[Federal Register Volume 62, Number 78 (Wednesday, April 23, 1997)]
[Proposed Rules]
[Pages 19691-19701]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-10449]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 62, No. 78 / Wednesday, April 23, 1997 /
Proposed Rules
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DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
7 CFR Parts 422 and 457
Potato Crop Insurance Regulations and Common Crop Insurance
Regulations
AGENCY: Federal Crop Insurance Corporation, USDA.
ACTION: Proposed rule.
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SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes
specific crop provisions for the insurance of potatoes. The provisions
will be used in conjunction with the Common Crop Insurance Policy Basic
Provisions, which contain standard terms and conditions common to most
crops. The intended effect of this action is to provide policy changes
to better meet the needs of the insured, include the current potato
crop insurance regulations with the Common Crop Insurance Policy for
ease of use and consistency of terms, and to restrict the effect of the
current potato crop insurance regulations to the 1997 and prior crop
years.
DATES: Written comments, data, and opinions on this proposed rule will
be accepted until close of business May 23, 1997 and will be considered
when the rule is to be made final.
ADDRESSES: Interested persons are invited to submit written comments to
the Director, Product Development Division, Federal Crop Insurance
Corporation, United States Department of Agriculture, 9435 Holmes Road,
Kansas City, MO 64131.
FOR FURTHER INFORMATION CONTACT: Rob Coultis, Insurance Management
Specialist, Product Development Division, Federal Crop Insurance
Corporation, at the Kansas City, MO, address listed above, telephone
(816) 926-7730.
SUPPLEMENTARY INFORMATION:
Executive Order No. 12866
The Office of Management and Budget (OMB) has determined this rule
to be exempt for the purposes of Executive Order No. 12866, and,
therefore, this rule has not been reviewed by OMB.
Paperwork Reduction Act of 1995
The information collection requirements contained in the potato
crop insurance regulations were previously approved by OMB pursuant to
the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35) under OMB
control number 0563-0003 through September 30, 1998.
The amendments set forth in this proposed rule, however, revise the
information required to be collected when a producer elects the new
Northern Potato Crop Insurance Storage Endorsement. Producers must
indicate an additional option code on either the application or
contract change form to select this endorsement, an insignificant
modification for the purposes of paperwork reduction. Other amendments
set forth in this rule not contain additional information collections
that require clearance by OMB under the provisions of 44 U.S.C. chapter
35.
The title of this information collection is ``Catastrophic Risk
Protection Plan and Related Requirements including, Common Crop
Insurance Regulations; Northern Potato Crop Insurance Provisions;
Central and Southern Potato Crop Insurance Provisions; Northern Potato
Quality Endorsement Crop Insurance Provisions; Northern Processing
Potato Quality Endorsement Crop Insurance Provisions; Certified Seed
Potato Endorsement Crop Insurance Provisions; and Northern Potato
Storage Endorsement Crop Insurance Provisions.'' The information to be
collected includes a crop insurance application and an acreage report.
Information collected from the application and acreage report is
electronically submitted to FCIC by the reinsured companies. Potential
respondents to this information collection are producers of potatoes
that are eligible for Federal crop insurance.
The information requested is necessary for the reinsured companies
and FCIC to provide insurance and reinsurance, determine eligibility,
determine the correct parties to the agreement or contract, determine
and collect premiums or other monetary amounts, and pay benefits.
All information is reported annually. The reporting burden for this
collection of information on crop insurance programs is estimated to
average 16.9 minutes per response for each of the 3.6 responses from
approximately 1,755,015 respondents. The total annual burden on the
public for this information collection is 2,676,932 hours.
FCIC is requesting comments on the following: (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
gathering technology.
Comments regarding paperwork reduction should be submitted to the
Desk Officer for Agriculture, Office of Information and Regulatory
Affairs, Office of Management and Budget, Washington, D.C. 20503.
OMB is required to make a decision concerning the collections of
information contained in these proposed regulations between 30 and 60
days after submission to OMB. Therefore, a comment to OMB is best
assured of having full effect if OMB receives it within 30 days of
publication. This does not affect the deadline for the public to
comment on the proposed regulation.
Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 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. 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.
[[Page 19692]]
Executive Order No. 12612
It has been determined under section 6(a) of Executive Order No.
12612, Federalism, that this rule does not have sufficient federalism
implications 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. New provisions included in this rule will not
impact small entities to a greater extent than large entities. Under
the current regulations, a producer is required to complete an
application and acreage report. If the crop is damaged or destroyed,
the insured is required to give notice of loss and provide the
necessary information to complete a claim for indemnity.
The insured must also annually certify to the previous years
production if adequate records are available to support the
certification. The producer must maintain the production records to
support the certified information for at least three years. This
regulation does not alter those requirements.
The amount of work required of the insurance companies delivering
and servicing these policies will not increase significantly from the
amount of work currently required. This rule does not have any greater
or lesser impact on the producer. Therefore, this action is determined
to be exempt from the provisions of the Regulatory Flexibility Act (5
U.S.C. 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 No. 12372
This program is not subject to the provisions of Executive Order
No. 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 No. 12988
This proposed rule has been reviewed under the provisions of
Executive Order 12988. The provisions of this rule will not have a
retroactive effect prior to the effective date. 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 11 must be exhausted before any
action for judicial review may be brought.
Environmental Evaluation
This action is not expected to have a 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 Initiative to eliminate unnecessary or duplicative
regulations and improve those that remain in force.
Background
FCIC proposes to add to the Common Crop Insurance Regulations (7
CFR part 457), new sections: 7 CFR Sec. 457.142, Northern Potato Crop
Insurance Provisions; 7 CFR Sec. 457.143, Northern Potato Quality
Endorsement Crop Insurance Provisions; 7 CFR Sec. 457.144, Northern
Processing Potato Quality Endorsement Crop Insurance Provisions; 7 CFR
Sec. 457.145, Certified Seed Potato Endorsement Crop Insurance
Provisions; 7 CFR Sec. 457.146, Northern Potato Storage Endorsement
Crop Insurance Provisions; and 7 CFR Sec. 457.147, Central and Southern
Potato Crop Insurance Provisions. The new provisions will be effective
for the 1998 and succeeding crop years. These provisions will replace
and supersede the current provisions for insuring potatoes found at 7
CFR part 422 (Potato Crop Insurance Regulations). FCIC also proposes to
amend 7 CFR part 422 to limit its effect to the 1997 and prior crop
years.
This action will revise the potato crop insurance regulations by
providing separate crop provisions for areas in which it is common to
store potatoes after harvest (northern areas) and areas in which
storage of production is less common (central and southern areas). It
also will make available a new endorsement (Northern Potato Storage
Endorsement) to provide coverage for damage that occurs within the
insurance period but does not become evident until a later time. This
rule also makes minor editorial and format changes to improve the
Potato Crop Insurance Regulations' compatibility with the Common Crop
Insurance Policy. In addition, FCIC is proposing substantive changes in
the provisions for insuring potatoes as follows.
Northern Potato Crop Provisions
1. Remove the definition of ``county'' to default to the definition
contained in the Basic Provisions (Sec. 457.8). The current definition
includes land identified by an FSA farm serial number for the county
that is physically located in another county the new definition does
not. This change will require land in another county to be insured
using the actuarial materials for the county where the land is located
and make this provision consistent with most other crops. Add
definitions for ``certified seed,'' ``days,'' ``discard,'' ``FSA,''
``final planting date,'' ``good farming practices,'' ``grade
inspection,'' ``hundredweight,'' ``interplanted,'' ``irrigated
practice,'' ``local market,'' ``planted acreage,'' ``practical to
replant,'' ``processor contract,'' ``production guarantee (per acre),''
``replanting,'' ``timely planted,'' and ``written agreement'' for
clarification.
2. Section 2--Clarify the guidelines under which basic units may be
divided into optional units to be consistent with most other crops.
3. Section 3(a)--Clarify that an insured may select only one price
election for all potatoes insured in a county, unless the Special
Provisions provide for separate price elections by type, in which case
the insured may select one price election for each type designated in
the Special Provisions.
4. Sections 3(b) and (c)--Reduce the price used to determine the
amount of an indemnity for unharvested acreage to 80 percent of the
price election elected by the insured. This will take into account
those costs not incurred by the insured when the crop is not harvested.
5. Section 4--Change the contract change date to November 30 for
all counties to maintain an adequate time period between this date and
the revised cancellation dates (see item 6 below).
6. Section 5--Change the cancellation and termination dates from
April 15 to March 15. These changes are made to standardize the
cancellation and termination date with the sales closing date. The
sales closing dates were previously amended to comply with the
requirement of the Federal Crop Insurance Reform Act of 1994 that
spring planted crop sales closing dates be moved 30 days earlier.
7. Section 8(b)--Provide that any acreage damaged prior to the
final planting date, to the extent that the majority of growers in the
area would not normally further care for the crop, must be replanted
unless the insurer agrees that it is not practical to replant. This
makes these provisions consistent with most other crops.
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8. Section 9--The end of the insurance period is changed from:
(a) October 31 to October 15 in Nevada;
(b) October 31 for Russet Burbanks and October 15 for all other
types to a single date of October 20 in Maine; and
(c) October 15 to October 31 in Ohio; Rhode Island; Humboldt,
Modoc, and Siskiyou Counties, California; and for potato types other
than Russets in Idaho, Oregon, and Washington.
These changes were made to more accurately reflect the normal
period in which potatoes are grown in the affected states or counties.
9. Section 12(d)(1)(iii)--Increases the amount of production to
count when production is harvested prior to full maturity. The
production to count will be increased by 2% of harvested production per
day for every day the potatoes were harvested prior to full maturity.
This percentage is based on University studies of average bulking
factors. This adjustment will not be made if production is harvested
early to prevent a loss in quantity or quality of production due to
disease. These changes will give consistency to the procedure for
determining production lost to early harvest.
10. Sections 12 (e) and (f)--Incorporate quality adjustment for
production damaged by freeze or other causes that result in soft rot,
wet breakdown, or other tuber rot condition into the crop provisions.
Previously, such quality adjustments were optional.
11. Section 13--Provides insurance coverage by written agreement in
certain instances. FCIC has a long standing policy of permitting
certain modifications of the insurance contract by written agreement
for some policies. This amendment allows FCIC to tailor the policy to a
specific insured in certain instances. The new section will cover the
procedures and duration of written agreements.
Central and Southern Potato Crop Provisions
1. Remove the definition of ``county'' to default to the definition
contained in the Basic Provisions (Sec. 457.8). The current definition
includes land identified by an FSA farm serial number for the county
that is physically located in another county the new definition does
not. This change will require land in another county to be insured
using the actuarial materials for the county where the land is located
and make this provision consistent with most other crops. Add
definitions for ``certified seed,'' ``days,'' ``discard,'' ``FSA,''
``final planting date,'' ``good farming practices,'' ``grade
inspection,'' ``hundredweight,'' ``interplanted,'' ``irrigated
practice,'' ``marketable lot,'' ``planted acreage,'' ``planting
period,'' ``practical to replant,'' ``production guarantee (per
acre),'' ``replanting,'' ``timely planted,'' and ``written agreement''
for clarification.
2. Clarify the guidelines under which basic units may be divided
into optional units, including for planting periods if allowed by the
Special Provisions.
3. Section 3(a)--Clarify that an insured may select only one price
election for all potatoes insured in a county, unless the Special
Provisions provide for separate price elections by type, in which case,
the insured may select one price election for each type designated in
the Special Provisions.
4. Sections 3 (b) and (c)--Reduce the price used to determine the
amount of an indemnity for unharvested acreage to 80 percent of the
price election elected by the insured. This will take into account
those costs not incurred by the insured when the crop is not harvested.
5. Section 4--The contract change date has been changed to November
30 in Oklahoma and Haskell County, Texas, and in all counties with a
March 15 cancellation date, to maintain an adequate time period between
these dates and the revised cancellation dates (see item 6 below).
6. Section 5--The cancellation and termination dates have been
changed to February 28 in Oklahoma and Haskell County, Texas to more
accurately reflect the period in which potatoes are grown in these
locations. The cancellation and termination dates have been changed to
March 15 for those counties that currently have an April 15 date. These
changes are made to standardize the cancellation and termination date
with the sales closing date. The sales closing dates were previously
amended to comply with the requirement of the Federal Crop Insurance
Reform Act of 1994 that spring planted crop sales closing dates be
moved 30 days earlier.
7. Section 8(b)--Provides that any acreage damaged prior to the
final planting date (on or before the last day of the applicable
planting period in counties for which the Special Provisions designate
separate planting periods), to the extent that the majority of growers
in the area would not normally further care for the crop, must be
replanted unless the insurer agrees that it is not practical to
replant. This makes this provision consistent with most other crops.
8. Section 12(d)(1)(iii)--Increases the amount of production to
count when production is harvested prior to full maturity. This
adjustment will not be made if production is harvested early to prevent
a loss in quantity or quality of production due to disease.
9. Section 13--Provides insurance coverage by written agreement in
certain instances. FCIC has a long standing policy of permitting
certain modifications of the insurance contract by written agreement
for some policies. This amendment allows FCIC to tailor the policy to a
specific insured in certain instances. The new section will cover the
procedures for and duration of written agreements.
Northern Potato Quality Endorsement
1. Section 3(b)--Exclude coverage for acreage grown for the
production of seed. Such acreage often is grown under management
practices designed to produce potatoes smaller than those required by
grading standards for fresh or processing use. These management
practices are incompatible with the protection provided under the
Potato Quality Endorsement against under-sized production.
2. Section 4(a)--Provide additional quality adjustment for
production with internal defects that cannot be sorted from undamaged
production. Current provisions do not provide adequate, or in some
cases, any adjustment when the entire crop is not marketable due to
internal defects and has to be destroyed.
3. Section 5--Clarify that production which is harvested or
appraised prior to reaching full maturity that does not grade U.S. No.
2 solely as a result of size will be considered to grade U.S. No. 2.
Northern Processing Potato Quality Endorsement
1. The Processing Quality Endorsement has been rewritten so that it
will attach to and amend the Quality Endorsement. This allows removal
of duplicative provisions since the primary difference between the two
endorsements is the coverage provided for low specific gravity and dark
fry color in the processing endorsement. The combination will also
result in quality protection for all of a producer's acreage, not just
the acreage covered by the processor contract.
2. Section 6(a)(1)(i)--Change the value of undamaged production
from the highest price election to the base contract price in order to
more accurately reflect lost value.
Certified Seed Potato Endorsement
1. Section 4--Limit the insurable certified seed acreage to not
greater than 125% of the average number of acres entered into the state
certification program in the three previous years, unless a written
agreement allows more acreage to be insured. This change is
[[Page 19694]]
made to reduce vulnerability to program abuse caused by persons
declaring large acreages insured for seed but intending to produce
potatoes for human consumption.
2. Rotation requirements and standards for parent seed have been
removed from the endorsement. These requirements are established and
administered by individual state certification authorities and vary by
state.
List of Subjects in 7 CFR Parts 422 and 457
Crop insurance, Potato crop insurance regulations, Potatoes.
Proposed Rule
Accordingly, for the reasons set forth in the preamble, the Federal
Crop Insurance Corporation hereby proposes to amend 7 CFR parts 422 and
457 as follows:
PART 422--POTATO CROP INSURANCE REGULATIONS
1. The authority citation for 7 CFR part 422 is revised to read as
follows:
Authority: 7 U.S.C. 1506(1), 1506(p).
2. The subpart heading preceding Sec. 422.1 is revised to read as
follows:
Subpart--Regulations for the 1986 through 1997 Crop Years (1987
through 1997 Crop Years in Certain California Counties and Florida)
3. Section 422.7 is amended by revising the introductory text of
paragraph (d) to read as follows:
Sec. 422.7 The application and policy.
* * * * *
(d) The application for the 1986 and succeeding crop years is found
at subpart D of part 400--General Administrative Regulations (7 CFR
400.37, 400.38). The provisions of the Potato Crop Insurance Policy for
the 1986 through 1997 crop years (1987 through 1997 crop years in
certain California counties and Florida) are as follows:
* * * * *
PART 457--COMMON CROP INSURANCE REGULATIONS; REGULATIONS FOR THE
1994 AND SUBSEQUENT CONTRACT YEARS
4. The authority citation for 7 CFR part 457 continues to read as
follows:
Authority: 7 U.S.C. 1506(l), 1506(p).
5. Section 457.142 is added to read as follows:
Sec. 457.142 Northern Potato Crop Insurance Provisions.
The Northern Potato Crop Insurance Provisions for the 1998 and
succeeding crop years are as follows:
FCIC policies:
DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
Reinsured policies:
(Appropriate title for insurance provider)
Both FCIC and reinsured policies:
NORTHERN POTATO CROP PROVISIONS
These provisions will be applicable in: Alaska; Humboldt, Modoc,
and Siskiyou Counties, California; Colorado; Connecticut; Idaho;
Indiana; Iowa; Maine; Massachusetts; Michigan; Minnesota; Montana;
Nebraska; Nevada; New York; North Dakota; Ohio; Oregon;
Pennsylvania; Rhode Island; South Dakota; Utah; Washington;
Wisconsin; and Wyoming.
If a conflict exists among the Basic Provisions (Sec. 457.8),
these Crop Provisions, and the Special Provisions; the Special
Provisions will control these Crop Provisions and the Basic
Provisions; and these Crop Provisions will control the Basic
Provisions.
1. Definitions
Certified seed--Potatoes for planting a potato crop in a
subsequent crop year that have been found to meet the standards of
the public agency that is responsible for the seed certification
process within the state in which they were grown.
Days--Calendar days.
Discard--Disposal of production by you, or a person acting for
you, without receiving any value for it.
FSA--The Farm Service Agency, an agency of the United States
Department of Agriculture, or a successor agency.
Final planting date--The date contained in the Special
Provisions for the insured crop by which the crop must initially be
planted in order to be insured for the full production guarantee.
Good farming practices--The cultural practices generally in use
in the county for the crop to make normal progress toward maturity
and produce at least the yield used to determine the production
guarantee, and are those recognized by the Cooperative State
Research, Education, and Extension Service as compatible with
agronomic and weather conditions in the county.
Grade inspection--An inspection prior to the sale, storage, or
disposal of any lot of potatoes, or any portion of a lot, in which
the potatoes are evaluated and quality (grade) determinations are
made by us, a laboratory approved by us, or a potato grader licensed
or certified by the applicable State or the United States Department
of Agriculture.
Harvest--The digging of potatoes.
Hundredweight--One hundred (100) pounds avoirdupois.
Interplanted--Acreage on which two or more crops are planted in
a manner that does not permit separate agronomic maintenance or
harvest of the insured crop.
Irrigated practice--A method of producing a crop by which water
is artificially applied during the growing season by appropriate
systems and at the proper times, with the intention of providing the
quantity of water needed to produce at least the yield used to
establish the irrigated production guarantee on the irrigated
acreage planted to the insured crop.
Local market--The area in which the insured potatoes are
normally sold.
Planted acreage--Land in which seed has been placed by a machine
appropriate for the insured crop and planting method, at the correct
depth, into a seedbed that has been properly prepared for the
planting method and production practice. Acreage planted in any
other manner will not be insurable unless otherwise provided by the
Special Provisions or by written agreement.
Practical to replant--In lieu of the definition of ``Practical
to replant'' contained in section 1 of the Basic Provisions
(Sec. 457.8), practical to replant is defined as our determination,
after loss or damage to the insured crop, based on factors,
including but not limited to moisture availability, condition of the
field, marketing windows, and time to crop maturity, that replanting
the insured crop will allow the crop to attain maturity prior to the
calendar date for the end of the insurance period. It will not be
considered practical to replant after the end of the late planting
period unless replanting is generally occurring in the area.
Processor contract--A written agreement between the producer and
a processor, containing at a minimum:
(a) The producer's commitment to plant and grow potatoes, and to
deliver the potato production to the processor;
(b) The processor's commitment to purchase the production stated
in the contract; and
(c) A price that will be paid to the producer for the production
stated in the contract.
Production guarantee (per acre)--The number of hundredweights
determined by multiplying the approved actual production history
yield per acre by the coverage level percentage you elect.
Replanting--Performing the cultural practices necessary to
prepare the land to replace the potato seed and then replacing the
potato seed in the insured acreage with the expectation of growing a
successful crop.
Timely planted--Planted on or before the final planting date
designated in the Special Provisions for the insured crop in the
county.
Written agreement--A written document that alters designated
terms of this policy in accordance with section 13 of these Crop
Provisions.
2. Unit Division
(a) Unless limited by the Special Provisions, a unit as defined
in section 1 (Definitions) of the Basic Provisions (Sec. 457.8)
(basic unit) may be divided into optional units only if, for each
optional unit, you meet all the conditions of this section or if a
written agreement to such division exists.
(b) Basic units may not be divided into optional units on any
basis including, but not limited to, production practice, type,
variety, and planting period, other than as described in this
section.
(c) If you do not comply fully with these provisions, we will
combine all optional
[[Page 19695]]
units that are not in compliance with these provisions into the
basic unit from which they were formed. We will combine the optional
units at any time we discover that you have failed to comply with
these provisions. If failure to comply with these provisions is
determined to be inadvertent, and the optional units are combined
into a basic unit, that portion of the additional premium paid for
the optional units that have been combined will be refunded to you.
(d) All optional units you selected for a crop year must be
identified on the acreage report for that crop year.
(e) The following requirements must be met for each optional
unit:
(1) You must have provided records by the production reporting
date, which can be independently verified, of planted acreage and
production for each optional unit for at least the last crop year
used to determine your production guarantee;
(2) You must plant the crop in a manner that results in a clear
and discernable break in the planting pattern at the boundaries of
each optional unit;
(3) You must have records of marketed production or measurement
of stored production from each optional unit maintained in such a
manner that permits us to verify the production from each optional
unit, or the production from each unit must be kept separate until
loss adjustment is completed by us; and
(4) Each optional unit must meet one or more of the following
criteria, as applicable:
(i) Optional Units by Section, Section Equivalent, or FSA Farm
Serial Number: Optional units may be established if each optional
unit is located in a separate legally identified section. In the
absence of sections, we may consider parcels of land legally
identified by other methods of measure including, but not limited to
Spanish grants, railroad surveys, leagues, labors, or Virginia
Military Lands, as the equivalent of sections for unit purposes. In
areas that have not been surveyed using the systems identified
above, or another system approved by us, or in areas where such
systems exist but boundaries are not readily discernable, each
optional unit must be located in a separate farm identified by a
single FSA farm serial number.
(ii) Optional Units on Acreage Including Both Irrigated and Non-
irrigated Practices: In addition to, or instead of, establishing
optional units by section, section equivalent, or FSA farm serial
number, optional units may be based on irrigated acreage or non-
irrigated acreage if both are located in the same section, section
equivalent or FSA farm serial number. To qualify as separate
irrigated and non-irrigated optional units, the non-irrigated
acreage may not continue into the irrigated acreage in the same rows
or planting pattern. The irrigated acreage may not extend beyond the
point at which the irrigation system can deliver the quantity of
water needed to produce the yield on which the guarantee is based,
except the corners of a field in which a center-pivot irrigation
system is used will be considered as irrigated acreage if separate
acceptable records of production from the corners are not provided.
If the corners of a field in which a center-pivot irrigation system
is used do not qualify as a separate non-irrigated optional unit,
they will be a part of the unit containing the irrigated acreage.
However, non-irrigated acreage that is not a part of a field in
which a center-pivot irrigation system is used may qualify as a
separate optional unit provided that all requirements of this
section are met.
3. Insurance Guarantees, Coverage Levels, and Prices for Determining
Indemnities
(a) In addition to the requirements of section 3 (Insurance
Guarantees, Coverage Levels, and Prices for Determining Indemnities)
of the Basic Provisions (Sec. 457.8), you may select only one price
election for all the potatoes in the county insured under this
policy unless the Special Provisions provide different price
elections by type, in which case you may select one price election
for each potato type designated in the Special Provisions. The price
elections you choose for each type must have the same percentage
relationship to the maximum price offered by us for each type. For
example, if you choose 100 percent of the maximum price election for
one type, you must also choose 100 percent of the maximum price
election for all other types.
(b) If any acreage of the insured crop is not harvested, the
price used to determine whether or not an indemnity is owed for such
acreage will be 80 percent of your price election.
(c) Any acreage of potatoes damaged to the extent that the
majority of producers in the area would not normally further care
for the potatoes will be deemed to have been destroyed even though
you may continue to care for it. The price election for unharvested
acreage will apply to such acreage.
4. Contract Changes
In accordance with section 4 (Contract Changes) of the Basic
Provisions (Sec. 457.8), the contract change date is November 30
preceding the cancellation date.
5. Cancellation and Termination Dates
In accordance with section 2 (Life of Policy, Cancellation, and
Termination) of the Basic Provisions (Sec. 457.8), the cancellation
and termination dates are March 15.
6. Annual Premium
In lieu of the premium computation method contained in section 7
(Annual Premium) of the Basic Provisions (Sec. 457.8), the annual
premium amount is computed by multiplying the production guarantee
by the price election for harvested acreage, the premium rate, the
insured acreage, your share at the time of planting, and any
applicable premium adjustment factors contained in the Actuarial
Table.
7. Insured Crop
In accordance with section 8 (Insured Crop) of the Basic
Provisions (Sec. 457.8), the crop insured will be all the potatoes
in the county for which a premium rate is provided by the Actuarial
Table:
(a) In which you have a share;
(b) Planted with certified seed unless otherwise permitted by
the Special Provisions;
(c) Planted for harvest as certified seed stock, or for human
consumption, unless specified otherwise in the Special Provisions;
(d) That are not (unless allowed by the Special Provisions or by
written agreement):
(1) Interplanted with another crop; or
(2) Planted into an established grass or legume.
8. Insurable Acreage
In addition to the provisions of section 9 (Insurable Acreage)
of the Basic Provisions (Sec. 457.8), we will not insure any acreage
that:
(a) Does not meet the rotation requirements shown in the Special
Provisions; or
(b) Is damaged before the final planting date to the extent that
the majority of producers in the area would normally not further
care for it, unless it is replanted or we agree that it is not
practical to replant.
9. Insurance Period
In accordance with the provisions of section 11 (Insurance
Period) of the Basic Provisions (Sec. 457.8), the calendar date for
the end of the insurance period is the date immediately following
planting as follows (exceptions for specific counties, varieties or
types as may be contained in the Special Provisions):
(a) October 1 in Alaska;
(b) October 10 in Nebraska and Wyoming;
(c) October 15 in Colorado; Indiana; Iowa; Michigan; Minnesota;
Montana; Nevada; North Dakota; South Dakota; Utah; and Wisconsin;
(d) October 20 in Maine; and
(e) October 31 in Humboldt, Modoc, and Siskiyou Counties,
California; Connecticut; Idaho; Massachusetts; New York; Ohio;
Oregon; Pennsylvania; Rhode Island; and Washington.
10. Causes of Loss
(a) In accordance with the provisions of section 12 (Causes of
Loss) of the Basic Provisions (Sec. 457.8), insurance is provided
only against the following causes of loss that occur within the
insurance period:
(1) Adverse weather conditions;
(2) Fire;
(3) Insects, but not damage due to insufficient or improper
application of pest control measures;
(4) Plant disease, but not damage due to insufficient or
improper application of disease control measures;
(5) Wildlife;
(6) Earthquake;
(7) Volcanic eruption; or
(8) Failure of the irrigation water supply, if caused by an
insured peril listed in section 10(a) (1) through (7) that occurs
during the insurance period.
(b) In addition to the causes of loss not insured against as
listed in section 12 of the Basic Provisions (Sec. 457.8), we will
not insure against any loss of production due to:
(1) Damage that occurs or becomes evident after the end of the
insurance period, including, but not limited to, damage that occurs
or becomes evident in storage; or
(2) Causes, such as freeze after certain dates, that are limited
by the Special Provisions.
11. Duties in the Event of Damage or Loss
(a) In accordance with the requirements of section 14 (Duties in
the Event of Damage or Loss) of the Basic Provisions (Sec. 457.8),
the representative samples of the unharvested
[[Page 19696]]
crop must be at least 10 feet wide and extend the entire length of
each field in the unit. The samples must not be harvested or
destroyed until the earlier of our inspection or 15 days after
harvest of the balance of the unit is completed.
(b) We must be given the opportunity to perform a grade
inspection on any unit for which you have given notice of damage.
12. Settlement of Claim
(a) We will determine your loss on a unit basis. In the event
you are unable to provide separate acceptable production records:
(1) For any optional units, we will combine all optional units
for which acceptable production records were not provided; or
(2) For any basic units, we will allocate any commingled
production to such units in proportion to our liability on the
harvested acreage for the units.
(b) In the event of loss or damage covered by this policy, we
will settle your claim by:
(1) Multiplying the insured acreage by its respective production
guarantee;
(2) Multiplying each result in section 12(b)(1) by the
respective price election;
(3) Totaling the results of section 12(b)(2);
(4) Multiplying the total production to be counted of each type,
if applicable, (see section 12(d)) by the respective price election;
(5) Totaling the results of section 12(b)(4);
(6) Subtracting the results of section 12(b)(5) from the result
in section 12(b)(3); and
(7) Multiplying the result of section 12(b)(6) by your share.
(c) The extent of any loss must be determined no later than the
time the potatoes are placed in storage, if the production is stored
prior to sale, or the date they are delivered to a buyer,
wholesaler, packer, broker, or other handler if production is not
stored.
(d) The total production to count (in hundredweight) from all
insurable acreage on the unit will include:
(1) All appraised production as follows:
(i) Not less than the production guarantee per acre for acreage:
(A) That is abandoned;
(B) That is put to another use without our consent;
(C) That is damaged solely by uninsured causes;
(D) From which any production is disposed of without a grade
inspection; or
(E) For which you fail to provide acceptable production records;
(ii) Production lost due to uninsured causes;
(iii) Production lost due to harvest prior to full maturity.
Production to count from such acreage will be determined by
increasing the amount of harvested production by 2 percent per day
for each day the potatoes were harvested prior to the date the
potatoes would have reached full maturity. The date the potatoes
would have reached full maturity will be determined using the normal
number of days to full maturity for the variety, growing area, and
planting date. This adjustment will not be made if the potatoes are
damaged by an insurable cause of loss, and leaving the crop in the
field would either reduce production or decrease quality;
(iv) Unharvested production (unharvested production may be
adjusted in accordance with sections 12 (e), (f), and (g)); and
(v) Potential production on insured acreage that you intend to
put to another use or abandon, if you and we agree on the appraised
amount of production. Upon such agreement, the insurance period for
that acreage will end when you put the acreage to another use or
abandon the crop. If agreement on the appraised amount of production
is not reached:
(A) If you do not elect to continue to care for the crop, we may
give you consent to put the acreage to another use if you agree to
leave intact, and provide sufficient care for, representative
samples of the crop in locations acceptable to us, (The stage
guarantee will be limited as specified in section 3 even if the
representative samples are harvested; and the amount of production
to count for such acreage will be based on the harvested production
or appraisals from the samples at the time harvest should have
occurred. If you do not leave the required samples intact, or fail
to provide sufficient care for the samples, our appraisal made prior
to giving you consent to put the acreage to another use will be used
to determine the amount of production to count); or
(B) If you elect to continue to care for the crop, the amount of
production to count for the acreage will be the harvested
production, or our reappraisal if additional damage occurs and the
crop is not harvested; and
(2) All harvested production from the insurable acreage (the
amount of production prior to the sorting or discarding of any
production).
(e) Potato production is eligible for quality adjustment if:
(1) The potatoes have freeze damage, soft rot or wet breakdown,
or other tuber rot conditions as defined in the United States
Standards for Grades of Potatoes;
(2) Freeze damage, soft rot, wet breakdown, or other tuber rot
condition is present at or prior to the end of the insurance period;
(3) The amount (percentage) of damage is determined no later
than the end of the insurance period; and
(4) A grade inspection is performed.
(f) Potato production that is eligible for quality adjustment,
as specified in section 12(e), with 5 percent damage (by weight) or
less will be adjusted 0.1 percent for each 0.1 percent of damage
through 5.0 percent.
(g) Potato production that is eligible for quality adjustment,
as specified in section 12(e), with 5.1 percent damage (by weight)
or more will be adjusted as follows:
(1) For potatoes damaged by freeze, production will be reduced
0.1 percent for each 0.1 percent of damage through 5.0 percent, 0.5
percent for each 0.1 percent of damage in from 5.1 through 15.0
percent, and by 1.0 percent for each 0.1 percent of damage from 15.1
through 19.5 percent.
(2) For potatoes that have soft rot, wet breakdown or other
tuber rot conditions due to late blight or any other insurable cause
(except freeze), production to count will be determined as follows:
(i) For potatoes sold within 7 days of harvest, by dividing the
price received per hundredweight by the highest price election
designated in the Special Provisions for the insured potato type,
and multiplying the result (not to exceed 1.0) by the number of
hundredweight of sold production. If production is sold for a price
lower than the value appropriate and representative of the local
market, we will determine the value of the production based on the
price you could have received in the local market;
(ii) For harvested potatoes discarded within 7 days of harvest
and appraised unharvested production that could:
(A) Not have been sold, the production to count will be zero; or
(B) Have been sold, the production will be reduced as follows
(all percentage points of damage will be rounded to the nearest 0.1
percent):
(1) 0.1 percent for each 0.1 percent of damage through 5.0
percent;
(2) 0.5 percent for each 0.1 percent of damage from 5.1 percent
through 6.0 percent;
(3) 1.0 percent for each 0.1 percent of damage from 6.1 through
8.0 percent;
(4) 2.0 percent for each 0.1 percent of damage from 8.1 through
9.0 percent; and
(5) 2.5 percent for each 0.1 percent of damage from 9.1 through
11.0 percent.
(iii) For potatoes remaining in storage 8 or more days after
harvest, adjustment will be made in accordance section
12(g)(2)(ii)(B).
13. Written Agreements
Designated terms of this policy may be altered by written
agreement in accordance with the following:
(a) You must apply in writing for each written agreement no
later than the sales closing date, except as provided in section
13(e);
(b) The application for a written agreement must contain all
variable terms of the contract between you and us that will be in
effect if the written agreement is not approved;
(c) If approved, the written agreement will include all variable
terms of the contract, including, but not limited to, crop type or
variety, the guarantee, premium rate, and price election;
(d) Each written agreement will only be valid for one year (If
the written agreement is not specifically renewed the following
year, insurance coverage for subsequent crop years will be in
accordance with the printed policy); and
(e) An application for a written agreement submitted after the
sales closing date may be approved if, after our physical inspection
of the acreage, it is determined that no loss has occurred and the
crop is insurable in accordance with the policy and written
agreement provisions.
6. Section 457.147 is added to read as follows:
Sec. 457.147 Central and Southern Potato Crop Insurance Provisions.
The Central and Southern Potato Crop Insurance Provisions for the
1998 and succeeding crop years are as follows:
FCIC policies:
DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
Reinsured policies:
[[Page 19697]]
(Appropriate title for insurance provider)
Both FCIC and reinsured policies:
CENTRAL AND SOUTHERN POTATO CROP PROVISIONS
These provisions will be applicable in: Alabama; all California
counties except Humboldt, Modoc and Siskiyou; Delaware; Florida;
Maryland; Missouri; New Jersey; New Mexico; North Carolina;
Oklahoma; Texas; and Virginia.
If a conflict exists among the Basic Provisions (Sec. 457.8),
these Crop Provisions, and the Special Provisions; the Special
Provisions will control these Crop Provisions and the Basic
Provisions; and these Crop Provisions will control the Basic
Provisions.
1. Definitions
Certified seed--Potatoes for planting a potato crop in a
subsequent crop year that have been found to meet the standards of
the public agency that is responsible for the seed certification
process within the State in which they were grown.
Days--Calendar days.
Discard--Disposal of production by you, or a person acting for
you, without receiving any value for it.
FSA--The Farm Service Agency, an agency of the United States
Department of Agriculture, or a successor agency.
Final planting date--The date contained in the Special
Provisions for the insured crop by which the crop must initially be
planted in order to be insured for the full production guarantee.
Good farming practices--The cultural practices generally in use
in the county for the crop to make normal progress toward maturity
and produce at least the yield used to determine the production
guarantee, and are those recognized by the Cooperative State
Research, Education, and Extension Service as compatible with
agronomic and weather conditions in the county.
Grade inspection--An inspection prior to the sale, storage, or
disposal of any lot of potatoes, or any portion of a lot, in which
the potatoes are evaluated and quality (grade) determinations are
made by us, a laboratory approved by us, or a potato grader licensed
or certified by the applicable State or the United States Department
of Agriculture.
Harvest--The digging of potatoes.
Hundredweight--One hundred (100) pounds avoirdupois.
Interplanted--Acreage on which two or more crops are planted in
a manner that does not permit separate agronomic maintenance or
harvest of the insured crop.
Irrigated practice--A method of producing a crop by which water
is artificially applied during the growing season by appropriate
systems and at the proper times, with the intention of providing the
quantity of water needed to produce at least the yield used to
establish the irrigated production guarantee on the irrigated
acreage planted to the insured crop.
Marketable lot--A quantity of production that can be separated
from other quantities of production by grade characteristics, load,
location or another distinctive feature.
Planted acreage--Land in which seed has been placed in the soil
by a machine appropriate for the insured crop and planting method,
at the correct depth, into a seedbed which has been properly
prepared for the planting method and production practice. Acreage
planted in any other manner will not be insurable unless otherwise
provided by the Special Provisions or by written agreement.
Planting period--The period of time between the calendar dates
designated in the Special Provisions for the planting of spring-
planted, summer-planted, fall-planted, or winter-planted potatoes.
Practical to replant--In lieu of the definition of ``Practical
to replant'' contained in section one of the Basic Provisions
(Sec. 457.8), practical to replant is defined as our determination,
after loss or damage to the insured crop, based on factors,
including but not limited to moisture availability, condition of the
field, marketing windows, and time to crop maturity, that replanting
to the insured crop will allow the crop to attain maturity prior to
the calendar date for the end of the insurance period. It will not
be considered practical to replant after the end of the late
planting period, or the end of the planting period in which initial
planting took place in counties for which the Special Provisions
designates separate planting periods, unless replanting is generally
occurring in the area.
Production guarantee (per acre)--The number of hundredweights
determined by multiplying the approved actual production history
yield per acre by the coverage level percentage you elect.
Replanting--Performing the cultural practices necessary to
prepare the land to replace the potato seed and then replacing the
potato seed in the insured acreage with the expectation of growing a
successful crop.
Timely planted--Planted on or before the final planting date
designated in the Special Provisions for the insured crop in the
county.
Written agreement--A written document that alters designated
terms of this policy in accordance with section 13 of these crop
provisions.
2. Unit Division
(a) Unless limited by the Special Provisions, in addition to the
provisions defining a unit in section 1 (Definitions) of the Basic
Provisions (Sec. 457.8), (basic unit) each planting in an area where
the Special Provisions allow separate planting periods will be
considered to be a separate basic unit.
(b) Basic units may be divided into optional units if, for each
optional unit you meet all the conditions of this section or if a
written agreement to such division exists.
(c) Basic units may not be divided into optional units on any
basis including, but not limited to, production practice, type, and
variety, other than as described under this section.
(d) If you do not comply fully with these provisions, we will
combine all optional units that are not in compliance with these
provisions into the basic unit from which they were formed. We will
combine the optional units at any time we discover that you have
failed to comply with these provisions. If failure to comply with
these provisions is determined to be inadvertent, and the optional
units are combined into a basic unit, that portion of the additional
premium paid for the optional units that have been combined will be
refunded to you.
(e) All optional units you selected for a crop year must be
identified on the acreage report for that crop year.
(f) The following requirements must be met for each optional
unit:
(1) You must have provided records by the production reporting
date, which can be independently verified, of planted acreage and
production for each optional unit for at least the last crop year
used to determine your production guarantee;
(2) You must plant the crop in a manner that results in a clear
and discernable break in the planting pattern at the boundaries of
each optional unit;
(3) You must have records of marketed production or measurement
of stored production from each optional unit maintained in such a
manner that permits us to verify the production from each optional
unit, or the production from each unit must be kept separate until
after loss adjustment is completed by us; and
(4) Each optional unit must meet one or more of the following
criteria, as applicable:
(i) Optional Units by Section, Section Equivalent, or FSA Farm
Serial Number: Optional units may be established if each optional
unit is located in a separate legally identified section. In the
absence of sections, we may consider parcels of land legally
identified by other methods of measure including, but not limited to
Spanish grants, railroad surveys, leagues, labors, or Virginia
Military Lands, as the equivalent of sections for unit purposes. In
areas that have not been surveyed using the systems identified
above, or another system approved by us, or in areas where such
systems exist but boundaries are not readily discernable, each
optional unit must be located in a separate farm identified by a
single FSA farm serial number.
(ii) Optional Units on Acreage Including Both Irrigated and Non-
irrigated Practices: In addition to, or instead of, establishing
optional units by section, section equivalent, or FSA farm serial
number, optional units may be based on irrigated acreage or non-
irrigated acreage if both are located in the same section, section
equivalent, or FSA farm serial number. To qualify as separate
irrigated and non-irrigated optional units, the non-irrigated
acreage may not continue into the irrigated acreage in the same rows
or planting pattern. The irrigated acreage may not extend beyond the
point at which your irrigation system can deliver the quantity of
water needed to produce the yield on which the guarantee is based,
except the corners of a field in which a center-pivot irrigation
system is used will be considered as irrigated acreage if separate
acceptable records of production from the corners are not provided.
If the corners of a field in which a center-pivot irrigation system
is used do not qualify as a separate non-irrigated optional unit,
they will be a part of the unit containing the irrigated acreage.
However, non-irrigated acreage that is not a part of a field in
which a center-pivot irrigation system is used may qualify as a
separate optional unit provided that all requirements of this
section are met.
[[Page 19698]]
3. Insurance Guarantees, Coverage Levels, and Prices for Determining
Indemnities
(a) In addition to the requirements of section 3 (Insurance
Guarantees, Coverage Levels, and Prices for Determining Indemnities)
of the Basic Provisions (Sec. 457.8), you may select only one price
election for all the potatoes in the county insured under this
policy unless the Special Provisions provide different price
elections by type, in which case you may select one price election
for each potato type designated in the Special Provisions. The price
elections you choose for each type must have the same percentage
relationship to the maximum price offered by us for each type. For
example, if you choose 100 percent of the maximum price election for
one type, you must also choose 100 percent of the maximum price
election for all other types.
(b) If any acreage of the insured crop is not harvested, the
price used to determine whether or not an indemnity is owed for such
acreage will be 80 percent of your price election.
(c) Any acreage of potatoes damaged to the extent that the
majority of producers in the area would not normally further care
for the potatoes will be deemed to have been destroyed even though
you may continue to care for it. The price election for unharvested
acreage will apply to such acreage.
4. Contract Changes
In accordance with section 4 (Contract Changes) of the Basic
Provisions (Sec. 457.8), the contract change date is:
(a) June 30 preceding the cancellation date for counties with a
September 30 cancellation date;
(b) September 30 preceding the cancellation date for counties
with a November 30 or December 31 cancellation date; and
(c) November 30 preceding the cancellation date for counties
with a February 28 or March 15 cancellation date.
5. Cancellation and Termination Dates
In accordance with section 2 (Life of Policy, Cancellation, and
Termination) of the Basic Provisions (Sec. 457.8), the cancellation
and termination dates are:
------------------------------------------------------------------------
State and county Dates
------------------------------------------------------------------------
Manatee, Hardee, Highlands, Okeechobee, September 30.
and St. Lucie Counties, Florida, and
all Florida counties lying south
thereof.
All California; and all Texas counties November 30.
except Bailey, Castro, Dallam, Deaf
Smith, Floyd, Gaines, Hale, Hartley,
Haskell, Knox, Lamb, Parmer, Swisher,
and Yoakum.
Alabama; Delaware; Maryland; Missouri; December 31.
New Jersey; North Carolina; Virginia;
and all Florida Counties except
Manatee, Hardee, Highlands, Okeechobee,
and St. Lucie Counties, Florida, and
all Florida counties lying south
thereof.
Oklahoma; Haskell and Knox County, Texas February 28.
Bailey, Castro, Dallam, Deaf Smith, March 15.
Floyd, Gaines, Hale, Hartley, Lamb,
Parmer, Swisher, and Yoakum counties,
Texas; and New Mexico.
------------------------------------------------------------------------
6. Annual Premium
In lieu of the premium computation method contained in section 7
(Annual Premium) of the Basic Provisions (Sec. 457.8), the annual
premium amount is computed by multiplying the production guarantee
by the price election for harvested acreage, the premium rate, the
insured acreage, your share at the time of planting, and any
applicable premium adjustment factors contained in the Actuarial
Table.
7. Insured Crop
In accordance with section 8 (Insured Crop) of the Basic
Provisions (Sec. 457.8), the crop insured will be all the potatoes
in the county for which a premium rate is provided by the Actuarial
Table:
(a) In which you have a share;
(b) Planted with certified seed unless otherwise permitted by
the Special Provisions;
(c) Planted for harvest as certified seed stock, or for human
consumption, unless specified otherwise in the Special Provisions;
(d) That are not (unless allowed by the Special Provisions or by
written agreement):
(1) Interplanted with another crop; or
(2) Planted into an established grass or legume.
8. Insurable Acreage
In addition to the provisions of section 9 (Insurable Acreage)
of the Basic Provisions (Sec. 457.8), we will not insure any acreage
that:
(a) Does not meet the rotation requirements shown in the Special
Provisions; or
(b) Is damaged before the final planting date or before the end
of the applicable planting period in counties for which the Special
Provisions designate separate planting periods, to the extent that
the majority of producers in the area would normally not further
care for it, unless it is replanted or we agree that it is not
practical to replant.
9. Insurance Period
In accordance with the provisions of section 11 (Insurance
Period) of the Basic Provisions (Sec. 457.8), the calendar date for
the end of the insurance period is the date immediately following
planting as follows (exceptions for specific counties, varieties or
types may be contained in the Special Provisions):
(a) July 15 in Missouri; North Carolina; and all Texas counties
except Bailey, Castro, Dallam, Deaf Smith, Floyd, Gaines, Hale,
Haskell, Hartley, Knox, Lamb, Parmer, Swisher, and Yoakum.
(b) July 25 in Virginia.
(c) August 15 in Oklahoma; and Haskell and Knox Counties, Texas.
(d) In Alabama; California; and Florida, the dates established
by the Special Provisions for each planting period; and
(e) October 15 in Bailey, Castro, Dallam, Deaf Smith, Floyd,
Gaines, Hale, Hartley, Lamb, Parmer, Swisher, and Yoakum Counties,
Texas; Delaware; Maryland; New Jersey; and New Mexico.
10. Causes of Loss
(a) In accordance with the provisions of section 12 (Causes of
Loss) of the Basic Provisions (Sec. 457.8), insurance is provided
only against the following causes of loss which occur within the
insurance period:
(1) Adverse weather conditions;
(2) Fire;
(3) Insects, but not damage due to insufficient or improper
application of pest control measures;
(4) Plant disease, but not damage due to insufficient or
improper application of disease control measures;
(5) Wildlife;
(6) Earthquake;
(7) Volcanic eruption; or
(8) Failure of the irrigation water supply, if caused by an
insured peril listed in section 10(a) (1) through (7) that occurs
during the insurance period.
(b) In addition to the causes of loss not insured against as
listed in section 12 (Causes of Loss) of the Basic Provisions
(Sec. 457.8), we will not insure against any loss of production due
to:
(1) Damage that occurs or becomes evident after the end of the
insurance period, including, but not limited to, damage that occurs
after potatoes have been placed in storage; or
(2) Causes, such as freeze after certain dates, that are limited
by the Special Provisions.
11. Duties in the Event of Damage or Loss
(a) In accordance with the requirements of section 14 (Duties in
the Event of Damage or Loss) of the Basic Provisions (Sec. 457.8),
the representative samples of the unharvested crop must be at least
10 feet wide and extend the entire length of each field in the unit.
The samples must not be harvested or destroyed until the earlier of
our inspection or 15 days after harvest of the balance of the unit
is completed.
(b) We must be given the opportunity to perform a grade
inspection on any unit for which you have given notice of damage.
12. Settlement of Claim
(a) We will determine your loss on a unit basis. In the event
you are unable to provide separate acceptable production records:
(1) For any optional units, we will combine all optional units
for which acceptable production records were not provided; or
(2) For any basic units, we will allocate any commingled
production to such units in proportion to our liability on the
harvested acreage for the units.
[[Page 19699]]
(b) In the event of loss or damage covered by this policy, we
will settle your claim by:
(1) Multiplying the insured acreage by its respective production
guarantee;
(2) Multiplying each result in section 12(b)(1) by the
respective price election;
(3) Totaling the results of section 12(b)(2);
(4) Multiplying the total production to be counted of each type,
if applicable (see section 12(d)), by the respective price election;
(5) Totaling the results of section 12(b)(4);
(6) Subtracting the results of section 12(b)(5) from the result
in section 12(b)(3); and
(7) Multiplying the result of section 12(b)(6) by your share.
(c) The extent of any loss must be determined no later than the
time potatoes are placed in storage, if the production is stored
prior to sale, or the date they are delivered to a buyer,
wholesaler, packer, broker, or other handler if production is not
stored.
(d) The total production to count (in hundredweight) from all
insurable acreage on the unit will include:
(1) All appraised production as follows:
(i) Not less than the production guarantee per acre for acreage:
(A) That is abandoned;
(B) That is put to another use without our consent;
(C) That is damaged solely by uninsured causes;
(D) From which any production is disposed of without a grade
inspection; or
(E) For which you fail to provide acceptable production records;
(ii) Production lost due to uninsured causes;
(iii) Production lost due to harvest prior to full maturity.
Production to count from such acreage will be determined by
increasing the amount of harvested production by 2 percent per day
for each day the potatoes were harvested prior to the date the
potatoes would have reached full maturity as determined by us. The
date the potatoes would have reached full maturity will be
determined using the normal number of days to full maturity for the
variety, growing area, and planting date. This adjustment will not
be made if the potatoes are damaged by an insurable cause of loss,
and leaving the crop in the field would either reduce production or
decrease quality.
(iv) Unharvested production (unharvested production may be
adjusted in accordance with section 12(e)); and
(v) Potential production on insured acreage that you intend to
put to another use or abandon and no longer care for, if you and we
agree on the appraised amount of production. Upon such agreement,
the insurance period for that acreage will end if when put the
acreage to another use or abandon the crop. If agreement on the
appraised amount of production is not reached:
(A) If you do not elect to continue to care for the crop, we may
give you consent to put the acreage to another use if you agree to
leave intact, and provide sufficient care for, representative
samples of the crop in locations acceptable to us, (The stage
guarantee will be limited as specified in section 3 even if the
representative samples are harvested; and the amount of production
to count for such acreage will be based on the harvested production
or appraisals from the samples at the time harvest should have
occurred. If you do not leave the required samples intact, or fail
to provide sufficient care for the samples, our appraisal made prior
to giving you consent to put the acreage to another use will be used
to determine the amount of production to count); or
(B) If you elect to continue to care for the crop, the amount of
production to count for the acreage will be the harvested
production, or our reappraisal if additional damage occurs and the
crop is not harvested; and
(2) All harvested production from the insurable acreage
determined in accordance with section 12(e).
(e) With the exception of production with external defects, only
marketable lots of mature potatoes will be production to count for
loss adjustment purposes. Production not meeting the standards for
grading U.S. No. 2 due to external defects will be determined on an
individual potato basis for all unharvested potatoes and for any
harvested potatoes if we determine it is practical to separate the
damaged production. All determinations must be based upon a grade
inspection.
(1) Marketable lots of potatoes will include:
(i) Those that are stored;
(ii) Those sold as seed;
(iii) Those sold for human consumption; and
(iv) All unsold harvested and appraised production meeting the
standards for grading U.S. No. 2 or better on a sample basis.
(2) Marketable lots will also include any potatoes that we
determine:
(i) Could have been sold for seed or human consumption in the
general marketing area;
(ii) Were not sold as a result of uninsured causes including,
but not limited to, failure to meet chipper or processor standards
for fry color or specific gravity; or
(iii) Were disposed of without our prior written consent and
such disposition prevented our determination of marketability.
(3) Unless included in section 12(e) (1) or (2), a potato lot
will not be considered marketable if, due to insurable causes of
damage, it:
(i) Is partially damaged, and is salvageable only for starch,
alcohol, or livestock feed;
(ii) Is discarded;
(iii) Is left unharvested and does not meet the standards for
grading U.S. No. 2 or better due to internal defects; or
(iv) Does not meet the standards for grading U.S. No. 2 or
better due to external defects, is harvested, and from which we
determine it is not practical to separate the damaged production.
13. Written Agreements
Designated terms of this policy may be altered by written
agreement in accordance with the following:
(a) You must apply in writing for each written agreement no
later than the sales closing date, except as provided in section
13(e);
(b) The application for a written agreement must contain all
variable terms of the contract between you and us that will be in
effect if the written agreement is not approved;
(c) If approved, the written agreement will include all variable
terms of the contract, including, but not limited to, crop type or
variety, the guarantee, premium rate, and price election;
(d) Each written agreement will only be valid for one year (If
the written agreement is not specifically renewed the following
year, insurance coverage for subsequent crop years will be in
accordance with the printed policy); and
(e) An application for a written agreement submitted after the
sales closing date may be approved if, after our physical inspection
of the acreage, it is determined that no loss has occurred and the
crop is insurable in accordance with the policy and written
agreement provisions.
7. Section 457.143 is added to read as follows:
Sec. 457.143 Northern potato crop insurance--quality endorsement.
The Northern Potato Crop Insurance Quality Endorsement provisions
for the 1998 and succeeding years are as follows:
FCIC policies:
DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
Reinsured policies:
(Appropriate title for insurance provider)
Both FCIC and reinsured policies:
NORTHERN POTATO CROP INSURANCE
QUALITY ENDORSEMENT
1. In return for payment of the additional premium designated in
the Actuarial Table, this endorsement is attached to and made part
of your Northern Potato Crop Provisions (Sec. 457.142) subject to
the terms and conditions described herein.
2. You must elect this endorsement on or before the sales
closing date for the initial crop year in which you wish to insure
your potatoes under this endorsement. This endorsement will continue
in effect until canceled. It may be canceled by either you or us for
any succeeding crop year by giving written notice to the other party
on or before the cancellation date.
3. All acreage of potatoes insured under the Northern Potato
Crop Provisions (Sec. 457.142) will be insured under this
endorsement except:
(a) Any acreage specifically excluded by the Actuarial Table;
and
(b) Any acreage grown for seed.
4. We will adjust production to count (determined in accordance
with section 15 of the Basic Provisions (Sec. 457.8) and section 11
of the Northern Potato Crop Provisions (Sec. 457.142)) from (1)
unharvested acreage; (2) harvested acreage that is stored after a
grade inspection; or (3) that is marketed after a grade inspection
and contains potatoes that grade less than U.S. No. 2 due to:
(a) Internal defects (the number of potatoes with such defects
must be in excess of the tolerance allowed for U.S. No. 2 grade
[[Page 19700]]
potatoes on a lot basis and must not be separable from undamaged
production using methods normally used by potato packers or
processors), will be adjusted as follows:
(1) For potatoes sold within 7 days of harvest, by multiplying
the production to count by the factor (not to exceed 1.0) that
results from dividing the market value per hundredweight of the
damaged production by the highest available price election. If
production is sold for a price lower than the value appropriate and
representative of the local market, we will determine the value of
the production based on the price you could have received in the
local market.
(2) For harvested potatoes discarded within 7 days of harvest
and appraised unharvested production that could:
(i) Not have been sold, the production to count will be zero; or
(ii) Have been sold, the production to count will be determined
in accordance with section 4(a)(1).
(3) For potatoes remaining in storage 8 or more days after
harvest, production to count will be determined in accordance with
section 4(b).
(b) Factors other than those specified in section 4(a), by
multiplying by a factor (not to exceed 1.0) that is determined as
follows:
(1) Production damaged by freeze or a cause that results in soft
rot or wet breakdown will be removed from representative samples of
the production;
(2) The percentage of remaining potatoes that grade U.S. No. 2
or better will be determined by dividing the weight of potatoes that
grade U.S. No. 2 or better in the remainder of section 4(b)(1) by
the total weight of the remainder of section 4(b)(1); and
(3) The percentage determined in section 4(b)(2) above will be
divided by the applicable percentage factor contained in the Special
Provisions.
5. Potatoes harvested or appraised prior to full maturity that
do not grade U.S. No. 2 due solely to size will be considered to
have met U.S. No. 2 standards unless the potatoes are damaged by an
insurable cause of loss, and leaving the crop in the field would
either reduce production or decrease quality.
6. Production to count for potatoes destroyed, stored or
marketed without a grade inspection will be 100 percent of the gross
weight of such potatoes.
7. All determinations must be based upon a grade inspection.
8. The Actuarial Table may provide ``U.S. No. 1'' in place of
``U.S. No. 2'' as used in this endorsement.
8. Section 457.144 is added to read as follows:
Sec. 457.144 Northern potato crop insurance--processing quality
endorsement.
The Northern Potato Crop Insurance Processing Quality Endorsement
provisions for the 1998 and succeeding crop years are as follows:
FCIC policies:
DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
Reinsured policies:
(Appropriate title for insurance provider)
Both FCIC and reinsured policies:
NORTHERN POTATO CROP INSURANCE
PROCESSING QUALITY ENDORSEMENT
1. In return for payment of the additional premium designated in
the Actuarial Table, this endorsement is attached to and made part
of your Northern Potato Crop Provisions (Sec. 457.142) and Quality
Endorsement (Sec. 457.143) subject to the terms and conditions
described herein.
2. You must have a Northern Potato Quality Endorsement
(Sec. 457.143) in place and elect this endorsement on or before the
sales closing date for the initial crop year in which you wish to
insure your potatoes under this endorsement. This endorsement may be
canceled by either you or us for any succeeding crop year by giving
written notice to the other party on or before the cancellation
date.
3. All terms of the Northern Potato Quality Endorsement
(Sec. 457.143) not modified by this endorsement will be applicable
to acreage covered under this endorsement.
4. A processor contract must be executed with a potato processor
for the potato types insured under this endorsement and a copy
submitted to us on or before the acreage reporting date for
potatoes. If you elect this endorsement, all insurable acreage of
production under contract with the processor must be insured under
this endorsement.
5. When the processor contract requires the processor to
purchase a stated amount of production, rather than all of the
production from a stated number of acres, the insured acreage will
be determined by dividing the stated amount of production by the
approved yield for the acreage.
6. In lieu of the provisions contained in section 4 of the
Northern Potato Quality Endorsement (7 CFR Sec. 457.143), production
that is rejected by the processor will be adjusted as follows:
(a) Production to count (determined in accordance with section
15 of the Basic Provisions (Sec. 457.8) and section 11 of the
Northern Potato Crop Provisions (Sec. 457.142)) from (1) unharvested
acreage; (2) harvested acreage that is stored after a grade
inspection; or (3) that is marketed after a grade inspection and
contains potatoes that:
(1) Grade less than U.S. No. 2 due to internal defects, a
specific gravity of less than 1.070, or a fry color of No. 3 or
darker due to either sugar exceeding 10 percent or sugar ends
exceeding 19 percent (the number of potatoes with such defects must
be in excess of the tolerance allowed for U.S. No. 2 grade potatoes
on a lot basis and must not be separable from undamaged production
using methods normally used by potato processors), will be adjusted
as follows:
(i) For potatoes sold within 7 days of harvest, by multiplying
the production to count by the factor (not to exceed 1.0) that
results from dividing the market value per hundredweight of the
damaged production by the base contract price. If production is sold
for a price lower than the value appropriate and representative of
the local market, we will determine the value of the production
based on the price you could have received in the local market.
(ii) For harvested potatoes discarded within 7 days of harvest
and appraised unharvested production that could:
(A) Not have been sold, the production to count will be zero; or
(B) Have been sold, the production to count will be determined
in accordance with section 6(a)(1)(i).
(iii) For potatoes remaining in storage 8 or more days after
harvest, production to count will be determined in accordance with
section 6(b).
(b) Grade less than U.S. No. 2 due to factors other than those
specified in section 6(a) will be multiplied by a factor (not to
exceed 1.0) that is determined as follows:
(1) Production damaged by freeze or a cause that results in soft
rot or wet breakdown will be removed from representative samples of
the production;
(2) The percentage of remaining potatoes that grade U.S. No. 2
or better will be determined by dividing the weight of potatoes that
grade U.S. No. 2 or better in the remainder of section 6(b)(1) by
the total weight of the remainder of section 6(b)(1); and
(3) The percentage determined in section 6(b)(2) above will be
divided by the applicable percentage factor contained in the Special
Provisions.
7. All grade determinations for the purposes of this endorsement
will be made using the United States Standards for Grades of
Potatoes for Processing or Chipping.
8. All determinations must be based upon a grade inspection.
9. The Actuarial Table may provide ``U.S. No. 1'' in place of
``U.S. No. 2'' as used in this endorsement.
9. Section 457.145 is added to read as follows:
Sec. 457.145 Potato crop insurance--certified seed endorsement.
The Potato Crop Insurance Certified Seed Endorsement provisions for
the 1998 and succeeding years are as follows:
FCIC policies:
DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
Reinsured policies:
(Appropriate title for insurance provider)
Both FCIC and reinsured policies:
POTATO CROP INSURANCE
CERTIFIED SEED ENDORSEMENT
1. In return for payment of the additional premium designated in
the Actuarial Table, this endorsement is attached to and made part
of your Northern Potato Crop Provisions subject to the terms and
conditions described herein.
2. You must elect this endorsement on or before the sales
closing date for the initial crop year you wish to insure your
potatoes under this endorsement. This endorsement
[[Page 19701]]
will continue in effect until canceled. It may be canceled by either
you or us for any succeeding crop year by giving written notice to
the other party on or before the cancellation date.
3. All potatoes grown on insurable acreage and that are entered
into the potato seed certification program administered by the state
in which the seed is grown must be insured unless limited by section
4 below.
4. The certified seed acreage you insure in the current crop
year cannot be greater than 125 percent of the average number of
acres grown for seed in the three previous years unless we agree
otherwise in writing. If you enter more than this number of acres
into the certification program, your certified seed production
guarantee for the current crop year will be reduced as follows:
(a) Multiply the average number of acres grown for certified
seed the 3 previous years by 1.25 and divide this result by the
number of acres grown for certified seed in the current crop year;
and
(b) Multiply the result of section 4(a) (not to exceed 1.0) by
the production guarantee for certified seed for the current crop
year.
5. You must provide acceptable records of your certified seed
potato acreage and production for the previous three years. These
records must clearly indicate the number of acres entered into the
potato seed certification program administered by the state in which
the seed is grown.
6. All potatoes insured for certified seed production must be
produced and managed in accordance with standards, practices, and
procedures required for certification by the state's certifying
agency and applicable regulations.
7. If, due to insurable causes occurring within the insurance
period, potato production does not qualify as certified seed on any
insured certified seed potato acreage within a unit, we will pay you
the dollar amount per hundredweight shown in the Special Provisions,
multiplied by your production guarantee for such acreage, and
multiplied by your share. Any production that does not qualify as
certified seed because of varietal mixing or your failure to follow
the standard practices and procedures required for certification
will be considered as lost due to uninsured causes.
8. You must notify us of any loss under this endorsement not
later than 14 days after you receive notice from the state
certification agency that any acreage has failed certification.
10. Section 457.146 is added to read as follows:
Sec. 457.146 Northern potato crop insurance--storage coverage
endorsement.
The Northern Potato Crop Insurance Storage Coverage Endorsement
provisions for the 1998 and succeeding years are as follows:
FCIC policies:
DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
Reinsured policies:
(Appropriate title for insurance provider)
Both FCIC and reinsured policies:
NORTHERN POTATO CROP INSURANCE
STORAGE COVERAGE ENDORSEMENT
1. In return for payment of the required additional premium
specified on the Actuarial Table, this endorsement is attached to
and made part of your Northern Potato Crop Provisions subject to the
terms and conditions described herein.
2. You must elect this endorsement on or before the sales
closing date for the initial crop year in which you wish to insure
your potatoes under this endorsement. This endorsement will continue
in effect until canceled. It may be canceled by either you or us for
any succeeding crop year by giving written notice to the other party
on or before the cancellation date.
3. Potato production grown under a contract that requires the
production to be delivered to a buyer within three days of harvest
will not be insured under this endorsement. All other potato
production insured under the Northern Potato Crop Provisions must be
insured under this endorsement unless the Special Provisions allow
you to exclude certain potato varieties, types, or groups from
insurance under this endorsement, and you elect to exercise this
option. Such exclusions, if allowed, must be shown annually on your
acreage report and will be applicable to all acreage of the excluded
varieties, types, or groups for the crop year.
4. When production from separate insurance units, basic or
optional, is commingled in storage, the production to count for each
unit will be allocated prorata based on the production placed in
storage from each unit. For example, if 500 hundredweight from one
unit are commingled with 1,500 hundredweight from another unit and
the production to count from the stored production is 1,000
hundredweight, 250 hundredweight of production to count will be
allocated to the unit originally contributing 500 hundredweight to
the stored production. This provision does not eliminate or change
any other requirement contained in this policy to provide or
maintain separate records of acreage or production by unit.
5. Production will be adjusted in accordance with this
endorsement only if:
(a) The potatoes are damaged by an insured cause other than
freeze that later results in soft rot or wet breakdown as defined in
the United States Standards for Grades of Potatoes, or other tuber
rot condition, to the extent that five percent (by weight) or more
of the insured production is affected;
(b) You notify us within 72 hours of your initial discovery of
any damage that has or that may later result in soft rot or wet
breakdown;
(c) Damage is the result of an insured cause other than freeze
that occurs prior to the end of the insurance period;
(d) The percentage of potatoes having soft rot, wet breakdown,
or other tuber rot condition is determined no later than 60 days
after harvest; and
(e) A grade inspection is performed.
6. Production to count for production that qualifies under the
terms of this endorsement will be determined as follows:
(a) For potatoes sold within 60 days of harvest, by dividing the
price received per hundredweight by the highest price election
designated in the Special Provisions for the insured potato type,
and multiplying the result (not to exceed 1.0) by the number of
hundredweight of sold production. If production is sold for a price
lower than the value appropriate and representative of the local
market, we will determine the value of the production based on the
price that we determine you could have received in the local market;
(b) For potatoes discarded within 60 days of harvest that could:
(1) Not have been sold, the production to count will be zero; or
(2) Have been sold, the production will be reduced as follows
(all percents of damage will be rounded to the nearest 0.1 percent):
(i) 0.1 percentage point for each 0.1 percent of damage through
5.0 percent;
(ii) 0.5 percentage point for each 0.1 percent of damage from
5.1 percent through 6.0 percent;
(iii) 1.0 percentage point for each 0.1 percent of damage from
6.1 through 8.0 percent;
(iv) 2.0 percentage point for each 0.1 percent of damage from
8.1 through 9.0 percent; and
(v) 2.5 percentage point for each 0.1 percent of damage from 9.1
through 11.0 percent.
(c) For potatoes stored more than 60 days after harvest,
adjustment will be made in accordance with subsection 6(b)(2) of
this endorsement.
Signed in Washington, DC, on April 17, 1997.
Kenneth D. Ackerman,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 97-10449 Filed 4-22-97; 8:45 am]
BILLING CODE 3410-FA-P
