, or by other records of
production approved by FCIC. Information contained in an application
for payment is considered a production report for the unit for the crop
year for which the application was filed.
Qualifying gross revenues means:
(1) With respect to a person who receives more than 50 percent of
such person's gross income from farming, ranching, and forestry
operations, the annual gross income for the calendar year from such
operations; and
(2) With respect to a person who receives 50 percent or less of
such person's gross income from farming, ranching, and forestry
operations, the person's total gross income from all sources.
Reseeded or replanted crop--The same crop planted on the same
acreage after the first planting of the crop has failed.
Seeded forage--Acreage which is mechanically seeded with grasses or
other vegetation at regular intervals, at least every 7 years, in
accordance with good farming practices.
Share--The producer's percentage of interest in the eligible crop
as an owner, operator, or tenant at the beginning of the crop year. For
the purposes of determining eligibility for NAP payments, the
producer's share will not exceed the producer's share at the earlier of
the time of loss or the beginning of harvest. Acreage or interest
attributed to a spouse, child, or member of the same household may be
considered part of the producer's share unless considered a separate
person.
Transitional NAP yield (``T'' Yield)--An estimated yield based on
the county expected yield adjusted for individual producers as
determined by FCIC. The T-yield will be used in the approved yield
calculation process when less than four consecutive crop years of
actual or assigned yields are available. (See APH).
Unit--For the noninsured crop disaster assistance program, all
acreage of the eligible crop in the county for the crop year:
(1) In which the person has 100 percent crop share; or
(2) Which is owned by one person and operated by another person on
a share basis.
(Example: If, in addition to the land the person owns, the person
rents land from five landlords, three on a crop share basis and two on
a cash basis, the person would be entitled to four units, one unit for
each crop share lease and one unit which includes the two cash leases
and the land owned by the person.) Land rented for cash, a fixed
commodity payment, or any consideration other than a share in the crop
on such land will be considered as owned by the lessee. No unit other
than that stated herein will be permitted.
Sec. 404.9 Coverage.
(a) Producers who are eligible to receive NAP payments for crop
years 1995 through 1998 will receive coverage against loss in yield
greater than 50 percent of the producer's approved yield for the
eligible crop payable at 60 percent of the established average market
price for the crop.
(b) Producers who are eligible to receive NAP payments after crop
year 1998 will receive coverage against loss in yield greater than 50
percent of the producer's approved yield for the eligible crop payable
at 55 percent of the established average market price for the crop.
(c) FCIC will adjust the NAP payment rate for crops that are
produced with significant and variable expenses that are not incurred
because the crop acreage was prevented from being planted or planted
but not harvested.
(d) NAP payments will be determined by unit based on the production
of all acreage of that crop (planted and eligible prevented from being
planted) in the unit.
(e) Each producer's NAP payment will be based on the producer's
share of the eligible crop.
Sec. 404.11 Eligibility.
Eligible crops under this part will be any commercial agricultural
crop, commodity, or acreage of a commodity grown for food or fiber for
which CAT is not available under 7 CFR part 402 unless excluded by
paragraph (b) of this section. Different types or varieties of a crop
or commodity may be treated as a separate eligible crop, if FCIC
determines there is a significant difference in price or yield.
(a) NAP payments will be made available for:
(1) Any commercial crop grown for food;
(2) Any commercial crop planted and grown for livestock
consumption,
[[Page 7203]]
including but not limited to grain and forage crops;
(3) Any commercial crop grown for fiber, excluding trees grown for
wood, paper, or pulp products;
(4) Any commercially produced aquacultural species;
(5) Floriculture crops;
(6) Ornamental nursery crops;
(7) Christmas tree crops;
(8) Turfgrass sod;
(9) Industrial crops; and
(10) Any crop, for which crop insurance under the Act is available
in the county, that is affected by a natural disaster that is not
insurable under the producer's crop insurance policy.
(b) NAP payments will not be available:
(1) For losses of livestock or their by-products;
(2) To any person who has qualifying gross revenues in excess of $2
million;
(3) For any acreage in any area for any crop for which CAT is
available, unless the loss was caused by a natural disaster that is not
covered under CAT and all other eligibility requirements for NAP are
satisfied;
(4) To any person who, in accordance with chapter VII of 7 CFR and
section 1764 of the Food Security Act of 1985, has been convicted under
Federal or state law of planting, cultivating, growing, producing,
harvesting or storing a controlled substance in any applicable crop
year;
(5) Producing an agricultural commodity in any crop year on a field
on which highly erodible land is predominant, unless the person is
exempt under the provisions of Sec. 12.5 of this title; or
(6) Producing an agricultural commodity in any crop year on
converted wetland, unless the person is exempt under the provisions of
Sec. 12.5 of this title.
(c) Any tenant, landlord, or producer on the unit separate from the
person determined to be ineligible under this provision will remain
eligible for NAP payments for their share of the crop unless such
tenant, landlord, or producer on the unit is:
(1) Also convicted of planting, cultivating, growing, producing,
harvesting or storing a controlled substance;
(2) Also in violation of chapter XII of the Food Security Act of
1985 and the regulations issued thereunder; or
(3) Otherwise determined by FCIC to be ineligible for NAP payments.
Sec. 404.13 Area.
(a) For the purposes of this part, acreage affected by a natural
disaster, or any adjustment thereto, will be included in the area
recommended by the state FSA committee and submitted to FCIC for
approval, regardless of whether the commodity produced on the affected
acreage suffered a loss.
(b) Except for eligible areas identified in paragraph (f) of this
section, an approved area shall include at least five producers of
crops on separate and distinct farms for which the area has been
approved for the payment of NAP benefits. Notwithstanding this
provision, FCIC may approve an area having fewer than five producers if
the Manager determines that such area will suffer significant economic
consequences as a result of the disaster.
(c) An area may be designated as follows:
(1) A county;
(2) Aggregated acreage that is at least 320,000 acres; or
(3) Aggregated acreage with not less than $80 million average value
for all crops produced annually.
(d) If the aggregated acreage affected by the natural disaster does
not meet the minimum requirement specified in paragraph (c)(2) or (3)
of this section, the aggregated acreage will be expanded by adding
acres from around the affected acreage, until the minimum requirement
is met.
(e) The area may not be defined in any manner that intentionally
includes or excludes producers or crops.
(f) In lieu of the paragraph (a) and (c) of this section, for
eligible areas outside the United States, the area shall include 10 or
more producers of the crop. Notwithstanding this provision, FCIC may
approve an area outside the 50 United States having fewer than 10
producers of the crop for which the area is requested if the Manager
determines that such area will suffer significant economic consequences
as a result of the disaster.
Sec. 404.15 Yield determinations.
(a) FCIC will establish expected area yields for eligible crops for
each county or area for which the NAP is available, using available
information, which may include, but is not limited to, NASS data,
CSREES records, credible nongovernment studies, yields in similar
areas, and reported approved yield data. For planted annual crops, such
yields will be based on the acreage planted for harvest.
(b) FCIC may make county yield adjustments taking into
consideration different yield variations due to different farming
practices in the county such as: irrigated, nonirrigated, organic,
nonorganic; different types and varieties of a crop; and intended use.
(c) In establishing expected area yields for eligible crops:
(1) If the approved area corresponds to a single county, the
expected area yield will be the yield established by FCIC for that
county, including any adjustments permitted by this section; or
(2) If the approved area encompasses portions of a county or more
than one county, the expected area yield will be the weighted average
of the yields established by FCIC for those counties in the area,
including any adjustments permitted by this section.
(3) FCIC may adjust expected area yields if:
(i) The cultural practices, including the age of the planting or
plantings, are different from those used to establish the yield.
(ii) The expected area yield established on a state or county level
is determined to be incorrect for the area.
(d) FCIC will establish approved yields for purposes of providing
assistance under this part. Approved yields for the eligible crop will
be based on the producer's actual production history in accordance with
the provisions of 7 CFR part 400, subpart G.
(e) The approved yield established for the producer for the year in
which the NAP payments are offered will be equal to the average of the
consecutive crop year yields, as established by FCIC, reported and
certified of that producer for that eligible crop.
(f) If a producer receives an assigned yield for a year of natural
disaster because production records were not submitted by the
production reporting deadline, the producer will be ineligible to
receive an assigned yield for the year of the next natural disaster
unless adequate production records for the eligible crop from the
previous one or more years, as applicable, are provided to the local
office. The producer shall receive a zero yield for those years the
producer is ineligible to receive an assigned yield.
(g) FCIC will select certain producers on a random or targeted
basis and require those selected to provide records acceptable to FCIC
to support the information provided. Producers may also be required to
support the yield certification at the time of loss adjustment or on
post-audit. Each certification must be supported by records acceptable
to FCIC. Failure to produce records acceptable to FCIC will result in
FCIC establishing the yield in accordance with APH and may subject the
producer to criminal and civil false claims actions under various
Federal statutes as well as refund of any amount received. In addition,
sanctions as set
[[Page 7204]]
out at 7 CFR part 400, subpart R may be imposed for false
certification. Records acceptable to FCIC may include:
(1) commercial receipts, settlement sheets, warehouse ledger
sheets, or load summaries if the eligible crop was sold or otherwise
disposed of through commercial channels provided the records are
reliable or verifiable; and
(2) such documentary evidence as is necessary in order to verify
the information provided by the producer if the eligible crop has been
sold, fed to livestock, or otherwise disposed of other than through
commercial channels such as contemporaneous measurements, truck scale
tickets, and contemporaneous diaries, provided the records are reliable
or verifiable.
(h) Any producer who has a contract to receive a guaranteed payment
for production, as opposed to delivery, of an eligible crop will have
the production adjusted upward by the amount of the production
corresponding to the amount of the contract payment received.
(i)(1) Producers will not be eligible to receive an assigned yield
if the acreage of the crop in a county for the crop year has increased
by more than 100 percent over any year in the preceding seven crop
years, unless:
(i) The producer provides adequate records of production costs,
acres planted, and yield for the crop year for which NAP payments are
being sought.
(ii) FCIC determines that the records provided under this paragraph
are inadequate, FCIC may require proof that the eligible crop could
have been marketed at a reasonable price had the crop been harvested.
(2) The provisions of this section will not apply if:
(i) The crop has been inspected prior to the occurrence of a loss
by a third party acceptable to FCIC; or
(ii) The FSA county executive director, with concurrence of the FSA
state director, makes a recommendation for an exemption from the
requirements and such recommendation is approved by FCIC.
Sec. 404.17 Acreage report.
(a) Producers must file one or more acreage reports annually at the
local office no later than the date specified by FCIC for each crop the
producer will want made eligible for the NAP program. The acreage
report may be filed by the farm operator. Any producer will be bound by
the acreage report filed by the farm operator unless the producer files
a separate acreage report prior to the acreage reporting date.
(b) That acreage report must include all of the following
information:
(1) All acreage in the county of the eligible crop (for each
planting in the event of multiple planting) in which the producer has a
share;
(2) The producer's share at the time of planting or the beginning
of the crop year;
(3) The FSA farm serial numbers;
(4) The crop, practice, and intended use;
(5) All persons sharing in the crop (including the identity of any
person having a substantial beneficial interest in the crop (refer to 7
CFR part 400, subpart Q) and the person's employer identification
number or social security number, if the person wishes to receive any
payment under the Act);
(6) The date the crop was planted;
(7) Acreage prevented from being planted; and
(8) Production from the previous crop year. (For example: The
producer reported the crop acreage planted in 1995. The producer must
then report the 1995 production for that acreage by the 1996 acreage
reporting date for the crop.)
(c) A person's failure to submit the required information by the
designated acreage reporting dates may result in the denial of NAP
payments. If there is a change of ownership, operation, or share within
the farming operation after the acreage reporting date, the local
office must be notified not later than 30 calendar days after the
change and proof of the change must be provided in order to maintain
eligibility for payments under this part.
Sec. 404.19 Loss requirements.
(a) To qualify for payment under this part, the loss or prevented
planting of the eligible crop must be due to a natural disaster as
defined at Sec. 404.7.
(b) NAP assistance will not cover losses due to:
(1) The neglect or malfeasance of the producer;
(2) The failure of the producer to reseed or replant to the same
crop in the county where it is customary to reseed or replant;
(3) The failure of the producer to follow good farming practices
for the commodity and practice;
(4) Water contained or released by any governmental, public, or
private dam or reservoir project, if an easement exists on the acreage
affected for the containment or release of the water;
(5) Failure or breakdown of irrigation equipment or facilities; or
(6) Except for tree crops and perennials, inadequate irrigation
resources at the beginning of the crop year.
(c) A producer of an eligible crop will not receive NAP payments
unless the projected average or actual yield for the crop, or an
equivalent measurement if yield information is not available, in the
area falls below 65 percent of the expected area yield. Once this area,
and all other, eligibility requirements have been satisfied:
(1) A reduced yield NAP payment will be made to a producer if the
total quantity of the eligible crop that the producer is able to
harvest on the unit is less than 50 percent of the approved yield for
the crop due to natural disaster reasonably related to the basis for
the area designation under Sec. 404.13, as determined by the FCIC
Manager, factored for the share of the producer for the crop.
Production from the entire unit will be used to determine whether the
producer qualifies for a NAP payment. The quantity will not be reduced
for any quality consideration unless a zero value is established.
(2) A prevented planting NAP payment will be made if the producer
is prevented from planting more than 35 percent of the total eligible
acreage intended for planting to the eligible crop. Producers must have
intended to plant the crop and prove that they were prevented from
planting the crop due to natural disaster reasonably related to the
basis for the area designation under Sec. 404.13 and the producer may
be required to prove that such producer had the resources available to
plant, grow, and harvest the crop, as applicable.
(d) NAP payments for prevented planting will not be available for:
(1) Tree crops and other perennials, unless the producer can prove
resources were available to plant, grow, and harvest the crop, as
applicable;
(2) Land which planting history or conservation plans indicate
would remain fallow for crop rotation purposes; or
(3) Land used for conservation purposes or intended to be or
considered to have been left unplanted under any program administered
by USDA.
Sec. 404.21 Application for payment and notice of loss.
(a) Any person with a share in the eligible crop who would be
entitled to a NAP payment must provide a notice of damage or loss
within 15 calendar days after the occurrence of the prevented planting
(the end of the planting period) or recognizable damage to the crop.
For the 1995 crop year only, the notice must be filed within the later
of July 3, 1995, or 15 days after the occurrence of the prevented
planting or damage to the crop. The notice must be filed at the local
office serving the area
[[Page 7205]]
where the producer's unit is located. The farm operator may provide the
notice for all producers with an interest in the crop. All producers on
a farm will be bound by the operator's filing or failure to file the
application for payment unless the individual producers elect to timely
file their notice.
(b) Applications for NAP payments must be filed, on our form, by
the applicant with the local office no later than the first acreage
reporting date for the crop in the crop year immediately following the
crop year in which the loss occurred.
(1) If the producer chooses not to harvest the crop, all eligible
acres and crop units for which the producer intends to make an
application for payment must be left intact until the units have been
appraised or released by an FCIC loss adjuster.
(2) If the producer harvests the crop, the producer must provide
such documentary evidence of crop production as FCIC may require which
may include leaving representative samples of the crop for inspection.
(c) Failure to make timely application or to supply the required
documentary evidence shall result in the denial of NAP payments.
(d) Payments under this part may be assigned by the eligible
producer only on our form and such assignment is effective only when
approved by FCIC. Failure of FCIC to make payment in accordance with
such assignment will not give rise to any liability on the part of FCIC
to the assignee.
Sec. 404.23 Payments for reduced yields and prevented planting.
In the event that the area loss requirement has been satisfied for
the crop and either:
(a) The producer has sustained a loss in yield in excess of 50
percent of the producer's approved yield established for the crop the
NAP low yield payment will be determined by:
(1) Multiplying the producer's approved yield by the total eligible
acreage planted to the eligible crop;
(2) Multiplying the product of paragraph (a)(1) of this section by
50 percent;
(3) Subtracting the total production from the total eligible
acreage from the result in paragraph (a)(2) of this section;
(4) Multiplying the product of paragraph (a)(3) of this section by
the producer's share of the eligible crop;
(5) Multiplying the result of paragraph (a)(4) of this section by
the applicable payment factor in accordance with Sec. 404.9(c);
(6) Multiplying the result in paragraph (a)(5) of this section by :
(i) For the 1995 through 1998 crop years, 60 percent of the average
market price, as determined by FCIC, or any comparable coverage, as
determined by FCIC: or
(ii) For the 1999 and subsequent years, 55 percent of the average
market price, as determined by FCIC, or any comparable coverage, as
determined by FCIC; or
(b) The producer has been unable to plant at least 35 percent of
the acreage intended for the eligible crop, the NAP payment will be
determined by:
(1) Multiplying the producer's acreage intended to be planted to
the eligible crop by 35 percent;
(2) Subtracting the result in (b)(1) of this section from the
number of eligible prevented planting acres as determined in
Sec. 404.19 (c) (2);
(3) Multiplying the result of (b)(2) of this section by the
producer's share of the eligible crop;
(4) Multiplying the producer's approved yield by the result of
(b)(3) of this section;
(5) Multiplying the result of (b)(4) of this section by the
approved prevented planting payment factor in accordance with
Sec. 404.9(c);
(6) Multiplying the result of (b)(5) of this section by:
(i) For the 1995 through 1998 crop years, 60 percent of the average
market price, as determined by FCIC, or any comparable coverage, as
determined by FCIC: or
(ii) For the 1999 and subsequent years, 55 percent of the average
market price, as determined by FCIC, or any comparable coverage, as
determined by FCIC.
Sec. 404.25 Multiple benefits.
(a) If a producer is eligible to receive NAP payments under this
part and benefits under any other program administered by the Secretary
for the same crop loss, the producer must choose whether to receive the
other program benefits or NAP payments. The producer is not eligible
for both. Such election does not relieve the producer from the
requirements of making a production and acreage report.
(b) Applicable programs include, but are not limited to, the
Emergency Livestock Feed Assistance Program and any other program
determined by FCIC to compensate the producer for the same crop loss.
Sec. 404.27 Payment and income limitations.
NAP payments made to eligible producers are subject to the
following provisions:
(a) For the purpose of making such payments, the term ``producer''
will be considered to mean the term ``person'' as determined in
accordance with 7 CFR part 1497, subpart B.
(b) No person shall receive payments for a crop year under this
part in excess of $100,000.
(c) A person who has qualifying gross revenues in excess of $2
million for the previous calendar year shall not be eligible to receive
NAP payments under this part.
(d) Simple interest on payments to the producer which are delayed
will be computed on the net payments ultimately found to be due, from
and including the 61st day after the latter of the date the producer
signs, dates, and submits a properly completed application for payment
on the designated form, the date disputed applications are adjudicated,
or the date the area is approved for NAP payments. Interest will be
paid unless the reason for failure to timely pay is due to the
producer's failure to provide information or other material necessary
for the computation or payment. The interest rate will be that
established by the Secretary of the Treasury under section 12 of the
Contract Disputes Act of 1978 (41 U.S.C. 611), and published in the
Federal Register semiannually on or about January 1 and July 1 of each
year and may vary with each publication.
Sec. 404.29 Misrepresentation, scheme and device, and fraud.
(a) If FCIC determines that any producer has misrepresented any
fact or has knowingly adopted, participated in, or benefitted from, any
scheme or device that has the effect of defeating, or is designed to
defeat the purpose of this part, such producer will not be eligible to
receive any payments applicable to the crop year for which the scheme
or device was adopted.
(b) If any misrepresentation, scheme or device, or practice has
been employed for the purpose of causing FCIC to make a payment which
FCIC otherwise would not make under this part:
(1) FCIC will withhold all or part of the payment that would
otherwise be due.
(2) All amounts paid by FCIC to any such producer, applicable to
the crop year in which the offense occurred, must be refunded to FCIC
together with interest and other amounts as determined in accordance
with this part.
(3) FCIC may impose such other penalties or administrative
sanctions as authorized by section 506(n) of the Federal Crop Insurance
Act, as amended
[[Page 7206]]
or available under 7 CFR part 400, subpart R.
(c) Scheme and device may include, but is not limited to:
(1) Concealing any information having a bearing on the application
of the rules of this part;
(2) Submitting false information to the FCIC or any county or state
FSA committee; or
(3) Creating fictitious entities for the purpose of concealing the
interest of a person in the farming operation.
Sec. 404.31 Refunds to the Corporation.
(a) In the event that there is a failure to comply with any term,
requirement, or condition for payment made in accordance with this
part, or the payment was established as a result of erroneous
information provided by any person, or was erroneously computed, all
such payments or overpayments will be refunded to FCIC on demand,
together with interest.
(b) Interest will accrue in accordance with the provisions of 7 CFR
Sec. 1403.9.
(c) Interest on any amount due the FCIC found to have been received
by the producer as a result of fraud, misrepresentation, scheme or
device, or presenting a false application for payment will start on the
date the producer received the payment.
(d) Recovery of delinquent debts and set off will be in accordance
with 7 CFR part 1403.
(e) If FCIC determines it is necessary to contract with a
collection agency or to employ an attorney to assist in collection, the
producer will pay all the expenses of collection.
(f) All amounts paid will be applied first to the payment of
expense of collection, second to the reduction of any penalties which
may have been assessed, then to the reduction of accrued interest, then
to the reduction of the principal balance.
Sec. 404.33 Cumulative liability.
(a) The liability of any producer for any payment or refunds, which
is determined in accordance with this part to be due to FCIC, will be
in addition to any other liability of such producer under any civil or
criminal fraud statute or any other statute or provision of law
including, but not limited to, 18 U.S.C. 286, 287, 371, 641, 1001;
1014, and 31 U.S.C. 3729.
(b) All producers on the unit receiving payments under this part
will be jointly and severally liable to repay any unearned NAP
payments.
Sec. 404.35 Appeals.
The appeal, reconsideration, or review of all determinations made
under this part, except the designation of an area for which there is
no appeal rights because it is determined a rule of general
applicability, must be in accordance with part 780 of this title.
Sec. 404.37 Exemption from levy.
Any payment that is due any person under this part will be made
without regard to questions of title under state law and without regard
to any attachment, levy, garnishment, or any other legal process
against the crop, and the proceeds thereof, which may be asserted by
any creditor, except statutory liens of the United States.
Sec. 404.39 Estates, trusts, and minors.
(a) Program documents executed by persons legally authorized to
represent estates or trusts will be accepted only if such person
furnishes evidence of the authority to execute such documents.
(b) A minor who is otherwise eligible will be eligible for NAP
payments under this part only if such person meets one of the following
requirements:
(1) The minor establishes that the right of majority has been
conferred on the minor by court proceedings or by statute;
(2) A guardian has been appointed to manage the minor's property
and the applicable program documents are executed by the guardian; or
(3) A bond is furnished under which the surety guarantees any loss
incurred for which the minor would be liable had the minor been an
adult.
Sec. 404.41 Death, incompetence, or disappearance.
In the case of death, incompetence or disappearance, of any person
who is eligible to receive NAP payments in accordance with this part,
such payments will be disbursed in accordance with part 707 of this
title.
Sec. 404.43 OMB control numbers.
These regulations amend the information collection requirements
previously approved by the Office of Management and Budget (``OMB'')
under OMB control number 0563-0016.
Done in Washington, D.C., on February 22, 1996.
Suzette M. Dittrich,
Acting Manager, Federal Crop Insurance Corporation.
[FR Doc. 96-4411 Filed 2-22-96; 3:00 pm]
BILLING CODE 3410-FA-P
