[Title 7 CFR ]
[Code of Federal Regulations (annual edition) - January 1, 1999 Edition]
[From the U.S. Government Printing Office]


          7



          Agriculture



[[Page i]]

          PARTS 400 TO 699

                         Revised as of January 1, 1999

          CONTAINING
          A CODIFICATION OF DOCUMENTS
          OF GENERAL APPLICABILITY
          AND FUTURE EFFECT

          AS OF JANUARY 1, 1999
          With Ancillaries
          Published by
          the Office of the Federal Register
          National Archives and Records
          Administration

          as a Special Edition of
          the Federal Register



[[Page ii]]

                                      




                     U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 1999



               For sale by U.S. Government Printing Office
 Superintendent of Documents, Mail Stop: SSOP, Washington, DC 20402-9328



[[Page iii]]




                            Table of Contents



                                                                    Page
  Explanation.................................................       v

  Title 7:

    Subtitle B--Regulations of the Department of Agriculture--
      Continued:

          Chapter IV--Federal Crop Insurance Corporation, 
          Department of Agriculture.............................     5
          Chapter V--Agricultural Research Service, Department 
          of Agriculture........................................   563
          Chapter VI--Natural Resources Conservation Service, 
          Department of Agriculture.............................   581

  Finding Aids:

      Table of CFR Titles and Chapters..........................   713
      Alphabetical List of Agencies Appearing in the CFR........   731
      List of CFR Sections Affected.............................   741



[[Page iv]]


      


                     ----------------------------

                     Cite this Code:  CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus,  7 CFR 400.1 refers 
                       to title 7, part 400, 
                       section 1.

                     ----------------------------

[[Page v]]



                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
permanent rules published in the Federal Register by the Executive 
departments and agencies of the Federal Government. The Code is divided 
into 50 titles which represent broad areas subject to Federal 
regulation. Each title is divided into chapters which usually bear the 
name of the issuing agency. Each chapter is further subdivided into 
parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1

    The appropriate revision date is printed on the cover of each 
volume.

LEGAL STATUS

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, January 1, 1999), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
the daily Federal Register. These two lists will identify the Federal 
Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

    Each volume of the Code contains amendments published in the Federal 
Register since the last revision of that volume of the Code. Source 
citations for the regulations are referred to by volume number and page 
number of the Federal Register and date of publication. Publication 
dates and effective dates are usually not the same and care must be 
exercised by the user in determining the actual effective date. In 
instances where the effective date is beyond the cut-off date for the 
Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
inserted following the text.

OMB CONTROL NUMBERS

    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires 
Federal agencies to display an OMB control number with their information 
collection request.

[[Page vi]]

Many agencies have begun publishing numerous OMB control numbers as 
amendments to existing regulations in the CFR. These OMB numbers are 
placed as close as possible to the applicable recordkeeping or reporting 
requirements.

OBSOLETE PROVISIONS

    Provisions that become obsolete before the revision date stated on 
the cover of each volume are not carried. Code users may find the text 
of provisions in effect on a given date in the past by using the 
appropriate numerical list of sections affected. For the period before 
January 1, 1986, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, or 1973-1985, published in seven separate volumes. For 
the period beginning January 1, 1986, a ``List of CFR Sections 
Affected'' is published at the end of each CFR volume.

CFR INDEXES AND TABULAR GUIDES

    A subject index to the Code of Federal Regulations is contained in a 
separate volume, revised annually as of January 1, entitled CFR Index 
and Finding Aids. This volume contains the Parallel Table of Statutory 
Authorities and Agency Rules (Table I), and Acts Requiring Publication 
in the Federal Register (Table II). A list of CFR titles, chapters, and 
parts and an alphabetical list of agencies publishing in the CFR are 
also included in this volume.
    An index to the text of ``Title 3--The President'' is carried within 
that volume.
    The Federal Register Index is issued monthly in cumulative form. 
This index is based on a consolidation of the ``Contents'' entries in 
the daily Federal Register.
    A List of CFR Sections Affected (LSA) is published monthly, keyed to 
the revision dates of the 50 CFR titles.

REPUBLICATION OF MATERIAL

    There are no restrictions on the republication of material appearing 
in the Code of Federal Regulations.

INQUIRIES

    For a legal interpretation or explanation of any regulation in this 
volume, contact the issuing agency. The issuing agency's name appears at 
the top of odd-numbered pages.
    For inquiries concerning CFR reference assistance, call 202-523-5227 
or write to the Director, Office of the Federal Register, National 
Archives and Records Administration, Washington, DC 20408 or e-mail 
[email protected].

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ELECTRONIC SERVICES

    The full text of the Code of Federal Regulations, the LSA (List of 
CFR Sections Affected), The United States Government Manual, the Federal 
Register, Public Laws, Weekly Compilation of Presidential Documents and 
the Privacy Act Compilation are available in electronic format at 
www.access.gpo.gov/nara (``GPO Access''). For more information, contact 
Electronic Information Dissemination Services, U.S. Government Printing 
Office. Phone 202-512-1530, or 888-293-6498 (toll-free). E-mail, 
[email protected].

[[Page vii]]

    The Office of the Federal Register also offers a free service on the 
National Archives and Records Administration's (NARA) World Wide Web 
site for public law numbers, Federal Register finding aids, and related 
information. Connect to NARA's web site at www.nara.gov/fedreg. The NARA 
site also contains links to GPO Access.

                              Raymond A. Mosley,
                                    Director,
                          Office of the Federal Register.

January 1, 1999.



[[Page ix]]



                               THIS TITLE

    Title 7--Agriculture is composed of fifteen volumes. The parts in 
these volumes are arranged in the following order: parts 1-26, 27-52, 
53-209, 210-299, 300-399, 400-699, 700-899, 900-999, 1000-1199, 1200-
1599, 1600-1899, 1900-1939, 1940-1949, 1950-1999, and part 2000 to end. 
The contents of these volumes represent all current regulations codified 
under this title of the CFR as of January 1, 1999.

    The Food and Nutrition Service current regulations in the volume 
containing parts 210-299, include the Child Nutrition Programs and the 
Food Stamp Program. The regulations of the Federal Crop Insurance 
Corporation are found in the volume containing parts 400-699.

    All marketing agreements and orders for fruits, vegetables and nuts 
appear in the one volume containing parts 900-999. All marketing 
agreements and orders for milk appear in the volume containing parts 
1000-1199. Part 900--General Regulations is carried as a note in the 
volume containing parts 1000-1199, as a convenience to the user.

    Redesignation tables appear in the Finding Aids section of the 
volumes containing parts 210-299 and parts 1600-1899.

    For this volume, Gregory R. Walton was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of 
Frances D. McDonald, assisted by Alomha S. Morris. 

[[Page x]]






[[Page 1]]



                          TITLE 7--AGRICULTURE




                  (This book contains parts 400 to 699)

  --------------------------------------------------------------------
                                                                    Part

  SUBTITLE B--Regulations of the Department of Agriculture (Continued):

chapter iv--Federal Crop Insurance Corporation, Department 
  of Agriculture............................................         400

chapter v--Agricultural Research Service, Department of 
  Agriculture...............................................         500

chapter vi--Natural Resources Conservation Service, 
  Department of Agriculture.................................         600

[[Page 3]]

  Subtitle B--Regulations of the Department of Agriculture (Continued)

[[Page 5]]




CHAPTER IV--FEDERAL CROP INSURANCE CORPORATION, DEPARTMENT OF AGRICULTURE




  --------------------------------------------------------------------
Part                                                                Page
400             General administrative regulations..........           7
401             General crop insurance regulations; 
                    regulations for the 1988 through 1998 
                    contract years..........................          62
402             Catastrophic Risk Protection Endorsement; 
                    regulations for the 1999 and subsequent 
                    reinsurance years.......................         167
403             General crop insurance regulation...........         171
404             [Reserved]
405             Apple crop insurance regulations for the 
                    1986 through the 1998 crop years........         178
406             Nursery crop insurance regulations..........         186
407-408         [Reserved]
409             Arizona--California citrus insurance 
                    regulations.............................         193
410-411         [Reserved]
412             Public information--Freedom of information..         200
413             [Reserved]
414             Forage seeding crop insurance...............         201
415             Forage production crop insurance regulations         207
416             Pea crop insurance regulations for the 1986 
                    through 1997 crop years.................         214
417-421         [Reserved]
422             Potato crop insurance regulations...........         221
423-424         [Reserved]
425             Peanut crop insurance regulations for the 
                    1993 through 1998 crop years............         233
426-429         [Reserved]
430             Sugar beet crop insurance regulations.......         240
431-432         [Reserved]
433             Dry bean crop insurance regulations.........         247
434             [Reserved]
435             Tobacco (quota plan) crop insurance 
                    regulations; regulations for the 1985 
                    through 1998 crop years.................         255
436             [Reserved]

[[Page 6]]


437             Sweet corn crop insurance regulations for 
                    the 1985 through 1997 crop years........         262
438-440         [Reserved]
441             Table grape crop insurance regulations for 
                    the 1987 through 1997 crop years........         269
442             [Reserved]
443             Hybrid seed crop insurance regulations for 
                    the 1986 through 1997 crop years........         275
444             [Reserved]
445             Pepper crop insurance regulations...........         285
446             Walnut crop insurance regulations...........         292
447             Popcorn crop insurance regulations for the 
                    1987 through the 1998 crop years........         297
448-449         [Reserved]
450             Prune crop insurance regulations for the 
                    1996 and succeeding crop years..........         304
451             Canning and processing peach crop insurance 
                    regulations.............................         310
452-453         [Reserved]
454             Fresh market tomato (guaranteed production 
                    plan) crop insurance regulations for the 
                    1987 through 1997 crop years............         316
455             Macadamia nut crop insurance regulations for 
                    the 1988 through the 1997 crop years....         323
456             Macadamia tree crop insurance regulations 
                    for the 1988 through 1997 crop years....         330
457             Common crop insurance regulations...........         335
458             Special California crop insurance 
                    regulations.............................         554

[[Page 7]]




PART 400--GENERAL ADMINISTRATIVE REGULATIONS--Table of Contents




Subpart A--Late Planting Agreement Option; Regulations for the 1987 and 
                          Succeeding Crop Years

Sec.
400.1  Availability of the late planting option.
400.2  Definitions.
400.3  Responsibilities of the insured.
400.4  Applicability to crops insured.
400.5  The Late Planting Agreement.

 Subpart B--Individual Yield Coverage Plan Regulations for the 1985 and 
                          Succeeding Crop Years

400.15  Availability of Individual Yield Coverage Plan.
400.16  Definitions.
400.17  Yield certification and acceptability.
400.18  Responsibilities.
400.19  Qualifications for Individual Yield Coverage Plan.
400.20  Modifications through individual certification of yield 
          (Individual Certified Yield Plan--ICYP).
400.21  OMB control numbers.

     Subpart C--General Administrative Regulations; Mutual Consent 
                              Cancellation

400.27  Applicability.
400.28  Mutual consent criteria.
400.29  OMB control numbers.
400.30--400.36  [Reserved]

Subpart D--Application for Crop Insurance; Regulations for the 1993 and 
                          Succeeding Crop Years

400.37  Applicability.
400.38  The crop insurance application.

                          Subpart E  [Reserved]

Subpart F--Food Security Act of 1985, Implementation; Denial of Benefits

400.45  Applicability.
400.46  Definitions.
400.47  Denial of crop insurance.
400.48  Protection of interests of tenants, landlords or producers.
400.49-400.50  [Reserved]

                  Subpart G--Actual Production History

400.51  Availability of actual production history program.
400.52  Definitions.
400.53  Yield certification and acceptability.
400.54  Submission and accuracy of production reports.
400.55  Qualifications for actual production history coverage program.
400.56  Administrative appeal exhaustion.
400.57  OMB control numbers.

   Subpart H--Information Collection Requirements Under the Paperwork 
                   Reduction Act; OMB Control Numbers

400.65  Purpose.
400.66  Display.

                          Subpart I  [Reserved]

                Subpart J--Appeal Procedure--Regulations

400.90  Applicability.

Subpart K--Debt Management--Regulations for the 1986 and Succeeding Crop 
                                  Years

400.115  Purpose.
400.116  Definitions.
400.117  Determination of delinquency.
400.118  Demand for payment.
400.119  Notice to debtor; credit reporting agency.
400.120  Subsequent disclosure and verification.
400.121  Information disclosure limitations.
400.122  Attempts to locate debtor.
400.123  Request for review of the indebtedness.
400.124  Disclosure to credit reporting agencies.
400.125  Notice to debtor, collection agency.
400.126  Referral of delinquent debts to contract collection agencies.
400.127  OMB control numbers.
400.128  Definitions.
400.129  Salary offset.
400.130  Notice requirements before offset.
400.131  Request for a hearing and result if an employee fails to meet 
          deadlines.
400.132  Hearings.
400.133  Written decision following a hearing.
400.134  Review of FCIC record related to the debt.
400.135  Written agreement to repay debt as an alternative to salary 
          offset.
400.136  Procedures for salary offset; when deductions may begin.
400.137  Procedures for salary offset; types of collection.
400.138  Procedures for salary offset; methods of collection.
400.139  Nonwaiver of rights.
400.140  Refunds.
400.141  Internal Revenue Service (IRS) Tax Refund Offset.
400.142  Past-due legally enforceable debt eligible for refund offset.

[[Page 8]]

 Subpart L--Reinsurance Agreement--Standards for Approval; Regulations 
              for the 1997 and Subsequent Reinsurance Years

400.161  Definitions.
400.162  Qualification ratios.
400.163  Applicability.
400.164  Availability of the Standard Reinsurance Agreement.
400.165  Eligibility for Standard Reinsurance Agreements.
400.166  Obligations of the Corporation.
400.167  Limitations on Corporation's obligations.
400.168  Obligations of participating insurance company.
400.169  Disputes.
400.170  General qualifications.
400.171  Qualifying when a state does not require that an Annual 
          Statutory Financial Statement be filed.
400.172  Qualifying with less than two of the required ratios or ten of 
          the analytical ratios meeting the specified requirements.
400.173  [Reserved]
400.174  Notification of deviation from financial standards.
400.175  Revocation and non-acceptance.
400.176  State action preemptions.
400.177  [Reserved]

  Subpart M--Agency Sales and Service Contract--Standards for Approval

400.201  Applicability of standards.
400.202  Definitions.
400.203  Financial statement and certification.
400.204  Notification of deviation from standards.
400.205  Denial or termination of contract and administrative 
          reassignment of business.
400.206  Financial qualifications for acceptability.
400.207  Representative licensing and certification.
400.208  Term of the contract.
400.209  Electronic transmission and receiving system.
400.210  OMB control numbers.

       Subpart N--Disaster Assistance Act of 1988; Procedures for 
                             Implementation

400.250  General statement.
400.251  Purpose and applicability.
400.252  Implementation and expense reimbursement.

 Subpart O--Non-Standard Underwriting Classification System Regulations 
                 for the 1991 and Succeeding Crop Years

400.301  Basic, purpose, and applicability.
400.302  Definitions.
400.303  Initial selection criteria.
400.304  Nonstandard Classification determinations.
400.305  Assignment of Nonstandard Classifications.
400.306  Spouses and minor children.
400.307  Discontinuance of participation.
400.308  Notice of Nonstandard Classification.
400.309  Requests for reconsideration.

           Subpart P--Preemption of State Laws and Regulations

400.351  Basis and applicability.
400.352  State and local laws and regulations preempted.

Subpart Q--General Administrative Regulations; Collection and Storage of 
   Social Security Account Numbers and Employer Identification Numbers

400.401  Basis and purpose and applicability.
400.402  Definitions.
400.403  Required system of records.
400.404  Policyholder responsibilities.
400.405  Agent and loss adjuster responsibilities.
400.406  Insurance provider responsibilities.
400.407  Restricted access.
400.408  Safeguards and storage.
400.409  Unauthorized disclosure.
400.410  Penalties.
400.411  Obtaining personal records.
400.412  Record retention.
400.413  OMB control numbers.

                          Subpart R--Sanctions

400.451  General.
400.452  Definitions.
400.453  Exhaustion of administrative remedies.
400.454  Civil penalties.
400.455  Governmentwide debarment and suspension (procurement).
400.456  Governmentwide debarment and suspension (nonprocurement).
400.457  Program Fraud Civil Remedies Act.
400.458  Scheme or device.
400.459  Indebtedness.
400.460--400.499  [Reserved]
400.500  OMB control numbers.

                          Subpart S  [Reserved]

  Subpart T--Federal Crop Insurance Reform, Insurance Implementation; 
        Regulations for the 1999 and Subsequent Reinsurance Years

400.650  Purpose.
400.651  Definitions.
400.652  Insurance availability.

[[Page 9]]

400.653  Determining crops of economic significance.
400.654  Application and acreage report.
400.655  Eligibility for other program benefits.
400.656  Coverage for acreage that is prevented from being planted.
400.657  Transitional yields for forage or feed crops, 1995-1997 crop 
          years.

 Subpart U--Ineligibility for Programs Under the Federal Crop Insurance 
                                   Act

400.675  Purpose.
400.676  OMB control numbers.
400.677  Definitions.
400.678  Applicability.
400.679  Criteria for ineligibility.
400.680  Determination and notification of ineligibility.
400.681  Effect of ineligibility.
400.682  Criteria for reinstatement of eligibility.
400.683  Administration and maintenance.

                        Subparts V-W  [Reserved]

    Subpart X--Interpretations of Statutory and Regulatory Provisions

400.765  Basis and applicability.
400.766  Definitions.
400.767  Requester obligations.
400.768  FCIC obligations.



Subpart A--Late Planting Agreement Option; Regulations for the 1987 and 
                          Succeeding Crop Years

    Authority: 7 U.S.C. 1506(l).

    Source: 51 FR 20246, June 4, 1986, unless otherwise noted.



Sec. 400.1  Availability of the late planting option.

    The Late Planting Option shall be offered under the provisions 
contained in 7 CFR part 402, et seq., within limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended (7 U.S.C. 1501 et seq.), only on those crops identified in 
Sec. 400.4 of this subpart. All provisions of the applicable contract 
for the insured crop apply, except those provisions which are in 
conflict with this subpart.



Sec. 400.2  Definitions.

    For the purposes of the Late Planting Option:
    (a) Final planting date means the final planting date for the 
insured crop contained in the actuarial table on file in the service 
office.
    (b) Late Planting Agreement means that agreement executed by the 
final planting date, between the FCIC and the insured whereby the 
insured elects, and FCIC provides, insurance on acreage planted for up 
to 20 days after the applicable final planting date. The production 
guarantee applicable on the final planting date will be reduced on the 
acreage planted after the final planting date by 10 percent for each 5 
days that the acreage is planted after the final planting date.
    (c) Production guarantee means the guaranteed level of production 
under the provisions of the applicable contract for crop insurance 
(sometimes expressed in amounts of insurance).



Sec. 400.3  Responsibilities of the insured.

    The insured is solely responsible for the completion of the Late 
Planting Agreement and for the accuracy of the data provided on that 
Agreement. The provisions of this subsection shall not relieve the 
insured of any responsibilities under the provisions of the insurance 
contract.



Sec. 400.4  Applicability to crops insured.

    The provisions of this subpart shall be applicable to the provisions 
of FCIC policies issued under the following regulations for insuring 
crops:
7 CFR part 416  Pea
7 CFR part 422  Potatoes
7 CFR part 425  Peanuts
7 CFR part 430  Sugar Beets
7 CFR part 433  Dry Beans
7 CFR part 435  Tobacco (Quota Plan)
7 CFR part 437  Sweet Corn (Canning and Freezing)
7 CFR part 447  Popcorn

[58 FR 64873, Dec. 10, 1993, as amended at 60 FR 40055, Aug. 7, 1995]



Sec. 400.5  The Late Planting Agreement.

    The provisions of the Late Planting Agreement are as follows:

                     U.S. DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                         Late Planting Agreement

Insured's Name__________________________________________________________

[[Page 10]]

Contract No.____________________________________________________________
Address_________________________________________________________________
Crop Year_______________________________________________________________
_______________________________________________________________________
Crop____________________________________________________________________

Notwithstanding the provisions of section 2 of the policy regarding the 
insurability of crop acreage initially planted after the final planting 
date on file in the service office, I elect to have insurance provided 
on acreage planted for 20 days after such date. Upon my making this 
election, the production guarantee or amount of insurance, whichever is 
applicable, will be reduced 10 percent for each five days or portion 
thereof that the acreage is planted after the final planting date. Each 
10 percent reduction will be applied to the production guarantee or 
amount of insurance applicable on the final planting date.
    The premium will be computed based on the guarantee or amount of 
insurance applicable on the final planting date; therefore, no reduction 
in premium will occur as a result of my election to exercise this 
option.
    If planting continues under this Agreement after the acreage 
reporting date on file in the service office, the acreage reporting date 
will be extended to 5 days after the completion of planting the acreage 
to which insurance will attach under this Agreement.

Insured's Signature_____________________________________________________
Date____________________________________________________________________

Corporation Representative's
Signature and Code Number_______________________________________________
Date____________________________________________________________________

            Collection of Information and Data (Privacy Act)

    To the extent that the information requested herein relates to the 
information supplier's individual capacity as opposed to the supplier's 
entrepreneurial (business) capacity, the following statements are made 
in accordance with the Privacy Act of 1974, as amended (5 U.S.C. 
552(a)). The authority for requesting information to be furnished on 
this form is the Federal Crop Insurance Act, as amended (7 U.S.C. 1501 
et seq.) and the Federal Crop Insurance Corporation Regulations 
contained in 7 CFR chapter IV.
    The information requested is necessary for the Federal Crop 
Insurance Corporation (FCIC) to process this form to provide insurance, 
determine eligibility, determine the correct parties to the agreement or 
contract, determine and collect premiums, and pay indemnities. 
Furnishing the Tax Identification Number (Social Security Number) is 
voluntary and no adverse action will result from the failure to furnish 
that number. Furnishing the information required by this form, other 
than the Tax Identification (Social Security) Number, is also voluntary; 
however, failure to furnish the correct, complete information requested 
may result in rejection of this form, rejection of or substantial 
reduction in any claim for indemnity, ineligibility for insurance, and a 
unilateral determination of the amount of premium due. (See the face of 
this form for information on the consequences of furnishing false or 
incomplete information.)
    The information furnished on this form will be used by Federal 
agencies, FCIC employees, and contractors who require such information 
in the performance of their duties. The information may be furnished to: 
FCIC contract agencies, employees and loss adjusters; reinsured 
companies; other agencies within the United States Department of 
Agriculture; the Internal Revenue Service; the Department of Justice, or 
other Federal or State law enforcement agencies; credit reporting 
agencies and collection agencies; and in response to judicial orders in 
the course of litigation.

[51 FR 20246, June 4, 1986, as amended at 52 FR 24979, July 2, 1987]



 Subpart B--Individual Yield Coverage Plan Regulations for the 1985 and 
                          Succeeding Crop Years

    Authority: Sec. 508, Pub. L. 75-430, 52 Stat. 73, as amended (7 
U.S.C. 1508).

    Source: 50 FR 32001, Aug. 8, 1985, unless otherwise noted.



Sec. 400.15  Availability of Individual Yield Coverage Plan.

    Individual Yield Coverage Plan (IYCP) shall be offered under the 
provisions contained in the following regulations:

CFR part 418........................................Wheat Crop Insurance
CFR part 419.......................................Barley Crop Insurance
CFR part 423.........................................Flax Crop Insurance
CFR part 427..........................................Oat Crop Insurance
CFR part 428....................................Sunflower Crop Insurance
CFR part 429..........................................Rye Crop Insurance
CFR part 431......................................Soybean Crop Insurance
CFR part 433.....................................Dry Bean Crop Insurance


Within limits prescribed by and in accordance with the provisions of the 
Federal Crop Insurance Act, as amended (7 U.S.C. 1501 et seq.), only on 
those crops identified in this section and in those areas where the 
actuarial table provides that IYCP is available. (IYCP is available only 
on those crops and in those areas where the Corporation's Actual 
Production History Program has not been implemented. The Actual 
Production History form will be used for both programs). All provisions 
of

[[Page 11]]

the applicable standard insurance contract for the crop apply, except 
those provisions which are in conflict with this subpart. Cropland 
acreage, which is defined as ``new ground acreage'' by the actuarial 
table or by the policy, will not be eligible for IYCP. Crops covered 
under the provisions of the Combined Crop Insurance policy will not be 
eligible for IYCP.



Sec. 400.16  Definitions.

    In addition to the definitions contained in the crop insurance 
contract, the following definitions, for the purposes of Individual 
Yield Coverage Plan, are applicable:
    (a) Appraised Production means production that was unharvested but 
reflected yield potential for the crop at the time of the appraisal. 
Appraisals will be determined by ASCS or FCIC.
    (b) Area Average Yield is the average yield determined by FCIC upon 
which the guarantee is based for the insured crop, area, type, and 
practice and is the average for the area over the base period. It is 
contained in the actuarial table.
    (c) Area Coverage Plan is the coverage and rate assigned by the FCIC 
Actuarial Division for an homogeneous group of areas and producers.
    (d) Average Yield is the average of the recorded and/or indexed 
yields for the 10-year base period, dropping the highest and lowest 
yield in the 10-year period, including a combination of a minimum of the 
three most recent year's recorded yields.
    (e) Base Period means the 10-year period immediately preceding the 
crop year for which the yield is to be established.
    (f) Established Farm Yield is the yield as shown on the Official 
Farm Record card (ASCS-156) on file in the county ASCS office.
    (g) FCIC Adjusted Yield is production information derived by the 
Statistical Reporting Service on a county, crop, and practice basis 
modified by FCIC for factors necessary to conform to sound actuarial 
practices.
    (h) Individual Yield Certification is the appraised result of the 
examination of the insured's records of planted acreage and production 
certified by the county Agricultural Stabilization and Conservation 
Service (ASCS) office.
    (i) Indexed Yield means yield established for a year in which 
recorded (actual) yields are not available. It is determined by 
multiplying the FCIC adjusted yield, for each crop year (for which 
records of acreage and production are not available), by the producer's 
yield index.
    (j) IYCP is the Individual Yield Coverage Plan.
    (k) ICYP is the Individual Certified Yield Plan within IYCP. (7 CFR 
400.20).
    (l) Recorded Yield is the yield that is based on the producer's 
records of planted acreage and production certified by ASCS.
    (m) Yield Index is the result obtained by dividing the total of the 
producer's recorded yields for the years FCIC adjusted yields are 
available by the total FCIC adjusted yields for those same years.



Sec. 400.17  Yield certification and acceptability.

    The insured shall request Form FCIC 19A (APH) (Actual Production 
History) and shall provide records of acreage and production to ASCS 
county office. The request and records must be submitted at least 15 
days prior to the acreage reporting date for the crop in the county. The 
ASCS county office will examine the insured's records and, if 
acceptable, record the actual yield obtained from the records, determine 
the relationship of such yields to the FCIC adjusted yield for the same 
years, and apply the yield index to the area average yield for those 
years for which the producer does not have acceptable records.



Sec. 400.18  Responsibilities.

    (a) The insured is solely responsible for the timely submission of 
Form FCIC 19A (APH) to the service office after its completion by the 
ASCS office.
    (b) The service office is responsible for the explanation of the 
Individual Yield Coverage Plan (IYCP) to the insured, and upon receipt 
of Form FCIC 19A (APH) is responsible for determining that the form is 
completed correctly.

[[Page 12]]



Sec. 400.19  Qualifications for Individual Yield Coverage Plan.

    The Insured may elect to substitute the IYCP Yield for the Area 
Average Yield.
    (a) For the producer to qualify for IYCP for any crop year, the 
completed Form FCIC 19A (APH) must be received in the crop insurance 
service office not later than the acreage reporting date for the crop 
and the year.
    (b) For a crop to qualify for IYCP, a minimum of 3 years of records 
of planted acreage and production, under the control of either the 
landlord or tenant, must be provided to ASCS for all units and be 
certified by ASCS. Records for up to 10 continuous years shall be used 
where such records are available and the same farming practices are 
followed for that period of time. There can be no break in continuity 
from the most recent crop year through preceding crop years. A year in 
which no acreage was planted to the crop on the unit or in which a 
different practice was followed will not be considered a break in 
continuity.
    (c) Either the landlord's or tenant operator's records may qualify 
either party for the same IYCP guarantee. If a conflict exists between 
the records of the landlord and the tenant operator, the Corporation 
will determine which records will be used.
    (d) If an insured wishes to obtain an IYCP yield on land newly added 
to production for the insured, the insured must comply with the 
provisions of this paragraph. If the IYCP yield being requested is for 
an ASCS program crop and if the added land has an ASCS established yield 
for that crop of 90 percent or more of the ASCS established yield of the 
unit to which the land is to be added or of the nearest unit then: When 
land without satisfactory records is added to a unit satisfactory 
records, the IYCP average yield will be that of the unit to which the 
land was added; and when land without satisfactory records is added as a 
separate unit, the IYCP average yield will be that of the closest unit 
of the same crop and practice. When the ASCS established farm yields for 
the added land are less than 90 percent of the program yields for the 
existing units, the IYCP yields will be the area average yield.
    (e) When the yield being requested on land being added is for a crop 
for which the added land does not have an ASCS established farm yield, 
the ASCS established farm yield for the crop with the largest ASCS base 
acreage on the added land will be compared to the program yield for the 
crop on the existing units to determine if the 90-percent ratio is 
achieved. If the land is being added to a unit and there is no ASCS 
established farm yield on either the added land or the units or both to 
compare, the IYCP yield will be the area average yield. If the land is 
being added as a separate unit, and the nearest unit has no ASCS 
established farm yield to compare to the added unit, the next nearest 
unit will be used. If no comparable yields are available on any unit, 
the yield of the added unit will be the area average yield.
    (f) If a producer disposes of his entire operation and begins 
operation on completely different units, the new units will be compared 
to the old units in accordance with paragraphs (d) and (e) of this 
section, for adding new units.
    (g) When land is being added but less than 3 continuous years of 
acceptable records are available, the acceptable production and acreage 
records will be used for the years they are available and paragraphs (d) 
and (e) of this section will be used for the years when adequate records 
are not available.
    (h) When participation in IYCP is continuous, ASCS certification 
under this part for up to 10 years, dropping the highest and lowest 
yield in the 10-year period, will be used in calculating the IYCP 
average yield. When an insured has previously participated in IYCP, he 
must have at least the most recent three years records of production 
acceptable to ASCS. These records and all records previously certified 
by ASCS up to 10 years, will be used to ascertain the new yield.
    (i) The premium shall be contained in the actuarial table and will 
be the same as applicable under the Area Coverage Plan.



Sec. 400.20  Modifications through individual certification of yield (Individual Certified Yield Plan--IYCP).

    (a) In addition to the provisions contained in Secs. 400.15 through 
400.19 of this

[[Page 13]]

part, producers who customarily feed crop production to livestock or 
poultry, and who are unable to provide adequate records sufficient to 
become eligible for the IYCP Plan, will be considered for eligibility 
for the Individual Certified Yield Plan (ICYP) in certain counties as 
announced by the Manager, FCIC.
    (b) To qualify for this plan, producers must agree to the conditions 
contained herein and provide information to the county ASCS office 
including but not limited to, the following:
    (1) Satisfactory acreage and yield records for at least the most 
recent crop year.
    (2) Acreage and yield records for the prior crop years even though 
such records may be incomplete.
    (3) Feeding records, fertilization and liming records, soil 
conservation methods used, land tillage practices, insecticide and 
herbicide records, planting pattern and population data, and equipment 
adequacy information as available.
    (4) Certification of acreage and yield data for the previous 2nd and 
3rd years when written records are unavailable.
    (5) Agreement to disregard to the extent required by FCIC any unit 
division guideline provisions of the crop insurance policy.
    (6) Records of acreage and yield for each future year that the 
insurance is in force. (Failure to provide such records in accordance 
with the provisions of Secs. 400.17 and 400.19 will result in insurance 
being based on the area coverage plan.)
    (7) Agreement to convert to the IYCP for determining yields as soon 
as 3 consecutive years acreage and yield records are available.
    (8) Producer certified yields will be reviewed by FCIC and may be 
adjusted by the Corporation prior to the final yield determination by 
ASCS.
    (9) The producer may request FCIC to assist in establishing 
satisfactory acreage and yield information through field appraisals of 
potential production, bin measurements, etc. FCIC will determine if any 
evidence offered by the producer is relevant to the determination of 
yield on the unit.
    (10) The producer must request the certified yield plan in 
accordance with the provisions of Secs. 400.17 and 400.19 from the 
county ASCS office.
    (11) The premium per acre shall be the production guarantee per acre 
under this plan times the applicable price election, times the 
applicable premium rate for the crop insured, times any applicable 
premium adjustment factor.



Sec. 400.21  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400 in title 
7 CFR.



     Subpart C--General Administrative Regulations; Mutual Consent 
                              Cancellation

    Authority: 7 U.S.C. 1501 et seq.

    Source: 57 FR 56438, Nov. 30, 1992, unless otherwise noted.



Sec. 400.27  Applicability.

    Notwithstanding any provisions of the crop insurance policy to the 
contrary, the mutual consent provision contained herein shall be 
applicable to all new crop insurance policies issued by the Federal Crop 
Insurance Corporation (7 CFR part 401 et seq.), or by a company 
reinsured by the Federal Crop Insurance Corporation, effective for the 
applicable crop year only if those policies meet the requirements of 
Sec. 400.28 of this subpart and if the crop insured is the same as the 
crop for which a disaster payment application (CCC 441) was filed for 
the previous crop year.

[58 FR 67304, Dec. 21, 1993]



Sec. 400.28  Mutual consent criteria.

    (a) An insured may request policy cancellation for the crop year for 
which the insured filed a CCC 441 for the applicable crop year if 
written documentation is provided, signed by an authorized Agricultural 
Stabilization and Conservation Service official, certifying the 
cancellation is based on one of the following conditions:
    (1) Insurance was not a condition of eligibility for disaster 
payment, based on one or more of the statutory criteria; or

[[Page 14]]

    (2) the producer withdrew his application for disaster payments with 
prejudice or it was rejected by Commodity Credit Corporation;
    (b) Cancellation requests must be received in writing no later than 
three weeks after the date:
    (1) The disaster payment check is issued; or
    (2) The producer is notified that an application for disaster 
payment has been rejected; or
    (3) The producer withdraws from the disaster payment program.
    (c) Carryover policies are not available for mutual consent 
cancellation. Crop insurance applications dated before the disaster 
cancellation date (available in the insureds' service office) are not 
eligible for mutual consent cancellations.

[57 FR 56438, Nov. 30, 1992, as amended at 58 FR 67304, Dec. 21, 1993]



Sec. 400.29  OMB control numbers.

    Office of Management and Budget control numbers (OMB) are contained 
in subpart H to part 400 in title 7 CFR.



Secs. 400.30--400.36  [Reserved]



Subpart D--Application for Crop Insurance; Regulations for the 1993 and 
                          Succeeding Crop Years

    Authority: Secs. 506, 507, Pub. L. 75-430, 52 Stat. 72, as amended 
(7 U.S.C. 1506, 1516).



Sec. 400.37  Applicability.

    The Crop Insurance application contained herein shall be applicable 
to all crop insurance regulations issued by the Corporation (7 CFR part 
400 et seq.), effective with the 1983 and succeeding crop years.

[48 FR 1023, Jan. 10, 1983]



Sec. 400.38  The crop insurance application.

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                       Crop Insurance Application

                           Continuous Contract

_______________________________________________________________________
1. Name of Applicant
_______________________________________________________________________
2. Applicant's Authorized Representative
_______________________________________________________________________
3. Street or Mailing Address
_______________________________________________________________________
4. City and State
_______________________________________________________________________
5. ZIP Code

[  ] [  ] - [  ] [  ] [  ] - [  ] [  ] [  ] [  ] [  ]
6. State    County
[  ] [  ] [  ] [  ] [  ]
7. Contract Number
_______________________________________________________________________
8. County
_______________________________________________________________________
9. State
_______________________________________________________________________
[  ] [  ] [  ] [  ] [  ] [  ] [  ]
10. Identification Number
[  ] [  ] [  ] [  ] [  ]
11. SSN TAX
_______________________________________________________________________
12. Type of Entity
13. Is Applicant Over 18: Yes______ No______
_______________________________________________________________________
If No, Date of Birth
    A. The applicant subject to the provisions of the regulations of the 
Federal Crop Insurance Corporation (herein called ``Corporation''), 
hereby applies to the Corporation for insurance on the applicant's share 
in the crop(s) shown below planted or grown, whichever is applicable, on 
insurable acreage as shown on the county actuarial table for the above-
stated county. The applicant elects from the actuarial table the 
coverage level and, where applicable, a price election, amount of 
insurance or plan of insurance. The premium rate and applicable 
production guarantee or amount of insurance per acre shall be those 
shown on the applicable county actuarial table filed in the service 
office for each crop year.

[[Page 15]]



 
                                                                                                                      For agency use only
 
 14. Effective crop        15. Crop        16. Type, class,   17. Price election  18. Level election      19              20.                 21.
        year                                 plan of ins.      or amount of ins.
                                                                                                          (A)             (P)
 
                                                                                                      [  ]
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                                                                                                      [  ]
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                                                                                                      [  ]
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[[Page 16]]

    N S I O T--F U R
    23. Crop(s) NOT insured the first year:
_______________________________________________________________________
    B. This application is hereby accepted by the Corporation except 
that the Corporation may reject the application on the basis that (1) 
the Corporation has determined that the risk is excessive under the 
provisions of the individual crop insurance regulations; (2) any 
material fact is concealed or misrepresented or fraud occurs in the 
application; or submission of the application; (3) the applicant is 
indebted to any United States Government Agency and that indebtedness is 
delinquent; (4) the applicant is indebted for crop insurance coverage 
provided by any company reinsured by the Corporation and that 
indebtedness is delinquent; (5) the applicant previously had crop 
insurance terminated for violation of the terms of the contract or the 
regulations, or for failure to pay the applicant's indebtedness; (6) the 
applicant is debarred by any United States Government Agency; or (7) the 
applicant has failed to provide complete and accurate information to 
material requests this application.
    Rejection shall be accomplished by depositing notification thereof 
in the United States mail, postage paid to the above address. Unless 
rejected as provided above, or the time for filing applications has 
passed at the time this application is filed, the contract shall be in 
effect for the crops and crop years specified and shall continue for 
each succeeding crop year until cancelled or terminated as provided in 
the contract. This accepted application, the insurance policy(ies), the 
applicable appendix(es), and the provisions of the county actuarial 
table showing the insurable and uninsurable acreage coverage levels, 
premium rates, and where applicable, the production guarantees, amounts 
of insurance, or plans of insurance shall constitute the contract. No 
term or condition of the contract shall be waived or changed except in 
writing by the Corporation.
    24. [  ] Applicant does not have like insurance on any of the above 
crops.
    25. [  ] Previous Carrier:
_______________________________________________________________________
    26. [  ] Policy Number:
_______________________________________________________________________
_______________________________________________________________________
    27. [  ] Applicant's Signature
_______________________________________________________________________
    28. [  ] Date
    [  ] [  ] [  ] [  ] [  ] [  ] [  ]
    29. Code No.
_______________________________________________________________________
    30. Witness to Signature
_______________________________________________________________________
    31. Location of Farm Headquarters
_______________________________________________________________________
    32. Address of Your Service Office
Phone:__________________________________________________________________
Phone:__________________________________________________________________
    I am aware and agree to comply with all requirements regarding the 
conservation provisions of the Food Security Act of 1985 (the Act) 
Sodbuster/Swampbuster provisions. I understand that I must be in 
compliance with the Act including reporting requirements to the 
applicable ASCS office for a crop insurance indemnity to be paid. I also 
understand that if I have not met these requirements, or if ASCS 
determines that I am out of compliance, an indemnity payment will not be 
made on this policy. Any graduated sanctions imposed by any agency under 
the Act must be paid in full prior to receipt of any of any indemnity 
paid.
Signature of Insured____________________________________________________
Date____________________________________________________________________
Agent's Initials________________________________________________________
    See Reverse Side of Form for Statement Required by Privacy Act of 
1974.
    33. Page ____  of ____  pages

            Collection of Information and Data (Privacy Act)

    The following statements are made in accordance with the Privacy Act 
of 1974 (5 U.S.C. 552(a)):
    The authority for requesting the information to be supplied on this 
form is the Federal Crop Insurance Act, as amended (7 U.S.C. 1501 et 
seq.), and the regulations promulgated thereunder (7 CFR part 400 et 
seq.). The information requested is necessary for FCIC to consider and 
process the application for insurance; to assist in determining the 
correct premium and indemnity; and to determine the correct parties to 
the insurance contract. The information may be furnished to FCIC 
contract agencies and contract loss adjusters, reinsured companies, 
other U.S. Department of Agriculture Agencies, the Internal Revenue 
Service, the Department of Justice or other State and Federal law 
enforcement agencies, and in response to orders of a court, magistrate, 
or administrative tribunal. Furnishing the social security number is 
voluntary and no adverse action will result from failure to do so. 
Furnishing the information other than the social security number, is 
also voluntary; however, failure to furnish the correct, complete 
information requested may result in rejection of the application and/or 
subsequent denial of any claim for indemnity which may be failed. The 
failure to supply correct, complete information may also invalidate the 
automatic acceptance provisions of Section B hereof and may 
substantially delay acceptance of the application and processing of any 
claim for indemnity.

[49 FR 6317, Feb. 21, 1984, as amended at 58 FR 17943, Apr. 7, 1993]

[[Page 17]]



                          Subpart E  [Reserved]



Subpart F--Food Security Act of 1985, Implementation; Denial of Benefits

    Authority: Secs. 1506, 1516, Pub. L. 75-430, 52 Stat. 73, 77, as 
amended (7 U.S.C. 1501 et seq.); sec. 1244, Pub. L. 99-198.

    Source: 52 FR 19128, May 21, 1987, unless otherwise noted.



Sec. 400.45  Applicability.

    (a) The regulations in this subpart implement Chapter XII and 
section 1764 of the Food Security Act of 1985 (Pub. L. 99-198) (the Act) 
requiring the denial of crop insurance to persons who are determined to 
have performed certain practices prohibited by the Act or who have 
violated certain federal or State statutes or the regulations 
implementing the Act. The provisions of this subpart are applicable to 
all crop insurance policies written by the Federal Crop Insurance 
Corporation (the Corporation) or reinsured by the Corporation.
    (b) The provisions of this subpart will be effective for the crop 
and crop year immediately following the first crop cancellation date 
occurring after the effective date of the Act for all crop policies 
reinsured by FCIC, and for all policies and regulations for crop 
insurance issued by FCIC.



Sec. 400.46  Definitions.

    For the purpose of this regulation and in addition to the 
definitions included at 7 CFR 12.2, the following definitions are 
applicable:
    (a) Controlled substance means any prohibited drug-producing plants 
including, but not limited to, cacti of the genus lophophora, coca 
bushes (erythroxylum coca), marijuana (cannabis satiua), opium poppies 
(papauer somniferum), and other drug-producing plants, the planting and 
harvesting of which is prohibited by Federal or State law.
    (b) Person means any producer, tenant, or landlord, insured under a 
policy of crop insurance issued by FCIC, or by a multi-peril insurance 
company whose crop insurance policy is reinsured by FCIC.
    (c) State means each of the fifty States, the District of Columbia, 
the Commonwealth of Puerto Rico, Guam, the Virgin Islands of the United 
States, American Samoa, the Commonwealth of the Northern Mariana 
Islands, or the Trust Territory of the Pacific.
    (d) The Act means the Food Security Act of 1985 (Pub. L. 99-198).



Sec. 400.47  Denial of crop insurance.

    (a) Any person convicted under Federal or State law of planting, 
cultivating, growing, producing, harvesting or storing a controlled 
substance in any crop year will be ineligible for crop insurance during 
that crop year and the four succeeding crop years.
    (1) The insurance of such person insured by FCIC who found to be 
ineligible under paragraph (a) of this section will be null and void, 
and any indemnity paid on such insurance must be returned in full to 
FCIC. Any premium paid for insurance coverage declared null and void 
will be returned, less a reasonable amount for expenses and handling not 
to exceed 20 percent of the premium paid.
    (2) Any person ineligible for crop insurance under the provisions of 
paragraph (a) of this section may make application for crop insurance 
for the crop year following the applicable period of ineligibility by 
submitting a new application. The previous application and policy of 
insurance will be cancelled.
    (b) Any insurance written by a multi-peril crop insurance company to 
any person who is ineligible under the provisions of this subpart is not 
eligible for reinsurance under the Corporation's standard reinsurance 
agreement. Any premium subsidy and expense allowance or loss paid by the 
Corporation because of such agreement will be immediately refunded to 
the Corporation. Notwithstanding any other provision of law, policies 
written by multi-peril crop insurance companies to any person ineligible 
under the provisions of this subpart are null and void. Premium paid for 
such policies will be refunded to the person applying for insurance, 
less a reasonable amount for expenses and handling not to exceed 20 
percent of the premium paid, and no indemnity will be paid unless the 
multi-

[[Page 18]]

peril company expressly agrees to continue such policy in effect without 
FCIC reinsurance. However, if the reinsured company follows the 
procedure of the Corporation and the requirements of the regulations, 
reinsurance will continue to be provided under the reinsurance agreement 
on the policy unless it is shown that the agent or company had knowledge 
of facts which would indicate ineligibility on the part of the insured 
and failed to act on that knowledge.
    (c) FCIC employees or contractors are required to report all 
suspected cases of violation of the Act or the regulations to the 
appropriate agency for a determination of violation. Benefits shall not 
be paid in such cases pending a determination from the appropriate 
agency.
    (d) Notwithstanding any other provision of this subpart, any crop 
insurance policy where insurance attached to a crop prior to August 15, 
1986, will continue in effect for that crop until the next termination 
date following August 15, 1986.

[52 FR 19128, May 21, 1987, as amended at 58 FR 17945, Apr. 7, 1993; 61 
FR 38058, July 23, 1996]



Sec. 400.48  Protection of interests of tenants, landlords or producers.

    Any tenant, landlord or producer on the farm separate from the 
person declared ineligible for crop insurance under the provisions of 
Sec. 400.47 of this part, will remain eligible for crop insurance on 
their insurable share in the crop, unless such tenant, landlord, or 
producer on the farm is:
    (a) Also convicted of planting, cultivating, growing, producing, or 
storing a controlled substance;
    (b) Otherwise determined by FCIC to be ineligible for crop 
insurance.

[52 FR 19128, May 21, 1987, as amended at 61 FR 38058, July 23, 1996]



Secs. 400.49-400.50  [Reserved]



                  Subpart G--Actual Production History

    Authority: 7 U.S.C. 1506, 1516.

    Source: 59 FR 47787, Sept. 19, 1994, unless otherwise noted.



Sec. 400.51  Availability of actual production history program.

    An Actual Production History (APH) Coverage Program is offered under 
the provisions contained in the following regulations:

7 CFR 401.110--Almond Endorsement
7 CFR part 405--Apple Crop Insurance
7 CFR 401.118--Canning and Processing Bean Endorsement
7 CFR part 409--Arizona-California Citrus Crop Insurance
7 CFR 401.127--Cranberry Endorsement
7 CFR part 433--Dry Beans Crop Insurance
7 CFR 401.116--Flaxseed Endorsement
7 CFR part 415--Forage Production Corp Insurance
7 CFR 401.130--Grape Endorsement
7 CFR part 455--Macadamia Nut Crop Insurance
7 CFR 401.126--Onion Endorsement
7 CFR part 447--Popcorn Crop Insurance
7 CFR part 403--Peach Crop Insurance
7 CFR 401.140--Pear Endorsement
7 CFR part 416--Pea Crop Insurance
7 CFR 401.146--Fresh Plum Endorsement
7 CFR part 422--Potato Crop Insurance
7 CFR part 450--Prune Crop Insurance
7 CFR 401.123--Safflower Seed Endorsement
7 CFR 401.133--Sugarcane Endorsement
7 CFR part 430--Sugar Beet Crop Insurance
7 CFR 401.124--Sunflower Seed Endorsement
7 CFR part 437--Sweet Corn Crop Insurance
7 CFR part 441--Table Grape Crop Insurance
7 CFR 401.129--Guaranteed Tobacco Endorsement
7 CFR 401.114--Canning and Processing Tomato Endorsement
7 CFR part 454--Guaranteed Production Plan of Fresh Market Tomato
7 CFR part 446--Walnut Crop Insurance
7 CFR part 457--Common Crop Insurance Regulations; and all special 
    provisions thereto unless specifically excluded by the special 
    provisions.

    The APH program operates within limits prescribed by, and in 
accordance with, the provisions of the Federal Crop Insurance Act, as 
amended (7 U.S.C. 1501 et seq.), only on those crops identified in this 
section in those areas

[[Page 19]]

where the Actuarial Table provides coverage. Except when in conflict 
with this subpart, all provisions of the applicable crop insurance 
contract for these crops apply.



Sec. 400.52  Definitions.

    In addition to the definitions contained in the crop insurance 
contract, the following definitions apply for the purposes of the APH 
Coverage Program:
    (a) APH--Actual Production History.
    (b) Actual yield-- The yield per acre for a crop year calculated 
from the production records or claims for indemnities. The actual yield 
is determined by dividing total production (which includes harvested and 
appraised production) by planted acres for annual crops or by insurable 
acres for perennial crops.
    (c) Adjusted yield--The transitional or determined yield reduced by 
the applicable percentage for lack of records. The adjusted yield will 
equal 65 percent of the transitional or determined yield, if no producer 
records are submitted; 80 percent, if records for one year are 
submitted; and 90 percent, if two years of records are submitted.
    (d) Appraised production--Production determined by the Agricultural 
Stabilization and Conservation Service (ASCS), the FCIC, or a company 
reinsured by the FCIC, that was unharvested but which reflected the 
crop's yield potential at the time of the appraisal. For the purpose of 
APH ``appraised production'' specifically excludes production lost due 
to uninsurable causes.
    (e) Approved APH yield--A yield, calculated and approved by the 
verifier, used to determine the production guarantee and determined by 
the sum of the yearly actual, assigned, and adjusted or unadjusted 
transitional or determined yields divided by the number of yields 
contained in the database. The database may contain up to 10 consecutive 
crop years of actual and or assigned yields. At least four yields will 
always exist in the database.
    (f) Assigned yield--A yield assigned by FCIC in accordance with the 
crop insurance contract, if the insured does not file production reports 
as required by the crop insurance contract. Assigned yields are used in 
the same manner as actual yields when calculating APH yields except for 
purposes of the Nonstandard Classification System (NCS).
    (g) Base period--Ten consecutive crop years (except peaches, which 
have a five-year base period) immediately preceding the crop year 
defined in the insurance contract for which the approved APH yield is 
being established (except for sugarcane, which begins the calendar year 
preceding the immediate previous crop year defined in the insurance 
contract).
    (h) Continuous production reports--Reports submitted by a producer 
for each crop year that the unit was planted to the crop and for the 
most recent crop year in the base period.
    (i) Crop year--Defined in the crop insurance contract, however, for 
APH purposes the term does not include any year when the crop was not 
planted or when the crop was prevented from being planted by an 
insurable cause. For example, if an insured plants acreage in a county 
to wheat one year, that year is a crop year in accordance with the 
policy definition. If the land is summerfallowed the next calendar year, 
that calendar year is not a crop year for the purpose of APH.
    (j) Database--A minimum of four years up to a maximum of ten crop 
years of production data used to calculate the approved APH yield.
    (k) Determined yield (D-yield)--An estimated year for certain crops, 
which can be determined by multiplying an average yield for the crop 
(attained by using data available from The National Agricultural 
Statistics Service (NASS) or comparable sources) by a percentage 
established by the FCIC for each county.
    (l) Master yields--Approved APH yields, for certain crops and 
counties as initially designated by the FCIC, based on a minimum of four 
crop years of production records for a crop within a county.
    (m) New producer--A person who has not been actively engaged in 
farming for a share of the production of the insured crop for more than 
two crop years.

[[Page 20]]

    (n) Production report--A written record showing the insured crop's 
annual production and used to determine the insured's yield for 
insurance purposes. The report contains yield history by unit, if 
applicable, including planted acreage for annual crops, insurable 
acreage for perennial crops, and harvested and appraised production for 
the previous crop years. This report must be supported by written 
verifiable records, measurement of farm stored production, or by other 
records of production approved by FCIC on an individual basis. 
Information contained in a claim for indemnity is considered a 
production report for the crop year for which the claim was filed.
    (o) Production Reporting Date (PRD)--The PRD is contained in the 
crop insurance contract and is the last date production reports will be 
accepted for inclusion in the database for the current crop year.
    (p) Transitional yield (T-Yield)--An estimated yield, for certain 
crops, generally determined by multiplying the ASCS program yield by a 
percentage determined by the FCIC for each county and provided on the 
actuarial table to be used in the APH yield calculation process when 
less than four consecutive crop years of actual or assigned yields are 
available.
    (q) Verifiable records--Contemporaneous records of acreage and 
production provided by the insured, which may be verified by FCIC 
through an independent source, and which are used to substantiate the 
acreage and production that have been reported on the production report.
    (r) Verifier--A person authorized by the FCIC to calculate approved 
APH yields.
    (s) Yield variance tables--Tables for certain crops that indicate 
unacceptable yield variations and yield trends which will require 
determination of the APH yield by the FCIC.



Sec. 400.53  Yield certification and acceptability.

    (a) Production reports must be provided to the crop insurance agent 
no later than the production reporting date for the crop insured.
    (1) Production reports must provide an accurate account of planted 
acreage for annual crops or insurable acres for perennial crops, as well 
as harvested and appraised production by unit.
    (2) The insured must certify the accuracy of the information.
    (3) Production reported for more than one crop year must be 
continuous. A year in which no acreage was planted to the crop on a unit 
or no acreage was planted to a practice, type, or variety requiring an 
APH yield will not be considered a break in continuity. Assigned yields, 
at the discretion of the FCIC, may be used to maintain continuity of 
yield data of file. Production on uninsured (for those years a crop 
insurance policy under the Federal Crop Insurance Act is in effect) or 
uninsurable acreage (for other years of the period) will not be used to 
determine APH yield unless production from such acreage is commingled 
with production from insured or insurable acreage.
    (b) Production reports and supporting records are subject to audit 
or review to verify the accuracy of the information certified. 
Production and supporting records may be reviewed and verified if a 
claim for indemnity is submitted on the insured crop. The reported yield 
is subject to revision, if needed, so that the claim conforms to the 
records submitted at that time.
    (1) Inaccurate production reports or failure to retain acceptable 
records shall result in the verifier combining optional farm units and 
recomputing the approved APH yield. These actions shall be taken at any 
time after reporting or record discrepancies are identified and may 
result in reduction of the approved APH yield for any calendar year.
    (2) Records must be provided by the insured at the time of an audit, 
review, or as otherwise requested, to verify that the acreage and 
production certified are accurate. Records of any other person having 
shares in the insured crop, which are used by the insured to establish 
the approved APH yield, must also be provided upon request.
    (3) In the event acreage or production data certified by two or more 
persons sharing in the crop on the same acreage is different, the 
verifier shall, at the verifier's discretion, determine which acreage 
and production data, if

[[Page 21]]

any, will be used to determine the approved APH yield. If the correct 
acreage and production cannot be determined, the data submitted will be 
considered unacceptable by the verifier for APH purposes.
    (4) Failure of the producer to report acreage and production 
completely and accurately may result in voidance of the crop insurance 
contract, as well as criminal or civil false claims penalties pursuant 
to applicable Federal criminal or civil statutes.



Sec. 400.54  Submission and accuracy of production reports.

    (a) The insured is solely responsible for the timely submission and 
certification of accurate, complete production reports to the agent. 
Production reports must be provided for all planted units.
    (b) Records may be requested by the FCIC, or an insurance company 
reinsured by the FCIC, or by anyone acting on behalf of the FCIC or the 
insurance company. The insured must provide such records upon request.
    (c) The agent will explain the APH Program to insureds and 
prospective insureds. When necessary, the agent will assist the insured 
in preparation of production reports. The agent will determine the 
adjusted or unadjusted transitional or determined yields in accordance 
with Sec. 400.54(b). The agent will review the production reports and 
forward them to the verifier, along with any requested and required 
supporting records for determination of an approved APH yield.
    (d) The verifier will determine if the certified production reports 
are acceptable and calculate the approved APH yield.



Sec. 400.55  Qualification for actual production history coverage program.

    (a) The approved APH yield is calculated from a database containing 
a minimum of four yields and will be updated each subsequent crop year. 
The database may contain a maximum of the 10 most recent crop years and 
may include actual, assigned, and adjusted or unadjusted T or D-Yields. 
T or D-Yields, adjusted or unadjusted, will only occur in the database 
when there are less than four years of actual and/or assigned yields.
    (b) The insured may be required to provide production records to 
determine the approved APH yield, if production records for the most 
recent crop year are available. If acceptable records of actual 
production are provided, the records must be continuous and contain at 
least the most recent crop year's actual yield.
    (1) If no acceptable production records are available, the approved 
APH yield is the adjusted T or D-Yield (65 percent of T or D-Yield).
    (2) If acceptable production records containing information for only 
the most recent crop year are provided, the three T or D-Yields adjusted 
by 80 percent will be used to complete the minimum database and 
calculate the approved APH yield.
    (3) If acceptable production records containing information for only 
the two most recent crop years are provided, the two T or D-Yields 
adjusted by 90 percent and the two actual yields will be used to 
complete the database and calculate the approved APH yield.
    (4) If acceptable production records containing information for only 
the three most recent crop years are provided, the three actual yields 
and one unadjusted T or D-Yield are used to complete the database and 
calculate the approved APH yield.
    (5) When the database contains four or more (up to ten) continuous 
actual yields, the approved APH yield is a simple average of the actual 
yields.
    (6) New producers may have their approved APH yields based on 
unadjusted T or D-Yields or a combination of actual and unadjusted T or 
D-Yields.
    (7) Producers who add land or new practice, types and varieties to 
their farming operations and who do not have available records for the 
added land, practice, types or varieties may have approved APH yields 
for the added land, practice, types or varieties that are based on 
adjusted or unadjusted T or D-Yields as determined by FCIC.
    (8) If the producer's crop is destroyed or if it produces a low 
actual yield due to insured causes of loss, the resulting average yield 
may qualify for catastrophic yield adjustment according to

[[Page 22]]

FCIC guidelines. APH yields qualifying for catastrophic yield adjustment 
may be adjusted to mitigate the effect of catastrophic years. Premium 
rates for approved APH yields, which are adjusted for catastrophic 
years, may be based on the producer's APH average yield prior to the 
catastrophic adjustment or such other basis as determined appropriate by 
FCIC.
    (c) If no insurable acreage of the insured crop is planted for a 
year, a production report indicating zero planted acreage will maintain 
the continuity of production reports for APH record purposes and that 
calendar year will not be included in the APH yield calculations.
    (d) Actual yields calculated from the claim for indemnity will be 
entered in the database. The resulting average yield will be used to 
determine the premium rate and approved APH yield, at the discretion of 
FCIC.
    (e) Optional units are not available to an insured who does not 
provide acceptable production reports for at least the most recent crop 
year with which to calculate an approved APH yield.
    (f) FCIC may determine approved APH yields for designated crops in 
the following situations:
    (1) If less than four years of yield history is certified and T or 
D-Yields are not provided in the actuarial documents,
    (2) If actual yield exceed tolerances specified in yield variance 
tables, and
    (3) For perennial crops:
    (i) If significant upward or downward yield trends are indicated;
    (ii) If tree or vine damage, or cultural practices will reduce the 
production level;
    (iii) if more than two percent of the trees or vines have been 
removed within the last two years; or
    (iv) If yield trends are evident and yields greater than the average 
yield are requested by the insured.
    (g) APH yields will not be approved the first insurance year on 
perennial crops until an inspection acceptable to FCIC has been 
performed and the acreage is accepted for insurance purposes in 
accordance with the crop insurance contract.
    (h) APH Master Yields may be established whenever crop rotation 
requirements and land leasing practices limit the yield history 
available. FCIC will establish crops and locations for which Master 
Yields are available. To qualify, the producer must have at least four 
recent continuous crop years' annual production reports and must certify 
the authenticity of the production reports of the insured crop. Master 
Yields are based on acreage and production history from all acreage of 
the insured crop in the county in which the operator has shared in the 
crop's production.
    (i) FCIC may use any production report available under the 
provisions of any crop insurance contract, whether continuous or not, 
involving the interests of the person's insured crops in determining the 
approved APH yield.



Sec. 400.56  Administrative appeal exhaustion.

    The insured may appeal the approved APH yield in accordance with the 
procedures contained in 7 CFR part 400, subpart J. Administrative 
remedies through the appeal process must be exhausted prior to any 
action for judicial review. The approved APH yield determined as a 
result of the appeal process will be the yield applicable to the crop 
year.



Sec. 400.57  OMB control numbers.

    OMB control numbers are contained in 7 CFR part 400, subpart H.



   Subpart H--Information Collection Requirements Under the Paperwork 
                   Reduction Act; OMB Control Numbers

    Authority: 5 U.S.C. 1320, Pub. L. 96-511 (44 U.S.C., chapter 35).

    Source: 56 FR 49390, Sept. 30, 1991, unless otherwise noted.



Sec. 400.65  Purpose.

    This subpart collects and displays the control numbers assigned to 
information collection requirements of the Federal Crop Insurance 
Corporation (FCIC) by the Office of Management and Budget pursuant to 
the Paperwork Reduction Act of 1980 (Pub. L. 96-511). FCIC intends that 
this subpart comply with the requirements of section 3507(f) of the 
Paperwork Reduction Act, which

[[Page 23]]

requires that agencies display a current control number assigned by the 
Director of OMB for each agency information collection requirement.



Sec. 400.66  Display.

    (a) Crop Insurance Regulations promulgated by FCIC and contained in 
7 CFR part 400 et seq., contain the following statement:

                           OMB Control Numbers

    The OMB control numbers are contained in subpart H of part 400, 
title 7 CFR.

    (b) Specific report title and agency forms approved by OMB are as 
follows:

----------------------------------------------------------------------------------------------------------------
                                                                                                      Expiration
                   FCI No.                                    Form title                  OMB No.        date
----------------------------------------------------------------------------------------------------------------
FCI-3........................................  Collector's Contact Report.............    0563-0043      8-31-94
FCI-5........................................  Contract Price Election Agreement          0563-0021      6-30-94
                                                Option for Non-Quota (additional)
                                                Peanuts.
FCI-5........................................  Request for Actuarial Change...........    0563-0042      9-30-94
FCI-5-A......................................  Request for Actuarial Change               0563-0042      9-30-94
                                                Continuation Sheet.
FCI-6........................................  Statement of Facts.....................    0563-0027      6-30-94
FCI-9........................................  Late Planting Agreement................    0563-0023      6-30-94
FCI-12.......................................  Crop Insurance Application.............    0563-0003      3-31-93
FCI-12-A.....................................  Contract Changes.......................    0563-0025      7-31-94
FCI-12-P.....................................  Pre-Acceptance Perennial Crop              0563-0031      7-31-94
                                                Inspection Report.
FCI-19.......................................  Crop Insurance Acreage Report..........    0563-0001      2-28-95
FCI-19-A.....................................  Actual Production History Review.......    0563-0036      7-31-94
FCI-19-A.....................................  Production and Yield Report............    0563-0029      7-31-94
FCI-19-C.....................................  Texas Citrus Grove Inspection Report...    0563-0017      4-30-95
FCI-20.......................................  Application for Assignment of Indemnity    0563-0014     12-31-93
FCI-21.......................................  Transfer of Right to an Indemnity......    0563-0014     12-31-93
FCI-63.......................................  Claim for Citrus Indemnity.............    0563-0007      2-28-95
FCI-63-A.....................................  Claim for Raisin Indemnity.............    0563-0007      2-28-95
FCI-63-A.....................................  Notice of Damage--Raisins..............    0563-0035      8-31-94
FCI-63-A.....................................  Adjuster's Florida Citrus Worksheet....    0563-0016      4-30-95
FCI-63-B.....................................  Tabulation of Production Records from      0563-0044      9-30-94
                                                Individual Load Certificates.
FCI-73.......................................  Certiication Form......................    0563-0033      7-31-94
FCI-74.......................................  Field Inspection and Claim for             0563-0007      2-28-95
                                                Indemnity.
FCI-74.......................................  Field Inspection and Claim for             0563-0007      2-28-95
                                                Indemnity (Continuation Sheet).
FCI-74-T-P-C.................................  Field Inspection and Claim for             0563-0007      2-28-95
                                                Indemnity (Tobacco, Peanuts, and
                                                Cotton).
FCI-74-T-P-C.................................  Field Inspection Claim for Indemnity       0563-0007      2-28-95
                                                (Continuation Sheet).
FCI-74-A.....................................  Adjuster's Apple Worksheet.............    0563-0016      4-30-95
FCI-74-A.....................................  Beans and Peas Appraisal Worksheet.....    0563-0016      4-30-95
FCI-74-A.....................................  Citrus Appraisal Worksheet.............    0563-0016      4-30-95
FCI-74-A.....................................  Stand Reduction and Hail Appraisal         0563-0016      4-30-95
                                                Worksheet.
FCI-74-A.....................................  Nut Tree Appraisal Worksheet...........    0563-0016      4-30-95
FCI-74-A.....................................  Adjuster's Citrus Worksheet............    0563-0016      4-30-95
FCI-74-A.....................................  Corn, Grain Sorghum, and Silage            0563-0016      4-30-95
                                                Appraisal Worksheet.
FCI-74-A.....................................  Cotton Appraisal Worksheet.............    0563-0016      4-30-95
FCI-74-A.....................................  Fig Appraisal Worksheet................    0563-0016      4-30-95
FCI-74-A.....................................  Flax Appraisal Worksheet...............    0563-0016      4-30-95
FCI-74-A.....................................  Forage Seeding Appraisal Worksheet.....    0563-0016      4-30-95
FCI-74-A.....................................  Fresh Sweet Corn Appraisal Worksheet...    0563-0016      4-30-95
FCI-74-A.....................................  Table Grape Appraisal Worksheet........    0563-0016      4-30-95
FCI-74-A.....................................  Peanut Appraisal Worksheet.............    0563-0016      4-30-95
FCI-74-A.....................................  Pear Appraisal Worksheet...............    0563-0016      4-30-95
FCI-74-A.....................................  Peppers, Fresh Tomatoes Appraisal          0563-0016      4-30-95
                                                Worksheet.
FCI-74-A.....................................  Fresh Plums Appraisal Worksheet........    0563-0016      4-30-95
FCI-74-A.....................................  Potato Appraisal Worksheet.............    0563-0016      4-30-95
FCI-74-A.....................................  Prune Appraisal Worksheet..............    0563-0016      4-30-95
FCI-74-A.....................................  Safflower Appraisal Worksheet..........    0563-0016      4-30-95
FCI-74-A.....................................  Wheat, Barley, Oats, Rye, Rice             0563-0016      4-30-95
                                                Appraisal Worksheet.
FCI-74-A.....................................  Soybean Appraisal Worksheet............    0563-0016      4-30-95
FCI-74-A.....................................  Stonefruit Appraisal Worksheet.........    0563-0016      4-30-95

[[Page 24]]

 
FCI-74-A.....................................  Sugar Beet Appraisal Worksheet.........    0563-0016      4-30-95
FCI-74-A.....................................  Sugarcane Appraisal Worksheet..........    0563-0016      4-30-95
FCI-74-A.....................................  Sunflower Appraisal Worksheet..........    0563-0016      4-30-95
FCI-74-A.....................................  Tobacco Appraisal Worksheet............    0563-0016      4-30-95
FCI-74-A.....................................  Adjuster's Peach Worksheet.............    0563-0016      4-30-95
FCI-74-A.....................................  Adjuster's Tomato Worksheet............    0563-0016      4-30-95
FCI-74-A.....................................  Texas Citrus Tree Appraisal Worksheet..    0563-0016      4-30-95
FCI-74-A.....................................  Macadamia Tree Worksheet...............    0563-0028      6-30-94
FCI-74-A.....................................  Macadamia Tree Worksheet (continuation)    0563-0028      6-30-94
FCI-74-A.....................................  Random Path Appraisal Worksheet........    0563-0039      8-31-94
FCI-74-B.....................................  Adjuster's Apple Worksheet.............    0563-0016      4-30-95
FCI-74-B.....................................  Peanut Computation Sheet...............    0563-0041      9-30-94
FCI-74-B.....................................  Stand Reduction Appraisal Worksheet....    0563-0016      4-30-95
FCI-74-B.....................................  Fresh Tomatoes Appraisal Worksheet.....    0563-0016      4-30-95
FCI-74-B.....................................  Peppers Appraisal Worksheet............    0563-0016      4-30-95
FCI-74-B.....................................  Cotton Claim for Indemnity.............    0563-0014     12-31-93
FCI-74-C.....................................  Summary of Harvested Production........    0563-0040      8-31-94
FCI-74-C.....................................  Hail Damage Appraisal Worksheet........    0563-0016      4-30-95
FCI-78.......................................  Request to Exclude Hail and Fire.......    0563-0032      6-30-94
FCI-78-A.....................................  Request to Exclude Hail and Fire.......    0563-0032      6-30-94
FCI-505......................................  Potato Crop Insurance Policy--Certified    0563-0029      6-30-94
                                                Seed Potato Option Amendment.
FCI-506......................................  Apple Fresh Fruit Option...............    0563-0020      6-30-94
FCI-513......................................  Waiver to Transfer Segregation II and      0563-0026      7-31-94
                                                III Peanuts to Quota Loan.
FCI-514......................................  Malting Barley Option..................    0563-0020      6-30-94
FCI-523......................................  Potato Quality Option..................    0563-0020      6-30-94
FCI-527......................................  Planting Record--Fresh Sweet Corn......    0563-0022      6-30-94
FCI-528......................................  Planting Record--Peppers...............    0563-0022      6-30-94
FCI-529......................................  Planting Record--Tomatoes (Fresh Market    0563-0022      6-30-94
                                                Dollar).
FCI-530......................................  Upland/ELS Cotton Program/                 0563-0038      8-31-94
                                                Identification of Cotton Prod.
FCI-532......................................  Power of Attorney......................    0563-0030      8-31-94
FCI-535......................................  Wheat Crop Insurance--Winter Coverage      0563-0020      6-30-94
                                                Option.
FCI-539......................................  Apple Sunburn Option...................    0563-0020      6-30-94
FCI-541......................................  Corn Silage Option.....................    0563-0020      6-30-94
FCI-544......................................  Underwriting Questionnaire (Container      0563-0034      7-31-94
                                                Stock Only).
FCI-545......................................  Nursey Container Report................    0563-0034      7-31-94
FCI-546......................................  Nursey Crop Insurance Inventory Summary    0563-0034      7-31-94
FCI-547......................................  Potato Crop Ins. Policy--Processing        0563-0020      6-30-94
                                                Potato Quality Option.
FCI-548......................................  Potato Crop Ins. Policy--Frost/Freeze      0563-0020      6-30-94
                                                Potato Option.
FCI-549......................................  High-Risk Land Exclusion Option........    0563-0018      6-30-95
FCI-550......................................  Fresh Market Tomato Minimum Value          0563-0020      6-30-94
                                                Option.
FCI-551......................................  Raisin Conditioning Pool--Production to    0563-0035      8-31-94
                                                Count.
FCI-552......................................  Self-Certification Replant Worksheet...    0563-0037      8-31-94
FCI-553......................................  Unit Division Option...................    0563-0001      2-28-95
FCI-554......................................  Macadamia Orchard Inspection Report....    0563-0015      4-30-95
FCI-555......................................  Peach Producer's Picking Records.......    0563-0024      6-30-94
FCI-819......................................  Raisin Supplement--Tonnage Report......    0563-0035      8-31-94
----------------------------------------------------------------------------------------------------------------


[56 FR 49390, Sept. 30, 1991, as amended at 58 FR 13531, Mar. 12, 1993]



                          Subpart I  [Reserved]



                Subpart J--Appeal Procedure--Regulations

    Authority: 7 U.S.C. 1506(p).



Sec. 400.90  Applicability.

    Persons who are insured or believe they are insured under contracts 
of insurance issued under the Federal Crop Insurance Act must obtain 
appeal and reconsideration of decisions made

[[Page 25]]

under the provisions of this chapter in accordance with part 780 of this 
title.

[60 FR 67313, Dec. 29, 1995]



Subpart K--Debt Management--Regulations for the 1986 and Succeeding Crop 
                                  Years

    Authority: Secs. 506, 516, Pub. L. 75-430, 52 Stat. 73, 77, as 
amended (7 U.S.C. 1506, 1516).

    Source: 51 FR 17316, May 12, 1986, unless otherwise noted.



Sec. 400.115  Purpose.

    This subpart sets forth procedures that will be followed, and the 
rights afforded to debtors, in connection with the reporting by the 
Federal Crop Insurance Corporation (FCIC) to credit reporting agencies 
of information with respect to current and delinquent debts owed to 
FCIC, and in connection with referral of delinquent debts to contract 
collection agencies.



Sec. 400.116  Definitions.

    (a) Credit reporting agency means (1) a reporting agency as defined 
at 4 CFR 102.5(a), or (2) any entity which has entered into an agreement 
with USDA concerning the referral of credit information.
    (b) Collection agency means a private debt collection contractor 
under Federal Supply Schedule contract with the General Services 
Administration (GSA) for professional debt collection services.
    (c) Comptroller means the employee of FCIC filling that position or 
the person designated by the Comptroller to perform that function.
    (d) Debt and claim are deemed synonymous and are used 
interchangeably herein. The debt or claim is an amount of money which 
has been determined by an appropriate agency official to be owed to FCIC 
by any individual, organization or entity, except another Federal 
agency; State, local or foreign government or agencies thereof; Indian 
tribal governments; or other public institutions.

The debt or claim may have arisen from overpayment, premium non-payment, 
interest, penalties, reclamations resulting from payments under good 
faith reliance provisions, or other causes.

    (e) Delinquent debt means (1) any debt owed to FCIC that has not 
been paid by the termination date specified in the applicable contract 
of insurance, or other due date for payment contained in any other 
agreement, or notification of indebtedness, and (2) any overdue amount 
owed to FCIC by a debtor which is the subject of an installment payment 
agreement which the debtor has failed to satisfy under the terms of such 
agreement.
    (f) System of records means a group of any records under the control 
of FCIC from which information is retrieved by the name of the 
individual by some identifying number, symbol, or other identification 
assigned to the individual.
    (g) Request for review means that request submitted to FCIC by a 
debtor for a review of the facts resulting in the determination of 
indebtedness to FCIC. FCIC allows 45 days for such request and any 
request submitted within that period is considered a timely request.



Sec. 400.117  Determination of delinquency.

    Prior to disclosing information about a debt to a credit reporting 
agency in accordance with this subpart, the FCIC claims official, 
designated as the Comptroller, FCIC, or the designee of the Comptroller 
who has jurisdiction over the claim, shall review the claim and 
determine that the claim is valid and overdue.



Sec. 400.118  Demand for payment.

    The Comptroller who is responsible for carrying out the provisions 
of this subpart with respect to the debt shall send to the debtor 
appropriate written demands for payment in terms which inform the debtor 
of the consequences of failure to make payment, in accordance with 
guidelines established by the Manager, FCIC, the Federal Claims 
Collection Standards at 4 CFR 102.2, or the contract between the General 
Services Administration (GSA) and the collection agency.

[[Page 26]]



Sec. 400.119  Notice to debtor; credit reporting agency.

    (a) In accordance with guidelines established by the Manager, FCIC, 
the Comptroller who is responsible for disclosure of information with 
respect to delinquent debts to a credit reporting agency shall send 
written notice to the delinquent debtors that FCIC intends to disclose 
credit information to a credit reporting agency on a regular basis. In 
addition, delinquent debtors are to be informed:
    (1) Of the basis for the indebtedness;
    (2) That the payment is overdue;
    (3) That FCIC intends to disclose to a credit reporting agency that 
the debtor is responsible for the debt and with respect to an 
individual, that such disclosure shall be made not less than 60 days 
after notification to such debtor;
    (4) Of the specific information intended to be disclosed to the 
credit reporting agency;
    (5) Of the rights of such debtor to a full explanation of the claim 
and to dispute any information in the system of records of FCIC 
concerning the claim;
    (6) Of the debtor's right to administrative appeal or review with 
respect to the claim and how such review shall be obtained; and
    (7) Of the date after which the information will be reported to the 
credit reporting agency.
    (b) The content and standards for demand letters and notices sent 
under this section shall be consistent with the Federal Claims 
Collection Standards at 4 CFR 102.2.



Sec. 400.120  Subsequent disclosure and verification.

    (a) FCIC shall promptly notify each credit reporting agency to which 
the original disclosure of debt information was made of any substantial 
change in the condition or amount of the claim. A substantial change in 
condition may include, but is not limited to, notice of death, cessation 
of business, or relocation of the debtor. A substantial change in the 
amount may include, but is not limited to, payments received, additional 
amounts due, or offsets made with respect to the debt.
    (b) FCIC shall promptly verify or correct, as appropriate, 
information about the claim or request of such credit reporting agency 
for verification of any or all information so disclosed. The records of 
the debtor shall reflect any correction resulting from such request.
    (c) FCIC shall obtain satisfactory assurances from each reporting 
agency to which information will be provided that the agency is in 
compliance with the provisions of all laws and regulations of the United 
States relating to providing credit information.



Sec. 400.121  Information disclosure limitations.

    FCIC shall limit delinquent debt information disclosed to credit 
reporting agencies to:
    (a) The name, address, taxpayer identification number, and other 
information necessary to establish the identity of the debtor;
    (b) The amount, status, and history of the claim; and
    (c) The FCIC program under which the claim arose.



Sec. 400.122  Attempts to locate debtor.

    Before disclosing delinquent debt information to a credit reporting 
agency, FCIC shall take reasonable action to locate a debtor for whom 
FCIC does not have a current address in order to send the notification 
in accordance with Sec. 400.119 of this subpart.



Sec. 400.123  Request for review of the indebtedness.

    (a) Before disclosing delinquent debt information to a credit 
reporting agency, FCIC shall, upon request of the debtor, provide for a 
review of the claim, including an opportunity for reconsideration of the 
initial decision concerning the existence or amount of the claim, in 
accordance with applicable administrative appeal procedures.
    (b) Upon receipt of a timely request for review, FCIC shall suspend 
its schedule for disclosure of delinquent debt information to a credit 
reporting agency until such time as a final decision is made on the 
request.
    (c) Upon completion of the review, the reviewing office shall 
transmit to the debtor a written notification of the decision. If 
appropriate, notification shall inform the debtor of the scheduled date 
on or after which information

[[Page 27]]

concerning the debt will be provided to the credit reporting agency. The 
notification shall, if appropriate, also indicate any changes in the 
information to be disclosed to the extent such information differs from 
that provided in the initial notification.



Sec. 400.124  Disclosure to credit reporting agencies.

    (a) In accordance with guidelines established by the Manager, FCIC, 
the Comptroller or designated manager of the systems of records shall 
disclose to credit reporting agencies the information specified in 
Sec. 400.121.
    (b) Disclosure of information to credit reporting agencies shall be 
made on or after the date specified in Secs. 400.119(a)(3) and 400.125 
and shall be comprised of the information set forth in the initial 
determination or any modification thereof.
    (c) This section shall not apply to disclosure of delinquent debts 
when:
    (1) The debtor has agreed to a repayment agreement for such debt and 
such agreement is still valid; or
    (2) The debtor has filed for review of the debt and the reviewing 
official or designee has not issued a decision on the review.



Sec. 400.125  Notice to debtor, collection agency.

    FCIC shall provide 30 days written notice to the debtor, mailed to 
the debtor's last known address, of FCIC's intent to forward the debt to 
a collection agency for further collection action.



Sec. 400.126  Referral of delinquent debts to contract collection agencies.

    (a) FCIC shall use the services of a contract collection agency 
which has entered into a contract with the General Services 
Administration to recover debts owed to FCIC.
    (b) If FCIC's collection efforts have been unsuccessful on a 
delinquent debt, and the delinquent debt remains unpaid, FCIC may refer 
the debt to a contract collection agency for collection.
    (c) FCIC shall retain the authority to resolve disputes, compromise 
claims, suspend or terminate collection action, and refer the matter for 
litigation.



Sec. 400.127  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 400.128  Definitions.

    (a) Agency means (1) An Executive Agency as defined by 5 U.S.C. 105, 
the United States Postal Service, and the United States Postal Rate 
Commission, or (2) A Military Department, as defined by section 102 of 
Title 5 U.S.C.
    (b) Debt means:
    (1) An amount owed to the United States from sources including, but 
not limited to, insured or guaranteed loans, fees, leases, insurance 
premiums, interest (except where prohibited by law), rents, royalties, 
services, sale of real or personal property, overpayments, penalties, 
damages, fines and forfeitures (except those arising under the Uniform 
Code of Military Justice).
    (2) An amount owed to the United States by an employee for pecuniary 
losses where the employee has been determined to be liable because of 
such employee's negligent, willful, unauthorized or illegal acts, 
including but not limited to:
    (i) Theft, misuse, or loss of Government funds;
    (ii) False claims for services and travel reimbursement;
    (iii) Illegal, unauthorized obligations and expenditures of 
Government appropriations;
    (iv) Using or authorizing the use of Government owned or leased 
equipment, facilities, supplies and services for other than official or 
approved purposes;
    (v) Lost, stolen, damaged, or destroyed Government property;
    (vi) Erroneous entries on accounting records or reports; and
    (vii) Deliberate failure to provide physical security and control 
procedures for accountable officers, if such failure is determined to be 
the proximate cause for a loss of Government funds.
    (c) Department or USDA means the United States Department of 
Agriculture.
    (d) Disposable salary (pay) means any pay due an employee which 
remains after required deductions for Federal, State and local income 
taxes; Social Security taxes, including Medicare

[[Page 28]]

taxes; Federal retirement programs; premiums for life and health 
insurance benefits; and such other deductions as may be required by law 
to be withheld.
    (e) Employee means a current employee of an agency, including a 
current member of the Armed Forces or a Reserve of the Armed Forces.
    (f) FCIC Official means the Manager, or the Manager's designee.
    (g) Hearing Officer means an Administrative Law Judge of the 
Department of Agriculture or another person not under the control of the 
USDA, designated by the FCIC Official to review the determination of the 
alleged debt.
    (h) Salary Offset means a deduction of a debt due the U.S. by 
deduction from the disposable salary of an employee without the 
employee's consent.
    (i) Waiver means the cancellation, remission, forgiveness, or non-
recovery of a debt owed by an employee as permitted or required by 5 
U.S.C. 5584, 10 U.S.C. 2774, 32 U.S.C. 716, 5 U.S.C. 8346(b), or any 
other law.

[53 FR 3, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.129  Salary offset.

    (a) Debt collection by salary offset is feasible if: the cost to the 
Government of collection by salary offset does not exceed the amount of 
the debt; there are no legal restrictions to the debt, such as the 
debtor being under the jurisdiction of a bankruptcy court or the 
expiration of a statute of limitations; or, other such legal 
restrictions. The Debt Collection Act permits collections of debts by 
offset for claims that have not been outstanding for more than 10 years.
    (b) The salary offset provisions contained herein provide procedures 
which must be followed before FCIC may request another Federal agency to 
offset any amount from the debtor's salary. Decisions made under the 
provisions of this section are not appealable under the provisions of 
the Appeal Regulations in part 400, subpart J of this title.
    (c) These regulations will not apply to any case where collection of 
a debt by salary offset is explicitly provided for by another statue as 
noted by the Comptroller General in 64 Comp. Gen. 142 (1984), including 
5 U.S.C. 5512(a), 5 U.S.C. 5513, 5 U.S.C. 5522(a) (1), 5 U.S.C. 5705 (1) 
and (2), and 5 U.S.C. 5724(f).
    (d) Salary offset may be used by FCIC to collect debts which arise 
from delinquent FCIC premium payments or delinquent repayment plans and 
other debts arising from, but not limited to, such sources as program 
theft, embezzlement, fraud, salary overpayments, underwithholding of any 
amounts due and payable for life and health insurance, advance travel 
payments, overpaid indemnities, and any amount owed by present or former 
employees from loss of federal funds through negligence and other 
matters. The debt does not have to be reduced to judgment and does not 
have to be covered by a security instrument.
    (e) FCIC may use salary offset against one of its employees who is 
indebted to another agency if requested to do so by that agency. Salary 
offset will not be initiated until after other servicing options 
available to the requesting agency have been utilized, and due process 
has been afforded to the FCIC employee. When salary offset is utilized, 
payment for the debt will be deducted from the employee's salary and 
sent directly to the creditor agency. Not more than fifteen percent 
(15%) of the employee's disposable salary can be offset in any one pay 
period, unless the employee agrees in writing to the deduction of a 
larger amount.
    (f) When FCIC is owed a debt by an employee of another agency, the 
other agency shall not initiate the requested offset until FCIC provides 
the agency with a written certification that the debtor owes FCIC a debt 
(including the amount and basis of the debt and the due date of the 
payment), and that FCIC has complied with Department regulations. If a 
repayment schedule is elected by the employee, interest will be charged 
in accordance with Departmental Regulation 2520-1, Interest Rate on 
Delinquent Debts; USDA Debt Collection Regulations in 7 CFR part 3; and 
4 CFR 102.13.
    (g) For the purposes of this section, the Manager, FCIC, or the 
Manager's designee, is delegated authority to:
    (1) Certify to the debtor's employing agency that the debt exists 
and the amount of the debt or delinquent balance;

[[Page 29]]

    (2) Certify that, with respect to debt collection, the procedures 
and regulations of FCIC and the Department have been complied with; and
    (3) Request that salary offset be initiated by the debtor's 
employing agency.

[53 FR 3, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.130  Notice requirements before offset.

    Salary offset will not be made unless the employee receives 30 
calendar days written notice. The notice of intent to offset salary 
(notice of intent) will state:
    (a) That FCIC has reviewed the records relating to the debt and has 
determined that the debt is owed, and has verified the amount of the 
debt, and the facts giving rise to the debt;
    (b) That FCIC intends to deduct an amount not to exceed 15% of the 
employees current disposable salary until the debt and all accumulated 
interest are paid in full;
    (c) The amount, frequency, approximate beginning date, and duration 
of the intended deductions;
    (d) An explanation of the requirements concerning interest, 
penalties, and administrative costs, including a statement that these 
assessments will be made unless waived in accordance with 31 U.S.C. 3717 
and 7 CFR 3.34;
    (e) That FCIC's records concerning the debt are available to the 
employee for inspection and that the employee may request a copy of such 
records;
    (f) That the employee has a right to voluntarily enter into a 
written agreement with FCIC for a repayment schedule with FCIC, which 
may be different from that proposed by FCIC, if the terms of the 
repayment agreement are agreed to by FCIC;
    (g) That the employee has the right to a hearing conducted by an 
Administrative Law Judge of USDA, or a hearing official not under the 
control of USDA, concerning the determination of the debt, the amount of 
the debt, or the percentage of disposable salary to be deducted each pay 
period, if the petition for a hearing is filed by the employee as 
prescribed by FCIC;
    (h) The method and time period allowable for a petition for a 
hearing;
    (i) That the timely filing of a hearing petition will stay the 
offset collection proceedings;
    (j) That a final decision on the hearing will be issued at the 
earliest practical date, but not later than 60 calendar days after the 
filing of the petition, unless the employee requests, and the hearing 
officer grants, a delay in the proceedings;
    (k) That any knowingly false or frivolous statement, representation, 
or evidence may subject the employee to:
    (1) Disciplinary procedures appropriate under 5 U.S.C. Chapter 75, 5 
CFR part 752, or any other applicable Statutes or regulations;
    (2) Penalties under the False Claims Act, 31 U.S.C. 3729-3731, or 
any other applicable statutory authority: or
    (3) Criminal penalties under 18 U.S.C. 286, 287, 1001, and 1002, or 
any other applicable statutory authority;
    (l) Any other rights or remedies available to the employee under any 
statute or regulations governing the program for which collection is 
being made;
    (m) That the employee may request waiver of salary overpayment under 
applicable statutory authority (5 U.S.C. 5584, 10 U.S.C. 2774, 32 U.S.C 
716, or 5 U.S.C 8346(b)), or may request waiver in the case of general 
debts and if waiver is available under any statutory provision 
pertaining to the particular debt being collected. The employee may 
question the amount or validity of the salary overpayment or general 
debt by submitting a claim to the Comptroller General in accordance with 
General Accounting Officer procedure.
    (n) That amounts paid on or deducted for the debt which are later 
waived or found not to be owed to the United States will be promptly 
refunded to the employee, unless there are applicable contractual or 
statutory provisions to the contrary; and
    (o) The name and address of an official of FCIC to whom the employee 
should direct any communication with respect to the debt.

[53 FR 4, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]

[[Page 30]]



Sec. 400.131  Request for a hearing and result if an employee fails to meet deadlines.

    (a) Except as provided in paragraph (c) of this section, an employee 
must file a petition for hearing that is received by the FCIC Official 
not later than 30 calendar days from the date of the notice of intent to 
collect a debt by salary offset, if the employee wants a hearing 
concerning:
    (1) The existence or amount of the debt; or
    (2) The FCIC Official's proposed offset schedule, including the 
percentage of deduction.
    (b) The petition must be signed by the employee and should clearly 
identify and explain with reasonable specificity and brevity the facts, 
evidence and witnesses which the employee believes support the his or 
her position. If the employee objects to the percentage of disposable 
salary to be deducted from each check, the petition should state the 
objection and the reasons for it.
    (c) If the employee files a petition for hearing later than the 30 
days provided in paragraph (a) of this section, the FCIC Official may 
accept the petition if the employee is able to show that the delay 
caused by conditions beyond his or her control, or because the employee 
failed to received the notice of the filing deadline (unless the 
employee has actual notice of the deadline).
    (d) An employee will not be granted a hearing and will have his or 
her disposable salary offset in accordance with the FCIC Official's 
announced schedule if the employee:
    (1) Fails to file a petition for hearing as set forth in this 
subsection; or
    (2) Is scheduled to appear and fails to appear at the hearing.

[53 FR 4, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.132  Hearings.

    (a) If an employee timely files a petition for a hearing, the FCIC 
Official will select the date, time, and location for the hearing.
    (b) The hearing shall be conducted by an appropriately designated 
Hearing Official.
    (c) Rules of evidence shall not be observed, but the hearing officer 
will consider all evidence that he or she determines to be relevant to 
the debt that is the subject of the hearing, and weigh all such evidence 
accordingly, given all the facts and circumstances surrounding the debt.
    (d) The burden of proof with respect to the existence of the debt 
rests with FCIC.
    (e) The employee requesting the hearing shall bear the ultimate 
burden of proof.
    (f) The evidence presented by the employee must prove that no debt 
exists, or cast sufficient doubt such that reasonable minds could differ 
as to the existence of the debt.

[53 FR 5, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.133  Written decision following a hearing.

    (a) At the conclusion of the hearing, a written decision will be 
provided which will include:
    (1) A statement of the facts presented at the hearing supporting the 
nature and origin of the alleged debt and those presented to refute the 
debt;
    (2) The hearing officer's analysis, findings, and conclusions, 
considering all the evidence presented and the respective burdens of the 
parties, in light of the hearing;
    (3) The amount and validity of the alleged debt determined as a 
result of the hearing;
    (4) The payment schedule (including the percentage of disposable 
salary), if applicable; and
    (5) The determination of the amount of the debt at this hearing is 
the final agency action on this matter.

[53 FR 5, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.134  Review of FCIC record related to the debt.

    An employee who intends to inspect or copy FCIC records related to 
the debt must send a letter to the FCIC official (designated in the 
notice of intent) stating his or her intentions. The letter must be 
received by the FCIC official within 30 calender days of the date of the 
notice of intent. In response to the timely notice submitted by the 
debtor, the FCIC official will notify the employee of the location and 
time

[[Page 31]]

when the employee may inspect and copy FCIC records related to the debt.

[53 FR 5, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.135  Written agreement to repay debt as an alternative to salary offset.

    The employee may propose, in response to a notice of intent, a 
written agreement to repay the debt as an alternative to salary offset. 
The proposed written agreement to repay the debt must be received by the 
FCIC official within 30 calendar days of the date of the notice of 
intent. The FCIC official will notify the employee whether the 
employee's proposed written agreement for repayment is acceptable. The 
FCIC official may accept a repayment agreement instead of proceeding by 
offset. In making this determination, the FCIC official will balance the 
FCIC interest in collecting the debt against hardship to the employee. 
If the debt is delinquent and the employee has not disputed its 
existence or amount, the FCIC official will accept a repayment 
agreement, instead of offset, for good cause such as, if the employee 
establishes that offset would result in undue financial hardship, or 
would be against equity and good conscience.

[53 FR 5, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.136  Procedures for salary offset; when deductions may begin.

    (a) Deductions to liquidate an employee's debt will be made by the 
method and in the amount outlined in the Notice of Intent to collect 
from the employee's salary, as provided for in Sec. 400.130.
    (b) If the employee files a petition for a hearing before the 
expiration of the period provided for in Sec. 400.130, then deductions 
will begin after the hearing officer has provided the employee with a 
final written decision in favor of FCIC.
    (c) If an employee retires or resigns before collection of the 
amount of the indebtedness is completed, the remaining indebtedness will 
be collected in accordance with procedures for administrative offset.

[53 FR 5, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.137  Procedures for salary offset; types of collection.

    A debt will be collected in a lump-sum or in installments. 
Collection will be by lump-sum collection unless the employee is 
financially unable to pay in one lump-sum, or if the amount of the debt 
exceeds 15 percent of the disposable pay for an ordinary pay period. In 
these cases, deduction will be by installments as set forth in 
Sec. 400.138.

[53 FR 5, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.138  Procedures for salary offset; methods of collection.

    (a) General. A debt will be collected by deductions at officially-
established pay intervals from an employee's current pay account, unless 
the employee and the hearing official agree to alternative arrangements 
for repayment under Sec. 400.135.
    (b) Installment deductions. Installment deductions will be made over 
a period not greater than the anticipated period of employment. The size 
and frequency of the installment deductions will bear a reasonable 
relation to the size of the debt and the employee's ability to pay. If 
possible, the installment payment will be sufficient in size and 
frequency to liquidate the debt in no more than three years. Installment 
payments of less than $25.00 per pay period, or $50.00 per month, will 
be accepted only in the most unusual circumstances.

[53 FR 5, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.139  Nonwaiver of rights.

    So long as there are no statutory or contractual provisions to the 
contrary, no employee payment (or all or portion of a debt) collected 
under these regulations will be interpreted as a waiver of any rights 
that the employee may have under the provisions of 5 U.S.C. 5514.

[53 FR 5, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]

[[Page 32]]



Sec. 400.140  Refunds.

    FCIC will promptly refund to the appropriate individual amounts 
offset under these regulations when:
    (a) A debt is waived or otherwise found not owing to the United 
States (unless expressly prohibited by statute or regulation); or
    (b) FCIC is directed by an administrative or judicial order to 
refund amounts deducted from an employee's current pay.

[53 FR 5, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.141  Internal Revenue Service (IRS) Tax Refund Offset.

    Under the provisions of 31 U.S.C. 3720A, the (IRS) may be requested 
to collect a legally enforceable debt owing to any Federal agency by 
offset against a taxpayer's Federal income tax refund. This section 
provides policies and procedures to implement IRS tax refund offsets in 
accordance with the provisions set forth in Sec. 301.6402-6T of 26 CFR 
chapter I.
    (a) Any person who is indebted to the Federal Crop Insurance 
Corporation (FCIC) is entitled to the extent of FCIC's administrative 
due process including review and appeal of the debt under the Appeal 
Regulations in 7 CFR part 400, subpart J.
    (b) If, after such administrative due process is exhausted, the debt 
is still outstanding with no other means of collection, the debtor will 
be notified by letter of FCIC's intention to refer such debt to the IRS 
for collection by tax refund offset. The notification letter will inform 
the debtor that their account is delinquent and that IRS will be 
requested to reduce the amount of any tax refund check due the debtor by 
the amount of the deliquency. The debtor will be given 60 days in which 
to write to the Manager, FCIC, providing written evidence that the debt 
is not legally enforceable. FCIC will refer the debt to IRS for 
collection by offset after the 60-day period if no response is received 
from the debtor. Decisions made under the provisions of this section are 
not appealable under the provisions of the Appeal Regulations in 7 CFR 
part 400, subpart J.
    (c) If the debtor has requested a review, and has provided written 
evidence that the debt is not legally enforceable, the Manager, with the 
assistance of the Office of General Counsel, USDA, will review the 
debtor's reasons for believing that the debt is not legally enforceable. 
The debtor will then be notified of the results of the review.
    (d) FCIC will notify IRS of those accounts against which offset 
action is to be taken.
    (e) If, during the period of review, the debtor pays the debt in 
full, the collection of the debt by tax refund offset procedure will be 
halted. Changes in debtor status that eliminate the debtor from IRS 
offset will be reported to IRS by FCIC and the debtor's refund will not 
be offset.
    (f) Amounts offset for delinquent debt which are later found to be 
not owed to FCIC, will be promptly refunded.
    (g) Debtors will not be subject to IRS offset for any of the 
following reasons:
    (1) Debtors who are discharged in bankruptcy or who are under the 
jurisdiction of a bankruptcy court;
    (2) Debtors who are employed by the Federal Government;
    (3) Debtors whose cases are in suspense because of actions pending 
by or taken by FCIC;
    (4) Debtors who have not provided a Social Security Number (SSN) and 
no SSN can be obtained;
    (5) Debtors whose indebtedness is less than $25;
    (6) Debtors whose account is more than ten (10) years delinquent; 
except in the case of a judgment debt; or
    (7) Debtors whose account has not been first reported to a consumer 
credit reporting agency.

[53 FR 5, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



Sec. 400.142  Past-due legally enforceable debt eligible for refund offset.

    For purposes of this section, a past-due, legally enforceable debt 
which may be referred by FCIC to IRS for offset is a debt which:
    (a) Except in the case of a judgement debt, has been delinquent for 
at least three months but has not been delinquent for more than 10 years 
at the time the offset is made;

[[Page 33]]

    (b) Cannot be currently collected pursuant to the salary offset 
provisions of 5 U.S.C. 5514(a)(1);
    (c) Is ineligible for administrative offset under 31 U.S.C. 3716(a) 
by reason of 31 U.S.C. 3716(c)(2), or cannot be collected by 
administrative offset under 31 U.S.C. 3716(a) by the referring agency 
against amounts payable to the debtor by the referring agency;
    (d) With respect to which the agency has given the employee at least 
60 days to present evidence that all or part of the debt is not past-due 
or legally enforceable, has considered evidence presented by such 
employee, and has determined that an amount of such debt is past-due and 
legally enforceable;
    (e) Has been disclosed by FCIC to a consumer reporting agency as 
authorized by 31 U.S.C. 3711(f), in the case of a debt to be referred to 
IRS after June 30, 1986;
    (f) With respect to which that FCIC has notified, or has made a 
reasonable attempt to notify, the employee that:
    (1) The debt is past due; and
    (2) Unless repaid within 60 days thereafter, will be referred to IRS 
for offset against any overpayment of tax; and
    (3) Which is at least $25.00.

[53 FR 6, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988]



 Subpart L--Reinsurance Agreement--Standards for Approval; Regulations 
              for the 1997 and Subsequent Reinsurance Years

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 52 FR 17543, May 11, 1987, unless otherwise noted. 
Redesignated at 53 FR 3, Jan. 4, 1988, and 53 FR 10527, Apr. 1, 1988.



Sec. 400.161  Definitions.

    In addition to the terms defined in the Standard Reinsurance 
Agreement, the following terms as used in this rule are defined to mean:
    (a) Annual Statutory Financial Statement means the annual financial 
statement of an insurer prepared in accordance with Statutory Accounting 
Principles and submitted to the state insurance department if required 
by any state in which the insurer is licensed.
    (b) Company means the company reinsured by FCIC or apply to FCIC for 
a Standard Reinsurance Agreement.
    (c) Corporation means the Federal Crop Insurance Corporation.
    (d) FCIC means the Federal crop Insurance Corporation.
    (e) Financial statement means any documentation submitted by a 
company as required by this subpart.
    (f) Guaranty fund assessments means the state administered program 
utilized by some state insurance regulatory agencies to obtain funds 
with which to discharge unfunded obligations of insurance companies 
licensed to do business in that state.
    (g) Insurer means an insurance company that is licensed or admitted 
as such in any State, Territory, or Possession of the United States.
    (h) MPUL means the maximum possible underwriting loss that an 
insurer can sustain on policies it intends to reinsure with FCIC, after 
adjusting for the effect of any reinsurance agreement with FCIC, and any 
outside reinsurance agreements, as evaluated by FCIC.
    (i) Obligations mean crop or indemnity for crop loss on policies 
reinsured under the Standard Reinsurance Agreement.
    (j) Plan of operation means a statment submitted to FCIC each year 
in which a reinsured or a prospective reinsured specifies the 
reinsurance options it wishes to use, its marketing plan, and similar 
information as required by the Corporation.
    (k) Quarterly Statutory Financial Statement means the quarterly 
financial statement of an insurer prepared in accordance with Statutory 
Accounting Principles and submitted to the state insurance department if 
required by any state in which the insurer is licensed.
    (l) Reinsurance agreement means an agreement between two parties by 
which an insurer cedes to a reinsurer certain liabilities arising from 
the insurer's sale of insurance policies.
    (m) Reinsured means the insurer which is a party to the Standard 
Reinsurance Agreement with FCIC.
    (n) Standard Reinsurance Agreement (Agreement) means the reinsurance

[[Page 34]]

agreement between the reinsured and FCIC.

[52 FR 17543, May 11, 1987. Redesignated at 53 FR 3, Jan. 4, 1988, and 
53 FR 10527, Apr. 1, 1988, as amended at 57 FR 34666, Aug. 6, 1992; 60 
FR 57903, Nov. 24, 1995]



Sec. 400.162  Qualification ratios.

    The sixteen qualification ratios include:
    (a) Eleven National Association of Insurance Commissioner's (NAIC's) 
Insurance Regulatory Information System (IRIS) ratios found in 
Secs. 400.170(d)(1)(ii) and 400.170(d)(2) (i), (ii), (iii), (vi), (vii), 
(ix), (xi), (xii), (xiii), and (xiv) and referenced in ``Using the NAIC 
Insurance Regulatory Information System'' distributed by NAIC, 120 West 
12th St., Kansas City, MO 64105-1925;
    (b) Three ratios used by A.M. Best Company found in 
Sec. 400.170(d)(2) (v), (viii), and (x) and referenced in Best's Key 
Rating Guide, A.M. Best, Ambest Road, Oldwick, N.J. 08858-0700;
    (c) One ratio found in Sec. 400.170(d)(1)(i) is calculated the same 
as the Gross Premium to Surplus IRIS ratio, with Gross Premium adjusted 
to exclude the MPCI premium assumed by FCIC; and
    (d) One ratio found in Sec. 400.170(d)(2)(iv) which is formulated by 
FCIC and is calculated the same as the One-Year Change to Surplus IRIS 
ratio but for a two-year period.

[60 FR 57903, Nov. 24, 1995]



Sec. 400.163  Applicability.

    The standards contained herein shall be applicable to insurers who 
apply for or enter into a Standard Reinsurance Agreement effective for 
the 1997 and subsequent reinsurance years or who continue with a prior 
years Standard Reinsurance Agreement into the 1997 and subsequent 
reinsurance years.

[60 FR 57903, Nov. 24, 1995]



Sec. 400.164  Availability of the Standard Reinsurance Agreement.

    Federal Crop Insurance Corporation will offer Standard Reinsurance 
Agreements to eligible Companies under which the Corporation will 
reinsure policies which the Companies issue to producers of agricultural 
commodities. The Standard Reinsurance Agreement will be consistent with 
the requirements of the Federal Crop Insurance Act, as amended, and 
provisions of the regulations of the Corporation found at chapter IV of 
title 7 of the Code of Federal Regulations.



Sec. 400.165  Eligibility for Standard Reinsurance Agreements.

    A Company will be eligible to participate in an Agreement if the 
Corporation determines the Company meets the standards and reporting 
requirements of this subpart.



Sec. 400.166  Obligations of the Corporation.

    The Agreement will include the following among the obligations of 
the Corporation.
    (a) The Corporation will reinsure policies written on terms, 
including premium rates, approved by the Corporation, on crops and in 
areas approved by the Corporation, and in accordance with the provisions 
of the Federal Crop Insurance Act, as amended, and the provisions of 
these regulations.
    (b) The Corporation will pay a portion of each producer's premium on 
the policies reinsured under the Agreement, as authorized by the Federal 
Crop Insurance Act, as amended.
    (c) The Corporation will assume all obligations for unpaid losses on 
policies reinsured under the Agreement in the event any company 
reinsured under the Agreement is unable to fulfill its obligations to 
any holder of a Multiple Peril Crop Insurance Policy reinsured by the 
Corporation by reason of a directive or order issued by any State 
Department of Insurance, State Commissioner of Insurance, any court of 
law having competent jurisdiction or any other similar authority of any 
jurisdiction to which the Company is subject.
    (d) Each policy reinsured by the Corporation must be clearly 
identified by including in bold face or large type the following 
statement as item number 1 in its General Provisions:
This insurance policy is reinsured by the Federal Crop Insurance 
Corporation under the provisions of the Federal Crop Insurance Act, as 
amended (the Act) (7 U.S.C. 1501 et seq.), and all terms of the policy 
and rights

[[Page 35]]

and responsibilities of the parties are specifically subject to the Act 
and the regulations under the Act published in chapter IV of 7 CFR.



Sec. 400.167  Limitations on Corporation's obligations.

    The Agreement will include the following among the limitations on 
the obligations of the Corporation.
    (a) The Corporation may, at any time, suspend its obligation to 
accept additional liability from the Company by providing written notice 
to that effect.
    (b) The obligations of the Corporation under the Agreement are 
contingent upon the availability of appropriations.
    (c) The Corporation will not reinsure any policy sold by the Company 
to a producer after the date Company receives notice that the 
Corporation has determined that the producer is ineligible to receive 
Federal Crop Insurance.



Sec. 400.168  Obligations of participating insurance company.

    The Agreement will include the following among the obligations of 
the Company.
    (a) The Company shall follow all applicable Corporation procedures 
in its administration of the crop insurance policies reinsured.
    (b) The Company shall make available to all eligible producers in 
the areas designated in its plan of operations as approved by the 
Corporation:
    (1) The crop insurance plans for the crops designated in its plan of 
operation in those counties within a State, or a portion of a State, 
where the Secretary of Agriculture has determined that insurance is 
available through local offices of the United States Department of 
Agriculture; and
    (2) Catastrophic risk protection, limited, and additional coverage 
plans of insurance for all crops, for which such insurance is made 
available by the Corporation, in all counties within a state, or a 
portion of State, where the Secretary of Agriculture has determined that 
insurance is no longer available through local offices of the United 
States Department of Agriculture.
    (c) The Company shall provide the Corporation, on forms approved by 
the Corporation all information that the Corporation may deem relevant 
in the administration of the Agreement, including a list of all 
applicants determined to be ineligible for crop insurance coverage and 
all insured producers cancelled or terminated from insurance, along with 
the reason for such action, the crop program, and the amount of coverage 
for each.
    (d) The Company shall utilize only loss adjustment procedures and 
methods that are approved by the Corporation.
    (e) The Company shall sell the policies covered under the Agreement 
through licensed agents or brokers who have successfully completed a 
training course approved by the Corporation.
    (f) The Company shall not discriminate against any employee, 
applicant for employment, insured or applicant for insurance because of 
race, color, religion, sex age, handicap, or national origin.

[52 FR 17543, May 11, 1987. Redesignated at 53 FR 3, Jan. 4, 1988, and 
53 FR 10527, Apr. 1, 1988, as amended at 61 FR 34368, July 2, 1996; 61 
FR 65153, Dec. 11, 1996]



Sec. 400.169  Disputes.

    (a) If the company believes that the Corporation has taken an action 
that is not in accordance with the provisions of the Standard 
Reinsurance Agreement or any reinsurance agreement with FCIC, except 
compliance issues, it may within 45 days after receipt of such 
determination, request, in writing, the Director of Insurance Services 
to make a final administrative determination addressing the disputed 
issue. The Director of Insurance Services will render the final 
administrative determination of the Corporation with respect to the 
applicable issues.
    (b) If the company believes that the Corporation's compliance review 
findings are not in accordance with the applicable laws, regulations, 
custom or practice of the insurance industry, or FCIC approved policy 
and procedure, it may within 45 days after receipt of such 
determination, request, in writing, the Director of Compliance to make a 
final administrative determination addressing the disputed issue. The 
Director of Compliance will render

[[Page 36]]

the final administrative determination of the Corporation with respect 
to these issues.
    (c) A company may also request reconsideration by the Director of 
Insurance Services of a decision of the Corporation rendered under any 
Corporation bulletin or directive which bulletin or directive does not 
affect, interpret, explain, or restrict the terms of the reinsurance 
agreement. The company, if it disputes the Corporation's determination, 
must request a reconsideraiton of that determination in writing, within 
45 days of the receipt of the determination. The determinations of the 
Director will be final and binding on the company. Such determinations 
will not be appealable to the Board of Contract Appeals.
    (d) Appealable final administrative determinations of the 
Corporation under Sec. 400.169 (a) or (b) may be appealed to the Board 
of Contract Appeals in accordance with the provisions of part 24 of 
title 7, subtitle A, of the Code of Federal Regulations, 7 CFR part 24.

[60 FR 21036, May 1, 1995]



Sec. 400.170  General qualifications.

    To qualify initially or thereafter for a Standard Reinsurance 
Agreement with FCIC, an insurer must:
    (a) Be licensed or admitted in any state, territory, or possession 
of the United States;
    (b) Be licensed or admitted, or use as a policy-issuing Company an 
insurer that is licensed or admitted, in each state from which the 
insurer will cede policies to FCIC for reinsurance;
    (c) Have surplus, as reported in its most recent Annual or Quarterly 
Statutory Financial Statement, that is at least equal to the MPUL for 
the company's estimated retained premium proposed to be reinsured, 
multiplied by the appropriate Minimum Surplus Factor found in the 
Minimum Surplus Table. For the purposes of the Minimum Surplus Table, an 
insurer is considered to issue policies in a state if at least two and 
one-half percent (2.5%) of all its reinsured retained premium is written 
in that state;

                          Minimum Surplus Table
------------------------------------------------------------------------
                                                               Minimum
                                                               surplus
 Number of states in which a company issues FCIC-reinsured      factor
                          policies                           (multiplied
                                                               by MPUL)
------------------------------------------------------------------------
1 through 10...............................................          2.5
11 or more.................................................          2.0
------------------------------------------------------------------------

    (d) Have and meet the ratio requirements of the Gross Premium to 
Surplus and Net Premium to Surplus required ratios and at least ten of 
the fourteen analytical ratios in this section based on the most recent 
Annual Statutory Financial Statement, or comply with Sec. 400.172:

------------------------------------------------------------------------
                   Ratio                          Ratio requirement
------------------------------------------------------------------------
(1) Required:
    (i) Gross Premium to Surplus..........  Less than 900%.
    (ii) Net Premium to Surplus...........  Less than 300%.
(2) Analytical:
    (i) Two-Year Overall Operating Ratio..  Less than 100%.
    (ii) Agents' Balances to Surplus......  Less than 40%.
    (iii) One-Year Change in Surplus......  Greater than -10% and less
                                             than 50%.
    (iv) Two-Year Change in Surplus.......  Greater than -10%.
    (v) Combined Ratio After Policyholder   Less than 115%.
     Dividends.
    (vi) Change in Writing................  Greater than -33% and less
                                             than 33%.
    (vii) Surplus Aid to Surplus..........  Less than 15%.
    (viii) Quick Liquidity................  Greater than 20%.
    (ix) Liabilities to Liquid Asset......  Less than 105%.
    (x) Return on Surplus.................  Greater than -5%.
    (xi) Investment Yield.................  Greater than 4.5% and less
                                             than 10%.
    (xii) One-Year Reserve Development to   Less than 20%.
     Surplus.
    (xiii) Two-Year Reserve Development to  Less than 20%.
     Surplus.
    (xiv) Estimated Current Reserve         Less than 25%.
     Deficiency to Surplus.
------------------------------------------------------------------------

    (e) Submit to FCIC all of the following statements:
    (1) Annual and Quarterly Statutory Financial Statements;
    (2) Statutory Management Discussion & Analysis;
    (3) Most recent State Insurance Department Examination Report;
    (4) Actuarial Opinion of Reserves;
    (5) Annual Audited Financial Report; and

[[Page 37]]

    (6) Any other appropriate financial information or explanation of 
IRIS ratio discrepancies as determined by the company or as requested by 
FCIC.

[60 FR 57903, Nov. 24, 1995]



Sec. 400.171  Qualifying when a state does not require that an Annual Statutory Financial Statement be filed.

    An insurer exempt by the insurance department of the states where 
they are licensed from filing an Annual Statutory Financial Statement 
must, in addition to the requirements of Sec. 400.170 (a), (b), (c) and 
(d), submit an Annual Statutory Financial Statement audited by a 
Certified Public Accountant in accordance with generally accepted 
auditing standards, which if not exempted, would have been filed with 
the insurance department of any state in which it is licensed.

[60 FR 57904, Nov. 24, 1995]



Sec. 400.172  Qualifying with less than two of the required ratios or ten of the analytical ratios meeting the specified requirements.

    An insurer with less than two of the required ratios or ten of the 
analytical ratios meeting the specified requirements in Sec. 400.170(d) 
may qualify if, in addition to the requirements of Sec. 400.170 (a), 
(b), (c) and (e), the insurer:
    (a) Submits a financial management plan acceptable to FCIC to 
eliminate each deficiency indicated by the ratios, or an acceptable 
explanation why a failed ratio does not accurately represent the 
insurer's insurance operations; or
    (b) Has a binding agreement with another insurer that qualifies such 
insurer under this subpart to assume financial responsibility in the 
event of the reinsured company's failure to meet its obligations on FCIC 
reinsured policies.

[60 FR 57904, Nov. 24, 1995]



Sec. 400.173  [Reserved]



Sec. 400.174  Notification of deviation from financial standards.

    An insurer must immediately advise FCIC if it deviates from 
compliance with any of the requirements of this chapter. FCIC may 
require the insurer to update its financial statements during the year. 
FCIC may terminate the reinsurance agreement if the Company is out of 
compliance with the requirements of this chapter.

[52 FR 17543, May 11, 1987. Redesignated at 53 FR 3, Jan. 4, 1988, and 
53 FR 10527, Apr. 1, 1988, as amended at 60 FR 57904, Nov. 24, 1995]



Sec. 400.175  Revocation and non-acceptance.

    (a) FCIC will deny reinsurance to any insurer or will terminate any 
existing reinsurance agreement if any false or misleading statement is 
made in the financial statements or any other document submitted by the 
insurer in connection with its qualification for FCIC reinsurance.
    (b) No policy issued by an insurer subsequent to revocation of a 
reinsurance agreement will be reinsured by FCIC. Policies in effect at 
the time of revocation will continue to be reinsured by FCIC for the 
balance of the crop year then in effect for the applicable crop. 
However, if materially false information is made to the Corporation and 
that information directly affects the ability of the Company to perform 
under the Agreement, or if the Company commits any fraudulent or 
criminal act in relation to the Standard Reinsurance Agreement or any 
policy reinsured under the Agreement, FCIC may require that the Company 
transfer the servicing and contractual right to all business in effect 
and reinsured by the Corporation to the Corporation.

[52 FR 17543, May 11, 1987. Redesignated at 53 FR 3, Jan. 4, 1988, and 
53 FR 10527, Apr. 1, 1988, as amended at 60 FR 57904, Nov. 24, 1995]



Sec. 400.176  State action preemptions.

    (a) No policyholder shall have recourse to any state guaranty fund 
or similar state administered program for crop or premium losses 
reinsured under such Standard Reinsurance Agreement. No assessments for 
such State funds or programs shall be computed or levied on companies 
for or on account of any premiums payable on policies of Multiple Peril 
Crop Insurance reinsured by the Corporation.
    (b) No policy of insurance reinsured by the Corporation and no 
claim, settlement, or adjustment action with respect to any such policy 
shall provide a

[[Page 38]]

basis for a claim of damages against the Company issuing such policy, 
other than damages to which the Corporation would be liable under 
federal law if the Corporation had issued the policy of insurance under 
its direct writing program, unless the claimant establishes in a court 
of competent jurisdiction, or to the satisfaction of the Corporation in 
the event of a settlement, that such damages were caused by the culpable 
failure of the Company to substantially comply with the Corporation's 
procedures or instructions in the handling of the claim or in servicing 
the insured' policy, or unless the Company or its agents were acting 
outside the scope of their authority (apparent or implied) in performing 
or omitting the actions claimed as a basis for the damage action.



Sec. 400.177  [Reserved]



  Subpart M--Agency Sales and Service Contract--Standards for Approval

    Authority: 7 U.S.C. 1506, 1516.

    Source: 53 FR 24015, June 27, 1988, unless otherwise noted.



Sec. 400.201  Applicability of standards.

    Federal Crop Insurance Corporation will offer an Agency Sales and 
Service Contract (the Contract) to private entities meeting the 
requirements set forth in this subpart under which the Corporation will 
insure producers of agricultural commodities. The Contract will be 
consistent with the requirements of the Federal Crop Insurance Act, as 
amended, and the provisions of the regulations of the Corporation found 
at chapter IV of title 7 of the Code of Federal Regulations. The 
Standards contained herein are required for an entity to be a contractor 
under the Contract.



Sec. 400.202  Definitions.

    For the purpose of these Standards:
    (a) Agency Sales and Service Contract or the Contract means the 
written agreement between the Federal Crop Insurance Corporation 
(Corporation) and a private entity (Contractor) for the purpose of 
selling and servicing Federal Crop Insurance policies and includes, but 
is not limited to, the following:
    (1) The Agency Sales and Service Contract;
    (2) Any Appendix to the Agency Sales and Service Contract issued by 
the Corporation;
    (3) The annual approved Plan or Operation; and
    (4) Any amendment adopted by the parties.
    (b) BELL 208B (or compatible) modem--means a modem meeting the 
standards developed by BELL Laboratories for dial-up, half-duplex, 4800 
or 9600 bits per second (bps) transmission of data utilizing 3780 (or 
2780) protocol.
    (c) Contract, the see Agency Sales and Service Contract.
    (d) Contractor's electronic system (system) means the data 
processing hardware and software, data communications hardware and 
software, and printers utilized with the system.
    (e) CPA means a Certified Public Accountant who is licensed as such 
by the State in which the CPA practices.
    (f) CPA Audit means a professional examination conducted by a CPA in 
accordance with generally accepted auditing standards of a Financial 
Statement on the basis of which the CPA expresses an independent 
professional opinion respecting the fairness of presentation of the 
Financial Statement.
    (g) Current Assets means cash and other assets that are reasonably 
expected to be realized in cash or sold or consumed during the normal 
operation cycle of the business or within one year if the operation 
cycle is shorter than one year.
    (h) Current Liabilities means those liabilities expected to be 
satisfied by either the use of assets classified as current in the same 
balance sheet, or the creation of other current liabilities, or those 
expected to be satisfied within a relatively short period of time, 
usually one year.
    (i) Financial Statement means the documents submitted to the 
Corporation by a private entity which portray the financial information 
of the entity. The financial statement must be prepared in accordance 
with Generally Accepted Accounting Principles (GAAP) and reflect the 
financial position in the Statement of Financial Condition or

[[Page 39]]

Balance Sheet; and the result of operations in the Statement of Profit 
and Loss or Income Statement.
    (j) Processing representative means a person or organization 
designated by the Contractor to be responsible for data entry and 
electronic transmission of data contained on crop insurance documents.
    (k) Sales means new applications and renewals of FCIC policies.
    (l) Suspended Data Notice means a notification of a temporary stop 
or delay in the processing of data transmitted to the Corporation by the 
Contractor because the same is incomplete, non-processable, obsolete, or 
erroneous.
    (m) 3780 protocol--means the data communications protocol (standard) 
that is a binary synchronous communications (BSC), International 
Business Systems (IBM)-defined, byte controlled communications protocol, 
using control characters and synchronized transmission of binary coded 
data.



Sec. 400.203  Financial statement and certification.

    (a) An entity desiring to become or continue as a contractor shall 
submit to the Corporation a financial statement which is as of a date 
not more than eighteen (18) months prior to the date of submission.
    (b) The financial statement submitted shall be audited by a CPA (CPA 
Audit); or if a CPA audited financial statement is not available, the 
statement submitted to the Corporation must be accompanied by a 
certification of:
    (1) The owner, if the business entity is a sole proprietorship; or
    (2) At least one of the general partners, if the business entity is 
a partnership; or
    (3) The Chief Executive Officer and Treasurer, if the business 
entity is a Corporation, that said statement fairly represents the 
financial condition of the entity on the date of such certification to 
the Corporation. If the financial statement as certified by the Chief 
Executive Officer and Treasurer, partner, or owner is submitted, a CPA 
audited financial statement must be submitted if subsequently available.



Sec. 400.204  Notification of deviation from standards.

    A Contractor shall advise the Corporation immediately if the 
Contractor deviates from the requirements of these standards. The 
Corporation may require the Contractor to show compliance with these 
standards during the contract year if the Corporation determines that 
such submission is necessary. If the Corporation determines that the 
deviation is temporary, the Corporation may grant a temporary waiver 
pending compliance within a specified period of time. A waiver of any 
provision of these standards will not be granted to an applicant for a 
contract.



Sec. 400.205  Denial or termination of contract and administrative reassignment of business.

    Non-compliance with these standards will result in:
    (a) The denial of a Contract; or
    (b) Termination of an existing Contract.
    In the event of denial or termination of the Contract, all crop 
insurance policies of the Corporation sold by the Contractor and all 
business pertaining thereto may be assumed by the Corporation and may be 
administratively reassigned by the Corporation to another Contractor.



Sec. 400.206  Financial qualifications for acceptability.

    The financial statement of an entity must show total allowable 
assets in excess of liabilities and the ability of the entity to meet 
current liabilities by the use of current assets.



Sec. 400.207  Representative licensing and certification.

    (a) A Contractor must maintain twenty-five (25) licensed and 
certified Contractor Representatives.
    (b) A Contractor's Representative who solicits, sells and services 
FCIC policies or represents the Contractor in solicitation, sales or 
service of such policies must hold a license as issued by the State or 
States in which the policies are issued, which license authorizes the 
sales of insurance in any one or more of the following lines:
    (1) Multiple peril crop insurance;

[[Page 40]]

    (2) Crop hail insurance;
    (3) Casualty insurance;
    (4) Property insurance;
    (5) Liability insurance; or
    (6) Fire insurance and allied lines.
    The Contractor must submit evidence, satisfactory to the 
Corporation, verifying the type of State license held by each 
Representative and the date of expiration of each license.
    (c) A Contractor's Representative must have achieved certification 
by the Corporation for each crop upon which the Representative sells and 
services insurance.



Sec. 400.208  Term of the contract.

    (a) The term of the Contract shall commence on July 1 or when 
signed. The contract will continue from year to year with an annual 
renewal date of July 1 for each succeeding year unless the Corporation 
or the Contractor gives at least ninety (90) days advance notice in 
writing to the other party that the contract is not to be renewed. Any 
breach of the contract, or failure to comply with these Standards, by 
the Contractor, may result in termination of the contract by the 
Corporation upon written notice of termination to the Contractor. That 
termination will be effective thirty (30) days after mailing of the 
notice and termination to the Contractor.
    (b) A Contractor who elects to continue under the Contract for a 
subsequent year must, prior to the month of June, submit a completed 
Plan of Operation which includes the Certifications as required by 
Sec. 400.203 of this subpart. The Contractor may not perform under the 
contract until the Plan of Operation is approved by the Corporation.



Sec. 400.209  Electronic transmission and receiving system.

    Any Contractor under the Contract is required to:
    (a) Adopt a plan for the purpose of transmitting and receiving 
electronically, information to and from the Corporation concerning the 
original executed crop insurance documents;
    (b) Maintain an electronic system which must be tested and approved 
by the Corporation;
    (c) Maintain Corporation approval of the electronic system as a 
condition to the electronic transmission and reception of data by the 
Contractor;
    (d) Utilize the Corporation approved automated data processing and 
electronic data transmission capabilities to process crop insurance 
documents as required herein; and
    (e) Establish and maintain the electronic equipment and computer 
software program capability to:
    (1) Receive and store actuarial data electronically via 
telecommunications utilizing 3780 protocol and utilizing a BELL 208B or 
compatible modem at 4800 bits per second (bps);
    (2) Enter and store information from original crop insurance 
documents into electronic format;
    (3) Verify electronically stored information recorded from crop 
insurance documents with electronically stored actuarial information;
    (4) Compute and print the data elements in the Summary of 
Protection;
    (5) Transmit crop insurance data electronically, via 3780 protocol 
utilizing a BELL 208B or compatible modem at 4800 bps;
    (6) Receive electronic acknowledgements, error messages, and other 
data via 3780 protocol utilizing a BELL 208B or compatible modem at 4800 
bps, and relate error messages to original crop insurance documents; and
    (7) Store backup data and physical documents.

    (The Corporation may approve other compatible specifications if 
accepted by the Corporation and if requested by the Contractor)



Sec. 400.210  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



       Subpart N--Disaster Assistance Act of 1988; Procedures for 
                             Implementation

    Source: 54 FR 24318, June 7, 1989, unless otherwise noted.



Sec. 400.250  General statement.

    The Disaster Assistance Act of 1988, subsequent disaster acts and 
disaster provisions in subsequent acts and the Rural Development Act (7 
U.S.C. 1961 et

[[Page 41]]

seq.) have required that, subject to certain provisions in those 
enactments, procedures on a farm, in order to be eligible to receive 
benefits under the various provisions, would be required to purchase 
Federal crop insurance when the disaster for which benefits are being 
obtained are related to a peril which should be covered under the 
insurance policy. Most of these legislative provisions require that 
regulations be promulgated to provide for a reduction in the commissions 
paid to private insurance agents, brokers, or companies on contracts for 
crop insurance entered into under such disaster provisions. Said 
reductions must be sufficient to reflect that such insurance contracts 
principally involve only a servicing function to be performed by the 
agent, broker, or company.

[58 FR 36593, July 8, 1993]



Sec. 400.251  Purpose and applicability.

    (a) It is the purpose of these regulations to provide the procedures 
for implementing the various disaster acts and disaster provisions which 
require the purchase of crop insurance issued under the Federal Crop 
Insurance Act, by requiring a reduction in the compensation rate to the 
agent, broker, or company under contract or agreement with FCIC.
    (b) The provisions contained in this subpart shall be applicable to 
all holders of an Agency Sales and Service Contract (herein referred to 
as ``agency'') or a Reinsurance Agreement (herein referred to as 
``company'') with FCIC, and shall be applicable on all crop insurance 
contracts for crops entered into to comply with the requirements of 
various disaster acts or provisions requiring the purchase of crop 
insurance issued under the Federal Crop Insurance Act.

[54 FR 24318, June 7, 1989, as amended at 58 FR 36593, July 8, 1993]



Sec. 400.252  Implementation and expense reimbursement.

    Crop insurance coverage, required by various disaster acts or 
disaster provisions to be made available to any producer identified by 
the Agricultural Stabilization and Conservation Service (ASCS) as having 
suffered a crop loss of 65 percent or more, unless the requirement for 
such crop insurance coverage is waived under the provisions of various 
disaster acts or disaster provisions, may be made available through any 
agent or company under the terms and conditions of the contract or 
agreement such agent or company may have with FCIC. Agents under an 
Agency Sales and Service Contract and companies under a Reinsurance 
Agreement with FCIC are required to sign an amendment to the contract or 
agreement agreeing to a reduction in expense reimbursement for evidence 
of a policy of crop insurance issued under the requirements of various 
disaster acts or disaster provisions. Such expense reimbursement:
    (a) Will not be reduced if the producer:
    (1) Had crop insurance under the Federal Crop Insurance Act during 
the crop year for which the payment or other benefit is being sought 
under the various disaster acts or disaster provisions and said 
insurance has been continued into the next crop year;
    (2) Furnishes evidence of insurance coverage (copy of the completed, 
filed application or policy confirmation) for the next crop year for the 
crop for which the payment or other benefit under various disaster acts 
or disaster provisions is being requested, to the ASCS county office at 
the time of application for the disaster payment or other benefit under 
various disaster acts or disaster provisions; or
    (3) Has, under the provisions of various disaster acts or disaster 
provisions, received a waiver of the requirement to obtain crop 
insurance coverage.
    (b) Will be reduced in the amount of 1\1/2\ percent of base premium 
when the producer, applying for disaster payment at the ASCS Office 
without evidence of the required crop insurance coverage, is required by 
the ASCS or the Farmer's Home Administration (FmHA) county committee to 
obtain such crop insurance coverage for next crop year in order to 
receive the payment or other benefit sought under various disaster acts 
or disaster provisions.

[54 FR 24318, June 7, 1989, as amended at 58 FR 36593, July 8, 1993]

[[Page 42]]



 Subpart O--Non-Standard Underwriting Classification System Regulations 
                 for the 1991 and Succeeding Crop Years

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 55 FR 32595, Aug. 10, 1990, unless otherwise noted.



Sec. 400.301  Basis, purpose, and applicability.

    The regulations contained in this subpart are issued pursuant to the 
Federal Crop Insurance Act, as amended (7 U.S.C. 1501 et seq.), to 
prescribe the procedures for nonstandard determinations and the 
assignment of assigned yields or premium rates in conformance with the 
intent of section 508 of the Act (7 U.S.C. 1508). These regulations are 
applicable to all policies of insurance insured or reinsured by the 
Corporation under the Act and on those policies where the insurance 
coverage or indemnities are based on determinations applicable to the 
individual insured. These regulations will not be applicable to any 
policy where the amount of coverage or indemnities are based on the 
experience of the area.

[62 FR 22876, Apr. 28, 1997]



Sec. 400.302  Definitions.

    Act--means Federal Crop Insurance Act as amended (7 U.S.C. 1501 et 
seq.).
    Actively engaged in farming means a person who, in return for a 
share of profits and losses, makes a contribution to the production of 
an insurable crop in the form of capital, equipment, land, personal 
labor, or personal management.
    Actual Yield--means total harvested production of a crop divided by 
the number of acres on which the crop was planted. For insured acres, 
actual yield is the total production to count as defined in the 
insurance policy, divided by insured acres.
    Assigned yield--means units of crop production per acre 
administratively assigned by the Corporation for the purpose of 
determining insurance coverage.
    Corporation--means the Federal Crop Insurance Corporation.
    Cumulative earned premium rate--is the total premium earned for all 
years in the base period, divided by the total liability for all years 
in the base period with the result expressed as a percentage.
    Cumulative loss ratio--means the ratio of total indemnities to total 
earned premiums during the base period expressed as a decimal.
    Earned premium means premium earned (both the amount subsidized and 
the amount paid by the producer, but excluding any amount of the subsidy 
attributed to the operating and administrative expenses of the insurance 
provider) for a crop under a policy insured or reinsured by the 
Corporation.
    Earned premium rate--means premium earned divided by liability and 
expressed as a percentage.
    Entity--means a person as defined in this subpart other than an 
individual.
    Indemnified loss means a loss applicable for the policy for any year 
during the NCS base period for which the total indemnity exceeds the 
total earned premium. If the person has insurance for the crop in more 
than one county for any crop year, indemnities and premiums will be 
accumulated for all counties for each crop year to determine an 
indemnified loss.
    Insurance experience means earned premiums, indemnities paid (but 
not including replant payments), and other data for the crop (after 
applicable adjustments), resulting from all of the insured's crop 
insurance policies insured or reinsured by the Corporation for one or 
more crop years and will include all information from all counties in 
which the person was insured.
    Loss ratio--means the ratio of indemnity to earned premium expressed 
as a decimal.
    NCS means nonstandard classification system.
    NCS base period means the 10 consecutive crop years (as defined in 
the crop policy) ending 2 crop years prior to the crop year in which the 
NCS classification becomes effective for all crops, except those 
specified on the Special Provisions. For these excepted crops, the NCS 
base period means the 10 consecutive crop years ending 3 crop years 
prior to the crop year in which the NCS classification becomes 
effective. For

[[Page 43]]

example: An NCS classification effective for the 1996 crop year against 
a producer of citrus production in Arizona, California, and Texas, or 
sugarcane would have a NCS base period that includes the 1984 through 
1993 crop years. An NCS classification effective for the 1996 crop year 
against a producer of all other crops would have a NCS base period that 
includes the 1985 through 1994 crop years.
    Person--means an individual, partnership, association, corporation, 
estate, trust, or other legal entity, and whenever applicable, a State 
or a political subdivision, or agency of a state.
    Substantial beneficial interest--means an interest of 10 percent or 
more. In determining whether such an interest equals at least 10 
percent, all interests which are owned directly or indirectly through 
such means as ownership of shares in a corporation which owns the 
interest will be taken into consideration.

[55 FR 32595, Aug. 10, 1990, as amended at 62 FR 22876, Apr. 28, 1997]



Sec. 400.303  Initial selection criteria.

    (a) Nonstandard classification procedures in this subpart initially 
apply when all of the following insurance experience criteria (including 
any applicable adjustment in Sec. 400.303(d)) for the crop have been 
met:
    (1) Three (3) or more indemnified losses during the NCS base period;
    (2) Cumulative indemnities in the NCS base period that exceed 
cumulative premiums during the same period by at least $500;
    (3) The result of dividing the number of indemnified losses during 
the NCS base period by the number of years premium is earned for that 
period equals .30 or greater; and
    (4) Either of the following apply:
    (i) The natural logarithm of the cumulative earned premium rate 
multiplied by the square root of the cumulative loss ratio equals 2.00 
or greater; or
    (ii) Five (5) or more indemnified losses have occurred during the 
NCS base period and the cumulative loss ratio equals or exceeds 1.50.
    (b) The minimum standards provided in paragraphs (a) (2), (3), and 
(4) of this section may be increased in a specific county if that 
county's overall insurance experience for the crop is substantially 
different from the insurance experience for which the criteria was 
determined. The increased standard will apply until the conditions 
requiring the increase no longer apply. Any change in the standards will 
be contained in the Special Provisions for the crop.
    (c) Selection criteria may be applied on the basis of insurance 
experience of a person, insured acreage, or the combination of both.
    (1) Insurance experience of a person will include:
    (i) Insurance experience of the person;
    (ii) Insurance experience of other insured entitites in which the 
person had substantial beneficial interest if the person was actively 
engaged in farming of the insured crop by virtue of the person's 
interest in those insured entities;
    (iii) Insurance experience of a spouse and minor children if the 
person is an individual and the spouse and minor children are considered 
the same as the individual under Sec. 400.306.
    (2) Insurance experience of insured acreage includes all insurance 
experience during the base period resulting from the production of the 
insured crop on the acreage.
    (3) Where insurance experience is based on a combination of person 
and insured acreage, the insurance experience will include the 
experience of the person as defined in paragraph (b) of this section (1) 
only on the specific insured acreage during the base period.
    (d) Insurance experience for the crop will be adjusted, by county 
and crop year, to discount the effect of indemnities caused by 
widespread adverse growing conditions. Adjustments are determined as 
follows:
    (1) Determine the average yield for the county using the annual 
county crop yields for the previous 20 crop years, unless such data is 
not available;
    (2) Determine the normal variability in the average yield for the 
county, expressed as the standard deviation;
    (3) Subtract the result of Sec. 400.303(d)(2) from 
Sec. 400.303(d)(1);
    (4) Divide the annual crop yield for the county for each crop year 
in the

[[Page 44]]

NCS base period by the result of Sec. 400.303(d)(3), the result of which 
may not exceed 1.0;
    (5) Subtract the result of Sec. 400.303(d)(4) for each crop year 
from 1.0;
    (6) Multiply the result of Sec. 400.303(d)(5) by the liability for 
the crop year; and
    (7) Subtract the result of Sec. 400.303(d)(6) from any indemnity for 
that crop year.
    (e) FCIC may substitute the crop yields of a comparable crop in 
determining Sec. 400.303(d) (1) and (2), or may adjust the average yield 
or the measurement of normal variability for the county crop, or any 
combination thereof, to account for trends or unusual variations in 
production of the county crop or if the availability of yield and loss 
data for the county crop is limited. Information about how these 
determinations are made is available by submitting a request to the FCIC 
Regional Service Office for the producer's area. Alternate methods of 
determining the effects of adverse growing conditions on insurance 
experience may be implemented by FCIC if allowed in the Special 
Provisions.

[55 FR 32595, Aug. 10, 1990, as amended at 62 FR 22876, Apr. 28, 1997]



Sec. 400.304  Nonstandard Classification determinations.

    (a) Nonstandard Classification determinations can affect a change in 
assigned yields, premium rates, or both from those otherwise prescribed 
by the insurance actuarial tables.
    (b) Changes of assigned yields based on insurance experience of 
insured acreage (or of a person on specific insured acreage) will be 
based on the simple average of available actual yields from the insured 
acreage during the base period.
    (c) Changes of assigned yields based on insurance experience of a 
person without regard to any specific insured acreage will be determined 
by an assigned yield factor calculated by multiplying excess loss cost 
ratio by loss frequency and subtracting that product from 1.00 where:
    (1) Excess loss cost ratio is total indemnities divided by total 
liabilities for all years of insurance experience in the base period and 
the result of which is then reduced by the cumulative earned premium 
rate, expressed as a decimal, and
    (2) Loss frequency is the number of crop years in which an indemnity 
was paid divided by the number of crop years in which premiums were 
earned during the base period.
    (d) Changes of premium rates will be made to reflect premium rates 
that would have resulted in insurance experience during the base period 
with a loss ratio of 1.00 but:
    (1) A higher loss ratio than 1.00 may be used for premium rate 
determinations provided that the higher loss ratio is applied uniformly 
in a county; and
    (2) If a Nonstandard Classification change has been made to current 
assigned yields, insurance experience during the base period will be 
adjusted to reflect the affects of changed assigned yields before 
changes of premium rates are calculated based on that experience.
    (e) Once selection criteria have been met in any year, Nonstandard 
Classification adjustments will be made from year to year until no 
further changes are necessary in assigned yields or premium rates under 
the conditions set forth in Sec. 400.304(f). In determining whether 
further changes are necessary, the eligibility criteria will be 
recomputed each subsequent year using the premium rates and yields which 
would have been applicable had this part not been in effect.
    (f) Nonstandard Classification changes will not be made that:
    (1) Increase assigned yields or decrease premium rates from those 
otherwise assigned by the actuarial tables, or
    (2) Result in less than a 10 percent decrease in assigned yields or 
less than a 10 percent increase in premium rates from those otherwise 
assigned by the actuarial tables.



Sec. 400.305  Assignment of Nonstandard Classifications.

    (a) Assignment of a Nonstandard Classification of assigned yields, 
assigned yield factors, or premium rates shall be made on forms approved 
by the

[[Page 45]]

Corporation and included in the actuarial tables for the county.
    (b) Nonstandard classification assignment will be made each year, 
for the year identified on the assignment forms, and are not subject to 
change under the provisions of this subpart by the Corporation for that 
year when included in the actuarial tables for the county, except as a 
result of a request for reconsideration as provided in section 400.309, 
or as the result of appeals under 7 CFR part 11.
    (c) A nonstandard classification may be assigned to identified 
insurable acreage; a person; or to a combination of person and 
identified acreage for a crop or crop practice, type, variety, or crop 
option or amendment whereby:
    (1) Classifications assigned to identified insurable acreage apply 
to all acres of the insured crop grown on the identified acreage;
    (2) Classifications assigned to a person apply to all insurable 
acres of the insured crop on which the person and any entity in which 
the person has substantial beneficial interest is actively engaged in 
farming; and
    (3) Classifications assigned to a combination of a person and 
identified insurable acreage will only apply to those acres of the 
insured crop grown on the identified acreage on which the named person 
is actively engaged in producing such crop.

[55 FR 32595, Aug. 10, 1990, as amended at 62 FR 22877, Apr. 28, 1997]



Sec. 400.306  Spouses and minor children.

    (a) The spouse and minor children of an individual are considered to 
be the same as the individual for purposes of this subpart except that:
    (1) The spouse who was actively engaged in farming in a separate 
farming operation prior to their marriage will be a separate person with 
respect to that separate farming operation so long as that operation 
remains separate and distinct from any farming operation conducted by 
the other spouse;
    (2) A minor child who is actively engaged in farming in a separate 
farming operation will be a separate person with respect to that 
separate farming operation if:
    (i) The parent or other entity in which the parent has a substantial 
beneficial interest does not have any interest in the minor's separate 
farming operation or in any production from such operation;
    (ii) The minor has established and maintains a separate household 
from the parent;
    (iii) The minor personally carries out the farming activities with 
respect to the minor's farming operation; and
    (iv) The minor establishes separate accounting and recordkeeping for 
the minor's farming operation.
    (b) An individual shall be considered to be a minor until the age of 
18 is reached. Court proceedings conferring majority on an individual 
under 18 years of age will not change such individual's status as a 
minor.



Sec. 400.307  Discontinuance of participation.

    If the person has discontinued participation in the crop insurance 
program, the person will still be included on the NCS list in the county 
until the person has discontinued participation as a policyholder or a 
person with a substantial beneficial interest in a policyholder for at 
least 10 consecutive crop years. The most recent nonstandard 
classification assigned will be continued from year to year until 
participation has been renewed for at least one crop year and at least 
three years of insurance experience have occurred in the current base 
period. A nonstandard classification will no longer be applicable to the 
person or the person on identified acreage if the Corporation determines 
the person is deceased.

[62 FR 22877, Apr. 28, 1997]



Sec. 400.308  Notice of Nonstandard Classification.

    (a) The Corporation will give written notice to all persons to whom 
a Nonstandard Classification will be assigned. The notice will give the 
Nonstandard Classification and the person's rights and responsibilities 
according to this subpart.
    (b) The person, upon receiving notice from the Corporation, will be 
responsible for giving notice of the Nonstandard Classification to any 
other person with an insurable interest affected by the classification. 
The person

[[Page 46]]

will give notice to any other affected person:
    (1) Prior to the sales closing date if the other affected person has 
an established insurable interest at the time the classified person is 
notified by the Corporation; or
    (2) Prior to the Classified person's establishing an insurable 
interest of another person that will be affected by the classification.



Sec. 400.309  Requests for reconsideration.

    (a) Any person to be assigned a nonstandard classification under 
this subpart will be notified of and allowed not less that 30 days from 
the date notice is received to request reconsideration before the 
nonstandard classification becomes effective. The request will be 
considered to have been made when received, in writing, by the 
Corporation.
    (b) Upon receipt of a timely request for reconsideration from the 
person to whom the classification will be assigned, the Corporation 
will:
    (1) Review all information supplied by, and respond to all questions 
raised by the individual, or
    (2) In the absence of information and questions, review insurance 
experience and determinations for compliance with this subpart and 
report review results to the individual requesting reconsideration.
    (c) Upon review of a request for reconsideration, the classification 
to be assigned will be corrected for:
    (1) Errors and omissions in insurance experience;
    (2) Incorrect calculations under procedures in this subpart, and
    (3) Typographical errors.
    (d) If the review finds no cause for change, the classification will 
be assigned and placed on file in the actuarial tables for the county.
    (e) Any person not satisfied by a determination of the Corporation 
upon reconsideration may further appeal under the provisions of 7 CFR 
part 11.

[55 FR 32595, Aug. 10, 1990, as amended at 62 FR 22877, Apr. 28, 1997]



           Subpart P--Preemption of State Laws and Regulations

    Authority: 7 U.S.C. 1506, 1516.

    Source: 55 FR 23069, June 6, 1990, unless otherwise noted.



Sec. 400.351  Basis and applicability.

    The regulations contained in this subpart are issued pursuant to the 
Federal Crop Insurance Act, as amended (7 U.S.C. 1501 et seq.) (the 
Act), to prescribe the procedures for Federal preemption of State laws 
and regulations not consistent with the purpose, intent, or authority of 
the Act. These regulations are applicable to all policies of insurance, 
insured or reinsured by the Corporation, contracts, agreements, or 
actions authorized by the Act and entered into or issued by FCIC.



Sec. 400.352  State and local laws and regulations preempted.

    (a) No State or local governmental body or non-governmental body 
shall have the authority to promulgate rules or regulations, pass laws, 
or issue policies or decisions that directly or indirectly affect or 
govern agreements, contracts, or actions authorized by this part unless 
such authority is specifically authorized by this part or by the 
Corporation.
    (b) The following is a non-inclusive list of examples of actions 
that State or local governmental entities or non-governmental entities 
are specifically prohibited from taking against the Corporation or any 
party that is acting pursuant to this part. Such entities may not:
    (1) Impose or enforce liens, garnishments, or other similar actions 
against proceeds obtained, or payments issued in accordance with the 
Federal Crop Insurance Act, these regulations, or contracts or 
agreements entered into pursuant to these regulations;
    (2) Tax premiums associated with policies issued hereunder;
    (3) Exercise approval authority over policies issued;
    (4) Levy fines, judgments, punitive damages, compensatory damages, 
or judgments for attorney fees or other costs against companies, 
employees of companies including agents and loss adjustors, or Federal 
employees arising out of actions or inactions on the part of such 
individuals and entities authorized or required under the Federal Crop 
Insurance Act, the regulations, any

[[Page 47]]

contract or agreement authorized by the Federal Crop Insurance Act or by 
regulations, or procedures issued by the Corporation (nothing herein is 
intended to preclude any action on the part of any authorized State 
regulatory body or any State court or any other authorized entity 
concerning any actions or inactions on the part of the agent, company or 
employee of any company whose action or inaction is not authorized or 
required under the Federal Crop Insurance Act, the regulations, any 
contract or agreement authorized by the Federal Crop Insurance Act or by 
regulations or procedures issued by the Corporation); or
    (5) Assess any tax, fee, or amount for the funding or maintenance of 
any State or local insolvency pool or other similar fund.
    The preceding list does not limit the scope or meaning of paragraph 
(a) of this section.



Subpart Q--General Administrative Regulations; Collection and Storage of 
   Social Security Account Numbers and Employer Identification Numbers

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 57 FR 46297, Oct. 8, 1992, unless otherwise noted.



Sec. 400.401  Basis and purpose and applicability.

    (a) The regulations contained in this subpart are issued pursuant to 
the Act to prescribe procedures for the collection, use, and 
confidentiality of Social Security Numbers (SSN) and Employer 
Identification Numbers (EIN) and related records.
    (b) These regulations are applicable to:
    (1) All holders of crop insurance policies issued by FCIC under the 
Act and sold and serviced by local FSA offices.
    (2) All holders of crop insurance policies sold by insurance 
providers and all insurance providers, their contractors and 
subcontractors, including past and present officers and employees of 
such companies, their contractors and subcontractors.
    (3) Any agent, general agent, or company, or any past or present 
officer, employee, contractor or subcontractor of such agent, general 
agent, or company under contract to FCIC or an insurance provider for 
loss adjustment or any other purpose related to the crop insurance 
programs insured or reinsured by FCIC; and
    (4) All past and present officers, employees, elected officials, 
contractors, and subcontractors of FCIC and FSA.

[57 FR 46297, Oct. 8, 1992, as amended at 62 FR 28608, May 27, 1997]



Sec. 400.402  Definitions.

    Act--The Federal Crop Insurance Act, as amended (7 U.S.C. 1501 et 
seq.).
    Applicant--A person who has submitted an application for crop 
insurance coverage under the Act.
    Authorized person--Any current or past officer, employee, elected 
official, general agent, contractor, or loss adjuster of FCIC, the 
insurance provider, or any other government agency whose duties require 
access to administer the Act.
    Disposition of records--The act of removing and disposing of records 
containing a participant's SSN or EIN by FCIC, or the insurance 
provider.
    FCIC--The Federal Crop Insurance Corporation of the United States 
Department of Agriculture or any successor agency.
    FSA--The Farm Service Agency of the United States Department of 
Agriculture, or a successor agency.
    Insurance provider--A private insurance company approved by FCIC, or 
a local FSA office providing crop insurance coverage to producers 
participating in any program administered under the Act.
    Past officers and employees--Any officer or employee of FCIC or the 
insurance provider who leaves the employ of FCIC or the insurance 
provider subsequent to the effective date of this rule.
    Person--An individual, partnership, association, corporation, 
estate, trust, or other legal entity, and whenever applicable, a state, 
political subdivision, or an agency of a state.
    Policyholder--An applicant whose application for insurance under the 
crop insurance program has been accepted by FCIC or the insurance 
provider.

[[Page 48]]

    Retrieval of records--Retrieval of a person's records by that 
person's SSN or EIN, or name.
    Safeguards--Methods of security to be employed by FCIC or the 
insurance provider to protect a participant's SSN or EIN from unlawful 
disclosure and access.
    Storage--The secured storing of records kept by FCIC or the 
insurance provider on computer disks or drives, computer printouts, 
magnetic tape, index cards, microfiche, microfilm, etc.
    Substantial beneficial interest--Any person having an interest of at 
least 10 percent in the applicant or policyholder.
    System of records--Records established and maintained by FCIC or the 
insurance provider containing SSN or EIN data, name, address, city and 
State, applicable policy numbers, and other information related to 
multiple peril crop insurance policies as required by FCIC, from which 
information is retrieved by a personal identifier including, but not 
limited to the SSN, EIN, or name.

[62 FR 28608, May 27, 1997]



Sec. 400.403  Required system of records.

    Insurance providers are required to implement a system of records 
for obtaining, using, and storing documents containing SSN or EIN data 
before they accept or receive any applications for insurance. This data 
should include: name; address; city and state; SSN or EIN; and policy 
numbers which have been used by FCIC or the insurance provider.

[62 FR 28608, May 27, 1997]



Sec. 400.404  Policyholder responsibilities.

    (a) The policyholder or applicant for crop insurance must provide a 
correct SSN or EIN to FCIC or the insurance provider to be eligible for 
insurance. The SSN or EIN will be used by FCIC and the insurance 
provider in:
    (1) Determining the correct parties to the agreement or contract;
    (2) Collecting premiums or other amounts due FCIC or the insurance 
provider;
    (3) Determining the amount of indemnities;
    (4) Establishing actuarial data on an individual policyholder basis; 
and
    (5) Determining eligibility for crop insurance program participation 
or other United States Department of Agriculture benefits.
    (b) If the policyholder or applicant for crop insurance does not 
provide the correct SSN or EIN on the application and other forms where 
such SSN or EIN is required, FCIC or the reinsured company shall reject 
the application.
    (c) The policyholder or applicant is required to provide to FCIC or 
the insurance provider, the name and SSN or EIN of any individual or 
other entity:
    (1) holding or acquiring a substantial beneficial interest in such 
policyholder or applicant; or
    (2) having any interest in the policyholder or applicant and 
receiving separate benefits under another United States Department of 
Agriculture program as a direct result of such interest.
    (d) If a policyholder or applicant is using an EIN for a policy in 
an individual person's name, the SSN of the policyholder or applicant 
must also be provided.

[62 FR 28608, May 27, 1997]



Sec. 400.405  Agent and loss adjuster responsibilities.

    (a) The agent or loss adjuster shall provide his or her correct SSN 
to FCIC or the insurance provider, whichever is applicable, to be 
eligible to participate in the crop insurance program. The SSN will be 
used by FCIC and the insurance provider in establishing a database for 
the purposes of:
    (1) Identifying agents and loss adjusters on an individual basis;
    (2) Evaluating agents and loss adjusters to determine level of 
performance;
    (3) Determining eligibility for program participation; and
    (4) Collection of any amount which may be owed by the agent and loss 
adjuster to the United States.
    (b) If the loss adjuster contracting with FCIC to participate in the 
crop insurance program does not provide his or her correct SSN on forms 
or contracts where such SSN is required, the loss adjuster's contract 
will be cancelled effective on the date of refusal and the loss adjuster 
will be subject to

[[Page 49]]

suspension and debarment in accordance with the suspension and debarment 
regulations of the United States Department of Agriculture.
    (c) If the agent or loss adjuster contracting with an insurance 
provider, who is also a private insurance company, to participate in the 
crop insurance program does not provide his or her correct SSN on forms 
or contracts where such SSN is required, the premium subsidy payable for 
administrative and operating expenses under the Standard Reinsurance 
Agreement, or any other reinsurance agreement, will not be paid on those 
policies lacking the correct SSN.

[62 FR 28609, May 27, 1997]



Sec. 400.406  Insurance provider responsibilities.

    The insurance provider is required to collect and record the SSN or 
EIN on each application or on any other form required by FCIC.

[62 FR 28609, May 27, 1997]



Sec. 400.407  Restricted access.

    The Manager, other officer, or employee of FCIC or an authorized 
person may have access to the SSNs and EINs obtained pursuant to this 
subpart, only for the purpose of establishing and maintaining a system 
of records necessary for the effective administration of the Act.

[62 FR 28609, May 27, 1997]



Sec. 400.408  Safeguards and storage.

    Records must be maintained in secured storage with proper safeguards 
sufficient to enforce the restricted access provisions of this subpart.

[62 FR 28609, May 27, 1997]



Sec. 400.409  Unauthorized disclosure.

    Anyone having access to the records identifying a participant's SSN 
or EIN will abide by the provisions of section 205(c)(2)(C) of the 
Social Security Act (42 U.S.C. 405(c)(2)(C), and section 6109(f), 
Internal Revenue Code of 1986 (26 U.S.C. 6109(f) and the Privacy Act of 
1974 (5 U.S.C. 552a). All records are confidential, and are not to be 
disclosed to unauthorized personnel.

[57 FR 46297, Oct. 8, 1992. Redesignated at 62 FR 28608, May 27, 1997]



Sec. 400.410  Penalties.

    Unauthorized disclosure of SSN's or EIN's by any person may subject 
that person, and the person soliciting the unauthorized disclosure, to 
civil or criminal sanctions imposed under various Federal statutes, 
including 26 U.S.C. 7613, 5 U.S.C. 552a, and 42 U.S.C. 408.

[57 FR 46297, Oct. 8, 1992. Redesignated at 62 FR 28608, May 27, 1997]



Sec. 400.411  Obtaining personal records.

    Policyholders, agents, and loss adjusters in the crop insurance 
program will be able to review and correct their records as provided by 
the Privacy Act. Records may be requested by:
    (a) Mailing a signed written request to the headquarters office of 
FCIC; the FCIC Regional Service Office, or the insurance provider; or
    (b) Making a personal visit to the above mentioned establishments 
and showing valid identification.

[57 FR 46297, Oct. 8, 1992. Redesignated and amended at 62 FR 28608, 
28609, May 27, 1997]



Sec. 400.412  Record retention.

    (a) FCIC or the insurance provider will retain all records of 
policyholders for a period of not less than 3 years from the date of 
final action on a policy for the crop year, unless further maintenance 
of specific records is requested by FCIC. Final actions on insurance 
policies include conclusion of insurance events, such as the latest of 
termination of the policy, completion of loss adjustment, or 
satisfaction of claim.
    (b) The statute of limitations for FCIC contract claims may permit 
litigation to be instituted after the period of record retention. 
Destruction of records prior to the expiration of the statute of 
limitations will not provide a defense to any action by FCIC against any 
private insurance company.

[62 FR 28609, May 27, 1997]

[[Page 50]]



Sec. 400.413  OMB control numbers.

    The collecting of information requirements in this subpart has been 
approved by the Office of Management and Budget and assigned OMB control 
number 0563-0047.

[62 FR 28609, May 27, 1997]



                          Subpart R--Sanctions

    Authority: 7 U.S.C. 1506(l).

    Source: 58 FR 53110, Oct. 14, 1993, unless otherwise noted.



Sec. 400.451  General.

    (a) The Federal Crop Insurance Corporation (FCIC) has implemented a 
system of sanctions to prevent waste, fraud, and abuse within its 
programs and insurance delivery systems. Such sanctions include civil 
penalties and disqualification from the crop insurance program under the 
Federal Crop Insurance Act, 7 U.S.C. 1506(m); government wide debarment 
and suspension; and civil penalties and assessments under the Program 
Fraud Civil Remedies Act, 31 U.S.C. 3801--31 U.S.C. 3812.
    (b) The provisions of this subpart apply to all contracts and 
agreements to which FCIC is a party unless otherwise specifically 
provided for in this subpart, including those in which FCIC provides 
administrative expense reimbursement, premium subsidy, or reinsurance 
benefits.
    (c) The provisions of this subpart are in addition to any other 
sanctions specifically provided in applicable contracts and agreements.
    (d) This subpart is applicable to any act or omission by any 
affected party after October 14, 1993.



Sec. 400.452  Definitions.

    For purposes of this subpart, a person means an individual, 
partnership, association, corporation, estate, trust, or other business 
enterprise or legal entity, and wherever applicable, a state, a 
political subdivision of a state, or any agency thereof.



Sec. 400.453  Exhaustion of administrative remedies.

    All administrative remedies contained herein or incorporated herein 
by reference must be exhausted before Judicial Review in the United 
States Courts may be sought, unless review is specifically required by 
statute.



Sec. 400.454  Civil penalties.

    (a) Any person who willfully and intentionally provides any 
materially false or inaccurate information to FCIC or to any approved 
insurance provider reinsured by FCIC with respect to an insurance plan 
or policy issued under the authority of the Federal Crop Insurance Act, 
as amended, (7 U.S.C. 1501 et seq.) may be subject to a civil fine of up 
to an amount specified in Sec. 3.91(b)(7) of this title and 
disqualification from participation in:
    (1) The catastrophic risk protection plan of insurance and the 
noninsured crop disaster assistance program for a period not to exceed 
two (2) years; or
    (2) Any plan of insurance providing protection in excess of that 
provided under the catastrophic risk protection plan of insurance for a 
period not to exceed ten (10) years.
    (b) FCIC may make the payment of a civil penalty under this section 
a prior condition for the issuance, renewal, restoration, or continuing 
validity of any crop insurance policy or other approval.
    (c) FCIC may compromise, modify, settle, collect, or remit with or 
without conditions, any civil penalty which is subject to imposition or 
which has been imposed under this section whenever it considers it to be 
appropriate or advisable.
    (d) If a director, officer, or agent of a corporation provides false 
or inaccurate information, they may be separately subject to the fine 
specified in paragraph (a) of this section without regard to any 
penalties to which the corporation may be subject.
    (e) The liability of any person for any penalty under this subpart 
or any related charges arising in connection therewith shall be in 
addition to any other liability of such person under any civil or 
criminal fraud statute or any other statute or provision of law.
    (f) Proceedings under this Sec. 400.454 will be in accordance with 
subpart H of 7 CFR part 1, ``Rules of Practice Governing Formal 
Adjudicatory Proceedings Instituted by the Secretary under

[[Page 51]]

Various Statutes,'' by which the Manager, FCIC, shall initiate 
proceedings by filing a complaint with the Hearing Clerk, United States 
Department of Agriculture.

[58 FR 53110, Oct. 14, 1993, as amended at 60 FR 37323, July 20, 1995; 
62 FR 40928, July 31, 1997]



Sec. 400.455  Governmentwide debarment and suspension (procurement).

    (a) This section prescribes the terms and conditions under which 
persons or business entities may be debarred or suspended by FCIC from 
contracting with the Federal government.
    (b) This section is in accordance with 48 CFR part 9, subpart 9.4 
and 48 CFR part 409, subpart 409.4 and shall be applicable to all FCIC 
debarment and suspension proceedings undertaken pursuant to the Federal 
Acquisition Regulations, except that the authority to debar or suspend 
is reserved to the Manager, FCIC, or the Manager's designee.
    (c) Any individual or entity suspended or debarred under the 
provisions of 48 CFR part 9, subpart 9.4 will not be eligible to 
contract with FCIC or be employed by or contract with any insurance 
company that sells or adjusts FCIC's crop insurance contracts or which 
company's crop insurance contracts are reinsured by FCIC. FCIC may waive 
this provision if it is satisfied that the insurance company has taken 
sufficient action to insure that the suspended or debarred entity or 
individual will not be involved, in any way, with FCIC or FCIC reinsured 
crop insurance contracts.



Sec. 400.456  Governmentwide debarment and suspension (nonprocurement).

    (a) This section prescribes the terms and conditions under which 
individuals or entities may be debarred or suspended by FCIC from 
participation in Federal assistance and benefits under Federal programs 
and activities.
    (b) This section, in accordance with 7 CFR part 3017, shall be 
applicable to all FCIC debarment and suspension proceedings other than 
those undertaken pursuant to the Federal Acquisition Regulations.
    (c) Proceedings under this section are not applicable to 
determinations of eligibility under the provisions of the crop insurance 
contracts or determinations to be made under 7 CFR 400.454.
    (d) The Manager, FCIC, shall be the debarring and suspending 
official for all debarment or suspension proceedings undertaken by FCIC 
under the provisions of 7 CFR part 3017.



Sec. 400.457  Program Fraud Civil Remedies Act.

    (a) This section is in accordance with the Program Fraud Civil 
Remedies Act of 1986 (31 U.S.C. 3801-U.S.C. 3831) which provides for 
civil penalties and assessments against persons who make, submit, or 
present, or cause to be made, submitted, or presented, false, 
fictitious, or fraudulent claims or written statements to Federal 
authorities or to their agents.
    (b) Proceedings under this section will be in accordance with 
subpart L of 7 CFR part 1, ``Procedures Related to Administrative 
Hearings Under the Program Fraud Civil Remedies Act of 1986.''
    (c) The Director, Appeals and Litigation Staff, FCIC, or the 
Director's designee, is authorized to serve as Agency Fraud Claims 
Officer for the purpose of implementing the requirements of this 
section.



Sec. 400.458  Scheme or device.

    (a) In addition to the penalties specified in this part, if a person 
has knowingly adopted a material scheme or device to obtain catastrophic 
risk protection, other plans of insurance coverage, or noninsured 
assistance benefits to which the person is not entitled, has evaded the 
provisions of the Federal Crop Insurance Act, or has acted with the 
purpose of evading the provisions of the Federal Crop Insurance Act, the 
person shall be ineligible to receive any and all benefits applicable to 
any crop year for which the scheme or device was adopted.
    (b) A scheme or device may include, but is not limited to, creating 
or using another entity, or concealing or providing false information 
with respect to your interest in the policyholder, to evade:
    (1) Suspension, debarment, or disqualification from participation in 
the program;

[[Page 52]]

    (2) The assignment of the nonstandard classification system; or
    (3) Ineligibility for a delinquent debt owed to FCIC or the 
insurance company.

[60 FR 37324, July 20, 1995]



Sec. 400.459  Indebtedness.

    Any person who owes a debt to FCIC, or an approved insurance 
provider, arising from any program administered under the Act, and that 
debt is delinquent, will be ineligible to participate in all such 
programs until the debt is paid in full or the person enters into an 
agreement, acceptable to FCIC or the approved insurance provider, to 
repay the debt. If the person provides adequate evidence to demonstrate 
that the amount of debt is in dispute, the person's application will be 
accepted or their insurance will remain in effect, but no indemnity 
payment will be made, until the disputed issue is resolved between that 
person and FCIC or the approved insurance provider through the available 
appeal process.

[60 FR 51321, Oct. 2, 1995]



Secs. 400.460--400.499  [Reserved]



Sec. 400.500  OMB control numbers.

    Office of Management and Budget (OMB) control numbers are contained 
in subpart H of 7 CFR part 400.



                          Subpart S  [Reserved]



  Subpart T--Federal Crop Insurance Reform, Insurance Implementation; 
        Regulations for the 1999 and Subsequent Reinsurance Years

    Authority: 7 U.S.C. 1506(l) and 1506(p).

    Source: 61 FR 42975, Aug. 20, 1996, unless otherwise noted.



Sec. 400.650  Purpose.

    The Reform Act requires FCIC to implement a crop insurance program 
that offers several levels of insurance coverage for producers. These 
levels of protection include catastrophic risk protection, limited 
coverage, and additional coverage insurance. This subpart provides 
notice of the availability of these crop insurance options and 
establishes provisions and requirements for implementation of the 
insurance provisions of the Reform Act.



Sec. 400.651  Definitions.

    Act. The Federal Crop Insurance Act, as amended (7 U.S.C. Secs. 1501 
et seq.).
    Additional coverage. Plans of crop insurance providing a level of 
coverage equal to or greater than sixty-five percent (65%) of the 
approved yield indemnified at one hundred percent (100%) of the expected 
market price, or comparable coverage as established by FCIC.
    Administrative fee. An amount the producer must pay for 
catastrophic, limited, and additional coverage each crop year on a per 
crop and county basis as specified in the Basic Provisions or the 
Catastrophic Risk Protection Endorsement.
    Approved insurance provider. A private insurance company, including 
its agents, that has been approved and reinsured by FCIC to provide 
insurance coverage to producers participating in the Federal crop 
insurance program.
    Approved yield. The amount of production per acre computed in 
accordance with FCIC's Actual Production History Program (7 CFR part 
400, subpart G) or for crops not included under 7 CFR part 400, subpart 
G, the yield used to determine the guarantee in accordance with the crop 
provisions or the Special Provisions.
    Catastrophic risk protection. The minimum level of coverage offered 
by FCIC which is required before a person may qualify for certain other 
USDA program benefits unless the producer executes a waiver of any 
eligibility for emergency crop loss assistance in connection with the 
crop. For the 1995 through 1998 crop years, such coverage will offer 
protection equal to fifty percent (50%) of the approved yield 
indemnified at sixty percent (60%) of the expected market price, or a 
comparable coverage as established by FCIC. For the 1999 and subsequent 
crop years, such coverage will offer protection equal to fifty percent 
(50%) of the approved yield indemnified at fifty-five percent (55%) of 
the expected market price, or a comparable coverage as established by 
FCIC.

[[Page 53]]

    Catastrophic Risk Protection Endorsement. The part of the crop 
insurance policy that contains provisions of insurance that are specific 
to catastrophic risk protection.
    Crop of economic significance. A crop that has either contributed in 
the previous crop year, or is expected to contribute in the current crop 
year, ten percent (10%) or more of the total expected value of the 
producer's share of all crops grown in the county. However, a crop will 
not be considered a crop of economic significance if the expected 
liability under the Catastrophic Risk Protection Endorsement is equal to 
or less than the administrative fee required for the crop.
    Expected market price. (price election) The price per unit of 
production (or other basis as determined by FCIC) anticipated during the 
period the insured crop normally is marketed by producers. This price 
will be set by FCIC before the sales closing date for the crop. The 
expected market price may be less than the actual price paid by buyers 
if such price typically includes remuneration for significant amounts of 
post-production expenses such as conditioning, culling, sorting, 
packing, etc.
    FCIC. The Federal Crop Insurance Corporation, a wholly owned 
Government Corporation within USDA.
    FSA. The Farm Service Agency, an agency of the United States 
Department of Agriculture or any successor agency.
    Insurable interest. The value of the producer's interest in the crop 
that is at risk from an insurable cause of loss during the insurance 
period. The maximum indemnity payable to the producer may not exceed the 
indemnity due on the producer's insurable interest at the time of loss.
    Intended crop. A crop stated on the application as submitted on or 
before the sales closing date for the crop which the producer intended 
to plant in the crop year for which application is made.
    Limited coverage. Plans of insurance offering coverage that is equal 
to or greater than fifty percent (50%) of the approved yield indemnified 
at one hundred percent (100%) of the expected market price, or a 
comparable coverage, but less than sixty-five percent (65%) of the 
approved yield indemnified at one hundred percent (100%) of the expected 
market price, or a comparable coverage.
    Limited resource farmer. A producer or operator of a farm, with an 
annual gross income of $20,000 or less derived from all sources of 
revenue, including income from spouse's or other members of the 
household, for each of the prior two years. Notwithstanding the previous 
sentence, a producer on a farm or farms of less than 25 acres aggregated 
for all crops, where a majority of the producer's gross income is 
derived from such farm or farms, but the producer's gross income from 
farming operations does not exceed $20,000, will be considered a limited 
resource farmer.
    Linkage requirement. The legal requirement that a producer must 
obtain at least catastrophic risk protection coverage for any crop of 
economic significance as a condition of receiving benefits for such crop 
from certain other USDA programs in accordance with Sec. 400.657, unless 
the producer executes a waiver of any eligibility for emergency crop 
loss assistance in connection with the crop.
    Person. An individual, partnership, association, corporation, 
estate, trust, or other legal entity, and wherever applicable, a state 
or a political subdivision or agency of a state.
    Reform Act. The Federal Crop Insurance Reform Act of 1994, Public 
Law 103-354.
    Secretary. The Secretary of the United States Department of 
Agriculture.
    Substitute crop. An alternative crop whose sales closing date has 
passed and that is planted on acreage that is prevented from being 
planted to an intended crop or where an intended crop is planted and 
fails.
    Zero acreage report. An acreage report filed by the producer that 
certifies that the producer does not have a share in the crop for that 
crop year.

[61 FR 42975, Aug. 20, 1996, as amended at 63 FR 40634, July 30, 1998]



Sec. 400.652  Insurance availability.

    (a) If sufficient actuarial data are available, FCIC will offer 
catastrophic risk protection, limited, and additional

[[Page 54]]

coverage plans of insurance to indemnify persons for FCIC insured or 
reinsured crop loss due to loss of yield or prevented planting, if the 
crop loss or prevented planting is due to an insured cause of loss 
specified in the applicable crop insurance policy.
    (b) Catastrophic risk protection coverage may be offered through 
approved insurance providers and through local offices of the Farm 
Service Agency specified by the Secretary. Limited and additional 
coverage will only be offered through approved insurance providers 
unless there is not a sufficient number of approved insurance providers 
that offer such insurance within a service area.
    (c) A person must obtain at least catastrophic risk protection for 
the crop on all insurable acreage in the county in which the person has 
a share on or before the sales closing date designated by FCIC for the 
crop in the county in order to satisfy the linkage requirements unless 
the producer executes a waiver of any eligibility for emergency crop 
loss assistance in connection with the crop.
    (d) For limited and additional coverage, in areas where insurance is 
not available for a particular agricultural commodity that is insurable 
elsewhere, FCIC may enter into a written agreement with a person to 
insure the commodity, provided that the person has actuarially sound 
data relating to the production of the commodity that is acceptable to 
FCIC and that such written agreement is specifically allowed by the crop 
insurance regulations applicable to the crop.
    (e) Failure to comply with all provisions of the policy constitutes 
a breach of contract and may result in ineligibility for certain other 
farm program benefits for that crop year and any benefit already 
received must be refunded. If a producer breaches the insurance 
contract, the execution of a waiver of eligibility for emergency crop 
loss assistance will not be effective for the crop year in which the 
breech occurred.



Sec. 400.653  Determining crops of economic significance.

    To be eligible for certain other program benefits under Sec. 400.657 
the following conditions will apply with respect to crops of economic 
significance if the producer does not execute a waiver of any 
eligibility for emergency crop loss assistance in connection with the 
crop.
    (a) If a producer planted a crop of economic significance in the 
preceding crop year, and does not intend to plant the same crop in the 
present crop year, the producer does not have to obtain insurance 
coverage or execute a waiver of any eligibility for emergency crop loss 
assistance in connection with the crop in the present crop year to 
comply with the linkage requirements. However, if the producer later 
decides to plant that crop, the producer will be unable to obtain 
insurance after the sales closing date and must execute a waiver of any 
eligibility for emergency crop loss assistance in connection with the 
crop to be eligible for benefits as specified in Sec. 400.657. Failure 
to execute such a waiver will require the producer to refund any 
benefits already received under a program specified in Sec. 400.657.
    (b) The producer is initially responsible to determine the crops of 
economic significance in the county. The insurance provider may assist 
the producer in making these initial determinations. However, these 
determinations will not be binding on the insurance provider. To 
determine the percentage value of each crop:
    (1) Multiply the acres planted to the crop times the producer's 
share, times the approved yield, and times the price;
    (2) Add the values of all crops grown by the producer (in the 
county); and
    (3) Divide the value of the specific crop by the result of paragraph 
(b)(2).
    (c) The producer may use the type of price, such as the current 
local market price, futures price, established price, highest amount of 
insurance, etc., for the price when calculating the value of each crop, 
provided that the producer uses the same type of price for all crops in 
the county.
    (d) The producer may be required to justify the calculation and 
provide adequate records to enable the insurance provider to verify 
whether a crop is of economic significance.

[[Page 55]]



Sec. 400.654  Application and acreage report.

    (a) To participate in catastrophic risk protection, limited, or 
additional coverage plans of insurance, a producer must submit an 
application for insurance on or before the applicable sales closing 
date.
    (b) In order to remain eligible for certain farm programs, as 
specified in Sec. 400.657, a producer must obtain at least catastrophic 
risk protection on all crops of economic significance, if catastrophic 
risk protection is available in the county, unless the producer executes 
a waiver of any eligibility for emergency crop loss assistance in 
connection with the crop.
    (c) Notwithstanding the requirements of Sec. 400.654(a) that 
applications for insurance be submitted on or before the applicable 
sales closing date, FCIC may permit a producer to insure crops other 
than those specified on the application under the following conditions:
    (1) The producer must be unable to plant the intended crop or it is 
not practical to replant a failed crop before the final planting date. 
FCIC will take into consideration marketing windows when determining 
whether it was not practical to replant.
    (2) Conditions must exist to warrant allowing a producer to insure 
crops other than the intended crop.
    (3) The producer must submit an application for the substitute crop 
on or before the acreage reporting date for the substitute crop and pay 
any applicable administrative fee. A producer may not substitute a crop 
that the producer planted in the preceding crop year unless that crop 
was listed on a timely filed application for the current crop year.
    (4) If the producer plants a substitute crop that is a crop of 
economic significance, the producer must obtain CAT coverage, if 
available, to comply with the linkage requirements specified in 
Sec. 400.657. The producer may not substitute a crop under this 
provision if the producer has signed or intends to sign a waiver for 
emergency crop loss assistance for the crop year.
    (5) The substitute crop must be planted on or before the final 
planting date or within the late planting period, if applicable, for the 
substitute crop.
    (6) Under no circumstances may a producer submit an application for 
limited or additional coverage after the sales closing date for the 
substitute crop.
    (d) For all coverages, including catastrophic risk protection, 
limited, and additional coverages, the producer must file a signed 
acreage report on or before the acreage reporting date. Any person may 
sign any document relative to crop insurance coverage on behalf of any 
other person covered by such a policy, provided that the person has a 
properly executed power of attorney or other legally sufficient document 
authorizing such person to sign.
    (e) Under catastrophic risk protection, unless the other person with 
an insurable interest in the crop objects in writing prior to the 
acreage reporting date and provides a signed acreage report on their own 
behalf an operator may sign the acreage report for all other persons 
with an insurable interest in the crop without a power of attorney. All 
persons with an insurable interest in the crop, and for whom the 
operator purports to sign and represent, are bound by the information 
contained in that acreage report.



Sec. 400.655  Eligibility for other program benefits.

    The producer must obtain at least catastrophic coverage for each 
crop of economic significance in the county in which the producer has an 
insurable share, if insurance is available in the county for the crop, 
unless the producer executes a waiver of any eligibility for emergency 
crop loss assistance in connection with the crop, to be eligible for:
    (a) Benefits under the Agricultural Market Transition Act;
    (b) Loans or any other USDA provided farm credit, including: 
guaranteed and direct farm ownership loans, operating loans, and 
emergency loans under the Consolidated Farm and Rural Development Act 
provided after October 13, 1994; and
    (c) Benefits under the Conservation Reserve Program derived from any 
new or amended application or contract executed after October 13, 1994.

[61 FR 42975, Aug. 20, 1996. Redesignated at 63 FR 40634, July 30, 1998]

[[Page 56]]



Sec. 400.656  Coverage for acreage that is prevented from being planted.

    For the 1995 and succeeding crop years, the insurance period for 
prevented planting for those crop insurance policies containing 
prevented planting coverage shall be extended so that prevented planting 
coverage begins:
    (a) On the sales closing date for the insured crop in the county for 
the crop year the application for insurance is accepted; or
    (b) For any crop year following the crop year the application for 
insurance is accepted, or for any crop year the insurance policy is 
transferred to a different insurance provider, on the sales closing date 
for the insured crop in the county for the previous crop year, provided 
continuous coverage has been in effect since that date. For example: If 
the producer makes application and purchases a corn crop insurance 
policy for the 1995 crop year (which is not terminated or canceled 
during or after the 1995 crop year), prevented planting coverage for the 
1996 crop year began on the 1995 sales closing date. Cancellation for 
the purpose of transferring the policy to a different insurance provider 
when there is no lapse in coverage will not be considered terminated or 
canceled coverage for the purpose of the preceding sentence.

[61 FR 42975, Aug. 20, 1996. Redesignated at 63 FR 40634, July 30, 1998]



Sec. 400.657  Transitional yields for forage or feed crops, 1995-1997 crop years.

    (a) For the 1995 through the 1997 crop years, producers who produce 
feed or forage will be eligible for an adjustment in the assigned yield 
described in 7 CFR 400.55(b)(1) if:
    (1) The feed or forage is primarily for use by the producer as 
livestock, dairy, or poultry operations; and
    (2) At least fifty percent (50%) of the producer's net farm income 
is derived from the livestock, dairy, or poultry operations.
    (b) Producers that qualify under paragraph (a) of this section will 
receive an assigned yield, if required, under 7 CFR 400.55(b)(1) equal 
to eighty percent (80%) of the T- or D-Yield.

[61 FR 42975, Aug. 20, 1996. Redesignated at 63 FR 40634, July 30, 1998]



 Subpart U--Ineligibility for Programs Under the Federal Crop Insurance 
                                   Act

    Authority: 7 U.S.C. 1506(1), 1506(p).

    Source: 62 FR 42042, Aug. 5, 1997, unless otherwise noted.



Sec. 400.675  Purpose.

    This rule prescribes conditions under which a person may be 
determined to be ineligible to participate in any program administered 
by FCIC under the Federal Crop Insurance Act, as amended. This rule also 
establishes the criteria for reinstatement of eligibility.



Sec. 400.676  OMB control numbers.

    The collecting of information requirements in this subpart has been 
approved by the Office of Management and Budget and assigned OMB control 
number 0563-0047.



Sec. 400.677  Definitions.

    Act. The Federal Crop Insurance Act, as amended (7 U.S.C. 1501 et 
seq.).
    Actively engaged in farming. Means a person who, in return for a 
share of profits and losses, makes a contribution to the production of 
an insurable crop in the form of capital, equipment, land, personal 
labor, or personal management.
    Applicant. A person who has submitted an application for crop 
insurance coverage under the Act.
    Authorized person. Any current or past officer, employee, elected 
official, general agent, agent, contractor, or loss adjuster of FCIC, 
the insurance provider, or any other government agency whose duties 
require access to the Ineligible Tracking System to administer the Act.
    CAT. The catastrophic risk protection plan of insurance.
    Controlled substance. Any prohibited drug-producing plants 
including, but not limited to, cacti of the genus (lophophora), coca 
bushes (erythroxylum coca), marijuana (cannabis sativa), opium poppies 
(papaver

[[Page 57]]

somniferum), and other drug-producing plants, the planting and 
harvesting of which is prohibited by Federal or state law.
    Debt. An amount of money which has been determined by an appropriate 
agency official to be owed, by any person, to FCIC or an insurance 
provider under any program administered under the Act based on evidence 
submitted by the insurance provider. The debt may have arisen from an 
overpayment, premium or administrative fee nonpayment, interest, 
penalties, or other causes.
    Debtor. A person who owes a debt and that debt is delinquent.
    Delinquent debt. Any debt owed to FCIC or the insurance provider, 
that arises under any program administered under the authority of the 
Act, that has not been paid by the termination date specified in the 
applicable contract of insurance, or other due date for payment 
contained in any other agreement or notification of indebtedness, or any 
overdue debt owed to FCIC or the insurance provider which is the subject 
of a scheduled installment payment agreement which the debtor has failed 
to satisfy under the terms of such agreement. Such debt may include any 
accrued interest, penalty, and administrative charges for which demand 
for repayment has been made, or unpaid premium including any accrued 
interest, penalty and administrative charges (7 CFR 400.116). A 
delinquent debt does not include debts discharged in bankruptcy and 
other debts which are legally barred from collection.
    EIN. An Employer Identification Number as required under section 
6109 of the Internal Revenue Code of 1986.
    FCIC. The Federal Crop Insurance Corporation, a wholly owned 
government corporation within the United States Department of 
Agriculture.
    FSA. The Farm Service Agency or a successor agency.
    Ineligible person. A person who is denied participation in any 
program administered by FCIC under the Act.
    Insurance provider. A reinsured company or FSA providing crop 
insurance coverage to producers participating in any Federal crop 
insurance program administered under the Act.
    Minor. Any person under 18 years of age. Court proceedings 
conferring majority on an individual under 18 years of age will result 
in such persons no longer being considered as a minor.
    Person. An individual, partnership, association, corporation, 
estate, trust, or other legal entity, and wherever applicable, a State, 
political subdivision, or an agency of a State.
    Policyholder. An applicant whose properly completed application for 
insurance under the crop insurance program has been accepted by FCIC or 
an insurance provider.
    Reinsurance agreement. An agreement between two parties by which an 
insurer cedes to a reinsurer certain liabilities arising from the 
insurer's sale of insurance policies.
    Reinsured company. A private insurance company having a Standard 
Reinsurance Agreement, or other reinsurance agreement, with FCIC, whose 
crop insurance policies are approved and reinsured by FCIC.
    Scheduled installment payment agreement. An agreement between a 
person and FCIC or the insurance provider to satisfy financial 
obligations of the person under conditions which modify the terms of the 
original debt.
    Settlement. An agreement between a person and FCIC or the insurance 
provider to resolve a dispute arising from a debt or other 
administrative determination.
    SSN. An individual's Social Security Number as required under 
section 6109 of the Internal Revenue Code of 1986.
    Standard Reinsurance Agreement (SRA). The primary reinsurance 
agreement between the reinsured company and FCIC.
    Substantial beneficial interest. An interest held by any person of 
at least 10 percent or more in the applicant or policyholder.
    System of records. Records established and maintained by FCIC and 
FSA containing SSN or EIN data, name, address, city and State, 
applicable policy

[[Page 58]]

numbers, and other information related to Federal crop programs as 
required by FCIC, from which information is retrieved by a personal 
identifier including the SSN, EIN, name, or other unique identifier of a 
person.

[62 FR 42042, Aug. 5, 1997, as amended at 63 FR 40631, July 30, 1998]



Sec. 400.678  Applicability.

    This subpart applies to any program administered by FCIC under the 
Act, including:
    (a) The catastrophic risk protection plan of insurance;
    (b) The limited and additional coverage plans of insurance as 
authorized under sections 508(c) and 508(m) of the Act; and
    (c) Private insurance products authorized under section 508(h) of 
the Act and reinsured by FCIC.



Sec. 400.679  Criteria for ineligibility.

    Any person may be determined to be ineligible to participate in any 
program administered by FCIC under the authority of the Act, if the 
person meets one or more of the following criteria:
    (a) Has a delinquent debt on a crop insurance policy, issued or 
reinsured by FCIC, or any delinquent debt due FCIC under the Act. Any 
person with a delinquent debt owed to FCIC or to the insurance provider 
shall be ineligible to participate in any program administered under the 
authority of the Act. Such determinations will be in accordance with 7 
CFR 400.459. The existence and delinquency of the debt must be 
verifiable.
    (b) Has violated the controlled substance (7 CFR part 718) 
provisions of the Food Security Act of 1985, as amended. Any person who 
violates the controlled substance provisions of the Food Security Act of 
1985, as amended, shall be ineligible to participate in any program 
administered under the Act.
    (c) Has been disqualified under section 506(n) of the Act and 7 CFR 
part 400, subpart R. Any person who is disqualified in any 
administrative proceeding shall be ineligible to participate in any 
program administered under the Act. Ineligibility determinations 
resulting from administrative proceedings will not be stayed pending 
review. However, reversal of the determination will date back to the 
time of determination.



Sec. 400.680  Determination and notification of ineligibility.

    (a) The insurance provider must send a written notice of the debt to 
the person, including the time frame in which the debt must be paid, and 
provide the person with a meaningful opportunity to contest the amount 
or existence of the debt. After the insurance provider has evaluated the 
person's response, if any, and determined that the debt is owed and 
delinquent, the insurance provider should submit the documentation 
establishing the existence and amount of the debt to FCIC, including any 
response by the person.
    (b) If an insurance provider or any other authorized person has 
evidence that a person meets any other criteria set forth in 
Sec. 400.679, they must submit the evidence to FCIC.
    (c) After FCIC verifies that the person has met one or more of the 
criteria stated in Sec. 400.679, FCIC will issue a Notice of 
Ineligibility and mail such notice to the person's last known address 
and to the insurance provider.
    (d) The Notice of Ineligibility will state the criteria upon which 
the determination of ineligibility has been based, a brief statement of 
the facts to support the determination, the time period of 
ineligibility, and the persons right to an appeal of the ineligibility 
determination.
    (e) Within 30 days of receiving the Notice of Ineligibility, any 
person receiving such a notice may appeal the determination of 
ineligibility to the National Appeals Division in accordance with 7 CFR 
part 11.
    (f) If the person appeals the determination of ineligibility to the 
National Appeals Division, the insurance provider will be notified and 
provided with an opportunity to participate in the proceeding if 
permitted by 7 CFR part 11.



Sec. 400.681  Effect of ineligibility.

    (a) The period of ineligibility will be effective:
    (1) For ineligibility as a result of a delinquent debt, the date the 
debt has been determined to be delinquent until

[[Page 59]]

the debt has been paid in full, discharged in bankruptcy, or the person 
has executed a scheduled installment payment agreement;
    (2) For ineligibility as a result of a violation of the controlled 
substance provisions of the Food Security Act of 1985, at the beginning 
of the crop year in which the producer was convicted and the four 
subsequent consecutive crop years; and
    (3) For ineligibility as a result of a disqualification under 
section 506(n) of the Act, the date that the Administrative Law Judge 
signs the order disqualifying the person until the period specified in 
the order of disqualification has expired.
    (b) Once the person has been determined to be ineligible:
    (1) All policies in which the ineligible person is the sole insured 
will be void for the period specified in Sec. 400.681(a);
    (2) If the ineligible person is a general partnership, all partners 
will be individually ineligible and any policy in which a partner has a 
100 percent interest will be void for the period specified in 
Sec. 400.681(a). The partnership and all partners will be removed from 
any policy in which they have a substantial beneficial interest, and the 
policyholder share under the policies will be reduced commensurate with 
the ineligible person's share;
    (3) If the applicant or policyholder is a corporation, partnership, 
or other business entity, and an ineligible person has a substantial 
beneficial interest in the applicant or policyholder, the application 
may be accepted or existing policies remain in effect, although the 
ineligible person will be removed from the policies and the policyholder 
share under the policies will be reduced commensurate with the 
ineligible person's share;
    (4) If the applicant or policyholder is a corporation, partnership, 
or other business entity that was created to conceal the interest of a 
person in the farming operation or to evade the ineligibility 
determination of a person with a substantial beneficial interest in the 
applicant or policyholder, the corporation, partnership or other 
business entity will be disregarded, the individual shareholders or 
partners will be personally responsible, and any shareholder or partner 
that is ineligible will be removed from the policy and the policyholder 
share under the policies will be reduced commensurate with the 
ineligible person's share;
    (5) Any indemnities or payments made on a voided policy, or on the 
portion of the policy reduced because of ineligibility, will be declared 
overpayments and must be repaid; and
    (6) If the policy is voided, all producer paid premiums may be 
refunded, or if an ineligible person is removed from a policy, the 
portion of the producer paid premium commensurate with the ineligible 
person's share may be refunded, less a reasonable amount for expense and 
handling in accordance with 7 CFR 400.47.
    (c) The spouse and minor children of an individual are considered to 
be the same as the individual for purposes of this subpart except that:
    (1) The spouse who was actively engaged in farming in a separate 
farming operation will be a separate person with respect to that 
separate farming operation so long as that operation remains separate 
and distinct from any farming operation conducted by the other spouse 
(Transfers of interest in a farming operation from one spouse to another 
will not be considered as a separate farming operation.);
    (2) A minor child who is actively engaged in farming in a separate 
farming operation will be a separate person with respect to that 
separate farming operation if:
    (i) The parent or other entity in which the parent has a substantial 
beneficial interest does not have any interest in the minor's separate 
farming operation or in any production from such operation;
    (ii) The minor has established and maintains a separate household 
from the parent;
    (iii) The minor personally carries out the farming activities with 
respect to the minor's farming operation; and
    (iv) The minor establishes separate accounting and record keeping 
for the minor's farming operation.

[[Page 60]]



Sec. 400.682  Criteria for reinstatement of eligibility.

    A person who has been determined ineligible may have eligibility 
reinstated as follows:
    (a) A delinquent debt owed on a crop insurance policy insured or 
reinsured by FCIC or any delinquent debt due FCIC. Eligibility may be 
reinstated after the debt is paid in full or discharged in bankruptcy, 
or the person has executed a scheduled installment payment agreement 
accepted by FCIC or the insurance provider. Eligibility may be 
reinstated as of the date the debt is paid, the date the agreement is 
accepted, or the date the debt is discharged in bankruptcy.
    (b) Violations of the controlled substance provisions of the Food 
Security Act of 1985, as amended. Eligibility may be reinstated after 
the period of ineligibility stated in Sec. 400.681 has expired.
    (c) Disqualification under section 506(n) of the Act. Eligibility 
may be reinstated when the period of disqualification determined in the 
administrative proceedings has expired and payment of all penalties and 
overpayments have been completed.
    (d) Timing of reinstatement of eligibility. After eligibility has 
been reinstated, the person must complete a new application for crop 
insurance coverage on or before the applicable sales closing date. If 
the date of reinstatement of eligibility occurs after the applicable 
sales closing date for the crop year, the person may not participate 
until the following crop year. If the National Appeals Division 
determines that the person should not have been placed on the Ineligible 
Tracking System, reinstatement will be effective at the beginning of the 
crop year for which the producer was listed on the Ineligible Tracking 
System and the person will be entitled to all applicable benefits under 
the policy.



Sec. 400.683  Administration and maintenance.

    (a) Ineligible producer data will be maintained in a system of 
records in accordance with the Privacy Act, 5 U.S.C. 552a.
    (1) The Ineligible Tracking System is a record of all persons who 
have been determined to be ineligible for participation in any program 
pursuant to this subpart. This system contains identifying information 
of the ineligible person including, but not limited to, name, address, 
telephone number, SSN or EIN, reason for ineligibility, and time period 
for ineligibility.
    (2) Information in the Ineligible Tracking System may be used by 
Federal agencies, FCIC employees, contractors, and reinsured companies 
and their personnel who require such information in the performance of 
their duties in connection with any program administered under the Act. 
The information may be furnished to other users including, but not 
limited to, FCIC contracted agencies; credit reporting agencies and 
collection agencies; in response to judicial orders in the course of 
litigation; and other users as may be appropriate or required by law or 
regulation. The individual information will be made available in the 
form of various reports and notices produced from the Ineligible 
Tracking System, based on valid requests.
    (3) Supporting documentation regarding the determination of 
ineligibility and reinstatement of eligibility will be maintained by 
FCIC and FSA, or its contractors, reinsured companies, and Federal and 
State agencies. This documentation will be maintained consistent with 
the electronic information contained within the Ineligible Tracking 
System.
    (b) Information may be entered into the Ineligible Tracking System 
by FCIC or FSA personnel.
    (c) All persons applying for or renewing crop insurance contracts 
issued or reinsured by FCIC will be subject to validation of their 
eligibility status against the Ineligible Tracking System. Applications 
or benefits approved and accepted are considered approved or accepted 
subject to review of eligibility status in accordance with this subpart.

[[Page 61]]



                        Subparts V-W  [Reserved]



    Subpart X--Interpretations of Statutory and Regulatory Provisions

    Source: 63 FR 70313, Dec. 21, 1998, unless otherwise noted.



Sec. 400.765  Basis and applicability.

    (a) The regulations contained in this subpart prescribe the rules 
and criteria for obtaining a final agency determination of the 
interpretation of any provision of the Act or the regulations 
promulgated thereunder.
    (b) This subpart is applicable to all regulations that were in 
effect for the 1995 and subsequent crop years.
    (c) All final agency determinations issued by FCIC, and published in 
accordance with Sec. 400.768(f ), will be binding on all participants in 
the Federal crop insurance program.



Sec. 400.766  Definitions.

    Act. The Federal Crop Insurance Act, 7 U.S.C. 1501 et seq.
    FCIC. The Federal Crop Insurance Corporation, a wholly owned 
government corporation within the United States Department of 
Agriculture.
    Participant. Any applicant for crop insurance, a producer with a 
valid crop insurance policy, or a private insurance company with a 
reinsurance agreement with FCIC or their agents, loss adjusters, 
employees or contractors.
    Regulations. All provisions contained in 7 CFR chapter IV.



Sec. 400.767  Requester obligations.

    (a) All requests for a final agency determination under this subpart 
must:
    (1) Be submitted, in writing by certified mail to the Associate 
Administrator, Risk Management Agency, United States Department of 
Agriculture, Stop Code 0801, 1400 Independence Avenue, SW., Washington, 
DC 20250-0801, faximile at (202) 690-5879 or by electronic mail at 
[email protected];
    (2) State that it is being submitted under section 506(s) of the 
Act;
    (3) Identify and quote the specific provision in the Act or 
regulations for which a final agency determination is requested;
    (4) State the crop year for which the interpretation is sought;
    (5) State the name, address, and telephone number of a contact 
person affiliated with the request; and
    (6) Contain the requester's detailed interpretation of the 
regulation.
    (b) The requestor must advise FCIC if the request for a final agency 
determination will be used in a lawsuit or the settlement of a claim.
    (c) Each request for final agency determination under this subpart 
must contain no more than one request for an agency interpretation.



Sec. 400.768  FCIC obligations.

    (a) FCIC will not interpret any specific factual situation or case, 
such as actions of any participant under the terms of a policy or any 
reinsurance agreement.
    (b) If, in the sole judgement of FCIC, the request is unclear, 
ambiguous, or incomplete, FCIC will not provide an interpretation, but 
will notify the requester that the request is unclear, ambiguous or 
incomplete, within 30 days of such request.
    (c) FCIC will provide a final determination of the interpretation to 
a request that meets all the conditions stated herein to the requester 
in writing, and at FCIC's discretion in the format in which it was 
received, within 90 days of the date of receipt by FCIC.
    (d) If a requestor is notified that a request is unclear, ambiguous 
or incomplete under section 400.768(b), the time to respond will be 
tolled from the date FCIC notifies the requestor until the date that 
FCIC receives a clear, complete, and unambiguous request.
    (e) If a response is not provided within 90 days, the requestor may 
assume the interpretation provided is correct for the applicable crop 
year.
    (f) All agency final determinations will be published by FCIC as 
specially numbered documents on the RMA Internet website.
    (g) All final agency determinations are considered matters of 
general applicability that are not appealable to the National Appeals 
Division. Before obtaining judicial review of any final agency 
determination, the person must

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obtain an administratively final determination from the Director of the 
National Appeals division on the issue of whether the final agency 
determination is a matter of general applicability.



PART 401--GENERAL CROP INSURANCE REGULATIONS; REGULATIONS FOR THE 1988 THROUGH 1998 CONTRACT YEARS--Table of Contents




Sec.
401.1  Applicability.
401.2  Availability of Federal crop insurance.
401.3  Premium rates, production guarantees or amounts of insurance, 
          coverage levels, and prices at which indemnities shall be 
          computed.
401.4  OMB control numbers.
401.5  Creditors.
401.6  Good faith reliance on misrepresentation.
401.7  The contract.
401.8  The application and policy.
401.9--401.100  [Reserved]
401.101  Wheat endorsement.
401.102  The winter coverage option for wheat.
401.103  Barley endorsement.
401.104  Winter coverage option for barley.
401.105  Oat endorsement.
401.106  Rye endorsement.
401.107  Late planting agreement option.
401.108  Prevented planting endorsement.
401.109  Hybrid sorghum seed endorsement.
401.110  Almond endorsement.
401.111  Corn endorsement.
401.112  Corn silage option.
401.113  Grain sorghum endorsement.
401.114  Canning and processing tomato endorsement.
401.115  Texas citrus endorsement.
401.116  Flaxseed endorsement.
401.117  Soybean endorsement.
401.118  Canning and processing bean endorsement.
401.119  Cotton endorsement.
401.120  Rice endorsement.
401.121  ELS cotton endorsement.
401.122  Stonefruit endorsement.
401.123  Safflower seed crop endorsement.
401.124  Sunflower seed crop endorsement.
401.125  Fig endorsement.
401.126  Onion endorsement.
401.127  Cranberry endorsement.
401.129  Tobacco (guaranteed plan) endorsement.
401.130  Grape endorsement.
401.131  High-risk land exclusion option.
401.133  Sugarcane endorsement.
401.134  Texas citrus tree endorsement.
401.135  Malting barley option.
401.137  Fresh market tomato minimum value option.
401.138  Fresh market sweet corn endorsement.
401.139  Fresh market tomato (dollar plan) endorsement.
401.140  Pear endorsement.
401.142  Raisin endorsement.
401.143  Florida citrus endorsement.
401.146  Fresh plum endorsement.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 52 FR 28447, July 30, 1987, unless otherwise noted.



Sec. 401.1  Applicability.

    The provisions of this part are applicable only to crops for which a 
crop endorsement is published as a section to 7 CFR part 401 and then 
only for the crops and crop years designated by the applicable section.



Sec. 401.2  Availability of Federal crop insurance.

    (a) Insurance shall be offered under the provisions of this section 
on the insured crop in counties within the limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended (the Act). The crops and counties shall be designated by the 
Manager of the Corporation from those approved by the Board of Directors 
of the Corporation.
    (b) The insurance is offered through two methods. First, the 
Corporation offers the contract contained in this part directly to the 
insured through agents of the Corporation. Those contracts are 
specifically identified as being offered by the Federal Crop Insurance 
Corporation. Second, companies reinsured by the Corporation offer 
contracts containing substantially the same terms and conditions as the 
contract set out in this part. These contracts are clearly identified as 
being reinsured by the Corporation.
    (c) No person may have in force more than one contract on the same 
crop for the crop year, whether insured by the Corporation or insured by 
a company which is reinsured by the Corporation
    (d) If a person has more than one contract under the Act outstanding 
on the same crop for the same crop year, all such contracts shall be 
voided for that crop year and the person will be liable for the premium 
on all contracts, unless the person can show to the satisfaction of the 
Corporation that the

[[Page 63]]

multiple contract insurance was inadvertent and without the fault of the 
person.
    (e) If the multiple contract insurance is shown to be inadvertent 
and without the fault of the insured, the contract with the earliest 
application will be valid and all other contracts on that crop for that 
crop year will be cancelled. No liability for indemnity or premium will 
attach to the contracts so cancelled.
    (f) The person must repay all amounts received in violation of this 
section with interest at the rate contained in the contract for 
delinquent premiums.
    (g) An insured whose contract with the Corporation or with a company 
reinsured by the Corporation under the Act has been terminated because 
of violation of the terms of the contract is not eligible to obtain 
multi-peril crop insurance under the Act with the Corporation or with a 
company reinsured by the Corporation unless the insured can show that 
the default in the prior contract was cured prior to the sales closing 
date of the contract applied for or unless the insured can show that the 
termination was improper and should not result in subsequent 
ineligibility
    (h) All applicants for insurance under the Act must advise the 
agent, in writing, at the time of application, of any previous 
applications for insurance under the Act and the present status of any 
such applications or insurance.



Sec. 401.3  Premium rates, production guarantees or amounts of insurance, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production guarantees 
or amounts of insurance, coverage levels, and prices at which 
indemnities shall be computed for the insured crop which will be 
included in the actuarial table on file in the applicable service 
offices for the county and which may be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect an amount of insurance or a coverage level and price from 
among those contained in the actuarial table for the crop year.



Sec. 401.4  OMB control numbers.

    OMB control numbers are contained in Subpart H to Part 400 in Title 
7 CFR.



Sec. 401.5  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 401.6  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the crop insurance contract, 
whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation:
    (1) Is indebted to the Corporation for additional premiums; or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the insured believed 
to be insured, or believed the terms of the insurance contract to have 
been complied with or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that:
    (1) An agent or employee of the Corporation did in fact make such 
misrepresentation or take other erroneous action or give erroneous 
advice;
    (2) Said insured relied thereon in good faith; and
    (3) To require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto. Requests for relief under this section must be 
submitted to the Corporation in writing.



Sec. 401.7  The contract.

    The insurance contract shall become effective upon the acceptance by 
the

[[Page 64]]

Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the crop as 
provided in the policy and the crop endorsement. The contract shall 
consist of the application, the policy, the crop endorsement and any 
amendments thereto, and the county actuarial table. Changes made in the 
contract shall not affect its continuity from year to year. No indemnity 
shall be paid unless the insured complies with all terms and conditions 
of the contract. The forms referred to in the contract are available at 
the applicable service offices.



Sec. 401.8  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation must be made by any person who wishes to participate in the 
program, to cover such person's share in the insured crop as landlord, 
owner-operator, or tenant. The application shall be submitted to the 
Corporation at the service office on or before the applicable sales 
closing date on file in the service office.
    (b) The Corporation may reject or discontinue the acceptance of 
applications in any county or of any individual application upon its 
determination that the insurance risk is excessive. The Manager of the 
Corporation is authorized in any crop year to extend the sales closing 
date for submitting applications in any county, by placing the extended 
date on file in the applicable service offices and publishing a notice 
in the Federal Register upon the Manager's determination that no adverse 
selectivity will result during the extended period. However, if adverse 
conditions should develop during such period, the Corporation will 
immediately discontinue the acceptance of applications. If the sales 
closing date falls on a Saturday or Sunday or legal holiday when the 
service office is not open, the application must be submitted by the 
close of business on the next business day.
    (c) In accordance with the provisions governing changes in the 
contract contained in previous policies and regulations issued by FCIC, 
a contract in the form provided for in this section will come into 
effect as a continuation of the contract issued under such prior 
regulations, without the filing of a new application.
    (d) The application for the 1988 and succeeding crop years is found 
at subpart D of part 400, General Administrative Regulations (7 CFR 
400.37 and 400.38) The provisions of the Safflower Insurance Policy for 
the 1988 through 1997 crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                      General Crop Insurance Policy

(This is a continuous contract. Refer to section 15.)

    Note: This is a contract with the Federal Crop Insurance 
Corporation, a United States Government agency. The terms of the 
contract are published in the Federal Register under the provisions of 
the Federal Register Act (44 U.S.C. 1501), and may not be waived or 
varied in any way by the Crop Insurance Agent or any other agent or 
employee of FCIC.

    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy and the applicable endorsement in return for the premium and your 
compliance with ALL provisions of the crop insurance contract. If a 
conflict exists between the terms of this policy and the crop 
endorsement, the terms of the crop endorsement control.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation. Unless the context indicates 
otherwise, use of the plural form of a word includes the singular and 
use of the singular form of the word includes the plural.

                          Terms and Conditions

                            1. Causes of Loss

    a. You are insured only against unavoidable loss of production 
directly caused by specific causes of loss contained in the crop 
endorsement.
    b. We do not insure against any loss caused by:
    (1) The neglect, mismanagement, or wrongdoing by you, any member of 
your family or household, your tenants, or employees;
    (2) The failure to follow recognized good farming practices for the 
insured crop;
    (3) Water contained by any governmental, public, or private dam or 
reservoir project;
    (4) Failure or breakdown of irrigation equipment or facilities;
    (5) Failure to carry out a good irrigation practice for the insured 
crop;

[[Page 65]]

    (6) Any cause not specified in the crop endorsement as an insured 
cause of loss; or
    (7) Any other cause set out as an uninsured cause of loss in the 
crop endorsement.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured is the crop specified in the crop endorsement 
and no other, which is planted for harvest as the insured crop, which is 
grown on insurable acreage, and for which a guarantee or amount of 
insurance and premium rate are provided by the actuarial table.
    b. The acreage insured for each crop year is the insurable acreage 
as designated by the actuarial table, which is planted to the insured 
crop and in which you have a share (as reported by you or as determined 
by us, whichever we elect).
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured crop at the time insurance attaches. However, only 
for the purpose of determining the amount of indemnity, your share will 
not exceed your share at the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. Unless the application clearly indicates that insurance is 
requested for a partnership or joint venture, insurance will cover only 
the crop share of the person making application for insurance.
    e. We do not insure any acreage:
    (1) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (2) Which is irrigated and an irrigated practice is not provided by 
the actuarial table or the crop endorsement (you may elect to insure 
irrigated acreage on a non-irrigated basis by reporting it as non-
irrigated on the acreage report and adjusting the basis used to 
establish your guarantee accordingly);
    (3) Which is destroyed, it is practical to replant to the insured 
crop, but the insured crop is not replanted;
    (4) Initially planted after the final planting date, unless we allow 
and you agree in writing on our form, to coverage reduction (the Late 
Planting Option applies only on selected crops);
    (5) Of a volunteer crop;
    (6) Planted to a type or variety of the crop not established as 
adapted to the area or excluded by the actuarial table;
    (7) Planted with a crop other than the insured crop;
    (8) Which does not meet rotation requirements required by the crop 
endorsement or actuarial table;
    (9) Of a second crop following the same crop (insured or uninsured) 
harvested in the same crop year unless specifically permitted by the 
crop endorsement or the actuarial table;
    (10) Used for wildlife protection or management;
    (11) On which a crop has not been planted and harvested in at least 
one of the three previous crop years unless it is determined the acreage 
has been in a soil conserving legume or unless the acreage meets the 
definition of Agricultural Stabilization and Conservation Service (ASCS) 
``cropland'' acreage; or
    (12) Which has been strip mined unless we agree in writing to insure 
such acreage.
    f. If insurance is provided for an irrigated practice, we will 
insure as irrigated, and you must report as irrigated, only the acreage 
for which you have adequate facilities and water, at the time insurance 
attaches, to carry out a good irrigation practice for the insured crop.
    g. Acreage which is planted for the development or production of 
hybrid seed or for experimental purposes is not insured, unless 
permitted by the crop endorsement or unless we agree, in writing, to 
insure such acreage.
    h. We may restrict the amount of acreage which we will insure to the 
amount allowed under any acreage limitation program established by the 
United States Department of Agriculture if we advise you of that limit 
prior to the time insurance attaches.
    i. You must not obtain any other crop insurance under the Federal 
Crop Insurance Act (Multiple Peril Crop Insurance Policy or Federal Crop 
Insurance Policy) on your share of the insured crop. More than one 
policy on your share will result in our voiding the policies and 
collecting the premium from you unless the violation of this provision 
is found by us to have been inadvertent. If we determine that the 
violation was inadvertent, the policy with the earliest date of 
application will be the one in force and all other policies will be 
void. Nothing in this paragraph prevents the insured from obtaining 
other hail and fire insurance not issued under the Act and which is 
subject to the provisions of section 9 hereof.
    j. Although your violation of a number of federal statutes including 
the Federal Crop Insurance Act may cause cancellation, termination, or 
voidance of your insurance contract, you are specifically directed to 
the provisions of Title XII of the Food Security Act of 1985 (Public Law 
99-198) and the regulations promulgated thereunder, generally referred 
to as the controlled substance provisions. Your insurance policy will be 
cancelled if you are determined to be in violation of these provisions. 
We will recover any and all monies paid to you or received by you and 
your premium will be refunded.

       3. Report of Acreage, Share, and Practice (Acreage Report)

    You must report on our form:

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    a. All insured and uninsured acreage of the crop in the county in 
which you have a share;
    b. The practice; and
    c. Your share at the time insurance attaches.
    The insurable practices are contained in the actuarial table. You 
must designate separately any acreage which is not insurable. The report 
must indicate if you do not have a share of the insured crop in the 
county. This report must be submitted each year on or before the acreage 
reporting date for the crop for the county. This report may be used as 
the basis to determine your premium and indemnity or we may compute 
premiums and indemnities on the acreage, share, and practice which is 
determined to have actually been in existence. If you do not submit this 
report by the reporting date, we may elect to determine, by unit, the 
insured acreage, share, and practice or we may deny liability on any 
unit. Because underreporting of acreage and share would have the effect 
of reducing your premium and any indemnity which may be due, you may not 
revise your report after the reporting date except with our approval. 
Errors in reporting units may be corrected by us to conform to 
applicable guidelines at the time of adjusting a loss.

 4. Production Guarantees, Coverage Levels or Amounts of Insurance, and 
                    Prices for Computing Indemnities

    a. The production guarantees or amounts of insurance, coverage 
levels, and prices for computing indemnities are contained in the 
actuarial table.
    b. Coverage level 2 will apply if you do not elect a coverage level.
    c. You may change the amount of insurance or coverage level and 
price election on or before the sales closing date for the crop year.
    d. You must report production to us for the previous crop year by 
the earlier of the acreage reporting date or 45 days after the sales 
closing date for the current crop year (See section 21).
    If you do not provide the required production report, we will assign 
a yield for the previous crop year. The yield assigned by us will not be 
more than 75% of the yield used by us to determine your guarantee for 
the previous crop year. The production report or assigned yield will be 
used to compute your production history for the purpose of determining 
your guarantee for the current crop year. If you have filed a claim for 
any crop year, the production used to determine the indemnity payment 
will be the production report for that year.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time insurance 
attaches. The annual premium is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time insurance attaches, and 
where applicable, times any applicable premium adjustment factor shown 
on the actuarial table.
    b. If you are eligible for a premium reduction based on your 
experience under previous crop policies, you may retain that experience 
under certain conditions as set out in the crop endorsement through the 
1991 crop year.
    c. Your premium payment, plus any accrued interest, will be 
considered delinquent if any amount due us is not paid on or before the 
termination date specified in the crop endorsement.

                            6. Amounts Due Us

    a. Interest will accrue at the rate of one and one-fourth percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance due us. For the purpose of premium amounts 
due us, the interest will start on the first day of the month following 
the first premium billing date.
    b. For the purpose of any other amounts due us, such as repayment of 
indemnities found not to have been earned, interest will start on the 
date that notice is issued to you for the collection of the unearned 
amount. Interest and penalties will be charged in accordance with 31 
U.S.C. 3717 and 4 CFR 102.13. The penalty for accounts more than 90 days 
past due (31 U.S.C. 3717(e)(2)) is six percent (6%) per annum. Interest 
on any amount due us found to have been received by you because of 
fraud, misrepresentation or presentation by you of a false claim will 
start on the date you received the amount with the 6% penalty beginning 
90 days after the notice of amount due is issued to you. This interest 
is in addition to any other amount found to be due under any other 
federal criminal or civil statute.
    c. All amounts paid will be applied first to reduction of accrued 
interest, then to reduction of the principal balance.
    d. If we determine that it is necessary to contract with a 
collection agency or to employ an attorney to assist in collection, you 
agree to pay all of the expenses of collection. Those expenses will be 
paid before the application of any amounts to interest or principal.
    e. Any amount due us may be deducted from any indemnity payment due 
you or from any replanting payment, or from any loan or payment due you 
under any Act of Congress or program administered by the United States 
Department of Agriculture or its Agencies and from any amounts due you 
from any other United States Government Agency.

[[Page 67]]

                           7. Insurance Period

    Insurance attaches on each unit or part of a unit when the insured 
crop is planted or when the application is properly signed, completed, 
and delivered to your service office, whichever is later, or on the 
calendar date for the beginning of the insurance period if specified in 
the crop endorsement, and ends at the earliest of:
    (a) Total destruction of the insured crop on the unit;
    (b) Harvest of the unit;
    (c) Final adjustment of a loss on a unit; or
    (d) The calendar date for the end of the insurance period contained 
in the crop endorsement.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if:
    (a) You want our consent to replant the insured crop damaged by an 
insured cause of loss;
    (b) During the period before harvest the insured crop on a unit is 
damaged by an insured cause of loss and you decide not to further care 
for or harvest any part of it;
    (c) You want our consent to put the acreage to another use; or
    (d) After consent to put acreage to another use is given, additional 
damage due to an insured cause of loss occurs.
    Insured acreage may not be put to another use until we have 
appraised the insured crop and given written consent. We will not 
consent to another use if the insured crop can be replanted. You must 
notify us when such acreage is replanted or put to another use.
    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (3) If a loss is anticipated by you on any unit within 15 days of or 
during harvest, notice of probable loss must be given to us within 72 
hours of your discovery. A representative sample of the unharvested 
insured crop, as required by the crop endorsement, must remain 
unharvested for a period of 15 days from the date of notice unless we 
give you written consent to harvest the sample.
    (4) In addition to the notices required by this section, if you 
intend to claim an indemnity on any unit, a notice of loss must be given 
not later than 10 days after the earliest of:
    (a) Total destruction of the insured crop on the unit;
    (b) Harvest of the unit; or
    (c) The calendar date for the end of the insurance period.
    b. You may not destroy and replant any of the insured crop on which 
you intend to claim a replanting payment, until we give written consent.
    c. You must obtain written consent from us before you destroy any of 
the insured crop which is not harvested.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the insured crop on the unit;
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production and, if applicable, the value 
received for the insured crop on the unit and that any loss of 
production or value has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit in accordance with 
the applicable crop endorsement and the actuarial table.
    d. If the information reported by you on the acreage report results 
in a lower premium than the premium determined to be due on the basis of 
the share, acreage, practice or type determined to actually exist, the 
guarantee on the unit will be computed on the information contained in 
the acreage report but all production from insurable acreage, whether or 
not reported as insurable, will count against the guarantee.
    e. The total production to be counted for a unit will include all 
production determined in accordance with the crop endorsement.
    f. The amount of production of any unharvested insured crop may be 
determined on the basis of our field appraisals conducted after the end 
of the insurance period.
    g. If you elect to exclude hail and fire as insured causes of loss 
and the insured crop is damaged by hail or fire, appraisals will be made 
in accordance with the applicable Form FCI-78 or FCI-78-A, ``Request To 
Exclude Hail and Fire.''
    h. If allowed by the crop endorsement, a replanting payment may be 
made on an insured crop replanted after we have given consent and the 
acreage replanted is at least the lesser of 20 acres or 20 percent of 
the insured acreage for the unit (as determined on the final planting 
date).
    (1) No replanting payment will be made on acreage:
    (a) On which our appraisal establishes that production will exceed 
the level set by the crop endorsement;
    (b) Initially planted prior to the date established by the actuarial 
table; or
    (c) On which one replanting payment has already been allowed for the 
crop year.
    (2) The replanting payment per acre will be your actual cost for 
replanting, but will not

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exceed the amount determined in accordance with the crop endorsement.
    If the information reported by you on the acreage report results in 
a lower premium than the premium determined to be due based on the 
acreage, share, practice or type determined actually to have existed, 
the replanting payment will be reduced proportionately.
    i. You must not abandon any acreage to us.
    j. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    k. An indemnity will not be paid unless you comply with all policy 
provisions.
    l. Under no circumstances will we be liable for the payment of 
damages (compensatory, punitive, or other), attorney's fees, or other 
charges in connection with any claim for indemnity, whether we approve 
or disapprove such claim. (State and local laws to the contrary are not 
applicable to this insurance contract.) We will pay simple interest 
computed on the net indemnity ultimately found to be due by us or by the 
final judgment of a court of competent jurisdiction, from and including 
the 61st day after the date you sign, date and submit to us the properly 
completed FCIC claim form. Interest will be paid only if the reason for 
our failure to timely pay is not due to your failure to provide 
information or other material necessary for the computation or payment 
of the indemnity 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 will vary 
with each publication.
    m. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after insurance attaches for any crop year, any indemnity will 
be paid to the person determined to be beneficially entitled thereto.
    n. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance. (For the purpose of this subsection, 
the amount of loss from fire will be the difference between the fair 
market value of the production on the unit before the fire and after the 
fire.)

                        10. Concealment or Fraud

    We may void the insurance contract on all crops without affecting 
your liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to this 
or any other contract with us. The voidance will be effective as of the 
beginning of the crop year with respect to which such act or omission 
occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to the applicable indemnity. The transfer must be on 
our form and approved by us. Both you and the person to whom you 
transfer your interest are jointly and severally liable for the payment 
of the premium. The transferee has all rights and responsibilities under 
the contract consistent with the transferee's interest.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year. The assignment must be on our form and will not be effective 
until approved in writing by us. The assignee may submit all notices and 
forms required to protect the insurance contract and to claim an 
indemnity.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep records of the harvesting, storage, shipment, sale, or 
other disposition of all the insured crop produced on each unit, and 
separate records including the same information for production of the 
crop from any uninsured acreage. The records must be kept for three 
years from the end of the crop year to which they pertain. Failure to 
keep and maintain such records may result in: (a) Cancellation of the 
contract for that crop year; (b) assignment of production to units by 
us; or (c) a determination that no indemnity is due, whichever we elect. 
Any person designated by us will have access to such records and the 
farm for purposes related to the contract.

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            15. Contract Term, Cancellation, and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. If the amount is paid by deduction from an indemnity 
or other U.S. Department of Agriculture payment, the date of payment:
    (1) If deducted from an indemnity, will be the date you sign the 
properly completed claim form; or
    (2) If deducted from a payment under another program administered by 
the United States Department of Agriculture, will be the date both such 
other payment and setoff are approved.
    d. The cancellation and termination dates are contained in the crop 
endorsement.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for three 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election or amount of insurance at which indemnities 
are computed is no longer offered, the actuarial table will provide the 
price election or amount of insurance which you are conclusively 
presumed to have elected unless you elect a different price election or 
amount of insurance prior to the sales closing date. All contract 
changes will be available at your service office by the contract change 
date contained in the crop endorsement. Acceptance of changes will be 
conclusively presumed in the absence of notice from you to cancel the 
contract.

                          17. Meaning of Terms

    For the purposes of the crop insurance contract:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the amounts of insurance or production 
guarantees, coverage levels or amounts of insurance, premium rates, 
prices for computing indemnities, practices, insurable and uninsurable 
acreage, and related information regarding crop insurance in the county.
    b. ASCS means the Agricultural Stabilization and Conservation 
Service of the United States Department of Agriculture.
    c. ASCS farm serial number means the number assigned to the farm by 
the ASCS County Office Committee.
    d. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county as shown by the actuarial table.
    e. Crop endorsement means the endorsement to the policy contained in 
this part which sets forth the terms and conditions of insurance 
applicable to the named crop.
    f. Cropland means any acreage considered by ASCS for program payment 
purposes.
    g. Crop year means the period within which the crop is normally 
grown and will be designated by the calendar year in which the insured 
crop is normally harvested.
    h. Harvest (Defined in the crop endorsement).
    i. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    j. Insured means the person who submitted the application accepted 
by us and does not extend to any other person having a share or interest 
in the crop such as a partnership, landlord, or any other person unless 
specifically indicated on the application and accepted by us.
    k. Insured crop means the crop insured under the provisions of the 
applicable crop endorsement.
    l. Loss ratio means the ratio of indemnity to premium.
    m. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State or a political subdivision or agency of a State.
    n. Production report means previous year yield information including 
planted acreage and harvested production, reported by you, that is 
supportable by written verifiable records from a buyer of the insured 
crop or by measurement of farm stored production.
    o. Section means a unit of measure under the rectangular survey 
system describing a tract of land usually one mile square and generally 
containing approximately 640 acres.

[[Page 70]]

    p. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    q. Tenant means a person who rents land from another person for a 
share of the crop or a share of the proceeds therefrom.
    r. Unit means all insurable acreage of the crop in the county on the 
date insurance attaches for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another specific 
entity on a share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the insured crop on such land will 
be considered as owned by the lessee. Land which would otherwise be one 
unit may, in certain instances, be divided according to guidelines 
contained in the applicable crop endorsement or by written agreement 
with us. Units will be determined when the acreage is reported but may 
be adjusted to reflect the actual unit structure when adjusting a loss; 
however, no further division may be made at loss adjustment time. We may 
consider any acreage and share thereof reported by or for your spouse or 
child or any member of your household to be your bona fide share or the 
bona fide share of any other person having an interest therein.
    s. Verifiable records mean documents indicating a quantity of 
production or acreage determined by us, other government agencies, 
buyers, processors, packers, storage facilities or other third parties 
acceptable to us. The documents must include the name of the producer 
and entity making the measurement, the date of the measurement, and the 
crop type, class, or variety.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations (7 CFR 
part 400, subpart J).

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice. If the date by which you are required to 
submit an application or a report or notice falls on a Saturday, Sunday, 
or Federal holiday if your service office is not open for business on 
such date such notice or report must be submitted on the next business 
day.

                     21. Dates, Reports, and Notices

    To preserve your rights under this insurance contract you are 
required to file a number of reports and notices with us by certain 
dates. The actual content requirements and time limits of those reports 
and notices are set out elsewhere in this contract and you must refer to 
those sections for those requirements.
    As a convenience to you and without limitation on our rights under 
this contract, a short description of most of the dates, reports and 
notices have been compiled in this section. Omission of any date, report 
or notice, or are referred to the crop endorsement for any such 
requirements.)
    a. ``Acreage report''--A report required by section 3 of this 
contract. This report contains, in addition to other information, the 
report of the insured's share of all acreage of an insured crop in the 
county whether insurable or uninsurable and must be filed prior to the 
final acreage reporting date contained in the actuarial table for the 
county for the crop insured.
    b. ``Another use, Notice of''--The written notice required when an 
insured wishes to put acreage to another use (See: Section 8).
    c. ``Application''--A form required by Subpart D of Part 400 of 7 
CFR and each individual program regulation. The application for 
insurance form must be completed and filed in the service office prior 
to the sales closing date (contained in the actuarial table) of the 
initial insurance year for each crop year for which an insurance 
endorsement is requested by the insured.
    d. ``Assignment of indemnity''--A transfer of contract rights, made 
on our form, and effective when approved by us. It is the arrangement 
whereby you assign your right to an indemnity payment to any party of 
your choice for the crop year.
    e. ``Billing date''--The first date upon which an insured is billed 
for insurance coverage and which generally falls at or near harvest 
time. Interest accruing on any unpaid premium balance attaches 30 days 
after the billing date.
    f. ``Cancellation date''--The date on or before which the insured or 
the Corporation may cancel the insurance policy for the subsequent crop 
year by giving written notice.
    g. ``Claim for indemnity'' (See: Section 9)--A claim made by the 
insured for damage or loss to an insured crop and submitted to the

[[Page 71]]

Corporation not later than 60 days after the earliest of:
    (1) Total destruction of the insured crop on the unit;
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    h. ``Claim for indemnity, Notice of''--The loss notice required to 
be given by the insured not later than 10 days after certain occurrences 
(See: Section 8).
    i. ``Contract change date''--The date by which FCIC makes any 
contract changes available for inspection in the service office (See: 
Section 16).
    j. ``Damage, notice of''--See: Probable loss, Notice of.
    k. ``Earliest planting date''--The earliest date established for 
planting the insured crop and qualifying for a replant payment (See: 
Actuarial Table and Section 9.h.(1)(b)).
    l. ``End of insurance period, Date of''--The date upon which the 
insured's crop insurance coverage ceases (See: Section 7).
    m. ``Insurance attaches, Date''--The date insurances attaches on the 
crop, generally after planting is completed or the calendar date in the 
crop endorsement (See: Section 7).
    n. ``Intent to abandon, Notice of''--The written notice to the 
Corporation by the insured indicating that because of damage from an 
insured cause, the insured has decided to no longer care for or harvest 
any part of the crop.
    o. ``Late planting agreement''--Available on selected crops. An 
amendment to the insurance contract which allows an insured whose 
planting has been delayed, to insure a crop planted after the final 
planting date in exchange for a reduction in coverage.
    p. ``Probable loss, notice of''--A written notice required to be 
filed in the service office whenever an insured believes that the 
insured crop has been damaged to the extent that a loss is probable 
(See: Section 8).
    q. ``Production report''--A written record showing the insured's 
annual production and used to determine the yield guarantee. (See: 
Section 4). The report contains previous year yield information 
including planted acreage and harvested production. This report must be 
supported by written records from a warehouseman or buyer of the insured 
crop or by measurement of farm stored production.
    r. ``Replanting, Notice of completion''--The notice required to be 
given by the insured to the Corporation when replanting is completed 
(See: Section 8).
    s. ``Reporting date''--The acreage reporting date (contained in the 
Actuarial Table) by which you are required to report all your insurable 
and uninsurable acreage in the county in which you have a share and your 
share at the time insurance attaches.
    t. ``Sales closing date''--The date contained in the actuarial table 
on file in the respective service office which sets out the final date 
when an application for insurance may be filed.
    u. ``Termination date''--The date upon which the Corporation may 
cancel the insurance policy for non-payment of premium.
    (e) Notwithstanding the terms of the crop insurance endorsement and 
any contract for crop insurance under the provisions of this part, 
coverage under the terms of such crop insurance endorsement will be 
effective subject to the availability of appropriations.

[52 FR 28447, July 30, 1987, as amended at 52 FR 36401, Sept. 29, 1987; 
53 FR 9099, Mar. 21, 1988; 53 FR 16540, May 10, 1988, and 54 FR 9766, 
Mar. 8, 1989; 54 FR 20370, May 11, 1989; 55 FR 6972, Feb. 28, 1990; 55 
FR 50812, Dec. 11, 1990; 56 FR 13577, Apr. 3, 1991; 61 FR 39050, July 
26, 1996; 62 FR 42649, Aug. 8, 1997]



Secs. 401.9--401.100  [Reserved]



Sec. 401.101  Wheat endorsement.

    The provisions of the Wheat Crop Insurance Endorsement for the 1988 
through the 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                            Wheat Endorsement

                             1. Insured Crop

    a. The crop insured will be wheat planted for harvest as grain.
    b. In addition to the wheat not insurable in section 2 of the 
general crop insurance policy, we do not insure any wheat:
    (1) If the seed has not been mechanically incorporated into the 
soil;
    (2) If the seed is planted where an established grass or legume 
exists unless we agree, in writing, to insure such wheat; or
    (3) Destroyed or put to another use in order to comply with other 
U.S. Department of Agriculture programs.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting; unless 
those causes are excepted, excluded, or limited by the actuarial table 
or section 9 of the general crop insurance policy.

[[Page 72]]

                            3. Annual Premium

    a. The annual premium amount is computed by multiplying the 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share at the time of planting.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1984 crop year 
under the terms of the experience table contained in the wheat policy 
for the 1985 crop year, you will continue to receive the benefit of the 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1985 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                           4. Insurance Period

    In lieu of the provisions in section 7 of the general crop insurance 
policy the following will apply:
    a. Insurance attaches on each unit or part of a unit when the wheat 
is planted except that:
    (1) In counties with an April 15 cancellation date, insurance will 
attach on fall-planted wheat on April 16 following planting if it is 
determined that there is an adequate stand on this date to produce a 
normal crop;
    (2) If you have optional winter coverage in effect, or if optional 
winter coverage is provided in the county and you purchase such coverage 
before the winter wheat sales closing date, insurance will attach at the 
time of planting; or
    (3) If optional winter coverage is provided in the county and you 
fail to purchase such coverage and it is determined that there is an 
adequate stand on the spring final planting date to produce a normal 
crop, insurance will attach on the spring final planting date.
    b. Insurance ends on each unit at the earliest of:
    (1) Total destruction of the wheat;
    (2) Combining, threshing, harvesting for silage or hay, or removal 
from the field;
    (3) Final adjustment of a loss; or
    (4) The following dates of the calendar year in which wheat is 
normally harvested:
    (a) Alaska, September 25;
    (b) All other states, October 31.

                            5. Unit Division

    Wheat acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one unit if you agree to pay additional premium as provided by 
the actuarial table and if for each proposed unit:
    a. You maintain written, verifiable records of planted acreage and 
harvested production for at least the previous crop year and production 
reports based on those records are filed to obtain an insurance 
guarantee; and
    b. Acreage planted to insured wheat is located in separate, legally 
identifiable sections (except in Florida) or, in the absence of section 
descriptions (and in all of Florida), the land is identified by separate 
ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the sections or ASCS Farm Serial Numbers are 
clearly identified and the insured acreage is easily determined; and
    (2) The wheat is planted in such a manner that the planting pattern 
does not continue into the adjacent section or ASCS Farm Serial Number; 
or
    c. The acreage planted to the insured wheat is located in a single 
section or ASCS Farm Serial Number and consists of acreage on which both 
an irrigated and nonirrigated practice are carried out, provided:
    (1) Wheat planted on irrigated acreage does not continue into 
nonirrigated acreage in the same rows or planting pattern; and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good dryland and irrigated farming practices 
for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       6. Notice of Damage or Loss

    a. In addition to the notices required in section 8 of the general 
crop insurance policy, in case of damage or probable loss you must give 
us written notice if you want to harvest the wheat for silage or hay. 
After such notice is given, we will appraise the potential grain 
production. If we are unable to do so before harvest, you may harvest 
the crop provided representative samples are left for appraisal 
purposes. For purposes of this section and section 8 of the general crop 
insurance policy the representative sample of the unharvested crop must 
be at least 10 feet wide and the entire length of the field.
    b. A replant payment is available under this endorsement only in 
those counties where a Wheat Winter Coverage Option is available and 
only if the insured has elected the Wheat Winter Coverage Option. The 
replant payment will be the actual cost of replanting not to exceed the 
lesser of 20 percent of the production guarantee or 3 bushels multiplied 
by the price election multiplied by your share.

[[Page 73]]

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of wheat to be 
counted (see subsection 7.b.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    b. The total production (bushels) to be counted for a unit will 
include all harvested and appraised production.
    (1) Mature wheat production which otherwise is not eligible for 
quality adjustment will be reduced .12 percent for each .1 percentage 
point of moisture in excess of 13.5 percent; or
    (2) Wheat, which due to insurable causes, grades not higher than 
U.S. No. 5 because of test weight, total damage, or shrunken and broken 
kernels, or which meets the special grade requirements for ``garlicky'', 
``smutty'', ``light smutty'', or ``ergoty'', (all as graded by a grain 
grader licensed by the Federal Grain Inspection Service or a licensed 
grader under the United States Warehouse Act) will be adjusted by:
    (a) Dividing the value per bushel of the insured wheat by the price 
per bushel of U.S. No. 2 wheat which does not grade garlicky, smutty, or 
ergoty; and
    (b) Multiplying the result by the number of bushels of such wheat.
    The applicable price for No. 2 wheat will be the local market price 
on the earlier of the day the loss is adjusted or the day the insured 
wheat is sold.
    (3) Any harvested production from other volunteer plants growing in 
the wheat will be counted as wheat on a weight basis.
    (4) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good wheat farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (c) Any unharvested production.
    (5) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of wheat becomes general 
in the county and is reappraised by us;
    (b) Further damaged by an insured cause and is reappraised by us; or
    (c) Harvested.

                  8. Cancellation and Termination Dates

    The cancellation and termination dates are:

------------------------------------------------------------------------
         State and county            Cancellation date  Termination date
------------------------------------------------------------------------
All Alaska Counties except those    Apr. 15...........  Apr. 15.
 listed below; Alamosa, Conejos,
 Costilla, Rio Grande, and
 Saguache Counties, Colorado;
 Maine; Minnesota; Daniels,
 Roosevelt, Sheridan, and Valley
 Counties, Montana; New Hampshire;
 North Dakota; Corson, Walworth,
 Edmunds, Faulk, Spink, Beadle,
 Jerauld, Aurora, Douglas, and Bon
 Homme Counties, South Dakota and
 all South Dakota Counties north
 and east thereof; Vermont; and
 Trempealeau, Jackson, Wood,
 Portage, Waupaca, Outagamie,
 Brown, and Kewaunee Counties,
 Wisconsin and all Wisconsin
 Counties north and west thereof;
 Big Horn, Fremont, Hot Springs,
 Park, and Washakie Counties,
 Wyoming.
All other Colorado Counties except  Sept. 30..........  Sept. 30.
 those listed below; all Iowa
 Counties except those listed
 below; Kansas; Nebraska; New
 Mexico; Oklahoma; Texas; all
 other Wisconsin Counties and all
 other states except those listed
 below.
Archuleta, Custer, Delta, Dolores,  Sept. 30..........  Nov. 30.
 Eagle, Garfield, Grand, La Plata,
 Mesa, Moffat, Montezuma,
 Montrose, Ouray, Pitkin, Rio
 Blanco, Routt, and San Miguel
 Counties, Colorado; Connecticut;
 Plymouth, Cherokee, Buena Vista,
 Pocahontas, Humboldt, Wright,
 Franklin, Butler, Black Hawk,
 Buchanan, Delaware, and Dubuque
 Counties, Iowa and all Iowa
 Counties north thereof;
 Massachusetts; all other Montana
 Counties; New York; Rhode Island;
 all other South Dakota Counties;
 and all other Wyoming Counties.
Matanuska-Susitna County, Alaska;   Oct. 31...........  Nov. 30.
 Arizona; California; Idaho;
 Nevada; Oregon; Utah; and
 Washington.
------------------------------------------------------------------------

                           9. Contract Changes

    The date by which contract changes will be available in your service 
office is December 31 preceding the cancellation date for counties with 
an April 15 cancellation date and August 15 preceding the cancellation 
date for all other counties.

                10. Late Planting and Prevented Planting

    (a) In lieu of subparagraphs 2.e.(4) and 21.o. of the General Crop 
Insurance Policy (Sec. 401.8), insurance will be provided for acreage 
planted to wheat during the late planting period (see subparagraph (c)), 
and acreage you were prevented from planting (see subparagraph (d)). 
These coverages provide reduced production guarantees for such acreage. 
The reduced guarantees will be combined with the

[[Page 74]]

production guarantee for timely planted acreage for each unit. The 
premium amount for late planted acreage and eligible prevented planting 
acreage will be the same as that for timely planted acreage. For 
example, assume you insure one unit in which you have a 100 percent 
share. The unit consists of 150 acres, of which 50 acres were planted 
timely, 50 acres were planted 7 days after the final planting date (late 
planted), and 50 acres are unplanted and eligible for prevented planting 
coverage. To calculate the amount of any indemnity which may be due to 
you, the production guarantee for the unit will be computed as follows:
    (1) For timely planted acreage, multiply the per acre production 
guarantee for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the per acre production 
guarantee for timely planted acreage by ninety-three percent (0.93) and 
multiply the result by the 50 acres planted late; and
    (3) For prevented planting acreage, multiply the per acre production 
guarantee for timely planted acreage by fifty percent (0.50) and 
multiply the result by the 50 acres eligible for prevented planting 
coverage.
    The total of the three calculations will be the production guarantee 
for the unit. Your premium will be based on the result of multiplying 
the per acre production guarantee for timely planted acreage by the 150 
acres in the unit.
    (b) You must provide written notice to us if you were prevented from 
planting (see subparagraph 11.(i)). This notice must be given not later 
than three (3) days after:
    (1) The latest wheat final planting date in the county if you have 
unplanted acreage that may be eligible for prevented planting coverage; 
and
    (2) The date you stop planting within the late planting period on 
any unit that may have acreage eligible for prevented planting coverage.
    (c) Late Planting.
    (1) For all spring-planted wheat acreage (and fall-planted wheat 
acreage only where insurance is not offered for spring-planted wheat) 
which is planted after the final planting date but on or before 25 days 
after the final planting date, the production guarantee for each acre 
will be reduced for each day planted after the final planting date by:
    (i) One percent (.01) for the first through the tenth day; and
    (ii) Two percent (.02) for the eleventh through the twenty-fifth 
day.
    (2) In addition to the requirements of section 3 (Report of Acreage, 
Share, and Practice (Acreage Report)) of the General Crop Insurance 
Policy (Sec. 401.8), you must report the dates the acreage is planted 
within the late planting period.
    (3) If planting of the wheat continues after the final planting 
date, or you are prevented from planting during the late planting 
period, the acreage reporting date will be the later of:
    (i) The acreage reporting date contained in the Actuarial Table; or
    (ii) Five (5) days after the end of the planting period.
    (d) Prevented Planting (Including Planting After the Late Planting 
Period).
    (1) If your were prevented from planting wheat (see subparagraph 
11.(i), you may elect:
    (i) To plant wheat during the late planting period. The production 
guarantee for such acreage will be determined in accordance subparagraph 
10.(c)(1);
    (ii) Not to plant this acreage to any crop that is intended for 
harvest in the same crop year. The production guarantee for such acreage 
which is eligible for prevented planting coverage will be fifty percent 
(0.50) of the production guarantee for timely planted acres. In counties 
for which the Actuarial Table designates a spring final planting date, 
the prevented planting guarantee will be based on your approved yield 
for spring-planted wheat. For example, if your production guarantee for 
timely planted acreage is 30 bushels per acre, your prevented planting 
production guarantee would be equivalent to 15 bushels per acre (30 
bushels multiplied by 0.50). This section does not prohibit the 
preparation and care of the acreage for conservation practices, such as 
planting a cover crop, as long as such crop is not intended for harvest; 
or
    (iii) To plant wheat after the late planting period. The production 
guarantee for such acreage will be fifty percent (0.50) of the 
production guarantee for timely planted acres. For example, if your 
production guarantee for timely planted acreage is 30 bushels per acre, 
your prevented planting production guarantee would be equivalent to 15 
bushels per acre (30 bushels multiplied 0.50). Production to count for 
such acreage will be determined in accordance with subparagraph 7.b.
    (2) In addition to the provisions of section 4 (Insurance Period) of 
this endorsement, the beginning of the insurance period for prevented 
planting coverage is the sales closing date designated in the Actuarial 
Table for wheat in the county.
    (3) The acreage to which prevented planting coverage applies will be 
limited as follows:
    (i) Eligible acreage will not exceed the greater of:
    (A) The number of acres planted to wheat on each ASCS Farm Serial 
Number during the previous crop year (adjusted for any reconstitution 
which may have occurred prior to the sales closing date);
    (B) The ASCS base acreage for wheat reduced by any acreage reduction 
applicable to

[[Page 75]]

the farm under any program administered by the United States Department 
of Agriculture; or
    (C) One hundred percent (100%) of the simple average of the number 
of acres planted to wheat during the crop years that were used to 
determine your yield;

unless we agree in writing, prior to the sales closing date, to approve 
acreage exceeding this limit.
    (ii) Acreage intended to be planted under any irrigated practice 
will be limited to the number of wheat acres properly prepared to carry 
out an irrigated practice.
    (iii) A prevented planting production guarantee will not be provided 
for:
    (A) Any acreage that does not constitute at least 20 acres or 20 
percent (20%) of the acres in the unit whichever is less;
    (B) Land for which the Actuarial Table does not designate a premium 
rate unless you submit a written request for coverage for such acreage 
prior to the sales closing date for wheat in the county. Upon your 
timely written request, we will provide a written insurance offer for 
such acreage;
    (C) Land used for conservation purposes or intended to be or 
considered to have been left unplanted under any program administered by 
the United States Department of Agriculture;
    (D) Land on which any crop, other than wheat, has been planted and 
is intended for harvest, or has been harvested in the same crop year; or
    (E) Land which planting history or conservation plans indicate would 
remain fallow for crop rotation purposes.
    (iv) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be reduced 
by the number of wheat acres timely planted and late planted. For 
example, assume you have 100 acres eligible for prevented planting 
coverage in which you have a 100 percent (100%) share. The acreage is 
located in a single ASCS Farm Serial Number which you insure as two 
separate optional units consisting of 50 acres each. If you planted 60 
acres of wheat on one optional unit and 40 acres of wheat on the second 
optional unit, your prevented planting eligible acreage would be reduced 
to zero (i.e., 100 acres eligible for prevented planting coverage minus 
100 acres planted equals zero). If you report more wheat acreage under 
this contract than is eligible for prevented planting coverage, we will 
allocate the eligible acreage to insured units based on the number of 
prevented planting acres and share you reported for each unit.
    (4) When the ASCS Farm Serial Number covers more than one unit, or a 
unit consists of more than one ASCS Farm Serial Number, the covered 
acres will be pro-rated based on the number of acres in each unit or 
ASCS Farm Serial Number that could have been planted to wheat in the 
crop year.
    (5) In accordance with the provisions of section 3 (Report of 
Acreage, Share, and Practice (Acreage Report)) of the General Crop 
Insurance Policy (Sec. 401.8), you must report any insurable acreage you 
were prevented from planting. This report must be submitted on or before 
the acreage reporting date for spring-planted wheat in counties for 
which the Actuarial Table designates a spring final planting date, or 
the acreage reporting date for fall-planted wheat in counties for which 
the Actuarial Table designates a fall final planting date only, even 
though you may elect to plant the acreage after the late planting 
period. Any acreage you report as eligible for prevented planting 
coverage which we determine is not eligible will be deleted from 
prevented planting coverage.
    (6) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be provided for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          11. Meaning of Terms

    (a) Adequate stand--a sufficient population of plants to produce at 
least the yield used to determine the guarantee.
    (b) Days-- calendar days.
    (c) Final planting date--the date contained in the Actuarial Table 
by which the insured wheat must initially be planted in order to be 
insured for the full production guarantee.
    (d) Harvest--completion of combining, threshing, or cutting for hay 
or silage on any acreage.
    (e) 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 wheat acreage.
    (f) Late planted--acreage planted during the late planting period.
    (g) Late planting period--(applicable only to spring-planted wheat 
acreage and fall-planted wheat acreage only where insurance is not 
offered for spring-planted wheat)-the period which begins the day after 
the final planting date for wheat and ends twenty-five (25) days after 
the wheat final planting date.
    (h) Latest wheat final planting date--
    (1) The final planting date for spring-planted wheat in all counties 
for which the Actuarial Table designates a final planting date for 
spring-planted wheat only;
    (2) The final planting date for fall-planted wheat in all counties 
for which the Actuarial Table designates a final planting date for fall-
planted wheat only; or

[[Page 76]]

    (3) The final planting date for spring-planted wheat in all counties 
for which the Actuarial Table designates final planting dates for both 
spring-planted and fall-planted wheat.
    (i) Prevented planting--inability to plant wheat with proper 
equipment by:
    (1) The latest wheat final planting date in the county; or
    (2) The end of the late planting period.
    You must have been unable to plant wheat due to an insured cause of 
loss which is general in the area (i.e., most producers in the 
surrounding area are unable to plant due to similar insurable causes) 
and which occurs between the sales closing date and the latest wheat 
final planting date in the county or within the late planting period.
    (j) Production guarantee--the number of bushels determined by 
multiplying the approved yield per acre by the coverage level percentage 
you elect.
    (k) Timely planted--wheat planted by the final planting date, as 
established by the Actuarial Table, for wheat in the county to be 
planted for harvest in the crop year.

[52 FR 28447, July 30, 1987, as amended at 53 FR 36781, Sept. 22, 1988; 
54 FR 20504, May 12, 1989; 58 FR 33508, June 18, 1993; 58 FR 67631, Dec. 
22, 1993; 60 FR 56934, Nov. 13, 1995]



Sec. 401.102  The winter coverage option for wheat.

    The Winter Coverage Option for wheat is available in the following 
counties and states beginning in the 1988 through 1994 crop years:

                              South Dakota

Bennett
Brule
Buffalo
Butte
Stanley
Charles Mix
Custer
Dewey
Fall River
Sully
Gregory
Haakon
Hand
Harding
Todd
Hughes
Hyde
Jackson
Jones
Tripp
Lawrence
Lyman
Meade
Mellette
Ziebach
Pennington
Perkins
Potter
Shannon

    The provisions of the Winter Coverage Option for Wheat for the 1988 
through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                Wheat Endorsement--Winter Coverage Option

                      (This is a continuous Option)

Insured's Name__________________________________________________________
Address_________________________________________________________________
Contract No.____________________________________________________________
Crop Year_______________________________________________________________
Identification No.______________________________________________________
SSN_____________________________________________________________________
Tax_____________________________________________________________________
    In consideration of the additional premium as set by the Actuarial 
Table (FCI-35), the insurance provided is attached to and made part of 
the Wheat Endorsement subject to the following terms and conditions:
    1. You must have a wheat endorsement.
    2. Coverage under this option for fall-planted wheat will begin at 
the time of planting and will end on the spring final planting date for 
wheat in the county.
    3. When there is not an adequate stand on the spring final planting 
date to produce the farm unit production guarantee, you have the option 
to:
    a. Continue to provide sufficient care for the insured wheat crop 
through harvest;
    b. Replant all destroyed acreage to a spring variety of wheat and 
receive a replanting payment in accordance with subsection 9.h. of the 
general crop insurance policy and subsection 6.b. of the wheat 
endorsement; or
    c. Accept our appraisal of the production to count, destroy the 
remaining crop on the acreage and be paid any indemnity due under the 
terms of the general crop insurance policy and the wheat endorsement.
    4. In case of damage to the wheat under this option, you must 
provide us with written notice prior to the spring final planting date 
for wheat.

Insured's Signature_____________________________________________________
Date____________________________________________________________________
Agent's Signature_______________________________________________________
Date____________________________________________________________________

[52 FR 28447, July 30, 1987, as amended at 60 FR 56934, Nov. 13, 1995]



Sec. 401.103  Barley endorsement.

    The provisions of the Barley Crop Insurance Endorsement for the 1988 
through the 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                           Barley Endorsement

                             1. Insured Crop

    a. The crop insured will be barley planted for harvest as grain. A 
mixture of barley with either oats or wheat or both planted for harvest 
as grain may also be insured if provided by the actuarial table. The 
production from such mixture will be considered as barley on a weight 
basis.
    b. In addition to the barley not insurable in section 2 of the 
general crop insurance policy, we do not insure any barley:

[[Page 77]]

    (1) If the seed has not been mechanically incorporated into the 
soil;
    (2) If the seed is planted where an established grass or legume 
exists unless we agree, in writing, to insure such barley; or
    (3) Destroyed or put to another use in order to comply with other 
U.S. Department of Agriculture programs.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.

                            3. Annual Premium

    a. The annual premium amount is computed by multiplying the 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share at the time of planting.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1984 crop year 
under the terms of the experience table contained in the barley policy 
for the 1985 crop year, you will continue to receive the benefit of the 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1985 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                           4. Insurance Period

    In lieu of the provisions in section 7 of the general crop insurance 
policy the following will apply:
    a. Insurance attaches on each unit or part of a unit when the barley 
is planted except that:
    (1) In counties with an April 15 cancellation date, insurance will 
attach on fall-planted barley on April 16 following planting if it is 
determined that there is an adequate stand on this date to produce a 
normal crop;
    (2) If you have optional winter coverage in effect, or if optional 
winter coverage is provided in the county and you purchase such coverage 
before the winter barley sales closing date, insurance will attach at 
the time of planting; or
    (3) If optional winter coverage is provided in the county and you 
fail to purchase such coverage, and it is determined that there is an 
adequate stand on the spring final planting date to produce a normal 
crop, insurance will attach on the spring final planting date.
    b. Insurance ends on each unit at the earliest of:
    (1) Total destruction of the barley;
    (2) Combining, threshing, harvesting for silage or hay, or removal 
from the field;
    (3) Final adjustment of a loss; or
    (4) The following dates of the calendar year in which barley is 
normally harvested:
    (a) Alaska, September 25;
    (b) All other states, October 31.

                            5. Unit Division

    Barley acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one unit if you agree to pay additional premium as provided 
for by the actuarial table and if for each proposed unit:
    a. You maintain written, verifiable records of planted acreage and 
harvested production for at least the previous crop year and production 
reports based on those records are filed to obtain an insurance 
guarantee; and
    b. Acreage planted to insured barley is located in separate, legally 
identifiable sections (except in Florida) or, in the absence of section 
descriptions (and all of Florida), the land is identified by separate 
ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the sections or ASCS Farm Serial Numbers are 
clearly identified and the insured acreage is easily determined; and
    (2) The barley is planted in such a manner that the planting pattern 
does not continue into the adjacent section or ASCS Farm Serial Number; 
or
    c. The acreage planted to the insured barley is located in a single 
section or ASCS Farm Serial Number and consists of acreage on which both 
an irrigated and nonirrigated practice are carried out, provided:
    (1) Barley planted on irrigated acreage does not continue into 
nonirrigated acreage in the same rows or planting pattern; and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good dryland and irrigated farming practices 
for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

[[Page 78]]

                       6. Notice of Damage or Loss

    a. In addition to the notices required in section 8 of the general 
crop insurance policy, in case of damage or probable loss you must give 
us written notice if you want to harvest the barley for silage or hay. 
After such notice is given, we will appraise the potential grain 
production. If we are unable to do so before harvest, you may harvest 
the crop provided representative samples are left for appraisal 
purposes. For the purposes of this section and Section 8 of the general 
crop insurance policy, the representative sample of the unharvested crop 
must be at least 10 feet wide and the entire length of the field.
    b. A replant payment is available under this endorsement only in 
those counties where a Barley Winter Coverage Option is available and 
only if the insured has elected the Barley Winter Coverage Option. The 
replant payment will be the actual cost of replanting not to exceed the 
lesser of 20 percent of the production guarantee or 3 bushels multiplied 
by the price election multiplied by your share.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of barley to be 
counted (see subsection 7.b.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    b. The total production (bushels) to be counted for a unit will 
include all harvested and appraised production.
    (1) Mature barley production which otherwise is not eligible for 
quality adjustment will be reduced .12 percent for each .1 percentage 
point of moisture in excess of 14.5 percent; or
    (2) Mature barley production which, due to insurable causes, has a 
test weight of less than 40 pounds per bushels or, as determined by a 
grain grader licensed by the Federal Grain Inspection Service or 
licensed under the United States Warehouse Act contains: less than 85 
percent sound barley; more than 8 percent damaged kernels; more than 35 
percent thin barley; more than 5 percent black barley; or grades smutty, 
garlicky, or ergoty, will be adjusted by:
    (a) Dividing the value per bushel of the insured barley by the price 
per bushel of U.S. No. 2 barley which does not grade smutty, garlicky, 
or ergoty; and
    (b) Multiplying the result by the number of bushels of such barley.
    The applicable price for No. 2 barley will be the local market price 
on the earlier of the day the loss is adjusted or the day the insured 
barley is sold.
    (3) Any harvested production from other volunteer plants growing in 
the barley will be counted as barley on a weight basis.
    (4) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good barley farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (c) Any unharvested production.
    (5) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of barley becomes general 
in the county and is reappraised by us;
    (b) Further damaged by an insured cause and is reappraised by us; or
    (c) Harvested.

                  8. Cancellation and Termination Dates

    The cancellation and termination dates are:

------------------------------------------------------------------------
         State and county            Cancellation date  Termination date
------------------------------------------------------------------------
Kit Carson, Lincoln, Elbert, El     Sept. 30..........  Nov. 30.
 Paso, Pueblo, Las Animas
 Counties, Colorado and all
 Colorado Counties south and east
 thereof; Connecticut; Kansas;
 Massachusetts; and New York.
New Mexico except Taos County;      Sept. 30..........  Sept. 30.
 Oklahoma; Missouri; Illinois;
 Indiana; Ohio; Pennsylvania; New
 Jersey; and all states south and
 east thereof.
Arizona; California; Clark and Nye  Oct. 31...........  Nov. 30.
 Counties, Nevada.
All other Colorado Counties; all    Apr. 15...........  Apr. 15.
 other Nevada Counties; Taos
 County, New Mexico, and all other
 states.
------------------------------------------------------------------------

                           9. Contract Changes

    The date by which contract changes will be available in your service 
office is December 31 preceding the cancellation date for counties with 
an April 15 cancellation date and August 15 preceding the cancellation 
date for all other counties.

                10. Late Planting and Prevented Planting

    (a) In lieu of subparagraphs 2.3.(4) and 21.o of the General Crop 
Insurance Policy (Sec. 401.8), insurance will be provided for acreage 
planted to barley during the late planting period (see subparagraph 
(c)), and acreage you were prevented from planting (see subparagraph 
(d)). These coverages provide reduced production guarantees for such 
acreage. The reduced guarantees will be combined with the production 
guarantee for timely planted

[[Page 79]]

acreage for each unit. The premium amount for late planted acreage and 
eligible prevented planting acreage will be the same as that for timely 
planted acreage. For example, assume you insure one unit in which you 
have a 100 percent (100%) share. The unit consists of 150 acres, of 
which 50 acres were planted timely, 50 acres were planted 7 days after 
the final planting date (late planted), and 50 acres are unplanted and 
eligible for prevented planting coverage. To calculate the amount of any 
indemnity which may be due to you, the production guarantee for the unit 
will be computed as follows:
    (1) For timely planted acreage, multiply the per acre production 
guarantee for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the per acre production 
guarantee for timely planted acreage by ninety-three percent (0.93) and 
multiply the result by the 50 acres planted late; and
    (3) For prevented planting acreage, multiply the per acre production 
guarantee for timely planted acreage by fifty percent (0.50) and 
multiply the result by the 50 acres eligible for prevented planting 
coverage.
    The total of the three calculations will be the production guarantee 
for the unit. Your premium will be based on the result of multiplying 
the per acre production guarantee for timely planted acreage by the 150 
acres in the unit.
    (b) You must provide written notice to us if you were prevented from 
planting (see subparagraph 11.(i)). This notice must be given not later 
than three (3) days after:
    (1) The latest barley final planting date in the county if you have 
unplanted acreage that may be eligible for prevented planting coverage; 
and
    (2) The date you stop planting within the late planting period on 
any unit that may have acreage eligible for prevented planting coverage.
    (c) Late Planting.
    (1) For all spring-planted barley acreage (and fall-planted barley 
acreage only where insurance is not offered for spring-planted barley) 
which is planted after the final planting date but on or before 25 days 
after the final planting date, the production guarantee for each acre 
will be reduced for each day planted after the final planting date by:
    (i) One percent (.01) for the first through the tenth day; and
    (ii) Two percent (.02) for the eleventh through the twenty-fifth 
day.
    (2) In addition to the requirements of section 3 (Report of Acreage, 
Share, and Practice (Acreage Report)) of the General Crop Insurance 
Policy (Sec. 401.8), you must report the dates the acreage is planted 
within the late planting period.
    (3) If planting of the barley continues after the final planting 
date, or you are prevented from planting barley during the late planting 
period, the acreage reporting date will be the later of:
    (i) The acreage reporting date contained in the Actuarial Table; or
    (ii) Five (5) days after the end of the late planting period.
    (d) Prevented Planting (Including Planting After the Late Planting 
Period).
    (1) If you were prevented from planting barley (see subparagraph 
11.(i)), you may elect:
    (i) To plant barley during the late planting period. The production 
guarantee for such acreage will be determined in accordance with 
subparagraph 10.(c)(1);
    (ii) Not to plant this acreage to any crop that is intended for 
harvest in the same crop year. The production guarantee for such acreage 
which is eligible for prevented planting coverage will be fifty percent 
(0.50) of the production guarantee for timely planted acres. In counties 
for which the Actuarial Table designates a spring final planting date, 
the prevented planting guarantee will be based on your approved yield 
for spring-planted barley. For example, if your production guarantee for 
timely planted acreage is 30 bushels per acre, your prevented planting 
production guarantee would be equivalent to 15 bushels per acre (30 
bushels multiplied by 0.50). This section does not prohibit the 
preparation and care of the acreage for conservation practices, such as 
planting a cover crop, as long as such crop is not intended for harvest; 
or
    (iii) To plant barley after the late planting period. The production 
guarantee for such acreage will be fifty percent (0.50) of the 
production guarantee for timely planted acres. For example, if your 
production guarantee for timely planted acreage is 30 bushels per acre, 
your prevented planting production guarantee would be equivalent to 15 
bushels per acre (30 bushels multiplied by 0.50). Production to count 
for such acreage will be determined in accordance with subparagraph 7.b.
    (2) In addition to the provisions of section 4 (Insurance Period) of 
this endorsement, the beginning of the insurance period for prevented 
planting coverage is the sales closing date designated in the Actuarial 
Table for barley in the county.
    (3) The acreage to which prevented planting coverage applies will be 
limited as follows:
    (i) Eligible acreage will not exceed the greater of:
    (A) The number of acres planted to barley on each ASCS Farm Serial 
Number during the previous crop year (adjusted for any reconstitution 
which may have occurred prior to the sales closing date);
    (B) The ASCS base acreage for barley reduced by any acreage 
reduction applicable to the farm under any program administered by

[[Page 80]]

the United States Department of Agriculture; or
    (C) One hundred percent (100%) of the simple average of the number 
of acres planted to barley during the crop years that were used to 
determine your yield;
unless we agree in writing, prior to the sales closing date, to approve 
acreage exceeding this limit.
    (ii) Acreage intended to be planted under an irrigated practice is 
limited to the number of barley acres properly prepared to carry out an 
irrigated practice.
    (iii) A prevented planting production guarantee will not be provided 
for:
    (A) Any acreage that does not constitute at least 20 acres or 20 
percent (20%) of the acres in the unit whichever is less;
    (B) Land for which the Actuarial Table does not designate a premium 
rate unless you submit a written request for coverage for such acreage 
prior to the sales closing date for barley in the county. Upon your 
timely written request, we will provide a written insurance offer for 
such acreage;
    (C) Land used for conservation purposes or intended to be or 
considered to have been left unplanted under any program administered by 
the United States Department of Agriculture;
    (D) Land on which any crop, other than barley, has been planted and 
is intended for harvest, or has been harvested in the same crop year; or
    (E) Land which planting history or conservation plans indicate would 
remain fallow for crop rotation purposes.
    (iv) For the purposes of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be reduced 
by the number of barley acres timely planted and late planted. For 
example, assume you have 100 acres eligible for prevented planting 
coverage in which you have a 100 percent (100%) share. The acreage is 
located in a single ASCS Farm Serial Number which you insure as two 
separate optional units consisting of 50 acres each. If you planted 60 
acres of barley on one optional unit and 40 acres of barley on the 
second optional unit, your prevented planting eligible acreage would be 
reduced to zero (i.e., 100 acres eligible for prevented planting 
coverage minus 100 acres planted equals zero). If you report more barley 
acreage under this contract than is eligible for prevented planting 
coverage, we will allocate the eligible acreage to insured units based 
on the number of prevented planting acres and share you reported for 
each unit.
    (4) When the ASCS Farm Serial Number covers more than one unit, or a 
unit consists of more than one ASCS Farm Serial Number, the covered 
acres will be pro-rated based on the number of acres in each unit or 
ASCS Farm Serial Number that could have been planted to barley in the 
crop year.
    (5) In accordance with the provisions of section 3 (Report of 
Acreage, Share, and Practice (Acreage Report)) of the General Crop 
Insurance Policy (Sec. 401.8), you must report any insurable acreage you 
were prevented from planting. This report must be submitted on or before 
the acreage reporting date for spring-planted barley in counties for 
which the Actuarial Table designates a spring final planting date, or 
the acreage reporting date for fall-planted barley in counties for which 
the Actuarial Table designates a fall final planting date only, even 
though you may elect to plant the acreage after the late planting 
period. Any acreage you report as eligible for prevented planting 
coverage which we determine is not eligible will be deleted from 
prevented planting coverage.
    (6) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be provided for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          11. Meaning of Terms

    (a) Adequate stand--a sufficient population of plants to produce at 
least the yield used to determine the guarantee.
    (b) Days--calendar days.
    (c) Final planting date--the date contained in the Actuarial Table 
by which the insured barley must initially be planted in order to be 
insured for the full production guarantee.
    (d) Harvest--completion of combining, threshing, or cutting for hay 
or silage on any acreage.
    (e) 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 barley acreage.
    (f) Late planted--acreage planted during the late planting period.
    (g) Later planting period--(applicable only to spring-planted barley 
acreage and fall-planted barley acreage only where insurance is not 
offered for spring-planted barley)--the period which begins the day 
after the final planting date for barley and ends twenty-five (25) days 
after the final planting date.
    (h) Latest barley final planting date--
    (1) The final planting date for spring-planted barley in all 
counties for which the Actuarial Table designates a final planting date 
for spring-planted barley only;
    (2) The final planting date for fall-planted barley in all counties 
for which the Actuarial Table designates a final planting date for fall-
planted barley only; or

[[Page 81]]

    (3) The final planting date for spring-planted barley in all 
counties for which the Actuarial Table designates final planting dates 
for both spring-planted and fall-planted barley.
    (i) Prevented planting--inability to plant barley with proper 
equipment by:
    (1) The latest barley final planting date in the county; or
    (2) The end of the late planting period.
    You must have been unable to plant barley due to an insured cause of 
loss which is general in the area (i.e., most producers in the 
surrounding area are unable to plant due to similar insurable causes) 
and which occurs between the sales closing date and the latest barley 
final planting date in the county or within the late planting period.
    (j) Production guarantee--the number of bushels determined by 
multiplying the approved yield per acre by the coverage level percentage 
you elect.
    (k) Timely planted--barley planted by the final planting date, as 
established by the Actuarial Table, for barley in the county to be 
planted for harvest in the crop year.

[52 FR 28447, July 30, 1985, as amended at 54 FR 20504, May 12, 1989; 58 
FR 33508, June 18, 1993; 58 FR 67633, Dec. 22, 1993; 60 FR 56934, Nov. 
13, 1995]



Sec. 401.104  Winter coverage option for barley.

    The Winter Coverage Option for Barley is not available in any 
counties for the 1988 crop year.
    The provisions of the Winter Coverage Option for Barley for the 1988 
through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

               Barley Endorsement--Winter Coverage Option

                      (This is a continuous Option)

Insured's Name__________________________________________________________
Address_________________________________________________________________
Contract No.____________________________________________________________
Crop Year_______________________________________________________________
Identification No.______________________________________________________
SSN_____________________________________________________________________
Tax_____________________________________________________________________
    In consideration of the additional premium as set by the Actuarial 
Table (FCI-35), the insurance provided is attached to and made part of 
the Barley Endorsement subject to the following terms and conditions:
    1. You must have a barley endorsement.
    2. Coverage under this option for fall-planted barley will begin at 
the time of planting and will end on the spring final planting date for 
barley in the county.
    3. When there is not an adequate stand on the spring final planting 
date to produce the farm unit production guarantee, you have the option 
to:
    a. Continue to provide sufficient care for the insured barley crop 
through harvest;
    b. Replant all destroyed acreage to a spring variety of barley and 
receive a replanting payment in accordance with subsection 9.h. of the 
general crop insurance policy, and subsection 6.b. of the Barley 
Endorsement; or
    c. Accept our appraisal of the production to count, destroy the 
remaining crop on the acreage and be paid any indemnity due under the 
terms of the general crop insurance policy and the barley endorsement.
    4. In case of damage to the barley under this option, you must 
provide us with written notice prior to the spring final planting date 
for barley.

Insured's Signature_____________________________________________________
Date____________________________________________________________________
Agent's Signature_______________________________________________________
Date____________________________________________________________________

[52 FR 28447, July 30, 1987, as amended at 60 FR 56934, Nov. 13, 1995]



Sec. 401.105  Oat endorsement.

    The provisions of the Oat Crop Insurance Endorsement for the 1988 
through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                             Oat Endorsement

                             1. Insured Crop

    a. The crop insured will be oats planted for harvest as grain and 
grain mixtures in which oats are the predominant grain.
    b. In addition to the oats not insurable in section 2 of the general 
crop insurance policy, we do not insure any oats:
    (1) If the seed has not been mechanically incorporated into the 
soil;
    (2) If the seed is planted where an established grass or legume 
exists unless we agree, in writing, to insure such oats; or
    (3) Destroyed or put to another use in order to comply with other 
U.S. Department of Agriculture programs.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;


[[Page 82]]


unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general policy.

                            3. Annual Premium

    a. The annual premium amount is computed by multiplying the 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share at the time of planting.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1984 crop year 
under the terms of the experience table contained in the oat policy for 
the 1985 crop year, you will continue to receive the benefit of the 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1985 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                           4. Insurance Period

    In lieu of the provisions in section 7 of the general crop insurance 
policy, the following will apply:
    a. Insurance attaches on each unit or part of a unit when the oats 
are planted except that, in counties with an April 15 cancellation date, 
insurance on fall-planted oats attaches on April 16 following planting 
if it is determined that there is an adequate stand on April 16 to 
produce a normal crop.
    b. Insurance ends on each unit at the earliest of:
    (1) Total destruction of the oats;
    (2) Combining, threshing, harvesting for silage or hay, or removal 
from the field;
    (3) Final adjustment of a loss; or
    (4) The following dates of the calendar year in which oats are 
normally harvested:
    (a) Alaska, September 25;
    (b) All other states, October 31.

                            5. Unit Division

    Oat acreage that would otherwise be one unit, as defined in section 
17 of the general crop insurance policy, may be divided into more than 
one unit if you agree to pay additional premium as provided for by the 
actuarial table and if for each proposed unit:
    a. You maintain written, verifiable records of planted acreage and 
harvested production for a least the previous crop year and production 
reports based on those records are filed to obtain an insurance 
guarantee; and
    b. Acreage planted to insured oats is located in separate, legally 
identifiable sections (except in Florida) or, in the absence of section 
descriptions (and in all of Florida) the land is identified by separate 
ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the sections or ASCS Farm Serial Numbers are 
clearly identified and the insured acreage is easily determined; and
    (2) The oats are planted in such a manner that the planting pattern 
does not continue into the adjacent section or ASCS Farm Serial Number; 
or
    c. The acreage planted to the insured oats is located in a single 
section or ASCS Farm Serial Number and consists of acreage on which both 
an irrigated and a nonirrigated practice are carried out, provided:
    (1) Oats planted on irrigated acreage do not continue into 
nonirrigated acreage in the same rows or planting pattern; and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good dryland and irrigated farming practices 
for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       6. Notice of Damage or Loss

    In addition to the notices required in section 8 of the general crop 
insurance policy, in case of damage or probable loss you must give us 
written notice if you want to harvest the oats for silage or hay. After 
such notice is given, we will appraise the potential grain production. 
If we are unable to do so before harvest, you may harvest the crop 
provided representative samples are left for appraisal purposes. For 
purposes of this section and Section 8 of the general crop insurance 
policy the representative sample of the unharvested crop must be at 
least 10 feet wide and the entire length of the field.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of oats to be counted 
(see subsection 7.b );
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    b. The total production (bushels) to be counted for a unit will 
include all harvested and appraised production.
    (1) Mature oat production which otherwise is not eligible for 
quality adjustment will be reduced .12 percent for each .1 percentage 
point of moisture in excess of 14.0 percent; or
    (2) Mature oat production which, due to insurable causes, has a test 
weight of less than

[[Page 83]]

27 pounds per bushel or, as determined by a grain grader licensed by the 
Federal Grain Inspection Service or licensed under the United States 
Warehouse Act, contains less than 80 percent sound oats or is smutty, 
garlicky, or ergoty, will be adjusted by:
    (a) Dividing the value per bushel of the insured oats by the price 
per bushel of U.S. No. 2 oats which do not grade smutty, garlicky, or 
ergoty; and
    (b) Multiplying the result by the number of bushels of such oats. 
The applicable price for No. 2 oats will be the local market price on 
the earlier of the day the loss is adjusted or the day the insured oats 
are sold.
    (3) Any harvested production from other volunteer plants growing in 
the oats will be counted as oats on a weight basis.
    (4) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good oat farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (c) Any unharvested production.
    (5) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of oats becomes general in 
the county and is reappraised by us;
    (b) Further damaged by an insured cause before the acreage is put to 
another use and is reappraised by us; or
    (c) Harvested.

                  8. Cancellation and Termination Dates

    The cancellation and termination dates are:

------------------------------------------------------------------------
                                                   Cancellation and
              State and county                     termination date
------------------------------------------------------------------------
Alabama; Arkansas; Florida; Georgia;         Sept. 30.
 Louisiana; Mississippi; New Mexico except
 Taos County; North Carolina; Oklahoma;
 South Carolina; Tennessee; Texas; and
 Patrick, Franklin, Pittsylvania, Campbell,
 Appomattox, Fluvanna, Buckingham, Louisa,
 Spotsylvania, Caroline, Essex, and
 Westmoreland Counties, Virginia and all
 counties east thereof.
Arizona; California except Del Norte,        Oct. 31.
 Humboldt, Lassen, Modoc, Plumas, Shasta,
 Siskiyou, and Trinity Counties.
All other California counties; Taos County,  Apr. 15.
 New Mexico; all other Virginia counties
 and all other states.
------------------------------------------------------------------------

                           9. Contract Changes

    The contract change date is December 31 preceding the cancellation 
date for counties with an April 15 cancellation date and August 15 
preceding the cancellation date for all other counties.

                10. Late Planting and Prevented Planting

    (a) In lieu of subparagraphs 2.e.(4) and 21.o of the General Crop 
Insurance Policy (Sec. 401.8), insurance will be provided for acreage 
planted to oats during the late planting period (see subparagraph (c)), 
and acreage you were prevented from planting (see subparagraph (d)). 
These coverages provide reduced production guarantees for such acreage. 
The reduced guarantees will be combined with the production guarantee 
for timely planted acreage for each unit. The premium amount for late 
planted acreage and eligible prevented planting acreage will be the same 
as that for timely planted acreage. For example, assume you insure one 
unit in which you have a 100 percent share. The unit consists of 150 
acres, of which 50 acres were planted timely, 50 acres were planted 7 
days after the final planting date (late planted), and 50 acres are 
unplanted and eligible for prevented planting coverage. To calculate the 
amount of any indemnity which may be due to you, the production 
guarantee for the unit will be computed as follows:
    (1) For timely planted acreage, multiply the per acre production 
guarantee for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the per acre production 
guarantee for timely planted acreage by ninety-three percent (0.93) and 
multiply the result by the 50 acres planted late; and
    (3) For prevented planting acreage, multiply the per acre production 
guarantee for timely planted acreage by fifty percent (0.50) and 
multiply the result by the 50 acres eligible for prevented planting 
coverage.
    The total of the three calculations will be the production guarantee 
for the unit. Your premium will be based on the result of multiplying 
the per acre production guarantee for timely planted acreage by the 150 
acres in the unit.
    (b) You must provide written notice to us if you were prevented from 
planting (see subparagraph 11.(i)). This notice must be given not later 
than three (3) days after:
    (1) The latest oat final planting date in the county if you have 
unplanted acreage that may be eligible for prevented planting coverage; 
and
    (2) The date you stop planting within the late planting period on 
any unit that may have acreage eligible for prevented planting coverage.
    (c) Late Planting.
    (1) For all spring-planted oat acreage (and fall-planted oat acreage 
only where insurance is not offered for spring-planted oats) planted 
after the final planting date, but on or before 25 days after the final 
planting

[[Page 84]]

date, the production guarantee for each acre will be reduced for each 
day planted after the final planting date by:
    (i) One percent (.01) for the first through the tenth day; and
    (ii) Two percent (.02) for the eleventh through the twenty-fifth 
day.
    (2) In addition to the requirements of section 3 (Report of Acreage, 
Share, and Practice (Acreage Report)) of the General Crop Insurance 
Policy (Sec. 401.8), you must report the dates the acreage is planted 
within the late planting period.
    (3) If planting of the oats continues after the final planting date, 
or you are prevented from planting oats during the late planting period, 
the acreage reporting date will be the later of:
    (i) The acreage reporting date contained in the Actuarial Table; or
    (ii) Five (5) days after the end of the late planting period.
    (d) Prevent Planting (Including Planting After the Late Planting 
Period).
    (1) If you were prevented from planting oats (see subparagraph 
11(i)), you may elect:
    (i) To plant oats during the late planting period. The production 
guarantee for such acreage will be determined in accordance with 
subparagraph 10.(c)(1);
    (ii) Not to plant this acreage to any crop that is intended for 
harvest in the same crop year. The production guarantee for such acreage 
which is eligible for prevented planting coverage will be fifty percent 
(0.50) of the production guarantee for timely planted acres. In counties 
for which the Actuarial Table designates a spring final planting date, 
the prevented planting guarantee will be based on your approved yield 
for spring-planted oats. For example, if your production guarantee for 
timely planted acreage is 30 bushels per acre, your prevented planting 
production guarantee would be equivalent to 15 bushels per acre (30 
bushels multiplied by 0.50). This section does not prohibit the 
preparation and care of the acreage for conservation practices, such as 
planting a cover crop, as long as such crop is not intended for harvest; 
or
    (iii) To plant oats after the late planting period. The production 
guarantee for such acreage will be fifty percent (0.50) of the 
production guarantee for timely planted acres. For example, if your 
production guarantee for timely planted acreage is 30 bushels per acre, 
your prevented planting production guarantee would be equivalent to 15 
bushels per acre (30 bushels multiplied by 0.50). Production to count 
for such acreage will be determined in accordance with subparagraph 7.b.
    (2) In addition to the provisions of section 4 (Insurance Period) of 
this endorsement, the beginning of the insurance period for prevented 
planting coverage is the sales closing date designated in the Actuarial 
Table for oats in the county.
    (3) The acreage to which prevented planting coverage applies will be 
limited as follows:
    (i) Eligible acreage will not exceed the greater of:
    (A) The number of acres planted to oats on each ASCS Farm Serial 
Number during the previous crop year (adjusted for any reconstitution 
which may have occurred prior to the sales closing date);
    (B) The ASCS based acreage for oats reduced by any acreage reduction 
applicable to the farm under any program administered by the United 
States Department of Agriculture; or
    (C) One hundred percent (100%) of the simple average of the number 
of acres planted to oats during the crop years that were used to 
determine your yield;

unless we agree in writing, prior to the sales closing date, to approve 
acreage exceeding this limit.
    (ii) Acreage intended to be planted under an irrigated practice will 
be limited to the number of oats acres properly prepared to carry out an 
irrigated practice.
    (iii) A prevented planting production guarantee will not be provided 
for:
    (A) Any acreage that does not constitute at least 20 acres or 20 
percent (20%) of the acres in the unit whichever is less;
    (B) Land for which the Actuarial Table does not designate a premium 
rate unless you submit a written request for coverage for such acreage 
prior to the sales closing date for oats in the county. Upon your timely 
written request, we will provide a written insurance offer for such 
acreage;
    (C) Land used for conservation purposes or intended to be or 
considered to have been left unplanted under any program administered by 
the United States Department of Agriculture;
    (D) Land on which any crop, other than oats, has been planted and is 
intended for harvest, or has been harvested in the same crop year; or
    (E) Land which planting history or conservation plans indicate would 
remain fallow for crop rotation purposes.
    (iv) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be reduced 
by the number of oat acres timely planted and late planted. For example, 
assume you have 100 acres eligible for prevented planting coverage in 
which you have a 100 percent (100%) share. The acreage is located in a 
single ASCS Farm Serial Number which you insure as two separate optional 
units consisting of 50 acres each. If you planted 60 acres of oats on 
one optional unit and 40 acres of oats on the second optional unit, your 
prevented planting eligible acreage would be reduced to zero (i.e., 100 
acres

[[Page 85]]

eligible for prevented planting coverage minus 100 acres planted equals 
zero). If you report more oat acreage under this contract than is 
eligible for prevented planting coverage, we will allocate the eligible 
acreage to insured units based on the number of prevented planting acres 
and share you reported for each unit.
    (4) When the ASCS Farm Serial Number covers more than one unit, or a 
unit consists of more than one ASCS Farm Serial Number, the covered 
acres will be pro-rated based on the number of acres in each unit or 
ASCS Farm Serial Number that could have been planted to oats in the crop 
year.
    (5) In accordance with the provisions of section 3 (Report of 
Acreage, Share, and Practice (Acreage Report)) of the General Crop 
Insurance Policy (Sec. 401.8), you must report any insurable acreage you 
were prevented from planting. This report must be submitted on or before 
the acreage reporting date for spring-planted oats in counties for which 
the Actuarial Table designates a spring final planting date, or the 
acreage reporting date for fall-planted oats in counties for which the 
Actuarial Table designates a fall final planting date only, even though 
you may elect to plant the acreage after the late planting period. Any 
acreage you report as eligible for prevented planting coverage which we 
determine is not eligible will be deleted from prevented planting 
coverage.
    (6) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be provided for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          11. Meaning of Terms

    (a) Adequate stand-- a sufficient population of plants to produce at 
least the yield used to determine the guarantee.
    (b) Days-- calendar days.
    (c) Final planting date-- the date contained in the Actuarial Table 
by which the insured oats must initially be planted in order to be 
insured for the full production guarantee.
    (d) Harvest--completion of combining, threshing, or cutting for hay 
or silage on any acreage.
    (e) 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 oat acreage.
    (f) Late planted-- acreage planted during the late planting period.
    (g) Late planting period--(applicable only to spring-planted oat 
acreage and fall-planted oat acreage only where insurance is not offered 
for spring-planted oats)--the period which begins the day after the 
final planting date for oats and ends twenty-five (25) days after the 
oat final planting date.
    (h) Latest oat final planting date--
    (1) The final planting date for spring-planted oats in all counties 
for which the Actuarial Table designates a final planting date for 
spring-planted oats only;
    (2) The final planting date for fall-planted oats in all counties 
for which the Actuarial Table designates a final planting date for fall-
planted oats only; or
    (3) The final planting date for spring-planted oats in all counties 
for which the Actuarial Table designates final planting dates for both 
spring-planted and fall-planted oats.
    (i) Prevented planting--inability to plant oats with proper 
equipment by:
    (1) The latest oat final planting date in the county; or
    (2) The end of the late planting period.

You must have been unable to plant oats due to an insured cause of loss 
which is general in the area (i.e., most producers in the surrounding 
area are unable to plant due to similar insurable causes) and which 
occurs between the sales closing date and the latest oat final planting 
date in the county or within the late planting period.
    (j) Production guarantee-- the number of bushels determined by 
multiplying the approved yield per acre by the coverage level percentage 
you elect.
    (k) Timely planted--oats planted by the final planting date as 
established by the Actuarial Table, for oats in the county to be planted 
for harvest in the crop year.

[52 FR 28447, July 30, 1987, as amended at 54 FR 20504, May 12, 1989; 58 
FR 33508, June 18, 1993; 58 FR 67634, Dec. 22, 1993; 60 FR 56934, Nov. 
13, 1995]



Sec. 401.106  Rye endorsement.

    The provisions of the Rye Crop Insurance Endorsement for the 1988 
through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                             Rye Endorsement

                             1. Insured Crop

    a. The crop insured will be rye planted for harvest as grain.
    b. In addition to the rye not insurable in section 2 of the general 
crop insurance policy, we do not insure any rye:
    (1) If the seed has not been mechanically incorporated into the 
soil;
    (2) If the seed is planted where an established grass or legume 
exists unless we agree, in writing, to insure such rye; or
    (3) Destroyed or put to another use in order to comply with other 
U.S. Department of Agriculture programs.

[[Page 86]]

    c. A late planting agreement will be available for all spring-
planted rye where insurance is offered and for fall-planted rye only 
where insurance is not offered for spring-planted rye.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.

                            3. Annual Premium

    a. The annual premium amount is computed by multiplying the 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share at the time of planting.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1984 crop year 
under the terms of the experience table contained in the rye policy for 
the 1985 crop year, you will continue to receive the benefit of that 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1985 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                           4. Insurance Period

    The calendar date for the end of the insurance period is October 31 
of the year in which the rye is normally harvested.

                            5. Unit Division

    Rye acreage that would otherwise be one unit, as defined in section 
17 of the general crop insurance policy, may be divided into more than 
one unit if you agree to pay additional premium as provided by the 
actuarial table and if for each proposed unit:
    a. You maintain written, verifiable records of planted acreage and 
harvested production for at least the previous crop year and production 
reports based on those records are filed to obtain an insurance 
guarantee; and
    b. The acreage planted to insured rye is located in separate, 
legally identifiable sections or, in the absence of section 
descriptions, the land is identified by separate ASCS Farm Serial 
Numbers, provided:
    (1) The boundaries of the sections or ASCS Farm Serial Numbers are 
clearly identified and the insured acreage is easily determined; and
    (2) The rye is planted in such a manner that the planting pattern 
does not continue into the adjacent section or ASCS Farm Serial Number; 
or
    c. The acreage planted to the insured rye is located in a single 
section or ASCS Farm Serial Number and consists of acreage on which both 
irrigated and nonirrigated practices are carried out, provided:
    (1) Rye planted on irrigated acreage does not continue into 
nonirrigated acreage in the same rows or planting pattern; and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good dryland and irrigated farming practices 
for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       6. Notice of Damage or Loss

    In addition to the notices required in section 8 of the general crop 
insurance policy, in case of damage or probable loss you must give us 
written notice if you want to harvest the rye for silage or hay. After 
such notice is given, we will appraise the potential grain production.
    If we are unable to do so before harvest, you may harvest the crop 
provided representative samples are left for appraisal purposes. For 
purposes of this section and section 8 of the general crop insurance 
policy the representative sample of the unharvested crop must be at 
least 10 feet wide and the entire length of the field.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of rye to be counted 
(see subsection 7.b.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    b. The total production (bushels) to be counted for a unit will 
include all harvested and appraised production.
    (1) Mature rye production which otherwise is not eligible for 
quality adjustment will be

[[Page 87]]

reduced .12 percent for each .1 percentage point of moisture in excess 
of 16 percent; or
    (2) Mature rye production which, due to insurable causes, has a test 
weight of less than 52 pounds per bushel or, as determined by a grain 
grader licensed by the Federal Grain Inspection Service or licensed 
under the United States Warehouse Act, contains: more than 7 percent 
damaged kernels; more than 25 percent thin rye; or is smutty, garlicky, 
or ergoty, will be adjusted by:
    (a) Dividing the value per bushel of the insured rye by the price 
per bushel of U.S. No. 2 rye which does not grade smutty, garlicky, or 
ergoty; and
    (b) Multiplying the result by the number of bushels of such rye. The 
applicable price for No. 2 rye will be the local market price on the 
earlier of the day the loss is adjusted or the day the insured rye is 
sold.
    (3) Any harvested production from other volunteer plants growing in 
the rye will be counted as rye on a weight basis.
    (4) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good rye farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (c) Any unharvested production.
    (5) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of rye becomes general in 
the county and is reappraised by us;
    (b) Further damaged by an insured cause and is reappraised by us; or
    (c) Harvested.

                  8. Cancellation and Termination Dates

    The cancellation and termination date for all states is September 
30.

                           9. Contract Changes

    The date by which contract changes will be available in your service 
office is August 15 preceding the cancellation date.

                          10. Meaning of Terms

    a. Adequate stand means a sufficient population of plants to produce 
at least the yield used to determine the guarantee.
    c. Harvest means combining, threshing, or cutting for hay or silage.

[52 FR 28447, July 30, 1987, as amended at 54 FR 20504, May 12, 1989; 58 
FR 33508, June 18, 1993; 60 FR 56934, Nov. 13, 1995]



Sec. 401.107  Late planting agreement option.

    (a) General. The provisions contained in the Late Planting Agreement 
Option, are a duplication of 7 CFR part 400, subpart A, with minor 
editorial changes to provide compatibility with the General Crop 
Insurance Regulations (7 CFR part 401), and become effective when 
elected by producers on the crop insurance endorsements herein which are 
eligible for the Late Planting Agreement Option.
    (b) Availability of the Late Planting Agreement. The Late Planting 
Agreement will be offered under the provisions contained in 7 CFR part 
401, within limits prescribed by and in accordance with the Federal Crop 
Insurance Act, as amended 9 U.S.C. 1501 et seq.), only on those crops 
identified in section 4 of this subpart. All provisions of the 
applicable endorsement for the insured crop apply, except those 
provisions which are in conflict with this subpart.
    (c) Definitions. For the purposes of the Late Planting Agreement 
Option:
    (1) Final planting date means the final planting date for the 
insured crop contained in the actuarial table on file in the service 
office.
    (2) Late Planting Agreement means that agreement executed by the 
final planting date, between the FCIC and the insured whereby the 
insured elects, and FCIC provides, insurance on acreage planted for up 
to 20 days after the applicable final planting date. The production 
guarantee applicable on the final planting date will be reduced on the 
acreage planted after the final planting date by 10 percent for each 5 
days that the acreage is planted after the final planting date.
    (3) Production guarantee means the guaranteed amount of production 
under the provisions of the applicable endorsement for crop insurance 
(sometimes expressed in amounts of insurance).
    (d) Responsibilities of the insured. The insured is solely 
responsible for the completion of the Late Planting Agreement Option and 
for the accuracy of the data provided on that Agreement. The provisions 
of this subpart do not

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relieve the insured of any responsibilities under the provisions of the 
insurance endorsement.
    (e) Applicability to crops insured. (1) The provisions of this 
section for insuring crops for the 1995 and subsequent crop years will 
be applicable only under the following endorsements:

401.114  Canning and Processing Tomato Endorsement.
401.118  Canning and Processing Bean Endorsement.
401.123  Safflower Seed Endorsement.
401.126  Onion Endorsement.
401.129  Tobacco (guaranteed plan) Endorsement.

    (2) The Late Planting Agreement Option will be available in all 
counties in which the Corporation offers insurance on these crops unless 
limited by the actuarial table, crop endorsement, or crop endorsement 
option.
    (f) The provisions of the Late Planting Agreement are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                         Late Planting Agreement

Insured's Name__________________________________________________________
Address_________________________________________________________________
Contract No.____________________________________________________________
Crop Year_______________________________________________________________
Crop____________________________________________________________________
    Notwithstanding the provisions of section 2 of the General Crop 
Insurance Regulations (7 CFR 401) regarding the insurability of crop 
acreage initially planted after the final planting date on file in the 
service office, I elect to have insurance provided on acreage planted 
within twenty days after such date. Upon my making this election, the 
production guarantee or amount of insurance, whichever is applicable, 
will be reduced ten percent for each five days or portion thereof that 
the acreage is planted after the final planting date. Each ten percent 
reduction will be applied to the production guarantee or amount of 
insurance applicable on the final planting date.
    The premium will be computed based on the guarantee or amount of 
insurance applicable on the final planting date; therefore, no reduction 
in premium will occur as a result of my election to exercise this 
option.
    If planting continues under this Agreement after the acreage 
reporting date on file in the service office, the acreage reporting date 
will be extended to five days after the completion of planting the 
acreage to which insurance will attach under this Agreement.

Insured's Signature_____________________________________________________
Date____________________________________________________________________
Corporation Representative's
Signature and Code Number_______________________________________________
Date____________________________________________________________________

[52 FR 28447, July 30, 1987, as amended at 60 FR 40056, Aug. 7, 1995]



Sec. 401.108  Prevented planting endorsement.

    (a) The provisions contained in the Prevented Planting Endorsement 
are a duplication of 7 CFR part 442, with minor editorial changes made 
to provide compatibility with the General Crop Insurance Regulations (7 
CFR part 401), and become effective when elected by producers on the 
crop insurance endorsements therein which are eligible for the Prevented 
Planting Endorsement.
    (b) The provisions of the prevented planting endorsement are as 
follows:

                   Federal Crop Insurance Corporation

                     Prevented Planting Endorsement

    A prevented planting crop insurance endorsement on the qualifying 
crop will be available to all insureds having a qualifying crop 
insurance endorsement under the provisions of this Part and who 
participate in the ASCS Acreage Reduction Program or Set-aside Program. 
This endorsement is not continuous. Application must be made annually 
for the prevented planting endorsement not later than the sales closing 
date established by the actuarial table for the applicable qualifying 
crop.

 (THIS IS AN ANNUAL ELECTION TO BE MADE BY THE INSURED BEFORE THE DATE 
                        SPECIFIED IN SECTION 10.)

    AGREEMENT TO INSURE: We will provide the insurance described in this 
endorsement in return for the premium and your compliance with all 
applicable provisions.

                        1. Applicable Provisions

    All provisions of the qualifying crop insurance endorsement and the 
prevented planting crop insurance application not in conflict with this 
endorsement are applicable.

                            2. Causes of Loss

    a. This insurance is against your being unavoidably prevented from 
planting insurable acreage to the qualifying crop or any other non-
conserving crop during the insurance period. (You are required to plant 
to another non-conserving crop during the insurance period after you 
know or should have known that it is no longer feasible to plant the 
qualifying crop and you are not prevented from planting the other non-
conserving crop

[[Page 89]]

by an insurable cause.) You must be prevented from planting by drought, 
flood, or other natural disaster which occurs within the insurance 
period. Limitations, exceptions, or exclusions on the causes insured 
against may be contained in the actuarial table.
    b. We will not insure against any prevention of planting:
    (1) If your failure to plant was due to a cause other than those 
listed in subsection 2.a.; or
    (2) If most producers in the surrounding area in similar 
circumstances were able to plant the qualifying crop or any other non-
conserving crop.

                      3. Acreage and Share Insured

    a. The acreage insured for each crop year will be the cultivated 
acreage in the county intended to be planted for harvest to the 
qualifying crop, in which you have a share, as reported by you or as 
determined by us, whichever we elect, and for which a premium rate is 
provided by the actuarial table.
    b. The insured share is your share as landlord, owner-operator or 
tenant in the qualifying crop if the crop had been planted at the time 
insurance attaches. However, only for the purpose of determining the 
amount of indemnity, your share will not exceed your share on the 
prevented planting date.
    c. Unless otherwise specified by the actuarial table, we will not 
insure any acreage unless you have a valid crop insurance endorsement 
for the current crop year on the qualifying crop and the acreage is 
insurable under that endorsement.
    d. You must participate in the ASCS acreage reduction or set-aside 
program for the qualifying crop in the applicable crop year on at least 
one farm which is part of the insured unit under this endorsement.

             4. Report of Acreage, Share, Type, and Practice

    You must report on our form:
    a. All the cultivated acreage intended for planting to the 
qualifying crop in the county in which you have a share;
    b. The intended type and practice; and
    c. Your share at the time of reporting.
    You must designate separately any cultivated acreage that is 
intended for planting to the qualifying crop that is not insurable. This 
report must be submitted not later than the sales closing date for the 
qualifying crop. All indemnities may be determined on the basis of 
information you submit on this report. If you do not submit this report 
by the reporting date, we may elect to determine the insured acreage and 
share or we may deny liability on the unit. Any report submitted by you 
may be revised only upon our approval.

               5. Amounts of Insurance and Coverage Levels

    a. The amount of insurance per acre is computed by multiplying the 
qualifying crop yield guarantee times the price election selected for 
the qualifying crop, times 0.35.
    b. The coverage level is the same as that selected under your crop 
insurance endorsement for the qualifying crop.

                            6. Annual Premium

    a. The annual premium is earned and payable on the date insurance 
attaches. The amount is computed by multiplying the amount of insurance 
per acre times the premium rate, times the insured acreage, times your 
share.
    b. Interest will accrue at the same rate and terms on any unpaid 
premium balance as on the qualifying crop insurance endorsement.

                         7. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payment 
due you or from any replanting payment, or from any loan or payment due 
you under any Act of Congress or program administered by the United 
States Department of Agriculture or its agencies, and from any amount 
due you from any other United States Government Agency.

                           8. Insurance Period

    In lieu of section 7 of the general policy, prevented planting 
insurance attaches on the sales closing date of the qualifying crop 
insurance endorsement for the crop year and ends at the earlier of:
    a. Planting of the insured acreage to the qualifying crop or any 
other non-conserving crop; or
    b. The prevented planting date.

           9. Notice of Damage or Loss and Claim for Indemnity

    a. If you are prevented from planting the insured acreage and expect 
to claim an indemnity on the unit, you must give us notice in writing 
not later than five days after the prevented planting date.
    b. Any claim for indemnity must be submitted to us on our form prior 
to the time a claim is or should be filed for the qualifying crop.
    c. We will not pay any indemnity unless you:
    (1) Establish that any prevention of planting on insured acreage was 
directly caused by one or more of the insured causes during the 
insurance period for the crop year for which the indemnity is claimed; 
and
    (2) Furnish all information we require concerning the loss.
    d. The indemnity will be determined for the unit by:

[[Page 90]]

    (1) Multiplying the insured acreage times the amount of insurance as 
determined in section 5 of this endorsement;
    (2) Subtracting therefrom the amount obtained by multiplying the 
planted acreage, times the amount of insurance; and
    (3) Multiplying this result by your share.
    e. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section.

           10. Life of Contract: Cancellation and Termination

    a. This endorsement will be in effect only for the crop year 
specified on the application and may not be canceled by you for such 
crop year.
    b. This endorsement may be renewed for each succeeding crop year if:
    (1) You apply and report your intended acreage for planting not 
later than the sales closing date of the qualifying crop; and
    (2) The qualifying crop insurance endorsement is not cancelled or 
terminated for the crop year.

                          11. Meaning of Terms

    For the purposes of prevented planting crop insurance:
    a. Cultivated acreage intended for planting means land that was 
ready or, except for insured causes, could have been made ready for 
planting, but does not include land:
    (1) On which a perennial forage crop is being grown or on which the 
qualifying crop or other non-conserving crop was planted prior to the 
prevented planting acreage reporting date; or
    (2) Which was not or would not have been planted to comply with any 
other United States Department of Agriculture or State programs or for 
any other reason.
    b. Farm means the land which is designated by ASCS under a single 
farm serial number.
    c. Insurable acreage means the land classified as insurable by us 
for the qualifying crop and shown as such by the actuarial table.
    d. Non-conserving crop means any crop planted for harvest as food, 
feed, or fiber.
    e. Planted acreage means the insurable acreage:
    (1) Planted to the qualifying crop or any non-conserving crop during 
the insurance period; or
    (2) Which could have been planted to the qualifying crop or any non-
conserving crop during the insurance period.
    f. Prevented planting date means the latest final spring planting 
date established by the crop actuarial tables for any insurable crop in 
the county, except tobacco, plus any extended date or final planting 
date offered under any late planting agreement option. (In areas where 
there are no spring planting dates, we will use the latest final fall 
planting date.)
    g. Qualifying crop means barley, oats, or wheat.
    h. Unit means all insurable acreage in the county which you intend 
for planting to the qualifying crop prior to the prevented planting date 
for the crop year at the time insurance first attaches under this 
endorsement for the crop year. The unit will be determined when the 
acreage is reported.
    i. Yield guarantee means the result of multiplying your yield for 
the qualifying crop by your coverage level for that crop.

[52 FR 28447, July 30, 1987, as amended at 58 FR 64874, Dec. 10, 1993]



Sec. 401.109  Hybrid sorghum seed endorsement.

    The provisions of the Hybrid Sorghum Seed Endorsement for the 1988 
through the 1997 crop years are as follows:

                   Federal Crop Insurance Corporation

                     Hybrid Sorghum Seed Endorsement

                             1. Insured Crop

    a. The crop insured will be female grain sorghum which is:
    (1) Planted for harvest and the production is intended for use as 
commercial seed to produce grain sorghum, forage sorghum, or sorghum 
sudan; and
    (2) Grown under a written contract executed with a seed company 
before the acreage reporting date.
    b. An instrument in the form of a ``lease'' under which you retain 
control of the acreage on which the insured crop is grown and which 
provides for delivery of the crop under certain conditions and at a 
stipulated price will be treated as a contract under which you have a 
share in the crop.
    c. In addition to the female grain sorghum not insurable in section 
2 of the general crop insurance policy, we do not insure any female 
grain sorghum:
    (1) In rows planted with a mixture of female and male plants;
    (2) Planted for any purpose other than for commercial seed;
    (3) Grown under a contract with any seed company and that seed 
company refuses to provide us with the records we require to determine 
the dollar value per bushel of seed production for each hybrid variety; 
or
    (4) Destroyed or put to another use in order to comply with other 
U.S. Department of Agriculture programs.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from

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the following causes occurring within the insurance period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply due to an unavoidable 
cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.
    b. In addition to the causes of loss not insured against in section 
1 of the general crop insurance policy we will not insure against any 
loss of production due to:
    (1) The use of unadapted, incompatible, or genetically deficient 
male or female seed;
    (2) Deficiencies determined during grow-out of a sample of the 
insured seed crop, including inadequate purity or poor vigor;
    (3) Failure to follow the grower provisions of the contract executed 
with the seed company;
    (4) Frost or freeze after the date set by the actuarial table;
    (5) Inadequate germination of the hybrid seed crop even though such 
inadequate germination was a direct result of an insured cause of loss 
unless inspected and accepted by us before harvest is completed; or
    (6) Failure to plant the male seed at a time sufficient to assure 
adequate pollination of the female plants.

    3. Report of Acreage, Share, Type, and Practice (Acreage Report)

    In addition to the information required in section 3 of the general 
crop insurance policy for the acreage report, you must report the crop 
type.

                            4. Annual Premium

    The annual premium amount is computed by multiplying the amount of 
insurance per acre times the premium rate, times the insured acreage, 
times your share at the time of planting.

                           5. Insurance Period

    In addition to the provisions in section 7 of the general crop 
insurance policy the following will apply:
    a. Insurance attaches on each unit or part of a unit when both the 
male plant seed and the female plant seed are completely planted in 
accordance with the production management practices of the seed company.
    b. The calendar date for the end of the insurance period is November 
30 of the crop year.

                            6. Unit Division

    Female grain sorghum acreage that would otherwise be one unit, as 
defined in section 17 of the general crop insurance policy, may be 
divided into more than one unit if you agree to pay additional premium 
if required by the actuarial table, and if for each proposed unit:
    a. You maintain written, verifiable records of planted acreage and 
harvested production for at least the previous crop year; and
    b. The acreage planted to insured female grain sorghum is located in 
separate legally identifiable sections, or in the absence of section 
descriptions, the land is identified by separate ASCS Farm Serial 
Numbers, provided:
    (1) The boundaries of the sections or ASCS Farm Serial Numbers are 
clearly identified and the insured acreage is easily determined; and
    (2) The female grain sorghum is planted in such a manner that the 
planting pattern does not continue into the adjacent section or ASCS 
Farm Serial Number.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       7. Notice of Damage or Loss

    In addition to the notices required in section 8 of the general crop 
insurance policy, in case of damage or probable loss you must give us 
written notice of probable loss at least 15 days before the beginning of 
harvest if you anticipate a germination rate of less than 80 percent on 
any unit. For purposes of section 8 of the general crop insurance policy 
the representative sample of the unharvested crop must be at least 10 
feet wide and the entire length of the field.

                         8. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the amount of insurance per 
acre;
    (2) Subtracting from this product the sum of:
    (a) The dollar amount obtained by multiplying seed production to 
count for each type and variety by the respective dollar value per 
bushel determined by us; plus
    (b) The dollar amount obtained by multiplying non-seed production to 
count by the local market price of such production on the earlier of the 
date the loss is adjusted or the date such production is sold; and
    (c) Multiplying this result by your share.
    b. The total production to be counted for a unit will include all 
harvested and appraised seed and all harvested and appraised non-seed 
production.

[[Page 92]]

    (1) Total seed production to be counted will include:
    (a) All production delivered to and accepted by the seed company;
    (b) All production with a germination rate of 80 percent or more as 
determined by a certified seed test conducted from a cleaned sample 
taken at the time of delivery to the seed company or, if the mature 
production is appraised, at the time of appraisal; and
    (c) All harvested and appraised production which does not qualify 
under (a) or (b) above because of damage caused by uninsured causes or 
the failure to follow grower provisions of the contract executed with 
the seed company.
    (2) Total non-seed production to be counted will include all 
production that does not qualify as seed production.
    (3) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good hybrid sorghum seed farming practices;
    (b) Potential production lost due to failure to follow the grower 
provisions of the contract executed with the seed company;
    (c) Not less than the dollar amount of insurance for any acreage 
which is abandoned or put to another use without our prior written 
consent or damaged solely by an uninsured cause; and
    (d) Any unharvested production.
    c. Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (1) Not put to another use before harvest of hybrid sorghum seed 
becomes general in the county and is reappraised by us;
    (2) Further damaged by an insured cause and is reappraised by us; or
    (3) harvested.
    d. To determine the quantity of mature production, seed and non-seed 
production will be:
    (1) Adjusted .12 percent for each .1 percentage point of moisture to 
13.0 percent; and
    (2) Measured at 56 pounds of production equaling one bushel.
    e. When records of seed production provided by the seed company have 
been adjusted to a basis of 13.0 percent moisture and 56 pound test 
weight, (d) above will not apply for harvested production and the 
records of the seed company will be used to determine the amount of 
indemnity if such production records are based on the same moisture and 
test weight criteria used to determine the dollar value per bushel of 
seed production.

                  9. Cancellation and Termination Dates

    The cancellation and termination dates are April 15.

                          10. Contract Changes

    The date by which contract changes will be available in your service 
office is December 31 preceding the cancellation date.

                        11. Production Reporting

    The production reporting provision contained in section 4 of the 
general crop insurance policy will not be applicable to this contract.

                12. Late Planting and Prevented Planting

    (a) In lieu of subparagraphs (2.e.(4) and 21.o. of the General Crop 
Insurance Policy (Sec. 401.8), insurance will be provided for acreage 
planted to the insured crop during the late planting period (see 
subparagraph (c)), and acreage you were prevented from planting (see 
subparagraph (d)). These coverages provide reduced amounts of insurance 
for such acreage. The reduced amounts of insurance will be combined with 
the amount of insurance for timely planted acreage for each unit. The 
premium amount for late planted acreage and eligible prevented planting 
acreage will be the same as that for timely planted acreage. For 
example, assume you insure one unit in which you have a 100 percent 
(100%) share. The unit consists of 200 acres of the same type and 
variety of which 150 acres are occupied by the female plant. Fifty acres 
were planted timely, 50 acres were planted 7 days after the final 
planting date (late planted), and 50 acres are unplanted and eligible 
for prevented planting coverage. To calculate the amount of any 
indemnity which may be due to you, the amount of insurance for the unit 
will be computed as follows:
    (1) For timely planted acreage, multiply the per acre amount of 
insurance for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the per acre amount of 
insurance for timely planted acreage by ninety-three percent (0.93) and 
multiply the result by the 50 acres planted late; and
    (3) For prevented planting acreage, multiply the per acre amount of 
insurance for timely planted acreage by:
    (i) Fifty percent (0.50) and multiply the result by the 50 acres you 
were prevented from planting, if the acreage is eligible for prevented 
planting coverage, and if the acreage is left idle for the crop year, or 
if a cover crop is planted not for harvest. Prevented planting 
compensation hereunder will not be denied because the cover crop is 
hayed or grazed; or
    (ii) Twenty-five percent (0.25) and multiply the result by the 50 
acres you were prevented from planting, if the acreage is eligible for 
prevented planting coverage, and if you elect to plant a substitute crop 
for harvest after the 10th day following the final planting date for the 
insured crop. (This subparagraph (ii)

[[Page 93]]

is not applicable, and prevented planting coverage is not available 
hereunder, if you elected the Catastrophic Risk Protection Endorsement 
or you elected to exclude prevented planting coverage when a substitute 
crop is planted (see subparagraph 12(d)(1)(iii))).
    The total of the three calculations will be the amount of insurance 
for the unit. Your premium will be based on the result of multiplying 
the per acre amount of insurance for timely planted acreage by the 150 
insured crop acres in the unit.
    (b) If you were prevented from planting, you must provide written 
notice to us not later than the acreage reporting date.
    (c) Late Planting.
    (1) For acreage planted after the final planting date but on or 
before 25 days after the final planting date the amount of insurance for 
each acre will be reduced for each day planted after the final planting 
date by:
    (i) One percent (.01) for the first through the tenth day; and
    (ii) Two percent (.02) for the eleventh through the twenty-fifth 
day.
    (2) In addition to the requirements of section 3 (Report of Acreage, 
Share and Practice (Acreage Report)) of the General Crop Insurance 
Policy (Sec. 401.8), you must report the dates the acreage is planted 
within the late planting period.
    (3) If planting of the insured crop continues after the final 
planting date, or you are prevented from planting the insured crop 
during the late planting period, the acreage reporting date will be the 
later of:
    (i) The acreage reporting date contained in the Acturial Table; or
    (ii) Five (5) days after the end of the late planting period.
    (d) Prevented Planting (Including Planting After the Late Planting 
Period).
    (1) If you were prevented from planting the insured crop (see 
subsection 13(o)), you may elect:
    (i) To plant the insured crop during the late planting period. The 
amount of insurance for such acreage will be determined in accordance 
with paragraph 12(c)(1);
    (ii) Not to plant this acreage to any crop except a cover crop not 
for harvest. You may also elect to plant the insured crop after the late 
planting period. In either case, the amount of insurance for such 
acreage will be fifty percent (50%) of the amount of insurance for 
timely planted acres. For example, if your amount of insurance for 
timely planted acreage is 200 dollars per acre, your prevented planting 
amount of insurance would be 100 dollars per acre (200 dollars 
multiplied by 0.50). If you elect to plant the insured crop after the 
late planting period, production to count for such acreage will be 
determined in accordance with subsections 8b through e; or
    (iii) Not to plant the intended crop but plant a substitute crop for 
harvest, in which case:
    (A) No prevented planting amount of insurance will be provided for 
such acreage if the substitute crop is planted on or before the tenth 
day following the final planting date for the insured crop; or
    (B) An amount of insurance equal to twenty-five percent (25%) of the 
amount of insurance for timely planted acres will be provided for such 
acreage, if the substitute crop is planted after the tenth day following 
the final planting date for the insured crop. If you elected the 
Catastrophic Risk Protection Endorsement or excluded this coverage, and 
plant a substitute crop, no prevented planting coverage will be 
provided. For example, if your amount of insurance for timely planted 
acreage is 200 dollars per acre, your prevented planting amount of 
insurance would be 50 dollars per acre (200 dollars multiplied by 0.25). 
You may elect to exclude prevented planting coverage when a substitute 
crop is planted for harvest and receive a reduction in the applicable 
premium rate. If you wish to exclude this coverage, you must so 
indicate, on or before the sales closing date, on your application or on 
a form approved by us. Your election to exclude this coverage will 
remain in effect from year to year unless you notify us in writing on 
our form by the applicable sales closing date for the crop year for 
which you wish to include this coverage. All acreage of the crop insured 
under this policy will be subject to this exclusion.
    (2) Proof may be required that you had the inputs available to plant 
and produce the intended crop with the expectation of at least producing 
the yield upon which your amount of insurance is based.
    (3) In addition to the provisions of section 7 (Insurance Period) of 
the General Crop Insurance Policy (Sec. 401.8), the insurance period for 
prevented planting coverage begins:
    (i) On the sales closing date contained in the Special Provisions 
for the insured crop in the county for the crop year the application for 
insurance is accepted; or
    (ii) For any subsequent crop year, on the sales closing date for the 
insured crop in the county for the previous crop year, provided 
continuous coverage has been in effect since that date. For example: If 
you make application and purchase a hybrid sorghum seed crop insurance 
policy for the 1996 crop year, prevented planting coverage will begin on 
the 1996 sales closing date for the insured crop in the county. If the 
hybrid sorghum seed coverage remains in effect for the 1997 crop year 
(is not terminated or cancelled during or after the 1996 crop year, 
except the policy may have been cancelled to transfer the policy to a 
different insurance provider, if there is no lapse in coverage), 
prevented

[[Page 94]]

planting coverage for the 1997 crop year began on the 1996 sales closing 
date.
    (4) The acreage to which prevented planting coverage applies will 
not exceed the total eligible acreage on all Farm Service Agency (FSA) 
Farm Serial Numbers in which you have a share, adjusted for any 
reconstitution that may have occurred on or before the sales closing 
date. Eligible acreage for each FSA Farm Serial Number is determined as 
follows:
    (i) Eligible acreage will not exceed the number of acres required to 
be grown in the current crop year under a contract executed with a seed 
company prior to the acreage reporting date.
    (ii) Acreage intended to be planted under an irrigated practice will 
be limited to the number of acres for which you had adequate irrigation 
facilities prior to the insured cause of loss which prevented you from 
planting.
    (iii) Prevented planting coverage will not be provided for any 
acreage:
    (A) That does not constitute at least 20 acres or 20 percent (20%) 
of the acreage in the unit, whichever is less (Acreage that is less than 
20 acres or 20 percent of the acreage in the unit will be presumed to 
have been intended to be planted to the insured crop planted in the 
unit, unless you can show that you had the inputs available before the 
final planting date to plant and produce another insured crop on the 
acreage);
    (B) For which the actuarial table does not designate a premium rate 
unless a written agreement designates such premium rate;
    (C) Used for conservation purposes or intended to be left unplanted 
under any program administered by the United States Department of 
Agriculture;
    (D) On which another crop is prevented from being planted, if you 
have already received a prevented planting indemnity, guarantee or 
amount of insurance for the same acreage in the same crop year, unless 
you provide adequate records of acreage and production showing that the 
acreage has a history of double-cropping in each of the last four years;
    (E) On which the insured crop is prevented from being planted, if 
any other crop is planted and fails, or is planted and harvested, hayed 
or grazed on the same acreage in the same crop year, (other than a cover 
crop as specified in paragraph (a)(3)(i) of this section, or a 
substitute crop allowed in paragraph (a)(3)(ii) of this section) unless 
you provide adequate records of acreage and production showing that the 
acreage has a history of double-cropping in each of the last four years;
    (F) When coverage is provided under the Catastrophic Risk Protection 
Endorsement if you plant another crop for harvest on any acreage you 
were prevented from planting in the same crop year, even if you have a 
history of double cropping. If you have a Catastrophic Risk Protection 
Endorsement and receive a prevented planting indemnity, guarantee, or 
amount of insurance for a crop and are prevented from planting another 
crop on the same acreage, you may only receive the prevented planting 
indemnity, guarantee, or amount of insurance for the crop on which the 
prevented planting indemnity, guarantee, or amount of insurance is 
received; or
    (G) For which planting history or conservation plans indicate that 
the acreage would have remained fallow for crop rotation purposes.
    (iv) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be reduced 
by the number of acres of the insured crop timely planted and late 
planted. For example, assume you have 100 acres eligible for prevented 
planting coverage in which you have a 100 percent (100%) share. The 
acreage is located in a single FSA Farm Serial Number which you insure 
as two separate optional units consisting of 50 acres each. If you 
planted 60 acres of the insured crop on one optional unit and 40 acres 
of the insured crop on the second optional unit, your prevented planting 
eligible acreage would be reduced to zero (i.e., 100 acres eligible for 
prevented planting coverage minus 100 acres planted equals zero).
    (5) In accordance with the provisions of section 3 (Report of 
Acreage, Share, and Practice (Acreage Report)) of the General Crop 
Insurance Policy (Sec. 401.8), you must report by unit any insurable 
acreage that you were prevented from planting. This report must be 
submitted on or before the acreage reporting date. For the purpose of 
determining acreage eligible for a prevented planting amount of 
insurance the total amount of prevented planting and planted acres 
cannot exceed the maximum number of acres eligible for prevented 
planting coverage. Any acreage you report in excess of the number of 
acres eligible for prevented planting coverage, or that exceeds the 
number of eligible acres physically located in a unit, will be deleted 
from your acreage report.
    (6) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be provided for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          13. Meaning of Terms

    (a) Adjusted average yield-- an expected yield level for a specific 
variety, in bushels per acre, determined by us and used to establish the 
value of seed production for the purpose of determining the amount of 
indemnity.

[[Page 95]]

    (b) Amount of insurance-- the number of dollars per acre that 
results from subtracting the minimum payment (in bushels) provided by 
the seed company from the county yield contained in the Actuarial Table 
for the selected coverage level and multiplying the result by the 
selected price election. If the minimum payment provided by the seed 
company is stated as a dollar amount, it will be converted to a bushel 
equivalent by dividing the dollar amount by the selected price election.
    (c) Commercial seed-- the offspring produced by crossing two 
individual seeds of different genetic character. The resultant offspring 
is the product intended for use on a commercial basis by an agricultural 
producer to produce a field crop type for grain sorghum, forage sorghum, 
or sorghum sudan.
    (d) Days-- calendar days.
    (e) Dollar value per bushel-- the value determined by dividing the 
amount of insurance per acre for timely planted acreage by the result of 
multiplying the adjusted average yield by the coverage level percentage 
you elect.
    (f) Female plants-- the plants grown for the purpose of producing 
commercial seed and from which the commercial seed is harvested.
    (g) Final planting date-- the date contained in the Actuarial Table 
by which the insured crop must initially be planted in order to be 
insured for the full amount of insurance.
    (h) Grow-out-- the growing of a sample of the insured crop to 
determine progeny characteristics.
    (i) Harvest-- combining, threshing, or picking of the seed and non-
seed production on any acreage.
    (j) Inadequate germination-- less than 80 percent of the seed 
produced from female plants germinated as determined by a warm test 
using clean seed.
    (k) Irrigated practice-- a method of producing a crop by which water 
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 amount of insurance on the irrigated insured crop acreage.
    (l) Late planted-- acreage planted during the late planting period.
    (m) Late planting period-- the period which begins the day after the 
final planting date for the insured crop and ends twenty-five (25) days 
after the final planting date.
    (n) Male plants-- the plants grown for the purpose of pollinating 
female plants.
    (o) Prevented planting--Inability to plant the insured crop with 
proper equipment by the final planting date designated in the Special 
Provisions for the insured crop in the county or the end of the late 
planting period. You must have been unable to plant the insured crop due 
to an insured cause of loss that has prevented the majority of producers 
in the surrounding area from planting the same crop.
    (p) Seed company-- a company which contracts with a grower to 
produce or grow plants for the production of hybrid seed.
    (q) Timely planted-- the insured crop planted by the final planting 
date, as established by the Acturial Table, for the insured crop in the 
county to be planted for harvest in the crop year.
    (r) Type-- grain sorghum, forage sorghum, or sorghum sudan.
    (s) Variety-- the seed produced from a pair of genetically 
identifiable parents.

[52 FR 28447, July 30, 1987, as amended at 58 FR 67635, Dec. 22, 1993; 
60 FR 62720, 62721, Dec. 7, 1995; 62 FR 65318, Dec. 12, 1997]



Sec. 401.110  Almond endorsement.

    The provisions of the Almond Crop Insurance Endorsement for the 1988 
through the 1997 crop years are as follows:

                   Federal Crop Insurance Corporation

                           Almond Endorsement

                             1. Insured Crop

    a. The crop insured will be almonds.
    b. In addition to the almonds not insurable in section 2 of the 
general crop insurance policy, we do not insure any almonds:
    (1) Which are not irrigated; or
    (2) On which the trees on the sales closing date have not reached 
the seventh growing season after being set out unless we agree in 
writing to insure such acreage.
    c. Insurance may attach only by written agreement with us on any 
acreage with less than 90 percent of a stand, based on the original 
planting pattern.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Wildlife;
    d. Earthquake;
    e. Volcanic eruption;
    f. Direct Mediterranean Fruit Fly damage; or
    g. Failure of the irrigation water supply due to an unavoidable 
cause occurring after insurance attaches;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.

[[Page 96]]

       3. Report of Acreage, Share, and Practice (Acreage Report)

    The date by which you must annually submit the acreage report 
described in section 3 of the general crop insurance policy is January 
15.

                            4. Annual Premium

    a. The annual premium amount is computed by multiplying the 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share on the date insurance 
attaches.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1984 crop year 
under the terms of the experience table contained in the almond policy 
for the 1985 crop year, you will continue to receive the benefit of the 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1985 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                           5. Insurance Period

    Insurance attaches for each crop year on January 1. The calendar 
date for the end of the insurance period is November 30 of the calendar 
year in which the almonds are normally harvested.

                            6. Unit Division

    Almond acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one unit if you agree to pay additional premium if required by 
the actuarial table and if for each proposed unit:
    a. You maintain written, verifiable records of acreage and harvested 
production for at least the previous crop year and production reports 
based on those records are filed to obtain an insurance guarantee; and
    b. The acreage of insured almonds is located on non-contiguous land.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of almonds to be 
counted (see subsection 7.b.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    b. The total production (total meat pounds) to be counted for a unit 
will include all harvested and appraised production.
    (1) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good almond farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
damaged solely by an uninsured cause, or destroyed by you without our 
consent; and
    (c) Any appraised production on unharvested acreage.
    (2) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Further damaged by an insured cause and is reappraised by us; or
    (b) Harvested.
    (3) Almonds which cannot be marketed due to insurable causes will 
not be considered production.

                  8. Cancellation and Termination Dates

    The cancellation and termination dates are December 31.

                           9. Contract Changes

    The date by which contract changes will be available in your service 
office is August 31 preceding the cancellation date.

                          10. Meaning of Terms

    a. Direct Mediterranean Fruit Fly damage means the actual physical 
damage to the almonds which causes such almonds to be considered 
unmarketable and will not include unmarketability of such almonds as a 
result of a quarantine, boycott, or refusal to accept the almonds by any 
entity without regard to the actual physical damage to such almonds.
    b. Harvest means the removal of the almonds from the orchard.
    c. Non-contiguous Land means land which is not touching at any 
point, except that land which is separated by only a public or private 
right-of-way will be considered contiguous.
    d. Total Meat Pounds means the total pounds of good almond meats 
(whole, chipped and broken, and inshell meats) and rejects, except those 
resulting from insurable causes as determined by us. Unshelled almonds 
will be converted to meat pounds.

[52 FR 28447, July 30, 1987, as amended at 54 FR 20504, May 12, 1989; 62 
FR 25108, May 8, 1997]

[[Page 97]]



Sec. 401.111  Corn endorsement.

    The provisions of the Corn Crop Insurance Endorsement for the 1988 
through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                            Corn Endorsement

                             1. Insured Crop

    a. The crop insured will be field corn (``corn'') planted for 
harvest as grain (or silage if a silage amendment is obtained).
    b. In addition to the corn not insurable under section 2 of the 
general crop insurance policy, we do not insure any corn:
    (1) On which the corn was destroyed or put to another use for the 
purpose of conforming with any other program administered by the United 
States Department of Agriculture;
    (2) Unless the acreage is planted in rows far enough apart to permit 
mechanical cultivation; or
    (3) Planted for silage unless a silage amendment has been obtained.
    c. If the actuarial table for the county provides a ``silage only 
guarantee'', coverage is only available with the completion of the 
silage amendment.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.

                            3. Annual Premium

    a. The annual premium amount is computed by multiplying the 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share at the time of planting.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insurance experience through the 1983 crop year 
under the terms of the experience table contained in the corn policy for 
the 1984 crop year, you will continue to receive the benefit of the 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1984 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply;
    (5) Participation must be continuous from prior to 1984.

                           4. Insurance Period

    The calendar date for the end of the insurance period is the date 
immediately following planting as follows:
    (a) Val Verde, Edwards, Kerr, Kendall, Bexar, Wilson, Karnes, 
Goliad, Victoria, and Jackson Counties, Texas, and all Texas counties 
lying south thereof--September 30;
    (b) Clark, Cowlitz, Grays Harbor, Island, Jefferson, King, Kitsap, 
Lewis, Pierce, Skagit, Snohomish, Thurston, Wahkiakum, and Whatcom 
Counties, Washington--October 31;
    (c) All other counties where our actuarial table shows:
    (a) only a silage guarantee; or
    (b) both a grain and a silage guarantee on any acreage of corn 
harvested for silage--September 30;
    (d) All other counties and states--December 10.

                            5. Unit Division

    Corn acreage that would otherwise be one unit, as defined in section 
17 of the general crop insured policy, may be divided into more than one 
unit if you agree to pay additional premium as provided for by the 
actuarial table and if for each proposed unit you maintain written 
verifiable records of planted acreage and harvested production for at 
least the previous crop year. Production reports by unit based on those 
records should be filed as early as possible but must be filed by no 
later than the date required by subsection 4.d. of the general crop 
insurance policy and either;
    a. Acreage planted to the insurance corn crop is located in 
separate, legally identifiable sections (except in Florida) or, in the 
absence of section descriptions (and in Florida) the land is identified 
by separate ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the section or ASCS Farm Serial Number are 
clearly identified, and the insured acreage can be easily determined; 
and
    (2) The corn is planted in such a manner that the planting pattern 
does not continue into an adjacent section or ASCS Farm Serial Number; 
or

[[Page 98]]

    b. Acreage planted to the insured corn is located in a single 
section or ASCS Farm Serial Number and consists of acreage on which both 
an irrigated and non-irrigated practices are carried out, provided:
    (1) Corn planted on the irrigated acreage does not continue into 
nonirrigated acreage in the same rows or planting pattern (Nonirrigated 
corners of a center pivot irrigation system planted to insured corn are 
part of the irrigated unit. The production from the total unit, both 
irrigated and nonirrigated, is combined to determine your yield for the 
purpose of determining the guarantee for the unit.); and
    (2) Planting, fertilizing, and harvesting are carried out in 
accordance with recognized good irrigated and non-irrigated farming 
practices for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       6. Notice of Damage or Loss

    For purposes of section 8 of the general crop insurance policy the 
representative sample of the unharvested crop must be at least 10 feet 
wide and the entire length of the field.

                         7. Claim for Indemnity

    a. An indenmity will be determined for each grain unit by:
    (1) Multiplying the insured grain acreage by the production 
guarantee;
    (2) Subtracting therefrom the total production of grain to be 
counted (See subsection 7.d.);
    (3) Multiplying this product by the grain price election; and
    (4) Multiplying this result by your share.
    b. When the actuarial table provides a bushel guarantee only or a 
bushel and tonnage guarantee (and you do not have a timely signed silage 
amendment) all appraisals will be made in bushels.
    c. When the actuarial table provides a tonnage guarantee, and a corn 
silage amendment is in effect, the indemnity will be determined in 
accordance with the procedure shown in the corn silage amendment.
    d. The total production (bushels) to be counted for a unit with a 
grain guarantee will include:
    (1) All harvested production and may be adjusted for moisture or 
quality as follows:
    (a) Mature grain which otherwise is not eligible for quality 
adjustment will be reduced .12 percent for each .1 percentage point of 
moisture in excess of 15.5 through 30.0 percent and .2 percent for each 
.1 percentage point of moisture from 30.1 through 40.0 percent; or
    (b) Mature grain which, due to insurable causes, has a moisture over 
40 percent; test weight below 49 pounds per bushel; or kernel damage 
more than 10 percent as determined by a grain grader licensed by the 
Federal Grain Inspection Service or licensed under the United States 
Warehouse Act, will be adjusted by:
    (1) Dividing the value per bushel of such corn by the price per 
bushel of U.S. No. 2 corn at 15.5% moisture; and
    (2) Multiplying the result by the number of bushels of such corn.
    The applicable price for No. 2 corn will be the local market price 
on the earlier of the day the loss is adjusted or the day such corn was 
sold.
    (2) All appraised production which will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to an uninsured causes and failure to follow 
recognized good corn farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause;
    (c) Appraised production on unharvested acreage;
    (d) For any acreage of corn reported as grain and harvested as 
silage, indemnity calculations will be converted to a bushel basis at 
the conversion rate shown in the form FCI-35 for silage harvested or 
appraised from a grain variety.
    (e) Appraised production on insured acreage for which we have given 
written consent to be put to another use unless such acreage is:
    (i) Not put to another use before harvest of corn becomes general in 
the county and reappraised by us;
    (ii) Further damaged by an insured cause and reappraised by us; or
    (iii) Harvested.
    e. A replanting payment is available under this endorsement. The 
replanting payment will not exceed 8 bushels multiplied by the price 
election, multiplied by your share. When the crop is replanted by a 
practice that was uninsurable as an original planting, any indemnity 
will be reduced by the amount of the replanting payment.

                  8. Cancellation and Termination Dates

------------------------------------------------------------------------
                                                   Cancellation and
              State and county                    termination dates
------------------------------------------------------------------------
Val Verde, Edwards, Kerr, Kendall, Bexar,    February 15.
 Wilson, Karnes, Goliad, Victoria, and
 Jackson Counties, Texas, and all Texas
 counties lying south thereof.

[[Page 99]]

 
Alabama: Arizona; Arkansas; California;      March 31.
 Florida; Georgia; Louisiana; Mississippi;
 Nevada; North Carolina; South Carolina;
 and El Paso, Hudspeth, Culberson, Reeves,
 Loving, Winkler, Ector, Upton, Reagan,
 Sterling, Coke, Tom Green, Concho,
 McCulloch, San Saba, Mills, Hamilton,
 Bosque, Johnson, Tarrant, Wise, Cooke
 Counties, Texas, and all Texas Counties
 lying south and east thereof to and
 including Terrell, Crockett, Sutton,
 Kimble, Gillespie, Blanco, Comal,
 Guadalupe, Gonzales, De Witt, Lavaca,
 Colorado, Wharton, and Matagorda Counties,
 Texas.
All other Texas counties and all other       April 15.
 states.
------------------------------------------------------------------------

                          9. Contract changes.

    Contract changes will be available at your service office by 
December 31 preceding the cancellation date for counties with an April 
15 cancellation date (February 15, 1992, for the 1992 crop year only), 
and by November 30 preceding the cancellation date (February 15, 1992, 
for the 1992 crop year only), for all other counties.

                10. Late Planting and Prevented Planting

    (a) In lieu of subparagraphs 2.e.(4) and 21.o. of the General Crop 
Insurance Policy (Sec. 401.8), insurance will be provided for acreage 
planted to corn during the late planting period (see subparagraph (c)), 
and acreage you were prevented from planting (see subparagraph (d)). 
These coverages provide reduced production guarantees for such acreage. 
The reduced guarantees will be combined with the production guarantee 
for timely planted acreage for each unit. The premium amount for late 
planted acreage and eligible prevented planting acreage will be the same 
as that for timely planted acreage. For example, assume you insure one 
unit in which you have a 100 percent (100%) share. The unit consists of 
150 acres, of which 50 acres were planted timely, 50 acres were planted 
7 days after the final planting date (late planted), and 50 acres are 
unplanted and eligible for prevented planting coverage. To calculate the 
amount of any indemnity which may be due to you, the production 
guarantee for the unit will be computed as follows:
    (1) For timely planted acreage, multiply the per acre production 
guarantee for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the per acre production 
guarantee for timely planted acreage by ninety-three percent (0.93) and 
multiply the result by the 50 acres planted late; and
    (3) For prevented planting acreage, multiply the per acre production 
guarantee for timely planted acreage by fifty percent (0.50) and 
multiply the result by the 50 acres eligible for prevented planting 
coverage.
    The total of the three calculations will be the production guarantee 
for the unit. Your premium will be based on the result of multiplying 
the per acre production guarantee for timely planted acreage by the 150 
acres in the unit.
    (b) You must provide written notice to us if you were prevented from 
planting (see subparagraph (11.(g)). This notice must be given no later 
than three (3) days after:
    (1) The final planting date if you have unplanted acreage that may 
be eligible for prevented planting coverage; and
    (2) The date you stop planting within the late planting period on 
any unit that may have acreage eligible for prevented planting coverage.
    (c) Late Planting.
    (1) For acreage planted after the final planting date but on or 
before 25 days after the final planting date, the production guarantee 
for each acre will be reduced for each day planted after the final 
planting date by:
    (i) One percent (.01) for the first through the tenth day; and
    (ii) Two percent (.02) for the eleventh through the twenty-fifth 
day.
    (2) In addition to the requirements of section 3 (Report of Acreage, 
Share, and Practice (Acreage Report)) of the General Crop Insurance 
Policy (Sec. 401.8), you must report the dates the acreage is planted 
within the late planting period.
    (3) If planting of the corn continues after the final planting date, 
or you are prevented from planting corn during the late planting period, 
the acreage reporting date will be the later of:
    (i) The acreage reporting date contained in the Actuarial Table; or
    (ii) Five (5) days after the end of the late planting period.
    (d) Prevented Planting (Including Planting After the Late Planting 
Period).
    (1) If you were prevented from planting corn (see subparagraph 
11.(g)), you may elect:
    (i) To plant corn during the late planting period. The production 
guarantee for such acreage will be determined in accordance with section 
10.(c)(1);
    (ii) Not to plant this acreage to any crop that is intended for 
harvest in the same crop year. The production guarantee for such acreage 
which is eligible for prevented planting coverage will be fifty percent 
(0.50) of the production guarantee for timely planted acres. For 
example, if your production guarantee for timely planted acreage is 70 
bushels per acre, your prevented planting production guarantee would be 
equivalent to 35 bushels per acre (70 bushels multiplied by 0.50). This 
section does not prohibit the preparation and care of the acreage for 
conservation practices, such as planting a cover crop,

[[Page 100]]

as long as such crop is not intended for harvest; or
    (iii) To plant corn after the late planting period. The production 
guarantee for such acreage will be fifty percent (0.50) of the 
production guarantee for timely planted acres. For example, if your 
production guarantee for timely planted acreage is 70 bushels per acre, 
your prevented planting production guarantee would be equivalent to 35 
bushels per acre (70 bushels multiplied by 0.50). Production to count 
for such acreage will be determined in accordance with subparagraph 7.d.
    (2) In addition to the provisions of section 7 (Insurance Period) of 
the General Crop Insurance Policy (Sec. 401.8), the beginning of the 
insurance period for prevented planting coverage is the sales closing 
date designated in the Actuarial Table for corn.
    (3) The acreage to which prevented planting coverage applies will be 
limited as follows:(i) Eligible acreage will not exceed the greater of:
    (A) The number of acres planted to corn on each ASCS Farm Serial 
Number during the previous crop year (adjusted for any reconstitution 
which may have occurred prior to the sales closing date);
    (B) The ASCS base acreage for corn reduced by any acreage reduction 
applicable to the farm under any program administered by the United 
States Department of Agriculture; or
    (C) One hundred percent (100%) of the simple average of the number 
of acres planted to corn during the crop years that were used to 
determine your yield;

unless we agree in writing, prior to the sales closing date, to approve 
acreage exceeding this limit.
    (ii) Acreage intended to be planted under an irrigated practice will 
be limited to the number of corn acres properly prepared to carry out an 
irrigation practice.
    (iii) A prevented planting production guarantee will not be provided 
for:
    (A) Any acreage that does not constitute at least 20 acres or 20 
percent (20%) of the acres in the unit whichever is less;
    (B) Land for which the Actuarial Table does not designate a premium 
rate unless you submit a written request for coverage for such acreage 
prior to the sales closing date for corn in the county. Upon your timely 
written request, we will provide a written insurance offer for such 
acreage;
    (C) Land used for conservation purposes or intended to be or 
considered to have been left unplanted under any program administered by 
the United States Department of Agriculture;
    (D) Land on which any crop, other than corn, has been planted and is 
intended for harvest, or has been harvested in the same crop year; or
    (E) Land which planting history or conservation plans indicate would 
remain fallow for crop rotation purposes.
    (iv) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and will be 
reduced by the number of corn acres timely planted and late planted. For 
example, assume you have 100 acres eligible for prevented planting 
coverage in which you have a 100 percent (100%) share. The acreage is 
located in a single ASCS Farm Serial Number which you insure as two 
separate optional units consisting of 50 acres each. If you planted 60 
acres of corn on one optional unit and 40 acres of corn on the second 
optional unit, your prevented planting eligible acreage would be reduced 
to zero (i.e., 100 acres eligible for prevented planting coverage minus 
100 acres planted equals zero). If you report more corn acreage under 
this contract than is eligible for prevented planting coverage, we will 
allocate the eligible acreage to insured units based on the number of 
prevented planting acres and share you reported for each unit.
    (4) When the ASCS Farm Serial Number covers more than one unit, or a 
unit consists of more than one ASCS Farm Serial Number, the covered 
acres will be pro-rated based on the number of acres in each unit or 
ASCS Farm Serial Number that could have been planted to corn in the crop 
year.
    (5) In accordance with the provisions of section 3 (Report of 
Acreage, Share, and Practice (Acreage Report)) of the General Crop 
Insurance Policy (Sec. 401.8), you must report any insurable acreage you 
were prevented from planting. This report must be submitted on or before 
the acreage reporting date, even though you may elect to plant the 
acreage after the late planting period. Any acreage you report as 
eligible for prevented planting coverage which we determine is not 
eligible will be deleted from prevented planting coverage.
    (6) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be provided for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          11. Meaning of Terms

    (a) Days--calendar days.
    (b) Final planting date--the date contained in the Actuarial Table 
by which the insured corn must initially be planted in order to be 
insured for the full production guarantee.
    (c) Harvest--completion of combining or picking corn for grain on 
any acreage.
    (d) 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

[[Page 101]]

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 corn acreage.
    (e) Late planted-- acreage planted during the late planting period.
    (f) Late planting period-- the period which begins the day after the 
final planting date for corn and ends twenty-five (25) days after the 
final planting date.
    (g) Prevented planting-- inability to plant corn with proper 
equipment by:
    (1) The final planting date for corn in the county; or
    (2) The end of the late planting period.
    You must have been unable to plant corn due to an insured cause of 
loss which is general in the area (i.e., most producers in the 
surrounding area are unable to plant due to similar insurable causes) 
and which occurs between the sales closing date and the final planting 
date or within the late planting period.
    (h) Production guarantee-- the number of bushels (tons if the Corn 
Silage Option is in effect) determined by multiplying the approved yield 
per acre by the coverage level percentage you elect.
    (i) Replanting-- performing the cultural practices necessary to 
replace the corn seed, and replacing the seed in the insured acreage 
with the expectation of growing a successful crop.
    (j) Silage-- corn harvested by severing the stalk from the land and 
chopping the stalk and the ear for the purpose of livestock feed.
    (k) Timely planted-- corn planted by the final planting date, as 
established by the Actuarial Table, for corn in the county to be planted 
for harvest in the crop year.

[52 FR 45143, Nov. 25, 1987, as amended at 53 FR 4589, Feb. 17, 1988; 54 
FR 20504, May 12, 1989; 56 FR 58302, Nov. 19, 1991; 57 FR 2008, Jan. 17, 
1992; 58 FR 3205, Jan. 8, 1993; 58 FR 67637, Dec. 22, 1993; 60 FR 56934, 
Nov. 13, 1995]



Sec. 401.112  Corn silage option.

    The provisions of the Corn Silage Crop Insurance Option to the Corn 
Crop Insurance Endorsement for the 1988 through 1994 crop years are as 
follows:

                   Federal Crop Insurance Corporation

                           Corn Silage Option

Insured's Name                           Contract No.
------------------------------------------------------------------------
Address                                  Crop Year
                                        --------------------------------
                                         Identification No.
                                        --------------------------------
                                         SSN      Tax
------------------------------------------------------------------------

    Upon our approval, this amendment is applicable for the 1988 through 
1994 crop years.
    1. You must have a corn endorsement in force. The corn endorsement 
provides guaranteed protection on a bushel basis for corn harvested as 
grain only.
    2. All provisions of the corn endorsement not in conflict with this 
option remain applicable. If a conflict exists between the terms of the 
endorsement and this silage option, the terms of the silage option 
apply.
    3. A properly executed Corn Silage Option must be submitted to us on 
or before the sales closing date if you wish to insure your corn as 
silage under this option.
    4. The silage option remains in force and need not be renewed 
annually. If you desire to cancel the option, you must do so in writing 
by the cancellation date shown in the actuarial table. The silage option 
is mandatory if required by the actuarial table.
    5. Failure to submit a properly executed silage option by the sales 
closing date will result in all your corn being insured under the terms 
and conditions of the corn endorsement.
    6. All production and appraisals under this option will be in tons. 
When the corn is harvested as silage and a grain appraisal is made 
concurrently with a silage appraisal, and the grain/silage appraisal is 
less than 4.5 bushels per ton, the production will be reduced 1 percent 
for each 1 tenth of a bushel below 4.5 bushels. The representative 
sample required by subsection 8.a(3) of the general policy must be at 
least 10 feet wide and the entire length of the field. If a 
representative sample is not left unharvested, no reduction for 
harvested silage will be allowed.
    7. If the actuarial table shows both a grain and silage guarantee, 
and the normal silage harvesting period has ended, we may increase any 
tonnage appraisal or any harvested silage production to 65 percent 
moisture equivalent to reflect the normal moisture content of silage 
harvested during the normal silage harvesting period.
    8. A replanting payment will be available in accordance with 
subsection 9.h. of the general policy if it is practical to replant. The 
payment will not exceed 1 ton, multiplied by the price election, 
multiplied by your share.
    Your premium rate under this option is that specified for silage 
corn on the actuarial table. If only one premium rate is shown by the 
actuarial table it will be applied to both grain and silage. Mixtures of 
corn and grain sorghum are insurable for silage only if the sorghum does 
not exceed 20 percent of the stand.
    The end of the insurance period under the silage option is September 
30 for the crop year. The silage option is not available in corn 
counties which offer coverage only on a bushel basis.

[[Page 102]]



Insured's Signature                         (Date)
 
------------------------------------------------------------------------
Agent's Signature                           (Date)
 
------------------------------------------------------------------------
Approved by Company                         (Date)
------------------------------------------------------------------------


[52 FR 45146, Nov. 25, 1987, as amended at 60 FR 56934, Nov. 13, 1995]



Sec. 401.113  Grain sorghum endorsement.

    The provisions of the Grain Sorghum Crop Insurance Endorsement for 
the 1988 through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                        Grain Sorghum Endorsement

                             1. Insured Crop

    a. The crop insured will be combine type hybrid grain sorghum 
planted for harvest as grain.
    b. In addition to the grain sorghum not insurable in section 2 of 
the general crop insurance policy, we do not insure any grain sorghum, 
which was destroyed or put to another use for the purpose of conforming 
with any other program administered by the United States Department of 
Agriculture.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting; unless 
those causes are excepted, excluded, or limited by the actuarial table 
or section 9 of the general crop insurance policy.

                            3. Annual Premium

    a. The annual premium amount is computed by multiplying the 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share at the time of planting.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insurance experience through the 1983 crop year 
under the terms of the experience table contained in the grain sorghum 
policy in effect for the 1984 crop year, you will continue to receive 
the benefit of the reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction amount will not increase because of 
favorable experience;
    (3) The premium reduction amount will decrease because of 
unfavorable experience in accordance with the terms of the policy in 
effect for the 1984 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous from at least prior to the 1984 
crop year.

                           4. Insurance Period

    The calendar date for the end of the insurance period is the date 
immediately following planting as follows: (a) Val Verde, Edwards, Kerr, 
Kendall, Bexar, Wilson, Karnes, Goliad, Victoria, and Jackson Counties, 
Texas, and all Texas counties south thereof: September 30. (b) All other 
Texas counties and all other States: December 10.

                            5. Unit Division

    Grain sorghum acreage that would otherwise be one unit, as defined 
in section 17 of the general crop insurance policy, may be divided into 
more than one unit if you agree to pay additional premium as provided 
for by the actuarial table and if for each proposed unit you maintain 
written, verifiable records of planted acreage and harvested production 
for at least the previous crop year. Production reports by unit based on 
those records should be filed as early as possible but must be filed by 
no later than the date required by subsection 4.d. of the general crop 
insurance policy and either;
    a. Acreage planted to the insured grain sorghum crop is located in 
separate, legally identifiable sections (except in Florida) or, in the 
absence of section descriptions (and in Florida) the land is identified 
by separate ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the section or ASCS Farm Serial Number are 
clearly identified, and the insured acreage can be easily determined; 
and
    (2) The grain sorghum is planted in such a manner that the planting 
pattern does not continue into an adjacent section or ASCS Farm Serial 
Number; or
    b. The acreage planted to the insured grain sorghum is located in a 
single section or ASCS Farm Serial Number and consists of acreage on 
which both irrigated and non-irrigated practices are carried out, 
provided:
    (1) Grain sorghum planted on the irrigated acreage does not continue 
into non-irrigated acreage in the same rows or planting pattern (Non-
irrigated corners of a center pivot irrigation system planted to 
insurable grain sorghum are part of the irrigated unit. The production 
from the total unit, both irrigated

[[Page 103]]

and nonirrigated, is combined to determine the unit yield for the 
purpose of determining the guarantee for the unit.); and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good irrigated and non-irrigated farming 
practices for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       6. Notice of Damage or Loss

    For the purpose of section 8 of the general crop insurance policy, 
representative sample of the unharvested crop must be at least 10 feet 
wide and the entire length of the field.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of grain sorghum to 
be counted (see subsection 7.d.);
    (3) Multiplying the remainder by your price election; and
    (4) Multiplying this result by your share.
    b. The total production (bushels) to be counted for a unit will 
include:
    (1) All harvested production which may be adjusted for moisture and 
quality as follows:
    (a) Mature grain sorghum production which is not eligible for 
quality adjustment will be reduced .12 percent for each .1 percentage 
point of moisture in excess of 14.0 percent; or
    (b) Mature grain sorghum production which, due to insurable causes 
has a test weight of less than 51 pounds per bushel or contains more 
than 15.0 percent kernel damage, as determined by a grain grader 
licensed by the Federal Grain Inspection Service or licensed under the 
United States Warehouse Act, will be adjusted by:
    (i) Dividing the value per bushel of the insured grain sorghum by 
the price per bushel of U.S. No. 2 grain sorghum; and
    (ii) Multiplying the result by the number of bushels of insured 
grain sorghum.
    The applicable price for No. 2 grain sorghum will be the local 
market price on the earlier of the day the loss is adjusted or the day 
the insured grain sorghum is sold; and
    (2) All appraised production which will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to an uninsured causes and failure to follow 
recognized good grain sorghum farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause;
    (c) Appraised production on unharvested aceage;
    (d) Appraised production on insured acreage for which we have given 
written consent to be put to another use unless such acreage is:
    (i) Not put to another use before harvest of grain sorghum becomes 
general in the county and reappraised by us;
    (ii) Further damaged by an insured cause and reappraised by us; or
    (iii) Harvested.
    c. A replanting payment is available under this endorsement. The 
replanting payment per acre will not exceed 7 bushels multiplied by the 
price election, multiplied by your share. When the crop is replanted by 
a practice that was uninsurable as an original planting, any indemnity 
will be reduced by the amount of the replant payment.

                  8. Cancellation and Termination Dates

------------------------------------------------------------------------
                                                   Cancellation and
              State and County                    termination dates
------------------------------------------------------------------------
Val Verde, Edwards, Kerr, Kendall, Bexar,    Feb. 15.
 Wilson, Karnes, Goliad, Victoria, and
 Jackson Counties, Texas, and all Texas
 counties south thereof.
Alabama; Arizona; Arkansas; California;      Mar. 31.
 Florida; Georgia; Louisiana; Mississippi;
 Nevada; North Carolina; South Carolina;
 and El Paso, Hudspeth, Culberson, Reeves,
 Loving, Winkler, Ector, Uptown, Reagan,
 Sterling, Coke, Tom Green, Concho,
 McCulloch, San Saba, Mills, Hamilton,
 Bosque, Johnson, Tarrant, Wise, Cooke
 Counties, Texas, and all Texas counties
 south and east thereof to and including
 Terrell, Crockett, Sutton, Kimble,
 Gillespie, Blanco, Comal, Guadalupe,
 Gonzales, De Witt, Lavaca, Colorado,
 Wharton, and Matagorda Counties, Texas.
All other Texas counties and all other       Apr. 15.
 States.
------------------------------------------------------------------------

                          9. Contract changes.

    Contract changes will be available at your service office by 
December 31 preceding the cancellation date for counties with an April 
15 cancellation date (February 15, 1992, for the 1992 crop year only), 
and by November 30 preceding the cancellation date (February 15, 1992, 
for the 1992 crop year only), for all other counties.

                10. Late Planting and Prevented Planting

    (a) In lieu of subparagraphs 2.e.(4) and 21.o. of the General Crop 
Insurance Policy (Sec. 401.8), insurance will be provided for acreage 
planted to grain sorghum during the late planting period (see 
subparagraph (c)), and acreage

[[Page 104]]

you were prevented from planting (see subparagraph (d)). These coverages 
provide reduced production guarantees for such acreage. The reduced 
guarantees will be combined with the production guarantee for timely 
planted acreage for each unit. The premium amount for late planted 
acreage and eligible prevented planting acreage will be the same as that 
for timely planted acreage. For example, assume you insure one unit in 
which you have a 100 percent (100%) share. The unit consists of 150 
acres, of which 50 acres were planted timely, 50 acres were planted 7 
days after the final planting date (late planted), and 50 acres are 
unplanted and eligible for prevented planting coverage. To calculate the 
amount of any indemnity which may be due to you, the production 
guarantee for the unit will be computed as follows:
    (1) For timely planted acreage, multiply the per acre production 
guarantee for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the per acre production 
guarantee for timely planted acreage by ninety-three percent (0.93) and 
multiply the result by the 50 acres planted late; and
    (3) For prevented planting acreage, multiply the per acre production 
guarantee for timely planted acreage by fifty percent (0.50) and 
multiply the result by the 50 acres eligible for prevented planting 
coverage.
    The total of the three calculations will be the production guarantee 
for the unit. Your premium will be based on the result of multiplying 
the per acre production guarantee for timely planted acreage by the 150 
acres in the unit.
    (b) You must provide written notice to us if you were prevented from 
planting (see subparagraph 11.(g)). This notice must be given not later 
than three (3) days after:
    (1) The final planting date if you have unplanted acreage that may 
be eligible for prevented planting coverage; and
    (2) The date you stop planting within the late planting period on 
any unit that may have acreage eligible for prevented planting coverage.
    (c) Late Planting.
    (1) For acreage planted after the final planting date but on or 
before 25 days after the final planting date, the production guarantee 
for each acre will be reduced for each day planted after the final 
planting date by:
    (i) One percent (.01) for the first through the tenth day; and
    (ii) Two percent (.02) for the eleventh through the twenty-fifth 
day.
    (2) In addition to the requirements of section 3 (Report of Acreage, 
Share, and Practice (Acreage Report)) of the General Crop Insurance 
Policy (Sec. 401.8), you must report the dates the acreage is planted 
within the late planting period.
    (3) If planting of the grain sorghum continues after the final 
planting date, or you are prevented from planting grain sorghum during 
the late planting period, the acreage reporting date will be the later 
of:
    (i) The acreage reporting date contained in the Actuarial Table; or
    (ii) Five (5) days after the end of the late planting period.
    (d) Prevented Planting (Including Planting After the Late Planting 
Period).
    (1) If you were prevented from planting grain sorghum (see 
subparagraph 11.(g)), you may elect:
    (i) To plant grain sorghum during the late planting period. The 
production guarantee for such acreage will be determined in accordance 
with subparagraph 10.(c)(1);
    (ii) Not to plant this acreage to any crop that is intended for 
harvest in the same crop year. The production guarantee for such acreage 
which is eligible for prevented planting coverage will be fifty percent 
(0.50) of the production guarantee for timely planted acres. For 
example, if your production guarantee for timely planted acreage is 30 
bushels per acre, your prevented planting production guarantee would be 
equivalent to 15 bushels per acre (30 bushels multiplied by 0.50). This 
section does not prohibit the preparation and care of the acreage for 
conservation practices, such as planting a cover crop, as long as such 
crop is not intended for harvest; or
    (iii) To plant grain sorghum after the late planting period. The 
production guarantee for such acreage will be fifty percent (0.50) of 
the production guarantee for timely planted acres. For example, if your 
production guarantee for timely planted acreage is 30 bushels per acre, 
your prevented planting production guarantee would be equivalent to 15 
bushels per acre (30 bushels multiplied by 0.50). Production to count 
for such acreage will be determined in accordance with subparagraph 7.b.
    (2) In addition to the provisions of section 7 (Insurance Period) of 
the General Crop Insurance Policy (Sec. 401.8), the beginning of the 
insurance period for prevented planting coverage is the sales closing 
date designated in the Actuarial Table for grain sorghum.
    (3) The acreage to which prevented planting coverage applies will be 
limited as follows:
    (i) Eligible acreage will not exceed the greater of:
    (A) The number of acres planted to grain sorghum on each ASCS Farm 
Serial Number during the previous crop year (adjusted for any 
reconstitution which may have occurred prior to the sales closing date);
    (B) The ASCS base acreage for grain sorghum reduced by any acreage 
reduction applicable to the farm under any program administered by the 
United States Department of Agriculture; or

[[Page 105]]

    (C) One hundred percent (100%) of the simple average of the number 
of acres planted to grain sorghum during the crop years that were used 
to determine your yield;

unless we agree in writing, prior to the sales closing date, to approve 
acreage exceeding this limit.
    (ii) Acreage intended to be planted under an irrigated practice will 
be limited to the number of grain sorghum acres properly prepared to 
carry out an irrigation practice.
    (iii) A prevented planting production guarantee will not be provided 
for:
    (A) Any acreage that does not constitute at least 20 acres or 20 
percent (20%) of the acres in the unit, whichever is less;
    (B) Land for which the Actuarial Table does not designate a premium 
rate unless you submit a written request for coverage for such acreage 
prior to the sales closing date for grain sorghum in the county. Upon 
your timely written request, we will provide a written insurance offer 
for such acreage;
    (C) Land used for conservation purposes or intended to be or 
considered to have been left unplanted under any program administered by 
the United States Department of Agriculture;
    (D) Land on which any crop, other than grain sorghum, has been 
planted and is intended for harvest, or has been harvested in the same 
crop year; or
    (E) Land which planting history or conservation plans indicate would 
remain fallow for crop rotation purposes.
    (iv) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be reduced 
by the number of grain sorghum acres timely planted and late planted. 
For example, assume you have 100 acres eligible for prevented planting 
coverage in which you have a 100 percent share. The acreage is located 
in a single ASCS Farm Serial Number which you insure as two separate 
optional units consisting of 50 acres each. If you planted 60 acres of 
grain sorghum on one optional unit and 40 acres of grain sorghum on the 
second optional unit, your prevented planting eligible acreage would be 
reduced to zero (i.e., 100 acres eligible for prevented planting 
coverage minus 100 acres planted equals zero). If you report more grain 
sorghum acreage under this contract than is eligible for prevented 
planting coverage, we will allocate the eligible acreage to insured 
units based on the number of prevented planting acres and share you 
reported for each unit.
    (4) When the ASCS Farm Serial Number covers more than one unit, or a 
unit consists of more than one ASCS Farm Serial Number, the covered 
acres will be pro-rated based on the number of acres in each unit or 
ASCS Farm Serial Number that could have been planted to grain sorghum in 
the crop year.
    (5) In accordance with the provisions of section 3 (Report of 
Acreage, Share, and Practice (Acreage Report)) of the General Crop 
Insurance Policy (Sec. 401.8), you must report any insurable acreage you 
were prevented from planting. This report must be submitted on or before 
the acreage reporting date, even though you may elect to plant the 
acreage after the late planting period. Any acreage you report as 
eligible for prevented planting coverage which we determine is not 
eligible will be deleted from prevented planting coverage.
    (6) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be provided for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          11. Meaning of Terms

    (a) Days--calendar days.
    (b) Final planting date--the date contained in the Actuarial Table 
by which the insured grain sorghum must initially be planted in order to 
be insured for the full production guarantee.
    (c) Harvest--completion of combining or threshing grain sorghum for 
grain on any acreage.
    (d) 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 grain sorghum 
acreage.
    (e) Late planted--acreage planted during the late planting period.
    (f) Late planting period--the period which begins the day after the 
final planting date for grain sorghum and ends twenty-five (25) days 
after the final planting date.
    (g) Prevented planting--inability to plant grain sorghum with proper 
equipment by:
    (1) The final planting date for grain sorghum in the county; or
    (2) The end of the late planting period.
    You must have been unable to plant grain sorghum due to an insured 
cause of loss which is general in the area (i.e., most producers in the 
surrounding area are unable to plant due to similar insurable causes) 
and which occurs between the sales closing date and the final planting 
date or within the late planting period.
    (h) Production guarantee--the number of bushels determined by 
multiplying the approved yield per acre by the coverage level percentage 
you elect.

[[Page 106]]

    (i) Replanting--performing the cultural practices necessary to 
replace the grain sorghum seed, and replacing the seed in the insured 
acreage with the expectation of growing a successful crop.
    (j) Timely planted--grain sorghum planted by the final planting 
date, as established by the Actuarial Table, for grain sorghum in the 
county to be planted for harvest in the crop year.

[52 FR 45151, Nov. 25, 1987, as amended at 54 FR 20504, May 12, 1989; 56 
FR 58302, Nov. 19, 1991; 57 FR 2008, Jan. 17, 1992; 58 FR 3207, Jan. 8, 
1993; 58 FR 67638, Dec. 22, 1993; 60 FR 56934, Nov. 13, 1995]



Sec. 401.114  Canning and processing tomato endorsement.

    The provisions of the Canning and Processing Tomato Crop Insurance 
Endorsement for the 1988 through the 1997 crop years are as follows:

                   Federal Crop Insurance Corporation

                Canning And Processing Tomato Endorsement

                             1. Insured Crop

    a. The crop insured will be tomatoes which are planted for harvest 
as canning or processing tomatoes.
    b. In addition to the tomatoes not insurable in section 2 of the 
general crop insurance policy, we do not insure any tomatoes:
    (1) Which are not grown under a written contract with a canner or 
processor or excluded from the canner or processor contract for, or 
during, the crop year. (Prior to the date you report your acreage, the 
contract must be completed to the extent that a binding agreement exists 
requiring the insured to deliver a stated amount of tomatoes and 
requiring the processor to accept that amount.); or
    (2) Except in California, that are grown on acreage where tomatoes 
have been grown in either of the two previous crop years.
    c. A late planting option will be available on tomatoes.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period.
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.
    b. In addition to the causes of loss not insured against under 
section 1 of the general crop insurance policy, we will not insure any 
loss of production due to failure to market the tomatoes unless such 
failure is due to actual physical damage from a cause specified in 
subsection 2.a.

                        3. Production Guarantees

    a. The production guarantees per acre are progressive by stages and 
increase, at specified intervals, to the final stage production 
guarantee. The stages and production guarantees are:
    (1) First stage is from planning until first fruit set, the first 
stage production guarantee is 50% of the final stage production 
guarantee;
    (2) Second stage is from first fruit set until harvest, the second 
stage production guarantee is 80% of the final stage production 
guarantee; and
    (3) Third stage (final stage) is harvested acreage, the third stage 
production guarantee is the final stage guarantee.
    b. Any acreage of tomatoes damaged to the extent that growers in the 
area would not further care for the tomatoes, will be deemed to have 
been destroyed even though the tomatoes continue to be cared for. The 
production for such acreage will be the guarantee for the stage (either 
first or second) in which such damage occurs.

                            4. Annual Premium

    a. The annual premium amount is computed by multiplying the final 
stage production guarantee times the price election, times the premium 
rate, times the insured acreage, times your share at the time of 
planting.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1983 crop year 
under the terms of the experience table contained in the canning and 
processing tomato policy for the 1984 crop year, you will continue to 
receive the benefit of the reduction subject to the following 
conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1984 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

[[Page 107]]

                           5. Insurance Period

    The date the canner or processor no longer accepts production under 
the contract which covers the insured acreage planted for the contract 
year is added to Section 7 of the general crop insurance policy as one 
of the events which designates the end of the insurance period. The 
calendar date for the end of the insurance period in California is 
October 20 of the calendar year in which the tomatoes are normally 
harvested (October 10 in all other States).

                            6. Unit Division

    Tomato acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one unit if you agree to pay additional premium if required by 
the actuarial table and if for each proposed unit you maintain written, 
verifiable records of planted acreage and harvested production for at 
least the previous crop year; and either
    a. Acreage planted to insured tomatoes is located in separate, 
legally identifiable sections or, in the absence of section 
descriptions, the land is identified by separate ASCS Farm Serial 
Numbers, provided:
    (1) The boundaries of the section or ASCS Farm Serial Number are 
clearly identified and the insured acreage can be easily determined; and
    (2) The tomatoes are planted in such a manner that the planting 
pattern does not continue into the adjacent section or ASCS Farm Serial 
Number; or
    b. The acreage planted to the insured tomatoes is located in a 
single section or ASCS Farm Serial Number and consists of acreage on 
which both an irrigated and nonirrigated practice are carried out, 
provided:
    (1) Tomatoes planted on irrigated acreage do not continue into 
nonirrigated acreage in the same rows or planting pattern; and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good dryland and irrigated farming practices 
for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       7. Notice of Damage or Loss

    a. In addition to the notices required in section 8 of the general 
crop insurance policy, if you are going to claim an indemnity on any 
unit, you must give us notice within 72 hours:
    (1) Of when harvest would normally start if any acreage on the unit 
is not to be harvested;
    (2) Of discontinuance of harvest on the unit; or
    (3) If you are unable to deliver production to the canner or 
processor.
    b. The tomato vines on any hard-harvested acreage must not be 
destroyed until inspected by us if an indemnity is to be claimed on the 
unit.
    c. For the purpose of section 8 of the general crop insurance policy 
the representative sample of the unharvested crop must be at least 10 
feet wide and the entire length of the field.

                         8. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of tomatoes to be 
counted (see subsection 8.b.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    b. The total production (tons) to be counted for a unit will 
include:
    (1) All harvested tomato production marketed and any tomato 
production which does not meet the quality requirements of the canner or 
processor contract due to not being timely marketed;
    (2) All appraised production which will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good tomato farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
put to another use without our prior written consent, or damaged solely 
by an uninsured cause;
    (c) For acreage which does not qualify for the final period 
guarantee, any amount of appraised and harvested production in excess of 
the difference between the final period guarantee and the guarantee 
applicable to such acreage;
    (d) Production lost due to uninsured causes; and
    (e) Appraised production on insured acreage for which we have given 
written consent to be put to another use unless such acreage is:
    (i) Not put to another use before harvest of tomatoes becomes 
general in the county and is reappraised by us;
    (ii) Further damaged by an insured cause and is reappraised by us; 
or
    (iii) Harvested.

                  9. Cancellation and Termination Dates

    The cancellation and termination dates are February 15 in California 
and April 15 in all other states.

[[Page 108]]

                          10. Contract Changes

    The date by which contract changes will be available in your service 
office is November 30 (December 17 for the 1998 crop year only) 
preceding the cancellation date for counties with a February 15 
cancellation date and December 31 preceding the cancellation date for 
all other counties.

                          11. Meaning of Terms

    a. First fruit set means the reproductive stage of the plant when 
30% of the plants have produced a fruit that has reached a minimum of 
one inch in diameter.
    b. Harvest means severance of tomatoes from the vines for the 
purpose of delivery to a canner or processor.

[52 FR 45599, Dec. 1, 1987, as amended at 54 FR 20504, May 12, 1989; 62 
FR 54342, Oct. 20, 1997; 62 FR 63633, Dec. 2, 1997]



Sec. 401.115  Texas citrus endorsement.

    The provisions of the Texas Citrus Crop Insurance Endorsement for 
the 1989 and subsequent crop year are as follows:

                   Federal Crop Insurance Corporation

                        Texas Citrus Endorsement

                             1. Insured Crop

    a. The crop insured will be any of the following citrus types you 
elect:
    Type I  Early and mid-season oranges;
    Type II  Late oranges (including temples);
    Type III  Grapefruit, except types IV and V;
    Type IV  Rio Red and Star Ruby grapefruit; or
    Type V  Ruby Red grapefruit.
    b. In addition to the citrus not insurable in section 2 of the 
general crop insurance policy, we do not insure any citrus:
    (1) Which is not irrigated;
    (2) If the producing trees have not produced an average yield of 
three tons of oranges or grapefruit per acre the previous year unless 
the trees are inspected by us and we agree, in writing, to the amount of 
insurance coverage;
    (3) If acceptable production records of at least the previous crop 
year are not available; or
    (4) Which we inspect and consider not acceptable.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period.
    (1) Freeze;
    (2) Frost;
    (3) Excess moisture;
    (4) Hail;
    (5) Fire;
    (6) Tornado;
    (7) Excess wind;
    (8) Wildlife;
    (9) Failure of the irrigation water supply; or
    (10) Direct Mediterranean Fruit Fly damage; unless those causes are 
excepted, excluded, or limited by the actuarial table or section 9 of 
the general crop insurance policy.
    b. In addition to the causes of loss not insured against in section 
1 of the general crop insurance policy, we will not insure against any 
loss of production due to fire if weeds and other forms of undergrowth 
have not been controlled or tree pruning debris has not been removed 
from the grove. We also specifically do not insure against the inability 
to market the fruit as a direct result of quarantine, boycott, or 
refusal of any entity to accept production unless the refused production 
has actual physical damage due to a cause specified in subsection 2.a.

    3. Report of Acreage, Share, Type, and Practice (Acreage Report)

    a. In addition to the information required in section 3 of the 
general crop insurance policy, you must report the crop type.
    b. The date by which you must annually submit the acreage report is 
June 30 of the calendar year the insured crop normally blooms.

            4. Production Reporting and Production Guarantees

    a. In addition to the production report required in section 4 of the 
general crop insurance policy, you must report:
    (1) The number of bearing trees; and
    (2) The number of trees topped, hedged, or pruned.
    b. In lieu of the method described in section 4 of the general crop 
insurance policy to determine the yield used to compute your production 
guarantee, your second stage (final stage) production guarantee will be 
based on our appraisal of current crop potential. This appraisal will be 
performed on or before insurance attaches.
    c. The production guarantees per acre are progressive by stages and 
increase, at specified intervals, to the final stage production 
guarantees. The stages and production guarantees are:
    (1) First stage is from the date insurance attaches until May 1 of 
the calendar year of normal bloom, the production guarantee will be:
    (a) Forty percent (40%) of the yield used to determine the previous 
year's production guarantee multiplied by the percentage of yield 
(coverage level) for the current crop

[[Page 109]]

year if you had insurance for the previous crop year; or
    (b) Forty percent (40%) of your production for the previous year per 
acre multiplied by the percentage of yield (coverage level) for the 
current crop year if you did not have insurance for the previous crop 
year.
    (2) Second stage (final stage) is from May 1 of the calendar year of 
normal bloom until the end of the insurance period, the production 
guarantee is the final stage production guarantee.
    d. Any acreage of citrus damaged to the extent that growers in the 
area would not further care for the citrus, will be deemed to have been 
destroyed even though the citrus continues to be cared for. The 
production guarantee for such acreage will be the guarantee for the 
stage in which such damage occurs.

                               5. Premium

    The premium amount is computed:
    a. For citrus damaged in the first stage to the extent that growers 
in the area would not further care for the citrus, by multiplying the 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share on the date insurance 
attaches.
    b. If subsection 5.a. does not apply, by multiplying the second 
stage production guarantee times the price election, times the premium 
rate, times the insured acreage, times your share on the date insurance 
attaches.

                           6. Insurance Period

    In lieu of section 7 of the General Crop Insurance Policy, insurance 
attaches on December 1 prior to the calendar year of normal bloom except 
if we accept your application for insurance after November 30, insurance 
will attach on the thirtieth (30th) day after you sign and submit a 
properly completed application. Insurance will not attach to any acreage 
inspected by us and determined to be unacceptable. Insurance ends on 
each unit at the earliest of:
    (1) Total destruction of the citrus;
    (2) Harvest;
    (3) The date harvest would normally start on any acreage which will 
not be harvested;
    (4) Final adjustment of a loss; or
    (5) May 31 of the calendar year following the normal year of bloom.

                            7. Unit Division

    a. Citrus acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided by 
citrus type.
    b. Citrus acreage that would otherwise be one unit as defined in 
section 17 of the general crop insurance policy and subsection 7.a. 
above may be divided into more than one unit if you agree to pay 
additional premium as required by the actuarial table and if, for each 
proposed unit, you maintain written, verifiable records of planted 
acreage and harvested production for at least the previous crop year. 
The acreage planted to insured citrus must be located in separate 
legally identifiable sections, the boundaries of the sections must be 
clearly identified, the insured acreage must be easily determined, and 
each unit must be non-contiguous. If you have a loss on any unit, 
production records for all harvested units must be provided. Production 
that is commingled between optional units will cause those units to be 
combined.

                       8. Notice of Damage or Loss

    In addition to the notices required in section 8 of the general crop 
insurance policy, if the insured citrus is damaged by excess moisture, 
you must give us notice of such damage within seventy-two (72) hours of 
occurrence.

                         9. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee for 
the applicable stage (see subsection 4.c.);
    (2) Subtracting therefrom the total production of citrus to be 
counted (see subsection 9.e.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    b. The total production to be counted for a unit will include all 
harvested and appraised production.
    (1) Any citrus production which is not marketed as fresh fruit and, 
due to insurable causes, does not contain 120 or more gallons of juice 
per ton, will be adjusted by:
    (a) Dividing the gallons of juice per ton obtained from the damaged 
citrus by 120; and
    (b) Multiplying the result by the number of tons of such citrus. If 
records of actual juice content are not available, an average juice 
content will be used.
    (2) Where the actuarial table provides for, and you elect the fresh 
fruit option, citrus production which is not marketable as fresh fruit 
due to insurable causes will be adjusted by:
    (a) Dividing the value per ton of the damaged citrus by the price of 
undamaged citrus; and
    (b) Multiplying the result by the number of tons of such citrus.
    The applicable price for undamaged citrus will be the local market 
price the week before damage occurred, or the contract price if the 
contract was entered into between the producer and buyer before damage 
occurred.
    (3) Any production will be considered marketed or marketable as 
fresh fruit unless due

[[Page 110]]

to insurable causes, such production was not marketed as fresh fruit.
    (4) In the absence of acceptable records to determine the 
disposition of harvested citrus, we may elect to determine such 
disposition and the amount of such production to be counted for the 
unit.
    (5) Any citrus on the ground which is not picked up and marketed 
will be considered lost if the damage was due to an insured cause.
    (6) Appraised production to be counted will include:
    (a) Unharvested production, and potential production lost due to 
uninsured causes and failure to follow recognized good citrus farming 
practices; and
    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause or destroyed by you without our 
consent.
    (7) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Further damaged by an insured cause and is reappraised by us; or
    (b) Harvested.

                 10. Cancellation and Termination Dates

    The cancellation and termination dates are November 30 prior to the 
calendar year of the normal bloom.

                          11. Contract Changes

    The date by which contract changes will be available in your service 
office is August 31 preceding the cancellation date.

                          12. Meaning of Terms

    a. Crop year means the period beginning with the date insurance 
attaches to the citrus crop and extending through normal harvest time, 
and will be designated by the calendar year following the year in which 
the bloom is normally set.
    b. Direct mediterranean fruit fly damage means the actual physical 
damage to the citrus on the unit which causes such citrus to be 
unmarketable and will not include inability to market such citrus as a 
direct result of a quarantine, boycott, or refusal to accept the citrus 
by any entity without regard to actual physical damage to such citrus.
    c. Excess moisture means that more than 20 inches of precipitation 
have fallen on the grove within a 72 hour period.
    d. Excess wind means a natural movement of air which has sustained 
speeds in excess of 58 miles per hour recorded at the U.S. Weather 
Service reporting station nearest to the crop at the time of crop 
damage.
    e. Freeze means the condition that exists when air temperatures over 
a widespread area remain at or below 32 degrees Fahrenheit.
    f. Frost means the condition that exists when the air temperature 
around the tree falls to 32 degrees Fahrenheit or below.
    g. Harvest means the severance of mature citrus from the tree either 
by pulling, picking, or by mechanical or chemical means, or picking up 
the marketable fruit from the ground.
    h. Hedged means to cut back the side branches for better or more 
fruitful growth.
    i. Non-contiguous land means land which is not touching at any 
point. Land which is separated by only a public or private right-of-way 
will be considered to be touching (contiguous).
    j. Topped means to cut back the upper branches for better or more 
fruitful growth.

[53 FR 6966, Mar. 4, 1988]



Sec. 401.116  Flaxseed endorsement.

    The provisions of the Flaxseed Crop Insurance Endorsement for the 
1988 through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                          Flaxseed Endorsement

                             1. Insured Crop

    a. The crop insured will be flaxseed planted for harvest as seed.
    b. In addition to the flaxseed not insurable in section 2 of the 
general crop insurance policy, we do not insure any flaxseed if the seed 
has not been mechanically incorporated into the soil in rows unless 
another method of planting is specifically allowed by the actuarial 
table.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;
unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.

                            3. Annual Premium

    a. The annual premium amount is computed by multiplying the 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share at the time of planting.

[[Page 111]]

    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insurance experience through the 1983 crop year 
under the terms of the experience table in the flax policy in effect for 
the 1984 crop year, you will continue to receive the benefit of the 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction amount will not increase because of 
favorable experience;
    (3) The premium reduction amount will decrease because of 
unfavorable experience in accordance with the terms of the policy in 
effect for the 1985 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                           4. Insurance Period

    The calendar date for the end of the insurance period is October 31 
following planting.

                            5. Unit Division

    Flaxseed acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one unit if you agree to pay additional premium as provided by 
the actuarial table and if for each proposed unit you maintain written, 
verifiable records of planted acreage and harvested production for at 
least the previous crop year and either;
    a. Acreage planted to the insured flaxseed is located in separate, 
legally identifiable sections or, in the absence of section descriptions 
the land is identified by separate ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the sections or ASCS Farm Serial Numbers are 
clearly identified, and the insured acreage can be easily determined; 
and
    (2) The flaxseed is planted in such a manner that the planting 
pattern does not continue into an adjacent section or ASCS Farm Serial 
Number; or
    b. The acreage planted to the insured flaxseed is located in a 
single section or ASCS Farm Serial Number and consists of acreage on 
which both irrigated and nonirrigated practices are carried out, 
provided:
    (1) Flaxseed planted on the irrigated acreage does not continue into 
nonirrigated acreage in the same rows or planting pattern (Nonirrigated 
corners of a center pivot irrigation system planted to insurable 
flaxseed are part of the irrigated unit. The production from the total 
unit, both irrigated and nonirrigated, is combined to determine your 
yield for the purpose of determining the guarantee for the unit.); and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good irrigated and nonirrigated farming 
practices for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       6. Notice of Damage or Loss

    For purposes of Section 8 of the general crop insurance policy the 
representative sample of the unharvested crop must be at least 10 feet 
wide and the entire length of the field.

                         7. Claim for Indemnity

    a. An indemnity will be determined for each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of flaxseed to be 
counted (see subsection 7.b.);
    Multiplying the remainder by your price election; and
    (4) Multiplying this result by your share.
    b. The total production (bushels) to be counted for a unit will 
include:
    (1) All harvested production and may be adjusted for moisture or 
quality as follows:
    (a) Mature flaxseed production which, due to insurable causes, has a 
test weight or less than 47 pounds per bushel or, as determined by a 
grain grader licensed by the Federal Grain Inspection Service or 
licensed under the United States Warehouse Act, contains more than 15 
percent damaged flaxseed, will be adjusted by:
    (i) Dividing the value per bushel of the insured flaxseed by the 
price per bushel of U.S. No. 2 flaxseed; and
    (ii) Multiplying the result by the number of bushels of insured 
flaxseed.
    (b) The applicable price for No. 2 flaxseed will be the local market 
price on the earlier of the day the loss is adjusted or the day the 
insured flaxseed is sold.
    (2) All appraised production will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to an uninsured causes and failure to follow 
recognized good flaxseed farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use (other than harvest) without our prior written 
consent or damaged solely by an uninsured cause;
    (c) Appraised production on unharvested acreage; and
    (d) Appraised production on insured acreage for which we have given 
written consent to be put to another use unless such acreage is:
    (i) Not put to another use before harvest of flax becomes general in 
the county and reappraised by us;
    (ii) Further damaged by an insured cause and reappraised by us; or

[[Page 112]]

    (iii) Harvested.

                  8. Cancellation and Termination Date.

    The cancellation and termination date for all states is April 15.

                           9. Contract Changes

    Contract changes will be available at your service office by 
December 31 prior to the cancellation date.

                          10. Meaning of Terms

    a. Harvest of flaxseed on the unit means combining, or removal from 
the field.
    b. Section is a unit of measure under the rectangular survey system 
describing a tract of land generally one mile square, usually consisting 
of approximately 640 acres.

[53 FR 4379, Feb. 16, 1988, as amended at 54 FR 20504, May 12, 1989; 60 
FR 56934, Nov. 13, 1995]



Sec. 401.117  Soybean endorsement.

    The provisions of the Soybean Crop Insurance Endorsement for the 
1988 through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                           Soybean Endorsement

                             1. Insured Crop

    a. The crop insured will be soybeans planted for harvest as beans.
    b. In addition to the soybeans not insurable under section 2 of the 
general crop insurance policy, we do not insure any soybeans if the seed 
has not been mechanically incorporated into the soil in rows during the 
planting process unless another method is specifically allowed by the 
actuarial table.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;
    Unless those causes are excepted, excluded, or limited by the 
actuarial table or section 9 of the general crop insurance policy.

                            3. Annual Premium

    a. The annual premium amount is computed by multiplying the 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share at the time of planting, 
times any applicable premium adjustment percentage for which you may 
qualify as shown in the actuarial table, because:
    (1) You have not selected optional units; or
    (2) You are eligible for a good insuring experience discount.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insurance experience through the 1983 crop year 
under the terms of the experience table contained in the soybean policy 
in effect for the 1984 crop year, you will continue to receive the 
benefit of the reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction amount will not increase because of 
favorable experience;
    (3) The premium reduction amount will decrease because of 
unfavorable experience in accordance with the terms of the policy in 
effect for the 1984 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                           4. Insurance Period

    In accordance with the provisions of section 7 of the general crop 
insurance policy the calendar date for the end of the insurance period 
in all states is December 10 immediately following planting.

                            5. Unit Division

    Soybean acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one unit if for each proposed unit:
    a. You maintain written verifiable records of planted acreage and 
harvested production for at least the previous crop year and production 
reports based on those records are filed to obtain an insurance 
guarantee; and
    b. Acreage planted to the insured soybeans is located in separate, 
legally identifiable sections (except in Florida) or, in the absence of 
section descriptions (and in Florida) the land is identified by separate 
ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the section or ASCS Farm Serial Number are 
clearly identified and the insured acreage is easily determined; and
    (2) The soybeans are planted in such a manner that the planting 
pattern does not continue into an adjacent section or ASCS Farm Serial 
Number; or
    c. The acreage planted to the insured soybeans is located in a 
single section or ASCS Farm Serial Number and consists of acreage on 
which both an irrigated and non-irrigated practices are carried out, 
provided:

[[Page 113]]

    (1) Soybeans planted on the irrigated acreage do not continue into 
non-irrigated acreage in the same rows or planting pattern; and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good irrigated and non-irrigated farming 
practices for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided to us. Production that is commingled between 
optional units will cause those units to be combined. If your soybean 
acreage is not divided into optional units as provided in this section, 
your premium amount will be reduced by the factor contained in the 
actuarial table.

                       6. Notice of Damage or Loss

    For purposes of section 8 of the general crop insurance policy the 
representative sample of the unharvested crop must be at least 10 feet 
wide and the entire length of the field.

                         7. Claim for Indemnity

    a. An indemnity will be determined for each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of soybeans to be 
counted (see subsection 7.b.);
    (3) Multiplying the remainder by your price election; and
    (4) Multiplying this result by your share.
    b. The total production (bushels) to be counted for a unit will 
include:
    (1) All harvested production and may be adjusted for moisture or 
quality as follows:
    (a) Mature soybean production which is not eligible for quality 
adjustment will be reduced .12 percent for each .1 percentage point of 
moisture in excess of 13.0 percent.
    (b) Soybean production which, due to insurable causes, has a test 
weight of less than 49 pounds per bushel or is of distinctly low quality 
as determined by a grain grader licensed by the Federal Grain Inspection 
Service or licensed under the United States Warehouse Act will be 
adjusted by:
    (i) Dividing the value per bushel of such soybeans by the price per 
bushel of U.S. No. 1 soybeans; and
    (ii) Multiplying the result by the number of bushels of such 
soybeans.
    (c) The applicable price for No. 2 soybeans will be the local market 
price on the earlier of the day the loss is adjusted or the day the 
insured soybeans are sold.
    (2) All appraised production and will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to an uninsured causes and failure to follow 
recognized good soybean farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use (other than harvest) without our prior written 
consent or damaged solely by an uninsured cause;
    (c) Any appraised production on unharvested acreage;
    (d) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use unless such acreage is:
    (i) Not put to another use before harvest of soybeans becomes 
general in the county and reappraised by us;
    (ii) Further damaged by an insured cause and reappraised by us; or
    (iii) Harvested.
    c. A replanting payment is available under this endorsement. The 
replanting payment will not exceed 3 bushels multiplied by the price 
election, multiplied by your share. When the crop is replanted by a 
practice that was uninsurable as an original planting, any indemnity 
will be reduced by the amount of the replanting payment.

                8. The Cancellation and Termination Dates

------------------------------------------------------------------------
                                                   Cancellation and
              State and county                    termination dates
------------------------------------------------------------------------
Jackson, Victoria, Goliad, Bee, Live Oak,    February 15.
 McMullen, La Salle, and Dimmit Counties,
 Texas and all Texas counties lying south
 thereof.
Alabama; Arizona; Arkansas; California;      March 31.
 Florida; Georgia; Louisiana; Mississippi;
 Nevada; North Carolina; South Carolina;
 and El Paso, Hudspeth, Culberson, Reeves,
 Loving, Winkler, Ector, Upton, Reagan,
 Sterling, Coke, Tom Green, Concho,
 McCulloch, San Saba, Mills, Hamilton,
 Bosque, Johnson, Tarrant, Wise, Cooke
 Counties, Texas, and all Texas counties
 lying south and east thereof to and
 including Maverick, Zavala, Frio,
 Atascosa, Karnes, De Witt, Lavaca,
 Colorado, Wharton, and Matagorda Counties,
 Texas.
All other Texas counties and all other       April 15.
 states.
------------------------------------------------------------------------

                          9. Contract changes.

    Contract changes will be available at your service office by 
December 31 preceding the cancellation date for counties with an April 
15 cancellation date (February 15, 1992, for the 1992 crop year only), 
and by November 30 preceding the cancellation date (February 15, 1992, 
for the 1992 crop year only), for all other counties.

                10. Late Planting and Prevented Planting

    (a) In lieu of subparagraphs 2.e.(4) and 21.o. of the General Crop 
Insurance Policy (Sec. 401.8), insurance will be provided for acreage 
planted to soybeans during the late planting period (see subparagraph 
(c)), and acreage you were prevented from planting (see subparagraph 
(d)). These coverages provide reduced

[[Page 114]]

production guarantees for such acreage. The reduced guarantees will be 
combined with the production guarantee for timely planted acreage for 
each unit. The premium amount for late planted acreage and eligible 
prevented planting acreage will be the same as that for timely planted 
acreage. For example, assume you insure one unit in which you have a 100 
percent (100%) share. The unit consists of 150 acres, of which 50 acres 
were planted timely, 50 acres were planted 7 days after the final 
planting date (late planted), and 50 acres are unplanted and eligible 
for prevented planting coverage. To calculate the amount of any 
indemnity which may be due to you, the production guarantee for the unit 
will be computed as follows:
    (1) For timely planted acreage, multiply the per acre production 
guarantee for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the per acre production 
guarantee for timely planted acreage by ninety-three percent (0.93) and 
multiply the result by the 50 acres planted late; and
    (3) For prevented planting acreage, multiply the per acre production 
guarantee for timely planted acreage by fifty percent (0.50) and 
multiply the result by the 50 acres eligible for prevented planting 
coverage.

The total of the three calculations will be the production guarantee for 
the unit. Your premium will be based on the result of multiplying the 
per acre production guarantee for timely planted acreage by the 150 
acres in the unit.
    (b) You must provide written notice to us if you were prevented from 
planting (see subparagraph 11.(h)). This notice must be given not later 
than three (3) days after:
    (1) The final planting date if you have unplanted acreage that may 
be eligible for prevented planting coverage; and
    (2) The date you stop planting within the late planting period on 
any unit that may have acreage eligible for prevented planting coverage.
    (c) Late Planting.
    (1) For acreage planted after the final planting date but on or 
before 25 days after the final planting date, the production guarantee 
for each acre will be reduced for each day planted after the final 
planting date by:
    (i) One percent (.01) for the first through the tenth day; and
    (ii) Two percent (.02) for the eleventh through the twenty-fifth 
day.
    (2) In addition to the requirements of section 3 (Report of Acreage, 
Share, and Practice (Acreage Report)) of the General Crop Insurance 
Policy (Sec. 401.8), you must report the dates the acreage is planted 
within the late planting period.
    (3) If planting of the soybeans continues after the final planting 
date, or you are prevented from planting soybeans during the late 
planting period, the acreage reporting date will be the later of:
    (i) The acreage reporting date contained in the Actuarial Table; or
    (ii) Five (5) days after the end of the late planting period.
    (d) Prevented Planting (Including Planting After the Late Planting 
Period).
    (1) If you were prevented from planting soybeans (see subparagraph 
11.(h)), you may elect:
    (i) To plant soybeans during the late planting period. The 
production guarantee for such acreage will be determined in accordance 
with subparagraph 10.(c)(1);
    (ii) Not to plant this acreage to any crop that is intended for 
harvest in the same crop year. The production guarantee for such acreage 
which is eligible for prevented planting coverage will be fifty percent 
(0.50) of the production guarantee for timely planted acres. For 
example, if your production guarantee for timely planted acreage is 30 
bushels per acre, your prevented planting production guarantee would be 
equivalent to 15 bushels per acre (30 bushels multiplied by 0.50). This 
section does not prohibit the preparation and care of the acreage for 
conservation practices, such as planting a cover crop, as long as such 
crop is not intended for harvest; or
    (iii) To plant soybeans after the late planting period. The 
production guarantee for such acreage will be fifty percent (0.50) of 
the production guarantee for timely planted acres. For example, if your 
production guarantee for timely planted acreage is 30 bushels per acre, 
your prevented planting production guarantee would be equivalent to 15 
bushels per acre (30 bushels multiplied by 0.50). Production to count 
for such acreage will be determined in accordance with subparagraph 7.b.
    (2) In addition to the provisions of section 7 (Insurance Period) of 
the General Crop Insurance Policy (Sec. 401.8), the beginning of the 
insurance period for prevented planting coverage is the sales closing 
date designated in the Actuarial Table for soybeans.
    (3) The acreage to which prevented planting coverage applies will be 
limited as follows:
    (i) Eligible acreage will not exceed the greater of:
    (A) The number of acres planted to soybeans on each ASCS Farm Serial 
Number during the previous crop year (adjusted for any reconstitution 
which may have occurred prior to the sales closing date); or
    (B) One hundred percent (100%) of the simple average of the number 
of acres planted to soybeans during the crop years that were used to 
determine your yield;

unless we agree in writing, prior to the sales closing date, to approve 
acreage exceeding this limit.

[[Page 115]]

    (ii) Acreage intended to be planted under an irrigated practice will 
be limited to the number of soybean acres properly prepared to carry out 
an irrigated practice.
    (iii) A prevented planting production guarantee will not be provided 
for:
    (A) Any acreage that does not constitute at least 20 acres or 20 
percent (20%) of the acres in the unit whichever is less;
    (B) Land for which the Actuarial Table does not designate a premium 
rate unless you submit a written request for coverage for such acreage 
prior to the sales closing date for soybeans in the county. Upon your 
timely written request, we will provide a written insurance offer for 
such acreage;
    (C) Land used for conservation purposes or intended to be or 
considered to have been left unplanted under any program administered by 
the United States Department of Agriculture;
    (D) Land on which any crop, other than soybeans, has been planted 
and is intended for harvest, or has been harvested in the same crop 
year; or
    (E) Land which planting history or conservation plans indicate would 
remain fallow for crop rotation purposes.
    (iv) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be reduced 
by the number of soybean acres timely planted and late planted. For 
example, assume you have 100 acres eligible for prevented planting 
coverage in which you have a 100 percent (100%) share. The acreage is 
located in a single ASCS Farm Serial Number which you insure as two 
separate optional units consisting of 50 acres each. If you planted 60 
acres of soybeans on one optional unit and 40 acres of soybeans on the 
second optional unit, your prevented planting eligible acreage would be 
reduced to zero (i.e., 100 acres eligible for prevented planting 
coverage minus 100 acres planted equals zero). If you report more 
soybean acreage under this contract than is eligible for prevented 
planting coverage, we will allocate the eligible acreage to insured 
units based on the number of prevented planting acres and share you 
reported for each unit.
    (4) When the ASCS Farm Serial Number covers more than one unit, or a 
unit consists of more than one ASCS Farm Serial Number, the covered 
acres will be pro-rated based on the number of acres in each unit or 
ASCS Farm Serial Number that could have been planted to soybeans in the 
crop year.
    (5) In accordance with the provisions of section 3 (Report of 
Acreage, Share, and Practice (Acreage Report)) of the General Crop 
Insurance Policy (Sec. 401.8), you must report any insurable acreage you 
were prevented from planting. This report must be submitted on or before 
the acreage reporting date, even though you may elect to plant the 
acreage after the late planting period. Any acreage you report as 
eligible for prevented planting coverage which we determine is not 
eligible will be deleted from prevented planting coverage.
    (6) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be provided for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          11. Meaning of Terms

    (a) Days-- calendar days.
    (b) Distinctly low quality--(1) Exceeding 8.0 percent kernel damage 
(excluding heat damage); (2) Having a musty, sour, or commercially 
objectionable foreign odor which causes the beans to grade U.S. Sample 
grade; or (3) Graded as ``Garlicky.''
    (c) Final planting date-- the date contained in the Actuarial Table 
by which the insured soybeans must initially be planted in order to be 
insured for the full production guarantee.
    (d) Harvest--completion of combining or threshing of soybeans on any 
acreage.
    (e) 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 soybean acreage.
    (f) Late planted-- acreage planted during the late planting period.
    (g) Late planting period-- the period which begins the day after the 
final planting date for soybeans and ends twenty-five (25) days after 
the final planting date.
    (h) Prevented planting-- inability to plant soybeans with proper 
equipment by:
    (1) The final planting date for soybeans in the county; or
    (2) The end of the late planting period.

You must have been unable to plant soybeans due to an insured cause of 
loss which is general in the area (i.e., most producers in the 
surrounding area are unable to plant due to similar insurable causes) 
and which occurs between the sales closing date and the final planting 
date or within the late planting period.
    (i) Production guarantee-- the number of bushels determined by 
multiplying the approved yield per acre by the coverage level percentage 
you elect.
    (j) Replanting-- performing the cultural practices necessary to 
replace the soybean seed, and replacing the seed in the insured acreage 
with the expectation of growing a successful crop.
    (k) Timely planted-- soybeans planted by the final planting date, as 
established by the

[[Page 116]]

Actuarial Table, for soybeans in the county to be planted for harvest in 
the crop year.

[52 FR 45153, Nov. 25, 1987; 53 FR 1001, Jan. 15, 1988, as amended at 54 
FR 48072, Nov. 21, 1989; 55 FR 42552, Oct. 22, 1990; 55 FR 50813, Dec. 
11, 1990; 56 FR 58302, Nov. 19, 1991; 57 FR 2008, Jan. 17, 1992; 58 FR 
3209, Jan. 8, 1993; 58 FR 67639, Dec. 22, 1993; 60 FR 56934, Nov. 13, 
1995]



Sec. 401.118  Canning and processing bean endorsement.

    The provisions of the Canning and Processing Bean Endorsement for 
the 1988 through 1997 crop years are as follows:

                   Federal Crop Insurance Corporation

                 Canning and Processing Bean Endorsement

                       1. Insured Crop and Acreage

    a. The crop insured will be fresh beans (snap and lima) which are 
planted for harvest as canning or processing beans.
    b. In addition to the beans not insurable under section 2 of the 
general crop insurance policy, we do not insure any beans;
    (1) Not grown under a contract with a canner, processor or broker or 
excluded from the canner, processor or broker contract for, or during, 
the crop year (The contract must be executed and effective before you 
report your acreage);
    (2) Planted for the fresh market; or
    (3) Planted to snap beans, lima beans, green peas, mint, rye, 
soybeans, or sunflowers the previous crop year unless otherwise provided 
for on the actuarial table.
    c. An instrument in the form of a ``lease'' under which you retain 
control of the acreage on which the insured beans are grown and which 
provides for delivery under certain conditions and at a stipulated price 
will, for the purpose of this endorsement, be treated as a contract 
under which you have a share in the beans.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting; unless 
those causes are excepted, excluded, or limited by the actuarial table 
or section 9 of the general crop insurance policy.
    b. In addition to the causes not insured against in section 1 of the 
General Crop Insurance Policy, we will not insure against any loss of 
production due to the crop not being timely harvested unless such delay 
in harvesting is solely and directly due to adverse weather conditions 
which preclude harvesting equipment from entering into and moving about 
the unit.

                           3. Annual premium.

    The annual premium amount is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time of planting, applying any 
applicable premium adjustment percentage (as shown in the actuarial 
table), for which you may qualify because you have not selected optional 
units.

                           4. Insurance period

    In addition to the provisions in section 7 of the general crop 
insurance policy, for unharvested acreage, the date by which acreage 
should have been harvested is added as one of the dates, the earliest of 
which is used to designate the end of the insurance period. The calendar 
date for the end of the insurance period is the applicable date of the 
year in which the beans are normally harvested, as follows:

Delaware, Maryland, and New Jersey--All   October 15.
 Beans.
New York--Snap Beans....................  September 30.
Utah--All Beans.........................  October 5.
All other states--Snap Beans............  September 20.
All other states--Lima Beans............  October 5.
 

                            5. Unit division.

    In addition to units defined in section 17 of the General Crop 
Insurance Policy, canning and processing bean acreage may be divided 
into units by type (smap or lima). For Idaho, Illinois, Indiana, Iowa, 
Michigan, Minnesota, New York, Oregon, Pennsylvania, Tennessee, Utah, 
Washington, and Wisconsin, bean acreage that would otherwise be one unit 
may be further divided, if for each proposed unit you maintain written, 
verifiable records of planted acreage and harvested production for at 
least the previous crop year and either:
    a. Acreage planted to the insured beans is located in separate, 
legally identifiable sections or, in the absence of section 
descriptions, the land is identified by separate ASCS Farm Serial 
Numbers, provided:
    (1) The boundaries of the sections or ASCS Farm Serial Numbers are 
clearly identified and the insured acreage can be easily determined; and
    (2) The beans are planted in such a manner that the planting pattern 
does not continue into the adjacent section or ASCS Farm Serial Number; 
or
    b. The acreage planted to the insured beans is located in a single 
section or ASCS Farm

[[Page 117]]

Serial Number and consists of acreage on which both an irrigated and 
nonirrigated practice are carried out, provided:
    (1) Beans planted on irrigated acreage do not continue into 
nonirrigated acreage in the same rows or planting pattern (Nonirrigated 
corners of a center pivot irrigation system planted to insurable beans 
are part of the irrigated unit. Production on the total unit, both 
irrigated and non-irrigated, will be combined to determine the yield for 
the purpose of determining the guarantee for the unit); and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good irrigated and nonirrigated farming 
practices for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       6. Notice of Damage or Loss

    In addition to the notices required in section 8 of the general crop 
insurance policy if you are going to claim an indemnity on any unit 
which is not to be harvested or on which harvest has been discontinued, 
you must give us notice not later than 48 hours:
    (1) After the time harvest would normally start; or
    (2) After discontinuance of harvest.
    For the purposes of section 8 of the general crop insurance policy 
the representative sample of the unharvested crop must be at least 10 
feet wide and the entire length of the field.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total bean production (tons) to be 
counted;
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    b. The total production (tons) to be counted for a unit will include 
all harvested and appraised production.
    (1) The tons of harvested production will be either the total net 
tons delivered to the processor or broker for which payment was 
received, as shown on the processor or broker settlement sheet, or will 
be determined by dividing the dollar amount received from the processor 
or broker by the contract price for the sieve size or grade factor 
designated by the actuarial table.
    (2) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good bean farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
put to another use without our prior written consent or damaged solely 
by an uninsured cause; and
    (c) Appraised production on unharvested acreage.
    (d) If any acreage is not timely harvested, the production to count 
will be the greater of:
    (i) That designated by the actuarial table;
    (ii) The appraised production; or
    (iii) The dollar amount received from the processor divided by the 
processor's base contract price per ton.
    (e) Appraised production on insured acreage for which we have given 
written consent to be put to another use unless such acreage is:
    (i) Not put to another use before harvest of beans becomes general 
in the county and is reappraised by us;
    (ii) Further damaged by an insured cause and is reappraised by us; 
or
    (iii) Harvested.

                  8. Cancellation and Termination Dates

    The cancellation and termination dates for all states are April 15.

                           9. Contract Changes

    The date by which contract changes will be available in your service 
office is December 31 preceding the cancellation date.

                          10. Meaning of Terms

    a. Harvest means the mechanical picking of bean pods from the vines 
for the purpose of delivery to the canner or processor.

[53 FR 6560, Mar. 2, 1988, as amended at 53 FR 9100, Mar. 21, 1988; 54 
FR 20503, May 12, 1989; 55 FR 1785, Jan. 19, 1990; 62 FR 58624, Oct. 30, 
1997]



Sec. 401.119  Cotton endorsement.

    The provisions of the Cotton Crop Insurance Endorsement for the 1990 
through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                           Cotton Endorsement

                       1. Insured Crop and Acreage

    a. The crop insured will be American Upland lint cotton.
    b. The acreage insured of skip-row cotton will be the acreage 
occupied by rows of cotton after eliminating the skipped-row portions.
    c. In addition to the cotton not insurable under section 2 of the 
general crop insurance policy, we do not insure any cotton:

[[Page 118]]

    (1) Which is not irrigated and, in the same calendar year, is grown:
    (a) Where a hay crop was harvested; or
    (b) Where a small grain crop reached the heading stage.
    (2) Planted in excess of any mandatory acreage limitations 
applicable to the farm by any program administered by the United States 
Department of Agriculture; or
    (3) Destroyed, or put to another use in order to comply with other 
United States Department of Agriculture programs.
    d. In lieu of subsection 2.e.(7) of the general crop insurance 
policy, we do not insure any cotton planted with another spring planted 
crop.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.

                            3. Annual Premium

    The annual premium amount is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time of planting, times any 
applicable premium adjustment factor for which you may qualify as 
contained in the actuarial table, because: (1) You have not selected 
optional units; or (2) You are eligible for good insuring experience 
discount.

                           4. Insurance Period

    a. In lieu of subsection 7.b of the general crop insurance policy 
(harvest of the unit), insurance will end upon removal of the cotton 
from the field.
    b. The calendar dates for the end of the insurance period are as 
follows:

(1) Val Verde, Edwards, Kerr, Kendall,     September 30.
 Bexar, Wilson, Karnes, Goliad, Victoria,
 and Jackson counties, Texas, and all
 Texas counties lying South thereof.
(2) Arizona, California, New Mexico,       January 31.
 Oklahoma, and all other Texas counties.
(3) All other states.....................  December 31.
 

                            5. Unit Division

    Cotton acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one optional unit, if for each proposed unit:
    a. You maintain written, verifiable records of planted acreage and 
harvested production for at least the previous crop year and production 
reports based on those records are filed to obtain an insurance 
guarantee; and
    b. Acreage planted to insured cotton is located in separate, legally 
identifiable sections (except in Florida) or, in the absence of section 
descriptions (and in Florida), the land is identified by separate ASCS 
Farm Serial Numbers, provided:
    (1) The boundaries of the sections or ASCS Farm Serial Numbers are 
clearly identified and the insured acreage is easily determined; and
    (2) The cotton is planted in such a manner that the planting pattern 
does not continue into the adjacent section or ASCS Farm Serial Number; 
or
    c. The acreage planted to the insured cotton is located in a single 
section or ASCS Farm Serial Number and consists of acreage on which both 
an irrigated and nonirrigated practice are carried out, provided:
    (1) Cotton planted on irrigated acreage does not continue into 
nonirrigated acreage in the same rows or planting pattern; and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good dryland and irrigated farming practices 
for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided to us. Production that is commingled between 
optional units will cause those units to be combined. If your cotton 
acreage is not divided into optional units as provided in this section, 
your premium amount will be reduced as provided on the actuarial table.

                       6. Notice of Damage or Loss

    For purposes of section 8 of the general crop insurance policy the 
representative sample of the unharvested crop must be at least 10 feet 
wide and the entire length of the field.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of cotton to be 
counted (see subsection 7.b.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this product by your share.
    b. The total production to be counted for a unit will include:

[[Page 119]]

    (1) All harvested production; and
    (2) All appraised production which will include:
    (a) Mature and potential production on unharvested acreage;
    (b) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good cotton farming practices;
    (c) Not less than the applicable guarantee for any acreage which is 
abandoned or put to another use without our prior written consent or 
damaged solely by an uninsured cause; and
    (d) Not less than 25 percent of the production guarantee per acre 
for any acreage of cotton that is immature when we determine that 
harvest of cotton becomes general in the county.
    (e) Production on insured acreage for which we have given written 
consent to be put to another use, unless such acreage is:
    (i) Not put to another use before harvest of cotton becomes general 
in the county and is reappraised by us;
    (ii) Further damaged by an insured cause and is reappraised by us; 
or
    (iii) Harvested; and
    (f) Production of not less than the harvested guarantee on acreage 
where the stalks have been destroyed without our written consent.
    c. When mature cotton (harvested or unharvested) has been damaged 
solely by insured causes, the production to count will be reduced if, on 
the date the final notice of loss is given by the insured, the price 
quotation for cotton of like quality (price quotation ``A'') for the 
applicable growth area is less than 75 percent of price quotation ``B.'' 
Price quotation ``B'' will be that day's growth area price quotation for 
the same area for cotton of the grade, staple length, and micronaire 
reading shown by the actuarial table for this purpose. The pounds of 
production to be counted will be determined by multiplying the number of 
pounds (harvested and appraised) of mature cotton by price quotation 
``A'' and dividing the result by 75 percent of price quotation ``B.''

                  8. Cancellation and Termination Dates

    The cancellation and termination dates are:

State and County:
    Val Verde, Edwards, Kerr, Kendall,      February 15.
     Bexar, Wilson, Karnes, Goliad,
     Victoria, and Jackson Counties,
     Texas, and all Texas counties lying
     south thereof.
    Alabama; Arizona; Arkansas;             March 31.
     California; Florida; Georgia;
     Louisiana; Mississippi; Nevada; North
     Carolina; South Carolina; and El
     Paso, Hudspeth, Culberson, Reeves,
     Loving, Winkler, Ector, Upton,
     Reagan, Sterling, Coke, Tom Green,
     Concho, McCulloch, San Saba, Mills,
     Hamilton, Bosque, Johnson, Tarrant,
     Wise, Cooke Counties, Texas, and all
     Texas counties lying south and east
     thereof to and including Terrell,
     Crockett, Sutton, Kimble, Gillespie,
     Blanco, Comal, Guadalupe, Gonzales,
     De Witt, Lavaca, Colorado, Wharton,
     and Matagorda Counties, Texas.
    All other Texas counties and all other  April 15.
     States.
 

                           9. Contract Changes

    The date by which contract changes will be available in your service 
office is December 31 preceding the cancellation date for counties with 
an April 15 cancellation date and November 30 preceding the cancellation 
date for all other Counties.

                10. Late Planting and Prevented Planting

    (a) In lieu of subparagraphs 2.e.(4) and 21.o. of the General Crop 
Insurance Policy (Sec. 401.8), insurance will be provided for acreage 
planted to cotton during the late planting period (see subparagraph 
(c)), and acreage you were prevented from planting (see subparagraph 
(d)). These coverages provide reduced production guarantees for such 
acreage. The reduced guarantees will be combined with the production 
guarantee for timely planted acreage for each unit. The premium amount 
for late planted acreage and eligible prevented planting acreage will be 
the same as that for timely planted acreage. For example, assume you 
insure one unit in which you have a 100 percent (100%) share. The unit 
consist of 150 acres, of which 50 acres were planted timely, 50 acres 
were planted 7 days after the final planting date (late planted), and 50 
acres are unplanted and eligible for prevented planting coverage. To 
calculate the amount of any indemnity which may be due to you, the 
production guarantee for the unit will be computed as follows:
    (1) For timely planted acreage, multiply the per acre production 
guarantee for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the per acre production 
guarantee for timely planted acreage by ninety-three percent (0.93) and 
multiply the result by the 50 acres planted late; and
    (3) For prevented planting acreage, multiply the per acre production 
guarantee for timely planted acreage by thirty-five percent (0.35) and 
multiply the result by the 50

[[Page 120]]

acres eligible for prevented planting coverage.

The total of the three calculations will be the production guarantee for 
the unit. Your premium will be based on the result of multiplying the 
per acre production guarantee for timely planted acreage by the 150 
acres in the unit.
    (b) You must provide written notice to us if you were prevented from 
planting (see subparagraph 11.(k)). This notice must be given not later 
than three (3) days after:
    (1) The final planting date if you have unplanted acreage that may 
be eligible for prevented planting coverage; and
    (2) The date you stop planting within the late planting period on 
any unit that may have acreage eligible for prevented planting coverage.
    (c) Late Planting.
    (1) For acreage planted after the final planting date but on or 
before 25 days after the final planting date, the production guarantee 
for each acre will be reduced for each day planted after the final 
planting date by:
    (i) One percent (.01) for the first through the tenth day; and
    (ii) Two percent (.02) for the eleventh through the twenty-fifth 
day.
    (2) In addition to the requirements of section 3 (Report of Acreage, 
Share, and Practice (Acreage Report)) of the General Crop Insurance 
Policy (Sec. 401.8), you must report the dates the acreage is planted 
within the late planting period.
    (3) If planting of the cotton continues after the final planting 
date, or you are prevented from planting cotton during the late planting 
period, the acreage reporting date will be the later of:
    (i) The acreage reporting date contained in the Actuarial Table; or
    (ii) Five (5) days after the end of the late planting period.
    (d) Prevented Planting (including Planting After the Late Planting 
Period).
    (1) If you were prevented from planting cotton (see subparagraph 
11.(k)), you may elect:
    (i) To plant cotton during the late planting period. The production 
guarantee for such acreage will be determined in accordance with 
subparagraph 10.(c)(1);
    (ii) Not to plant this acreage to any crop that is intended for 
harvest in the same crop year. The production guarantee for such acreage 
which is eligible for prevented planting coverage will be thirty-five 
percent (0.35) of the production guarantee for timely planted acres. For 
example, if your production guarantee for timely planted acreage is 700 
pounds per acre, your prevented planting production guarantee would be 
equivalent to 245 pounds per acre (700 pounds multiplied by 0.35). This 
section does not prohibit the preparation and care of the acreage for 
conservation practices, such as planting a cover crop, as long as such 
crop is not intended for harvest; or
    (iii) To plant cotton after the late planting period. The production 
guarantee for such acreage will be thirty-five percent (0.35) of the 
production guarantee for timely planted acres. For example, if your 
production guarantee for timely planted acreage is 700 pounds per acre, 
your prevented planting production guarantee would be equivalent to 245 
pounds per acre (700 pounds multiplied by 0.35). Production to count for 
such acreage will be determined in accordance with subparagraphs 7.b. 
and c.
    (2) In addition to the provisions of section 7 (Insurance Period) of 
the General Crop Insurance Policy (Sec. 401.8) and subparagraph 11.(b) 
(Meaning of Terms) of this endorsement, the beginning of the insurance 
period for prevented planting coverage is the sales closing date 
designated in the Actuarial Table for cotton.
    (3) The acreage to which prevented planting coverage applies will be 
limited as follows:
    (i) Eligible acreage will not exceed the greater of:
    (A) The number of acres planted to cotton on each ASCS Farm Serial 
Number during the previous crop year (adjusted for any reconstitution 
which may have occurred prior to the sales closing date);
    (B) The ASCS base acreage for cotton reduced by any acreage 
reduction applicable to the farm under any program administered by the 
United States Department of Agriculture; or
    (C) One hundred percent (100%) of the simple average of the number 
of acres planted to cotton during the crop years that were used to 
determine your yield;

unless we agree in writing, prior to the sales closing date, to approve 
acreage exceeding this limit.
    (ii) Acreage intended to be planted under an irrigated practice will 
be limited to the number of acres properly prepared to carry out an 
irrigated practice.
    (iii) A prevented planting production guarantee will not be provided 
for:
    (A) Any acreage that does not constitute at least 20 acres or 20 
percent (20%) of the acres in the unit whichever is less;
    (B) Land for which the Actuarial Table does not designate a premium 
rate unless you submit a written request for coverage for such acreage 
prior to the sales closing date for cotton in the county. Upon your 
timely written request, we will provide a written insurance offer for 
such acreage;
    (C) Land used for conservation purposes or intended to be or 
considered to have been left unplanted under any program administered by 
the United States Department of Agriculture;
    (D) Land on which any crop, other than cotton, has been planted and 
is intended for

[[Page 121]]

harvest, or has been harvested in the same crop year; or
    (E) Land which planting history or conservation plans indicate would 
remain fallow for crop rotation purposes.
    (iv) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be reduced 
by the number of cotton acres timely planted and late planted. For 
example, assume you have 100 acres eligible for prevented planting 
coverage in which you have a 100 percent (100%) share. The acreage is 
located in a single ASCS Farm Serial Number which you insure as two 
separate optional units consisting of 50 acres each. If you planted 60 
acres of cotton on one optional unit and 40 acres of cotton on the 
second optional unit, your prevented planting eligible acreage would be 
reduced to zero (i.e., 100 acres eligible for prevented planting 
coverage minus 100 acres planted equals zero). If you report more cotton 
acreage under this contract than is eligible for prevented planting 
coverage, we will allocate the eligible acreage to insured units based 
on the number of prevented planting acres and share you reported for 
each unit.
    (4) When the ASCS Farm Serial Number covers more than one unit, or a 
unit consists of more than one ASCS Farm Serial Number, the covered 
acres will be pro-rated based on the number of acres in each unit or 
ASCS Farm Serial Number that could have been planted to cotton in the 
crop year.
    (5) In accordance with the provisions of section 3 (Report of 
Acreage, Share, and Practice (Acreage Report)) of the General Crop 
Insurance Policy (Sec. 401.8), you must report any insurable acreage you 
were prevented from planting. This report must be submitted on or before 
the acreage reporting date, even though you may elect to plant the 
acreage after the late planting period. Any acreage you report as 
eligible for prevented planting coverage which we determine is not 
eligible will be deleted from prevented planting coverage.
    (6) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be providing for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          11. Meaning of Terms

    (a) Cotton--only American Upland Cotton.
    (b) Crop year--the period beginning at planting and extending 
through the end of the insurance period shown in section 4 and is 
designated by the calendar year in which the crop is normally planted.
    (c) Days--calendar days.
    (d) Final planting date--the date contained in the Actuarial Table 
by which the insured cotton must initially be planted in order to be 
insured for the full production guarantee.
    (e) Growth area--a geographic area designated by the Secretary of 
Agriculture for the purpose of reporting cotton prices.
    (f) Harvest--the removal of the seed cotton on each acre from the 
open cotton boll or the severance of the open cotton boll from the stalk 
by either manual or mechanical means.
    (g) 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 cotton acreage.
    (h) Late planted--acreage during the late planting period.
    (i) Late planting period--the period which begins the day after the 
final planting date for cotton and ends twenty-five (25) days after the 
final planting date.
    (j) Mature cotton--cotton which can be harvested either manually or 
mechanically and will include both unharvested and harvested cotton.
    (k) Prevented planting--inability to plant cotton with proper 
equipment by:
    (1) The final planting date for cotton in the county; or
    (2) The end of the late planting period.

You must have been unable to plant cotton due to an insured cause of 
loss which is general in the area (i.e., most producers in the 
surrounding area are unable to plant due to similar insurable causes) 
and which occurs between the sales closing date and the final planting 
date or within the late planting period.
    (l) Production guarantee--the number of pounds determined by 
multiplying the approved yield per acre by any applicable yield 
conversion factor for the row pattern planted, multiplied by the 
coverage level percentage you elect.
    (m) Skip-row--planting patterns consisting of alternating rows of 
cotton and fallow rows or rows of another crop (not spring-planted) as 
defined by ASCS (if non-cotton rows are occupied by another crop any 
yield factor normally applied for skip-row cotton will not be 
applicable).
    (n) Timely planted--cotton planted by the planting date, as 
established by the Actuarial Table, for cotton in the county to be 
planted for harvest in the crop year.

[54 FR 48074, Nov. 21, 1989, as amended at 58 FR 67641, Dec. 22, 1993; 
60 FR 56934, Nov. 13, 1995]



Sec. 401.120  Rice endorsement.

    The provisions of the Rice Crop Insurance Endorsement for the 1988

[[Page 122]]

through the 1997 crop years are as follows:

                   Federal Crop Insurance Corporation

                            Rice Endorsement

                             1. Insured Crop

    a. The crop insured will be rice which is planted for harvest as 
grain.
    b. In addition to the rice not insurable under section 2 of the 
general crop insurance policy, we do not insure any rice:
    (1) Destroyed or put to another use in order to comply with other 
United States Department of Agriculture programs; or;
    (2) Which is not irrigated.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period.
    (1) Adverse weather conditions (excluding drought);
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply due to an unavoidable 
cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.
    b. In addition to the causes of loss not insured against under 
section 1 of the general crop insurance policy, we will not insure 
against my loss of production due to application of saline water.

                            3. Annual premium

    The annual premium amount is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time of planting, times any 
applicable premium adjustment percentage for which you may qualify as 
contained in the actuarial table, because;
    (a) You have not selected optional units; or
    (b) You are eligible for a good insuring experience discount.

                           4. Insurance Period

    The calendar date for the end of the insurance period is October 31 
of the calendar year on which the rice is normally harvested.

                            5. Unit Division

    Rice acreage that would otherwise be one unit, as defined in section 
17 of the general crop insurance policy, may be divided into more than 
one unit if for each proposed unit:
    a. You maintain written verifiable records of planted acreage and 
harvested production for at least the previous crop year and production 
reports based on those records are filed to obtain an insurance 
guarantee; and
    b. Acreage planted to the insured rice is located in separate, 
legally identifiable sections (except in Florida) or, in the absence of 
section descriptions (and in Florida) the land is identified by separate 
ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the section or ASCS Farm Serial Number are 
clearly identified and the insured acreage is easily determined; and
    (2) The rice is planted in such a manner that the planting pattern 
does not continue into an adjacent section or ASCS Farm Serial Number; 
or
    c. If you have a loss on any unit, production records for all 
harvested units must be provided to us. Production that is commingled 
between optional units will cause those units to be combined. If your 
rice acreage is not divided into optional units as provided in this 
section, your premium amount will be reduced as provided by the 
actuarial table.

                       6. Notice of Damage or Loss

    For purposes of section 8 of the general crop insurance policy the 
representative sample of the unharvested crop must be at least 10 feet 
wide and the entire length of the field.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of rice to be counted 
(see subsection 7.b.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this product by your share.
    b. The total production to be counted for a unit will include all 
harvested production including any production from a second rice crop 
harvested in the same crop year (Any mature production from volunteer 
rice growing in the rice will be counted as rice on a weight basis).
    (1) Mature rough rice production which otherwise is not eligible for 
quality adjustment will be reduced in volume by .12 percent for each .1 
percentage point of moisture in excess of 12.0 percent; or
    (2) Mature rough rice production which, due to insurable causes:
    (a) Has a total milling yield (heads, second heads, screening, and 
brewers) of less than 68 pounds per hundredweight;
    (b) The whole kernel weight is less than 55 pounds per hundredweight 
for medium and short grain varieties;

[[Page 123]]

    (c) The whole kernel weight is less than 48 pounds per hundredweight 
for long grain varieties;
    (d) Contains more than 4.0 percent chalky kernels in long grain 
varieties;
    (e) Contains more than 6.0 percent chalky kernels in medium or short 
grain varieties;
    (f) Contains more than 3.0 percent chalky kernels in other types; or
    (g) Contains more than 2.5 percent red rice will have the production 
adjusted by:
    (i) Dividing the value per pound of such rice, by the price per 
pound of U.S. No. 3 rough rice; and
    (ii) Multiplying the result by the number of pounds of such rice.

(The applicable price for No. 3 rough rice will be the nearest mill 
center price on the earlier of the day the loss is adjusted or the day 
the rice was sold).
    c. The production to be counted will include all appraised 
production as follows:
    (1) All unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good rice farming practices;
    (2) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause;
    (3) Appraised production on unharvested acreage.
    (4) Appraised production on insured acreage for which we have given 
written consent to be put to another use unless such acreage is:
    (i) Not put to another use before harvest of rice becomes general in 
the county and is reappraised by us;
    (ii) Further damaged by an insured cause and is reappraised by us; 
or
    (iii) Harvested.
    d. A replanting payment is available under this endorsement. The 
replanting payment per acre will not exceed 400 pounds multiplied by the 
price election, multiplied by your share.

                  8. Cancellation and Termination Dates

    The cancellation and termination dates are:

------------------------------------------------------------------------
                                                   Cancellation and
              State and county                    termination dates
------------------------------------------------------------------------
Jackson, Victoria, Goliad, Bee, Live Oak,    February 15.
 McMullen, LaSalle, Dimmit Counties, Texas,
 and all Texas counties south thereof.
Missouri...................................  April 15.
Florida....................................  March 15.
All other Texas counties and all other       March 31.
 states.
------------------------------------------------------------------------

                           9. Contract Changes

    The date by which contract changes will be available in your service 
office is December 31 preceding the cancellation date for counties with 
an April 15 cancellation date and November 30 (December 17 for the 1998 
crop year only) preceding the cancellation date for all other counties.

                10. Late Planting and Prevented Planting

    (a) In lieu of subparagraphs 2.e.(4) and 21.o. of the General Crop 
Insurance Policy (Sec. 401.8), insurance will be provided for acreage 
planted to rice during the late planting period (see subparagraph (c)), 
and acreage you were prevented from planting (see subparagraph (d)). 
These coverages provide reduced production guarantees for such acreage. 
The reduced guarantees will be combined with the production guarantee 
for timely planted acreage for each unit. The premium amount for the 
late planted acreage and eligible prevented planting acreage will be the 
same as that for timely planted acreage. For example, assume you insure 
one unit in which you have a 100 percent (100%) share. The unit consists 
of 150 acres, of which 50 acres were planted timely, 50 acres were 
planted 7 days after the final planting date (late planted), and 50 
acres are unplanted and eligible for prevented planting coverage. To 
calculate the amount of any indemnity which may be due to you, the 
production guarantee for the unit will be computed as follows:
    (1) For timely planted acreage, multiply the per acre production 
guarantee for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the per acre production 
guarantee for timely planted acreage by ninety-three percent (0.93) and 
multiply the result by the 50 acres planted late; and
    (3) For prevented planting acreage, multiply the per acre production 
guarantee for timely planted acreage by:
    (i) Thirty-five percent (0.35) and multiply the result by the 50 
acres you were prevented from planting, if the acreage is eligible for 
prevented planting coverage, and if the acreage is left idle for the 
crop year, or if a cover crop is planted not for harvest. Prevented 
planting compensation hereunder will not be denied because the cover 
crop is hayed or grazed; or
    (ii) Seventeen and five tenths percent (0.175) and multiply the 
result by the 50 acres you were prevented from planting, if the acreage 
is eligible for prevented planting coverage, and if you elect to plant a 
substitute crop for harvest after the 10th day following the final 
planting date for the insured crop. (This subparagraph (ii) is not 
applicable, and prevented planting coverage is not available hereunder, 
if you elected the Catastrophic Risk Protection Endorsement or you 
elected to exclude prevented planting coverage when a substitute crop is 
planted (see subparagraph 10(d)(1)(iii))).
    The total of the three calculations will be the production guarantee 
for the unit. Your

[[Page 124]]

premium will be based on the result of multiplying the per acre 
production guarantee for timely planted acreage by the 150 acres in the 
unit.
    (b) If you were prevented from planting, you must provide written 
notice to us not later than the acreage reporting date.
    (c) Late Planting.
    (1) For acreage planted after the final planting date but on or 
before 25 days after the final planting date, the production guarantee 
for each acre will be reduced for each day planted after the final 
planting date by:
    (i) One percent (.01) for the first through the tenth day; and
    (ii) Two percent (0.02) for the eleventh through the twenty-fifth 
day.
    (2) In addition to the requirements of section 3 (Report of Acreage, 
Share, and Practice (Acreage Report)) of the General Crop Insurance 
Policy (Sec. 401.8), you must report the dates the acreage is planted 
within the late planting period.
    (3) If planting of the rice continues after the final planting date, 
or you are prevented from planting rice during the late planting period, 
the acreage reporting date will be the later of:
    (i) The acreage reporting date contained in the Actuarial Table; or
    (ii) Five (5) days after the end of the late planting period.
    (d) Prevented Planting (Including Planting After the Late Planting 
Period).
    (1) If you were prevented from planting rice (see subsection 11(h)), 
you may elect:
    (i) To plant rice during the late planting period. The production 
guarantee for such acreage will be determined in accordance with 
paragraph 10(c)(1);
    (ii) Not to plant this acreage to any crop except a cover crop not 
for harvest. You may also elect to plant the insured crop after the late 
planting period. In either case, the production guarantee for such 
acreage will be thirty-five percent (35%) of the production guarantee 
for timely planted acres. For example, if your production guarantee for 
timely planted acreage is 2000 pounds per acre, your prevented planting 
production guarantee would be 700 pounds per acre (2000 pounds 
multiplied by 0.35). If you elect to plant the insured crop after the 
late planting period, production to count for such acreage will be 
determined in accordance with subsections 7b and c; or
    (iii) Not to plant the intended crop but plant a substitute crop for 
harvest, in which case:
    (A) No prevented planting production guarantee will be provided for 
such acreage if the substitute crop is planted on or before the tenth 
day following the final planting date for the insured crop; or
    (B) A production guarantee equal to seventeen and five tenths 
percent (17.5%) of the production guarantee for timely planted acres 
will be provided for such acreage, if the substitute crop is planted 
after the tenth day following the final planting date for the insured 
crop. If you elected the Catastrophic Risk Protection Endorsement or 
excluded this coverage and plant a substitute crop, no prevented 
planting coverage will be provided. For example, if your production 
guarantee for timely planted acreage is 2000 pounds per acre, your 
prevented planting production guarantee would be 350 pounds per acre 
(2000 pounds multiplied by 0.175). You may elect to exclude prevented 
planting coverage when a substitute crop is planted for harvest and 
receive a reduction in the applicable premium rate. If you wish to 
exclude this coverage, you must so indicate, on or before the sales 
closing date, on your application or on a form approved by us. Your 
election to exclude this coverage will remain in effect from year to 
year unless you notify us in writing on our form by the applicable sales 
closing date for the crop year for which you wish to include this 
coverage. All acreage of the crop insured under this policy will be 
subject to this exclusion.
    (2) Proof may be required that you had the inputs available to plant 
and produce the intended crop with the expectation of at least producing 
the production guarantee.
    (3) In addition to the provisions of section 7 (Insurance Period) of 
the General Crop Insurance Policy (Sec. 401.8), the insurance period for 
prevented planting coverage begins:
    (i) On the sales closing date contained in the Special Provisions 
for rice in the county for the crop year the application for insurance 
is accepted; or
    (ii) For any subsequent crop year, on the sales closing date for the 
insured crop in the county for the previous crop year, provided 
continuous coverage has been in effect since that date. For example: If 
you make application and purchase a rice crop insurance policy for the 
1996 crop year, prevented planting coverage will begin on the 1996 sales 
closing date for the insured crop in the county. If the rice coverage 
remains in effect for the 1997 crop year (is not terminated or cancelled 
during or after the 1996 crop year, except the policy may have been 
cancelled to transfer the policy to a different insurance provider, if 
there is no lapse in coverage), prevented planting coverage for the 1997 
crop year began on the 1996 sales closing date.
    (4) The acreage to which prevented planting coverage applies will 
not exceed the total eligible acreage on all Farm Service Agency (FSA) 
Farm Serial Numbers in which you have a share, adjusted for any 
reconstitution that may have occurred on or before the sales closing 
date. Eligible acreage for each FSA Farm Serial Number is determined as 
follows:
    (i) If you participate in any program administered by the United 
States Department of Agriculture that limits the number of

[[Page 125]]

acres that may be planted for the crop year, the acreage eligible for 
prevented planting coverage will not exceed the total acreage permitted 
to be planted to the insured crop.
    (ii) If you do not participate in any program administered by the 
United States Department of Agriculture that limits the number of acres 
that may be planted, and unless we agree in writing on or before the 
sales closing date, eligible acreage will not exceed the greater of:
    (A) The FSA base acreage for the insured crop, including acres that 
could be flexed from another crop, if applicable;
    (B) The number of acres planted to rice on the FSA Farm Serial 
Number during the previous crop year; or
    (C) One hundred percent (100%) of the simple average of the number 
of acres planted to rice during the crop years that you certified to 
determine your yield.
    (iii) Prevented planting coverage will not be provided for any 
acreage:
    (A) That does not constitute at least 20 acres or 20 percent (20%) 
of the acreage in the unit, whichever is less (Acreage that is less than 
20 acres or 20 percent of the acreage in the unit will be presumed to 
have been intended to be planted to the insured crop planted in the 
unit, unless you can show that you had the inputs available before the 
final planting date to plant and produce another insured crop on the 
acreage);
    (B) For which the actuarial table does not designate a premium rate 
unless a written agreement designates such premium rate;
    (C) Used for conservation purposes or intended to be left unplanted 
under any program administered by the United States Department of 
Agriculture;
    (D) On which another crop is prevented from being planted, if you 
have already received a prevented planting indemnity, guarantee or 
amount of insurance for the same acreage in the same crop year, unless 
you provide adequate records of acreage and production showing that the 
acreage has a history of double-cropping in each of the last four years;
    (E) On which the insured crop is prevented from being planted, if 
any other crop is planted and fails, or is planted and harvested, hayed 
or grazed on the same acreage in the same crop year, (other than a cover 
crop as specified in paragraph (a)(3)(i) of this section, or a 
substitute crop allowed in paragraph (a)(3)(ii) of this section) unless 
you provide adequate records of acreage and production showing that the 
acreage has a history of double-cropping in each of the last four years;
    (F) When coverage is provided under the Catastrophic Risk Protection 
Endorsement if you plant another crop for harvest on any acreage you 
were prevented from planting in the same crop year, even if you have a 
history of double cropping. If you have a Catastrophic Risk Protection 
Endorsement and receive a prevented planting indemnity, guarantee, or 
amount of insurance for a crop and are prevented from planting another 
crop on the same acreage, you may only receive the prevented planting 
indemnity, guarantee, or amount of insurance for the crop on which the 
prevented planting indemnity, guarantee, or amount of insurance is 
received; or
    (G) For which planting history or conservation plans indicate that 
the acreage would have remained fallow for crop rotation purposes.
    (iv) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be reduced 
by the number of rice acres timely planted and late planted. For 
example, assume you have 100 acres eligible for prevented planting 
coverage in which you have a 100 percent (100%) share. The acreage is 
located in a single FSA Farm Serial Number which you insure as two 
separate optional units consisting of 50 acres each. If you planted 60 
acres of rice on one optional unit and 40 acres of rice on the second 
optional unit, your prevented planting eligible acreage would be reduced 
to zero (i.e., 100 acres eligible for prevented planting coverage minus 
100 acres planted equals zero).
    (5) In accordance with the provisions of section 3 (Report of 
Acreage, Share, and Practice (Acreage Report) of the General Crop 
Insurance Policy (Sec. 401.8), you must report by unit any insurable 
acreage that you were prevented from planting. This report must be 
submitted on or before the acreage reporting date. For the purpose of 
determining acreage eligible for a prevented planting production 
guarantee the total amount of prevented planting and planted acres 
cannot exceed the maximum number of acres eligible for prevented 
planting coverage. Any acreage you report in excess of the number of 
acres eligible for prevented planting coverage, or that exceeds the 
number of eligible acres physically located in a unit, will be deleted 
from your acreage report.
    (6) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be provided for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          11. Meaning of Terms

    (a) Days--calendar days.
    (b) Final planting date--the date contained in the Actuarial Table 
by which the insured rice must initially be planted in order to be 
insured for the full production guarantee.
    (c) Harvest--the completion of combining or threshing rice for grain 
on any acreage.

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    (d) Late planted--acreage planted during the late planting period.
    (e) Late planting period--the period which begins the day after the 
final planting date for rice and ends twenty-five (25) days after the 
final planting date.
    (f) Mill center--any location in which two or more mills are engaged 
in milling rough rice.
    (g) Planted--uniform placement of an adequate amount of rice seed 
into a prepared seedbed by one of the following methods. Any acreage 
into which seed is placed in any other manner will not be considered as 
planted under the terms of this policy:
    (1) Drill seeding--uniform placement of the rice seed into the 
prepared seedbed by use of a grain drill that incorporates the seed to a 
proper soil depth.
    (2) Broadcast seeding--uniform distribution of the rice seed onto 
the surface of a prepared seedbed, followed by either mechanical 
incorporation of the seed to a proper soil depth in the seedbed or 
flushing the seedbed with water.
    (3) Broadcast seeding into a controlled flood--uniform distribution 
of the rice seed onto a prepared seedbed that has been intentionally 
covered by water. The water must be free of movement and be completely 
contained on the acreage by properly constructed levees and gates.
    (h) Prevented planting--Inability to plant the insured crop with 
proper equipment by the final planting date designated in the Special 
Provisions for the insured crop in the county or the end of the late 
planting period. You must have been unable to plant the insured crop due 
to an insured cause of loss that has prevented the majority of producers 
in the surrounding area from planting the same crop.
    (i) Production guarantee--the number of pounds determined by 
multiplying the approved yield per acre by the coverage level percentage 
you elect.
    (j) Replanting--performing the cultural practices necessary to 
replace the rice seed and replacing the rice seed in the insured acreage 
with the expectation of growing a successful crop.
    (k) Second crop rice--regrowth of a stand of rice originating from 
the initially insured rice crop following harvest and which can be 
harvested in the same crop year.
    (l) Timely planted--rice planted by the final planting date, as 
established by the Actuarial Table, for rice in the county to be planted 
for harvest in the crop year.

[52 FR 45605, Dec. 1, 1987; 54 FR 48076, Nov. 21, 1989; 57 FR 54682, 
Nov. 20, 1992; 58 FR 67642, Dec. 22, 1993; 60 FR 62721, 62722, Dec. 7, 
1995; 62 FR 28310, May 23, 1997; 62 FR 63633, Dec. 2, 1997]



Sec. 401.121  ELS cotton endorsement.

    The provisions of the ELS Cotton Crop Insurance Endorsement for the 
1990 through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                  Extra Long Staple Cotton Endorsement

                       1. Insured Crop and Acreage

    a. The crop insured will be Extra Long Staple cotton (``ELS'') and 
American Upland lint cotton (``AUP'') if the acreage was first planted 
in the crop year to ELS cotton.
    b. The acreage of skip-row cotton insured will be the acreage 
occupied by the rows of cotton after eliminating the skipped-row 
portions.
    c. In addition to the cotton not insurable in section 2 of the 
general crop insurance policy, we do not insure any cotton:
    (1) Which is not irrigated if it is grown:
    (a) Where a hay crop was harvested in the same calendar year; or
    (b) Where a small grain crop reached the heading stage in the same 
calendar year;
    (2) Planted in excess of any mandatory acreage limitations 
applicable to the farm by any program administered by the United States 
Department of Agriculture; or
    (3) Destroyed, or put to another use in order to comply with other 
United States Department of Agriculture programs.
    d. In lieu of subsection 2.e.(7) of the general crop insurance 
policy, we do not insure any cotton planted with another spring planted 
crop.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. Failure of the irrigation water supply due to an unavoidable 
cause occurring after the beginning of planting;

unless those causes are expected, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.

                            3. Annual Premium

    The annual premium amount is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time of planting, times any 
applicable premium adjustment percentage for

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which you may qualify as shown in the actuarial table, because you have 
not selected optional units as provided by the actuarial table.

                           4. Insurance Period

    a. In lieu of subsection 7.(b) of the general crop insurance policy, 
(harvest of the unit) insurance will end upon removal of the cotton from 
the field.
    b. The calendar date for the end of the insurance period is January 
31.

                            5. Unit Division

    Cotton acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one optional unit, if for each proposed unit:
    a. You maintain written, verifiable records of planted acreage and 
harvested production for at least the previous crop year and production 
reports based on those records records are filed to obtain an insurance 
guarantee; and
    b. Acreage planted to insured cotton is located in separate, legally 
identifiable sections (except in Florida) or, in the absence of section 
descriptions (and in all of Florida), the land is identified by separate 
ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the sections or ASCS Farm Serial Numbers are 
clearly identified and the insured acreage is easily determined; and
    (2) The cotton is planted in such a manner that the planting pattern 
does not continue into the adjacent section or ASCS Farm Serial Number; 
or
    c. The acreage planted to the insured cotton is located in a single 
section or ASCS Farm Serial Number and consists of acreage on which both 
an irrigated and nonirrigated practice are carried out, provided:
    (1) Cotton planted on irrigated acreage does not continue into 
nonirrigated acreage in the same rows or planting pattern; and
    (2) Planting, fertilizing, and harvesting are carried out in 
accordance with recognized good dryland and irrigated farming practices 
for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided to us. Production that is commingled between 
optional units will cause those units to be combined. If your cotton 
acreage is not divided into optional units as provided in this section, 
your premium amount will be reduced as provided on the actuarial table.

                       6. Notice of Damage or Loss

    In addition to the provisions in section 8 of the general crop 
insurance policy;
    a. You may not destroy any cotton on which an indemnity will be 
claimed until we give consent.
    b. You must give us notice if you are going to replant any acreage 
originally planted to ELS cotton to AUP cotton.
    c. For purposes of section 8 of the general crop insurance policy 
the representative sample of the unharvested crop must be at least 10 
feet wide and the entire length of the field.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of cotton to be 
counted (see subsection 7.b.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this product by your share.
    b. The total production to be counted for a unit will include all 
harvested and appraised production.
    (1) Any mature ELS cotton production will be reduced when, due 
solely to insured causes, the quality of the ELS cotton produced is such 
that the price quotation for ELS cotton of like grade, staple length, 
and micronaire reading (price A) is less than 75 percent of price B. 
Price B is defined as the market price quotation for ELS cotton of the 
grade, staple length, and micronaire reading designated in the actuarial 
table for this purpose. The price quotations for prices A and B will be 
the market price quotations at the recognized market closest to the unit 
on the earlier of the day the loss is adjusted or the day the damaged 
ELS cotton is sold. In the absence of a price quotation on such date, 
the price quotations for the nearest prior date for which an ELS cotton 
price quotation was listed for both prices A and B will be used. The 
pounds of production to be counted will be determined by multiplying the 
number of pounds of mature production by price A and dividing the result 
by 75 percent of price B.
    (2) Any AUP cotton harvested from acreage originally planted to ELS 
cotton in the same growing season will be reduced by the factor obtained 
by dividing the price of the AUP cotton by the price of ELS cotton of 
the grade, staple length, and micronaire reading shown in our actuarial 
table. The prices will be determined at the closest recognized market to 
the insured unit of the earlier of the date the loss is adjusted or the 
date the AUP cotton was sold.
    (3) Appraised production to be counted will include:
    (a) Mature and potential production on unharvested acreage;
    (b) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good cotton farming practices;

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    (c) Not less than the applicable guarantee for any acreage which is 
abandoned or put to another use without our prior written consent or 
damaged solely by an uninsured cause; and
    (d) Not less than 25 percent of the production guarantee per acre 
for any acreage of cotton that is immature when we determine that 
harvest of cotton becomes general in the county.
    (4) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of cotton becomes general 
in the county and is reappraised by us;
    (b) Further damaged by an insured cause and is reappraised by us; or
    (c) Harvested.
    (5) Any appraisal of the AUP cotton on acreage originally planter to 
ELS cotton will be reduced by the factor determined in section 7.b.(2) 
above. If prices are not yet available, the previous year's season 
average price will be used.
    (6) The cotton stalks must not be destroyed on any acreage for which 
an indemnity is claimed, until we give consent. An appraisal of not less 
than the guarantee may be made on acreage where the stalks have been 
destroyed without our consent.

                  8. Cancellation and Termination Dates

    The cancellation and termination dates are:

------------------------------------------------------------------------
                                           Cancellation and termination
                 States                               dates
------------------------------------------------------------------------
New Mexico.............................  April 15
All other states.......................  March 31
------------------------------------------------------------------------

                           9. Contract Changes

    The date by which contract changes will be available in your service 
office is November 30 preceding the cancellation date.

  10. Prevented Planting (Including Planting after the Final Planting 
                                  Date)

    (a) In lieu of subparagraph 2.e.(4) of the General Crop Insurance 
Policy (Sec. 401.8), insurance will be provided for acreage you were 
prevented from planting (see subparagraph 11.(h)). This coverage 
provides a reduced production guarantee for such acreage. The reduced 
guarantee will be combined with the production guarantee for timely 
planted acreage for each unit. The premium amount for eligible prevented 
planting acreage will be the same as that for timely planted acreage. 
For example, assume you insure one unit in which you have a 100 percent 
(100%) share. The unit consists of 100 acres, of which 50 acres were 
planted by the final planting date and 50 acres are unplanted and 
eligible for prevented planting coverage. To calculate the amount of any 
indemnity which may be due to you, the production guarantee for the unit 
will be computed as follows:
    (1) For timely planted acreage, multiply the per acre production 
guarantee for timely planted acreage by the 50 acres planted timely; and
    (2) For prevented planting acreage, multiply the per acre production 
guarantee for timely planted acreage by thirty-five percent (0.35) and 
multiply the result by the 50 acres eligible for prevented planting 
coverage.

The total of the two calculations will be the production guarantee for 
the unit. Your premium will be based on the result of multiplying the 
per acre production guarantee for timely planted acreage by the 100 
acres in the unit.
    (b) If you were prevented from planting ELS cotton (see subparagraph 
11.(h)), you may elect:
    (1) Not to plant this acreage to any crop that is intended for 
harvest in the same crop year. The production guarantee for such acreage 
which is eligible for prevented planting coverage will be thirty-five 
percent (0.35) of the production guarantee for timely planted acres. For 
example, if your production guarantee for timely planted acreage is 600 
pounds per acre, your prevented planting production guarantee would be 
equivalent to 210 pounds per acre (600 pounds multiplied by 0.35). This 
section does not prohibit the preparation and care of the acreage for 
conservation practices, such as planting a cover crop, as long as such 
crop is not intended for harvest; or
    (2) To plant ELS cotton after the final planting date. The 
production guarantee for such acreage will be thirty-five percent (0.35) 
of the production guarantee for timely planted acres. For example, if 
your production guarantee for timely planted acreage is 600 pounds per 
acre, you prevented planting production guarantee would be equivalent to 
210 pounds per acre (600 pounds multiplied by 0.35). Production to count 
for such acreage will be determined in accordance with subparagraph 7.b.
    (c) In addition to the provisions of section 7 (Insurance Period) of 
the General Crop Insurance Policy (Sec. 401.8), the beginning of the 
insurance period for prevented planting coverage is the sales closing 
date designated in the Actuarial Table for ELS cotton.
    (d) You must provide written notice to us if you were prevented from 
planting. This notice must be given not later than three (3) days after 
the final planting date if you have unplanted acreage that may be 
eligible for prevented planting coverage.
    (e) The acreage to which prevented planting coverage applies will be 
limited as follows:

[[Page 129]]

    (1) Eligible acreage will not exceed the greater of:
    (i) The number of acres planted to ELS cotton on each ASCS Farm 
Serial Number during the previous crop year (adjusted for any 
reconstitution which may have occurred prior to the sales closing date);
    (ii) The ASCS base acreage for ELS cotton reduced by any acreage 
reduction applicable to the farm under any program administered by the 
United States Department of Agriculture; or
    (iii) One hundred percent (100%) of the simple average of the number 
of acres planted to ELS cotton during the crop years that were used to 
determine your yield;

unless we agree in writing, prior to the sales closing date, to approve 
acreage exceeding this limit.
    (2) Acreage intended to be planted under an irrigated practice will 
be limited to the number of ELS cotton acres properly prepared to carry 
out an irrigation practice.
    (3) A prevented planting production guarantee will not be provided 
for:
    (i) Any acreage that does not constitute at least 20 acres or 20 
percent (20%) of the acres in the unit whichever is less;
    (ii) Land for which the Actuarial Table does not designate a premium 
rate unless you submit a written request for coverage for such acreage 
prior to the sales closing date for ELS cotton in the county. Upon your 
timely written request, we will provide a written insurance offer for 
such acreage;
    (iii) Land used for conservation purposes or intended to be or 
considered to have been left unplanted under any program administered by 
the United States Department of Agriculture;
    (iv) Land on which any crop, other than ELS cotton, has been planted 
and is intended for harvest, or has been harvested in the same crop 
year; or
    (v) Land which planting history or conservation plans indicate would 
remain fallow for crop rotation purposes.
    (4) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be reduced 
by the number of ELS cotton acres timely planted. For example, assume 
you have 100 acres eligible for prevented planting coverage in which you 
have a 100 percent (100%) share. The acreage is located in a single ASCS 
Farm Serial Number which you insure as two separate optional units 
consisting of 50 acres each. If you planted 60 acres of ELS cotton on 
one optional unit and 40 acres of ELS cotton on the second optional 
unit, your prevented planting eligible acreage would be reduced to zero 
(i.e., 100 acres eligible for prevented planting coverage minus 100 
acres planted equals zero). If you report more ELS cotton acreage under 
this contract than is eligible for prevented planting coverage, we will 
allocate the eligible acreage to insured units based on the number of 
prevented planting acres and share you reported for each unit.
    (f) When the ASCS Farm Serial Number covers more than one unit, or a 
unit consists of more than one ASCS Farm Serial Number, the covered 
acres will be pro-rated based on the number of acres in each unit or 
ASCS Farm Serial Number that could have been planted to ELS cotton in 
the crop year.
    (g) In accordance with the provisions of section 3 (Report of 
Acreage, Share, and Practice (Acreage Report)) of the General Crop 
Insurance Policy (Sec. 401.8), you must report any insurable acreage you 
were prevented from planting. This report must be submitted on or before 
the acreage reporting date. Any acreage you report as eligible for 
prevented planting coverage which we determine is not eligible will be 
deleted from prevented planting coverage.
    (h) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be provided for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          11. Meaning of Terms

    (a) Cotton--Extra Long Staple cotton and acreage replanted to 
American Upland Cotton after ELS was destroyed by an insured cause.
    (b) Days--calendar days.
    (c) ELS Cotton--Extra Long Staple cotton (also called Pima Cotton 
and American-Egyptian Cotton).
    (d) Final planting data--the date contained in the Actuarial Table 
by which the insured ELS cotton must initially be planted in order to be 
insured for the full production guarantee.
    (e) Harvest--the removal of the seed cotton on each acre from the 
open cotton boll or the severance of the open cotton boll from the stalk 
by either manual or mechanical means.
    (f) 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 ELS cotton acreage.
    (g) Mature cotton--ELS cotton which can be harvested either manually 
of mechanically and will include both unharvested and harvested cotton.
    (h) Prevented planting--inability to plant ELS cotton with proper 
equipment by the final planting date due to an insured cause of loss 
which is general in the area (i.e., most producers in the surrounding 
area are unable to plant due to similar insurable causes) and

[[Page 130]]

which occurs between the sales closing date and the final planting date.
    (i) Production guarantee--the number of pounds determined by 
multiplying the approved yield per acre by any applicable yield 
conversion factor for the row pattern planted, multiplied by the 
coverage level percentage you elect.
    (j) Replanted--performing the cultural practices necessary to 
replant acreage to AUP cotton and replacing the AUP cotton seed after 
ELS cotton was destroyed by an insured cause in the same growing season.
    (k) Skip-row--planting patterns consisting of alternating rows of 
cotton and fallow rows as defined by ASCS (if non-cotton rows are 
occupied by another crop any yield factor normally applied for skip-row 
cotton will not be applicable).
    (l) Timely planted--ELS cotton planted by the final planting date, 
as established by the Actuarial Table, for ELS cotton in the county to 
be planted for harvest in the crop year.

[54 FR 48068, Nov. 21, 1989, as amended at 58 FR 67643, Dec. 22, 1993; 
60 FR 56934, Nov. 13, 1995]



Sec. 401.122  Stonefruit endorsement.

    The provisions of the Stonefruit Crop Insurance Endorsement for the 
1988 through 1998 crop years are as follows:

                   Federal Crop Insurance Corporation

                         Stonefruit Endorsement

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Earthquake;
    (3) Fire;
    (4) Wildlife;
    (5) Volcanic eruption;
    (6) An insufficient number of chilling hours to effectively break 
dormancy; or
    (7) Failure of the irrigation water supply due to an unavoidable 
cause occurring after insurance attaches;
    Unless these causes of loss are excepted, excluded, or limited by 
the actuarial table or section 9 of the general crop insurance policy.
    b. In addition to the causes of loss not insured against under 
Section 1.b. of the general crop insurance policy, we will not insure 
against any loss of production due to:
    (1) Fire, where weeds and other forms of undergrowth have not been 
controlled or tree pruning debris has not been removed from the orchard;
    (2) Insect infestation;
    (3) Split pits regardless of cause; or
    (4) Inability to market as a direct result of quarantine, boycott, 
or refusal of any entity to accept or harvest production unless 
production has actual physical damage due to a cause specified in 
subsection 1.a.

                       2. Insured Crop and Acreage

    a. The crop insured will be any of the following stonefruit types 
you elect in writing prior to the sales closing date and grown for fresh 
market fruit or processing (whichever is applicable) for which we 
provide a guarantee and premium rate:

Type I--Apricots--Fresh
Type II--Apricots--Processing
Type III--Nectarines--Fresh
Type IV--Peaches, Cling--Processing
Type V--Peaches, Freestone--Processing
type VI--Peaches, Freestone--Fresh
    b. You may insure any fresh market Stonefruit of Type I Apricots or 
Type VI Freestone Peaches as processing Type II Apricots or Type V 
Freestone Peaches respectively by converting fresh market lugs, 
harvested or appraised, to equivalent processing tons using the weight 
equivalents provided in paragraph 12.d.
    c. In lieu of the provisions of paragraph 2.e. of the general crop 
insurance policy, we do not insure any stonefruit acreage:
    (1) Which is not irrigated;
    (2) On which the trees have not reached the fifth growing season 
after being set out;
    (3) Which has not produced at least 200 lugs fresh market production 
per acre (at least 2.2 tons per acre for processing types);
    (4) For which acceptable production records for the type elected for 
at least the previous crop year are not provided;
    (5) Which we inspect and consider not acceptable;
    (6) Which is interplanted with another crop;
    (7) On which is grown a type or variety: not established as adapted 
to the area; excluded by the actuarial table; or not regulated by the 
California Tree Fruit agreement or a related crop advisory board for the 
State (for applicable types);
    (8) From which the fruit is harvested directly by the public; or
    (9) If the orchard practices carried out are not in accordance with 
the orchard practices for which the premium rates have been established.

    3. Report of Acreage, Share, Type, and Practice (Acreage Report)

    The acreage report must be filed on or before January 31. You must 
report the crop type in addition to the information required by the 
general crop insurance policy for the acreage report.

[[Page 131]]

            4. Production Reporting and Production Guarantees

    a. In addition to the production report required in section 4 of the 
general crop insurance policy, you must report:
    (1) The number of bearing trees;
    (2) The number of trees planted per acre;
    (3) Known tree damage or use of production practices which have or 
may reduce the yield from previous levels; and
    (4) If the number of bearing trees (fifth growing season and older) 
is reduced more than 10% from the preceding calendar year. (The 
production guarantee will be reduced 1 percent (through adjustment to 
your average yield) for each 1 percent reduction in excess of 10 
percent).
    b. You may select only one coverage level and price election per 
type for the crop year.
    c. The processing price elections will be applied to any applicable 
type (except type III--Nectarines) where an election:
    (1) Has not been made by the insured; or
    (2) Is not available in accordance with the provisions of the 
actuarial table.

                            5. Annual Premium

    The annual premium is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time insurance attaches.

                           6. Insurance Period

    In lieu of the provisions in section 7 of the general crop insurance 
policy, coverage begins for each crop year on February 1. Insurance ends 
on each acre at the earliest of:
    a. Total destruction of the insured crop by type;
    b. Harvest;
    c. The date harvest would normally start for the type if the crop is 
not to be harvested;
    d. Final adjustment of a loss; or
    e. In all counties, the calendar date immediately following February 
1 as follows:
    (1) all apricots--July 31.
    (2) all nectarines and peaches--September 30.

                                7. Units

    Stonefruit acreage of each type, grown on non-contiguous land, that 
would otherwise be one unit as defined in section 17 of the general crop 
insurance policy, may be divided into more than one unit if you agree to 
pay an additional premium as provided for by the actuarial table and if 
for each proposed unit you maintain written, verifiable records of 
acreage and harvested production for at least the previous crop year.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between units will 
cause the production from those units to be combined for the purpose of 
calculating an indemnity.

                       8. Notice of Damage or Loss

    In lieu of the notices required in subsections 8.a.(2),(3), and (4) 
of the general crop insurance policy, in case of damage or probable loss 
you must give us written notice within 72 hours of the date of damage 
and indicate the cause of damage and whether a claim for indemnity is 
probable. Notwithstanding the previous sentence, if damage occurs within 
72 hours of or during harvest, immediate notice stating the cause of 
damage and probability of a claim must be given to us. If notice is 
given under this paragraph, we must be notified of the time of harvest 
at least 72 hours before harvest begins.

                         9. Claim for Indemnity

    In addition to Section 9 of the general crop insurance policy:
    a. The indemnity will be determined separately for each unit of 
types I, III, and VI by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of fresh stonefruit 
by type to be counted (see section 9.b. or c.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by the insured share.
    b. The total production (standard lug equivalents) (see section 
12.d.) to be counted for a unit will include all production harvested, 
by type and all appraised production. For fresh apricots (Type I), such 
production must meet the California Department of Food and Agriculture 
minimum standards. For fresh nectarines (Type III) and fresh freestone 
peaches (Type VI), such production must meet U.S. 1 standards as 
modified by the latest California Tree Fruit Agreement Publication.
    (1) Production of fresh stonefruit damaged by insurable causes 
within the insurance period, that could be marketed for any use as other 
than fresh packed stonefruit, will be determined by multiplying the 
number of tons that could be marketed by the value per ton of fruit or 
$50.00 per ton, whichever is greater, and dividing that result by the 
highest price election available for the type. This result will be the 
number of standard lug equivalents to be considered as production to 
count.
    (2) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes;
    (b) Not less than the applicable guarantee for any acreage which is 
abandoned, destroyed by you without our prior written

[[Page 132]]

consent, or not inspected by us prior to the completion of harvest;
    (c) Any unharvested production where good stonefruit cultural 
practices were discontinued following an appraisal; and
    (d) Any appraised production on unharvested acreage.
    (3) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Not harvested before the harvest of stonefruit becomes general 
in the county and is reappraised by us;
    (b) Further damaged by an insured cause and is reappraised by us; or
    (c) Harvested.
    (4) The amount of production of any unharvested type may be 
determined on the basis of orchard appraisals conducted after the end of 
the insurance period or discontinuance of harvest. We may appraise and 
consider as production to count, any insured fruit remaining on acreage 
not clean harvested.
    (5) We may delay final appraisal until the extent of damage can be 
determined.
    c. The total production in tons to be counted for a processing unit 
will include all production harvested and all appraised production:
    (1) For processing apricots (Type II), such production must meet 
California Department of Food and Agriculture minimum standards:
    (2) For processing clingstone peaches (Type IV), such production 
must be graded by the California State Inspection Service as 2 or 
better;
    (3) For processing freestone peaches (Type V), such production must 
meet California Department of Food and Agriculture minimum standards and 
will include all production harvested and appraised which is acceptable 
to the processor;
    (4) Appraised production to be counted for Types II, IV, and V will 
include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good stonefruit production practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause, or destroyed by you without our 
consent; and
    (c) Any unharvested production.
    (5) Any appraisal for processing fruit types will be conducted based 
on procedure stated in subsection 9.b(2), (3), and (4).
    d. In the absence of acceptable records to determine the disposition 
of harvested stonefruit, we may elect to determine such disposition and 
the amount of such production to be counted for the unit.
    e. You must authorize us in writing to examine and obtain any 
records pertaining to production and marketing of the insured fruit 
under this contract from the broker, shipper, canner, advisory board, 
marketing order or any other source we deem necessary.

               10. The Cancellation and Termination Dates

    The cancellation and termination dates are January 31.

                          11. Contract Changes

    The date by which contract changes will be available in your service 
office is October 31 preceding the cancellation date. Acceptance of any 
change will be conclusively presumed in the absence of notice from you 
to cancel the contract.

                          12. Meaning of Terms

    For the purpose of Stonefruit crop insurance:
    a. Appraisal means an estimate of the potential production 
determined by our representative using our prescribed procedures.
    b. Crop Year means the period beginning with the date insurance 
attaches and extending through the normal harvest time and will be 
designated by the calendar year in which the insured type is normally 
harvested.
    c. Harvest means the picking of mature fruit from the trees by hand 
or machine.
    d. Lug means a container of fresh fruit of the weights shown below. 
All fresh production to count of varying lug sizes will be converted to 
standard lug equivalents on the basis of the following average net 
pounds of packed fruit:

------------------------------------------------------------------------
                                                                 Pounds/
                              Type                                 lug
------------------------------------------------------------------------
I Apricots.....................................................       24
III Nectarines.................................................       25
VI Freestone Peaches...........................................       22
------------------------------------------------------------------------

    e. Ton means a volume of apricots or processing peaches of type II, 
IV, or V marketable through processing channels and equaling 2000 
pounds.

[53 FR 6561, Mar. 2, 1988, as amended at 63 FR 29935, June 2, 1998]



Sec. 401.123  Safflower seed crop endorsement.

    The provisions of the Safflower Seed Crop Insurance Endorsement for 
the 1988 through the 1997 crop year.

                   Federal Crop Insurance Corporation

                     Safflower Seed Crop Endorsement

                             1. Insured Crop

    a. The crop insured will be safflower seed (``safflowers'').
    b. In addition to the safflowers not insurable in section 2 of the 
general crop insurance policy, we do not insure any safflowers

[[Page 133]]

on which safflowers, sunflowers, dry beans, soybeans, mustard, rapeseed, 
or lentils have been grown the preceding crop year.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insect infestation;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or subsection 9 of the general policy.

                            3. Annual Premium

    The annual premium is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time of planting.

                           4. Insurance Period

    The calendar date for the end of insurance period is October 31 of 
the calendar year in which the safflowers are normally harvested.

                            5. Unit Division

    Safflower acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one unit if you agree to pay additional premium as provided 
for by the actuarial table and if for each proposed unit you maintain 
written verifiable records of planted acreage and harvested production 
for at least the previous crop year; and either
    a. Acreage planted to insured Safflowers is located in separate 
legally identifiable sections or, in the absence of section descriptions 
the land is identified by separate ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the section or Farm Serial Number are clearly 
identified, and the insured acreage can be easily determined; and
    (2) The safflowers are planted in such a manner that the planting 
pattern does not continue into the adjacent section or Farm Serial 
Number; or
    b. Acreage planted to safflowers is located in a single section or 
ASCS Farm Serial Number and consists of acreage on which both an 
irrigated and nonirrigated practice are carried out, provided:
    (1) Safflowers planted on irrigated acreage does not continue into 
nonirrigated acreage in the same rows or planting pattern (Nonirrigated 
corners of a center pivot irrigation system are part of the irrigated 
unit. The production from the total unit, both irrigated and 
nonirrigated, is combined to determine your yield for the purpose of 
determining the guarantee for the unit.); and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized good irrigated and nonirrigated farming 
practices for the area.
    If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined for the purpose of 
calculating an indemnity.

                       6. Notice of Damage or Loss

    The representative samples of unharvested safflowers as required in 
section 8 of the general crop insurance policy will be at least 10 feet 
wide and the entire length of the field.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting from that result the total production of safflowers 
to be counted;
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    b. The total production (in pounds) to be counted for a unit will 
include all harvested and appraised production.
    (1) Mature safflower production which otherwise is not eligible for 
quality adjustment will be reduced .12 percent for each .1 percentage 
point of moisture in excess of 8.0 percent.
    (2) Mature safflower production will be adjusted for quality when, 
due to insurable causes, such production has a test weight below 35 
pounds per bushel or has seed damage in excess of 25 percent as 
determined by a grader licensed to grade safflowers by the Federal Grain 
Inspection Service.
    (3) Mature safflower production which is eligible for quality 
adjustment, due to insurable causes, will be adjusted by:
    (a) Dividing the value per pound of damaged safflowers by the 
average market price per pound for undamaged safflowers; and
    (b) Multiplying the result by the number of pounds of such 
safflowers.
    For the purpose of this insurance, the applicable price for damaged 
safflowers will be not less than 50 percent of the average market price 
for undamaged safflowers.
    (4) Any harvested production from other volunteer plants growing in 
the safflowers will be counted as safflowers on a weight basis.
    (5) Appraised production to be counted will include:

[[Page 134]]

    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (c) Any appraised production on unharvested acreage.
    (6) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of safflowers becomes 
general in the county and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.

                  8. Cancellation and Termination Dates

    The cancellation and termination dates for California are December 
31, beginning December 31, 1991. For all other states, the cancellation 
and termination dates are April 15.

                           9. Contract Changes

    Contract changes will be available at your service office by August 
31 prior to the cancellation date for California, and by December 31 
prior to the cancellation date for all other states.

                          10. Meaning of Terms

    a. Harvest means the completion of combining or threshing of 
safflowers on the unit.
    b. Value per pound of damaged safflowers means the value of the 
damaged safflowers (test weight below 35 pounds per bushel or seed 
damage in excess of 25 percent) at the local market but not less than 50 
percent of the average market price for undamaged safflowers.

[52 FR 45159, Nov. 25, 1987, as amended at 54 FR 28795, July 10, 1989; 
55 FR 40788, Oct. 5, 1990; 62 FR 42649, Aug. 8, 1997]



Sec. 401.124  Sunflower seed crop endorsement.

    The provisions of the Sunflower Seed Crop Insurance Endorsement for 
the 1988 through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                     Sunflower Seed Crop Endorsement

                             1. Insured Crop

    a. The crop insured will be sunflower seed (``sunflowers'').
    b. Unless otherwise provided by the actuarial table, insurance will 
attach only on acreage initially planted in rows far enough apart to 
permit cultivation; but, if such insured acreage is destroyed and 
replanted by broadcasting, drilling, or in rows too close to permit 
cultivation. it will be considered insured acreage.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted. excluded, or limited by the actuarial 
table or section 9 of the general policy.

                            3. Annual Premium

    a. The annual premium is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time of planting.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1984 crop year 
under the terms of the experience table contained in the sunflower 
policy in effect for the 1985 crop year, you will continue to receive 
the benefit of that reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1985 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                           4. Insurance Period

    The calendar date for the end of insurance period is November 30 of 
the calendar year in which the sunflowers are normally harvested.

                            5. Unit Division

    Sunflower acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one unit if you agree to pay additional premium as provided 
for by the actuarial table and if for each proposed unit you maintain 
written verifiable records of

[[Page 135]]

planted acreage and harvested production for at least the previous crop 
year; and either
    a. Acreage planted to insured sunflowers is located in separate 
legally identifiable sections or, in the absence of section descriptions 
the land is identified by separate ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the section or Farm Serial Number are clearly 
identified, and the insured acreage can be easily determined; and
    (2) The safflowers are planted in such a manner that the planting 
pattern does not continue into the adjacent section or Farm Serial 
Number; or
    b. The acreage planted to sunflowers is located in a single section 
or Farm Serial Number and consists of acreage on which both an irrigated 
and nonirrigated practice are carried out, provided:
    (1) Sunflowers planted on irrigated acreage does not continue into 
nonirrigated acreage in the same rows or planting pattern (Nonirrigated 
corners of a center pivot irrigation system are part of the irrigated 
unit. The production from the total unit, both irrigated and 
nonirrigated, is combined to determine your yield for the purpose of 
determining the guarantee for the unit.); and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized irrigated and nonirrigated farming practices 
for the area.

If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       6. Notice of Damage or Loss

    The representative samples of unharvested sunflowers as required in 
section 8 of the general crop insurance policy will be at least 10 feet 
wide and the entire length of the field.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of sunflowers to be 
counted (see section 9e);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    b. The total production (in pounds) to be counted for a unit will 
include all harvested and appraised production.
    (1) Mature sunflower production (quantity) which otherwise is not 
eligible for quality adjustment will be reduced .12 percent for each .1 
percentage point of moisture in excess of 10 percent; or
    (2) Mature production will be adjusted for quality when, due to 
insurable causes, the insured sunflower seed crop grades below the 
following:

----------------------------------------------------------------------------------------------------------------
                                                      Oil type                           Non-oil type
----------------------------------------------------------------------------------------------------------------
Test weight...........................  Less than 25 pounds................  Less than 22 pounds.
Damaged kernels.......................  More than 10% total................  More than 5% total
----------------------------------------------------------------------------------------------------------------

    Sunflowers grading below these standards will be adjusted by:
    (a) dividing the value per pound by the price per pound of No. 2 
sunflowers; and
    (b) multiplying the result by the number of pounds of insured 
sunflowers.
    The applicable price for No. 2 sunflowers will be the local market 
price on the earlier of the day the loss is adjusted or the day the 
sunflowers are sold.
    (3) Any harvested production from other crops growing in the 
sunflowers will be counted as sunflowers on a weight basis.
    (4) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good sunflower farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (c) Any unharvested production or harvested or unharvested acreage.
    (5) Any appraisal we have made on insured acreage and given written 
consent for that acreage to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of sunflowers becomes 
general in the county and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    c. A replant payment is available under the Sunflower Endorsement. 
No replant payment will be made on acreage on which our appraisal 
exceeds 90 percent of the guarantee. The payment per acre will not 
exceed the product obtained by multiplying 175 pounds times the price 
election, times your share.

[[Page 136]]

                           8. Replant Payment

    In accordance with paragraph 9.h. of the general crop insurance 
policy a replant payment not to exceed the product by multiplying 175 
pounds times the prime elective, times your share may be made.

                  9. Cancellation and Termination Date

    The cancellation and termination date for all states is April 15.

                          10. Contract Changes

    The date by which contract changes will be available in your service 
office will be December 31 preceding the cancellation date.

                          11. Meaning of Terms

    a. Harvest means the completion of combining or threshing of 
sunflowers on the unit.
    b. Replanting means performing the cultural practices necessary to 
replant insured acreage to sunflowers.

[52 FR 45155, Nov. 25, 1987, as amended at 53 FR 40718, Oct. 18, 1988; 
54 FR 20369, May 11, 1989; 54 FR 20504, May 12, 1989; 54 FR 33493, Aug. 
15, 1989; 60 FR 56934, Nov. 13, 1995]



Sec. 401.125  Fig endorsement.

    The provisions of the Fig Crop Insurance Endorsement for the 1988 
through 1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                             Fig Endorsement

                             1. Insured Crop

    a. The crop insured will be commercially grown dried figs.
    b. In addition to the figs not insurable under section 2 of the 
general crop insurance policy, we do not insure any figs:
    (1) Which are not irrigated;
    (2) Which have not reached the seventh growing season after being 
set out;
    (3) Grown for purposes other than for dried figs;
    (4) Grown with another crop;
    (5) Unless acceptable production records for at least the previous 
crop year are provided;
    (6) With less than 90 percent of a stand based on the original 
planting pattern unless we agree, in writing, to insure such acreage;
    (7) Which we inspect and consider not acceptable;
    (8) For the crop year the application is filed unless such acreage 
has been inspected and accepted by us; or
    (9) Acquired for the crop year unless such acreage has been 
inspected and accepted by us.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather;
    (2) Earthquake;
    (3) Fire;
    (4) Volcanic eruption;
    (5) Wildlife; and
    (6) Failure of the irrigation water supply due to an unavoidable 
cause occurring after insurance attaches;

unless those causes are excepted, excluded or limited by the actuarial 
table or section 9 of the general crop insurance policy.
    b. In addition to the causes of loss not insured against in section 
1 of the general crop insurance policy, we will not insure against:
    (1) Any loss of production due to fire, where weeds and other forms 
of undergrowth have not been controlled or tree pruning debris has not 
been removed from the grove; or
    (2) The inability to market the fruit as a direct result of 
quarantine, boycott, or refusal of any entity to accept production.

     3. Report of Acreage, Share, Type and Practice (Acreage Report)

    a. In addition to the information required in section 3 of the 
general crop insurance policy, you must report the crop type.
    b. You must submit the acreage report described in section 3 of the 
general crop insurance policy by March 1.
    c. By applying for fig crop insurance, you authorize us to determine 
or verify your production and acreage from records maintained by the 
California Fig Advisory Board or the fig packer.

                            4. Annual Premium

    The annual premium amount is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share on the date insurance attaches.

                           5. Insurance Period

    In lieu of the provisions of section 7 of the general crop insurance 
policy insurance attaches on each unit on March 1 and insurance ends at 
the earliest of:
    (1) Total destruction of the fig crop;
    (2) The date harvest of the figs (by type) should have started on 
any acreage that will not be harvested;
    (3) Harvest of the figs;
    (4) Final adjustment of a loss; or
    (5) October 31.

                            6. Unit Division

    a. In addition to the provisions in subsection 17.q. of the general 
crop insurance

[[Page 137]]

policy, a unit will be all insurable acreage of an insurable type of fig 
in the county.
    b. Fig acreage that would otherwise be one unit may be divided into 
more than one unit if you agree to pay additional premium as provided 
for by the acturial table and if for each proposed unit:
    (1) You maintain written, verifiable records of acreage and 
harvested production for at least the previous crop year, and production 
reports based on those records are filed to obtain an insurance 
guarantee; and
    (2) The acreage of insured figs is located on noncontiguous land. If 
you have a loss on any unit, production records for all harvested units 
must be provided. Production that is commingled between optional units 
will cause those units to be combined.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of figs to be counted 
(see subsection 7.b.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this product by your share.
    b. The total production (pounds) to be counted for a unit will 
include all harvested and appraised marketable figs, as defined by the 
Marketing Order for Dried Figs, as amended.
    (1) All substandard production must be inspected by us and we must 
give written consent to you prior to delivery to the substandard pool. 
If the substandard production is not inspected or we do not give written 
consent prior to the delivery to the substandard pool, all production 
will be counted as marketable production.
    (2) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good fig farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause, or destroyed by you without our 
consent; and
    (c) Any unharvested production.
    (3) Any appraisal we have made on insured acreage will be considered 
production to count unless such acreage is:
    (a) Not harvested before the harvest of figs becomes general in the 
county;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.

                  8. Cancellation and Termination Dates

    The cancellation and termination dates are February 28.

                           9. Contract Changes

    The date on which contract changes will be available in your service 
office is October 31 preceding the cancellation date.

                          10. Meaning of Terms

    a. Harvest means the picking of the figs from the trees or ground by 
hand or machine for the purpose of removal from the orchard.
    b. Non-contiguous land means land which is not touching at any 
point, except that land which is separated by only a public or private 
right-of-way will be considered contiguous.
    c. Substandard production means production that does not meet 
minimum grade standards and is defined as ``substandard'' by the 
Marketing Order for Dried Figs, as amended, which is in effect on the 
date insurance attaches.

[53 FR 15015, Apr. 27, 1988, as amended at 60 FR 56934, Nov. 13, 1995]



Sec. 401.126  Onion endorsement.

    The provisions of the Onion Endorsement for the 1988 through the 
1997 crop years are as follows:

                   Federal Crop Insurance Corporation

                            Onion Endorsement

                             1. Crop Insured

    a. The crop insured will be onions planted for harvest as dry onions 
(bulb onions).
    b. In addition to the onions not insurable under section 2 of the 
general crop insurance policy, we do not insure any onions planted for 
green (bunch) or seed onions, including chives, garlic, leek, or 
scallions.
    c. A late planting agreement will be available.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:

    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.

[[Page 138]]

                            3. Annual Premium

    The annual premium is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time of planting.

                           4. Insurance Period

    In lieu of section 7 of the general crop insurance policy, insurance 
attaches on each unit or part of a unit when the onions are planted and 
ends at the earliest of:
    (a) Total destruction of the onions on the unit;
    (b) Five days after digging of the onions;
    (c) Removal of the onions from the field;
    (d) Final adjustment of a loss on a unit; or
    (e) The following dates for the calendar year in which the onions 
are normally harvested:
Washington-Walla Walla Sweets and any other non-storage type onion--July 
31
Colorado--September 30
All other Washington onions and all other states--October 15

                            5. Unit Division

    Onion acreage that would otherwise be one unit, as defined in the 
general policy, may only be further divided into units by onion type 
(Red, Yellow, or White) if you agree to pay an additional premium as 
provided for by the actuarial table and if for each proposed unit by 
type:
    a. You maintain written verifiable records of planted acreage and 
harvested production for at least the previous crop year and production 
reports by type based on those records are filed to obtain an insurance 
guarantee.
    b. The acreage boundaries between onion types is clearly 
identifiable, the insured acreage is easily determined and the onions 
are planted in such a manner that the planting pattern does not continue 
into the adjacent field of different type (maximum number of units, 
three); or
    c. The acreage planted to onions consists of acreage on which both 
irrigated and nonirrigated practices are carried out, provided:
    (1) Onions planted on irrigated acreage do not continue into 
nonirrigated acreage in the same rows or planting pattern (Nonirrigated 
corners of a center pivot irrigation system are part of the irrigated 
unit. The production from the total unit, both irrigated and 
nonirrigated, is combined to determine the unit yield for the purpose of 
determining the guarantee for the unit); and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with recognized irrigated and nonirrigated farming practices 
for the area (maximum number of units, six; three irrigated and three 
non-irrigated).

                       6. Notice of Damage or Loss

    In addition to the notices required in the general crop insurance 
policy and in case of damage or probable loss:
    a. You must give us written notice if you want to harvest the onions 
(After such notice is given, we will appraise the potential production. 
If we are unable to do so before harvest, you may harvest the crop, 
provided representative samples are left for appraisal purposes.); and
    b. Any representative sample must be at least 10 feet wide and the 
entire length of the field.

                         7. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Multiplying the result by the price election;
    (3) Subtracting therefrom the dollar amount obtained by multiplying 
the total production of onions to be counted (see subsection 7b.) by the 
larger of your price election or the local market price at the time the 
onions are appraised; and
    (4) Multiplying this result by your share.
    b. The total production (in hundredweight) to be counted for a unit 
will include all harvested and appraised production.
    (1) The extent of any loss may be determined no later than the date 
onions are placed in storage or delivered to a packer or processor, 
whichever is earlier.
    (2) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause;
    (c) Not less than the guarantee for any acreage from which the 
harvested production is disposed of without our prior written consent 
and such disposition prevents accurate determination of production; and
    (d) Any appraised production on unharvested acreage.
    (3) Any appraisal we have made on insured acreage for which we have 
given written consent for another use will be considered production 
unless such acreage is;
    (a) Not put to another use before harvest of onions becomes general 
in the county for the planting period and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.

                  8. Cancellation and Termination Dates

    The cancellation and termination dates are March 1st.

[[Page 139]]

                           9. Contract Changes

    The contract change date is December 31 preceding the cancellation 
date.

                          10. Meaning of Terms

    Harvest means the digging of onions and placement of the onions into 
a container.

[53 FR 19217, May 27, 1988, as amended at 62 FR 28613, May 27, 1997]



Sec. 401.127  Cranberry endorsement.

    The provisions of the Cranberry Crop Insurance Endorsement for the 
1990 through the 1997 crop years are as follows:

                   Federal Crop Insurance Corporation

                          Cranberry Endorsement

                             1. Insured Crop

    a. The crop insured will be cranberries which are grown for 
processing or fresh market.
    b. Except by written agreement between you and us or unless provided 
by the actuarial table, we do not insure any acreage:
    (1) Unless at least four growing seasons have elapsed between the 
date the vines were set out and the date insurance attaches;
    (2) With less than 90 percent of a stand of bearing vines based on 
the original planting pattern; or
    (3) That is being renovated and not being used to produce a full 
crop for the current year.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) adverse weather conditions;
    (2) fire;
    (3) wildlife;
    (4) earthquake;
    (5) volcanic eruption;
    (6) insects;
    (7) plant disease;
    (8) if applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after insurance attaches; or
    (9) failure or breakdown of irrigation equipment or facilities due 
to direct damage to the irrigation equipment or facilities from an 
insurable cause of loss if the cranberry crop is damaged by freezing 
temperatures within 72 hours of such equipment or facilities failure and 
the equipment or facilities could not have been made operational or 
replaced within such 72-hour time period;
unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.
    b. We do not insure against any loss caused by the failure or 
breakdown of irrigation equipment or facilities except as provided in 
section 2.a.(9) above.

                            3. Annual Premium

    The annual premium amount is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share on the date insurance attaches.

                           4. Insurance Period

    a. In addition to the provisions in section 7 of the general crop 
insurance policy, for unharvested acreage, the date by which acreage 
should have been harvested is added as one of the dates, the earliest of 
which is used to designate the end of the insurance period. The calendar 
date for the end of the insurance period is November 20. The calendar 
date for the beginning of the insurance period is November 21.
    b. If you obtain any insurable acreage of cranberries on or before 
January 5 of any crop year, insurance will be considered to have 
attached to such acreage at the beginning of the insurance period if we 
inspect such acreage and accept it in writing. If you convey any acreage 
of cranberries on or before January 5 of any crop year, insurance will 
not be considered to have attached to such acreage for that crop year.

                            5. Unit Division

    Cranberry acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one unit if you agree to pay an additional premium if required 
by the actuarial table and if for each proposed unit:
    a. you maintain written verifiable records of acreage and harvested 
production for at least the previous crop year and production reports 
based on those records are timely filed to obtain an insurance 
guarantee; and
    b. the acreage planted to insured cranberries in the county is 
located on non-contiguous land.
If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       6. Notice of Damage or Loss

    In addition to section 8 of the general crop insurance policy, in 
case of damage or probable loss:
    a. You must immediately give us written notice of the loss or 
probable loss, including the dates of damage, if probable loss is 
determined within 15 days prior to or during harvest.

[[Page 140]]

    b. If you are going to claim an indemnity on any unit, you must give 
us notice not later than 72 hours after the earliest of:
    (1) Total destruction of the cranberries on the unit;
    (2) Discontinuance of harvest of any acreage on the unit; or
    (3) The date harvest would normally start in the area if any acreage 
on the unit is not to be harvested.
    c. Unless notice has been given under section b. above, and in 
addition to the other notices required by this section, if you are going 
to claim an indemnity on any unit, you must give us written notice not 
later than 10 days after the earlier of:
    (1) Harvest of the unit; or
    (2) November 20 of the crop year.

                         7. Claim for Indemnity

    a. In addition to the provisions of subsection 9.b. of the general 
crop insurance policy, we will not pay any indemnity unless you 
authorize us, in writing, to examine and obtain any records from any 
person or entity pertaining to the production and marketing of the 
insured cranberries.
    b. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting from that result the total production of cranberries 
to be counted (see subsection 7.c.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    c. The total production (in barrels) to be counted for a unit will 
include all harvested and appraised production.
    (1) Cranberry production which, due to insurable causes, is 
determined not to meet quality requirements of the receiving handler, 
would not meet those requirements if properly handled, and has a value 
of less than 75 percent of the market price for cranberries meeting the 
minimum requirements will be adjusted by:
    (a) Dividing the value per barrel of such cranberries by the market 
price per barrel for cranberries meeting the minimum requirements; and
    (b) Multiplying the result by the number of barrels of such 
cranberries.
    (2) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good cranberry farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause or destroyed by you without our 
consent; and
    (c) Any unharvested production.
    (3) Any appraisal we have made on insured acreage will be considered 
production to count unless such acreage is:
    (a) Not harvested before the harvest of cranberries becomes general 
in the county and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (4) We may determine the amount of production of any unharvested 
cranberries on the basis of field appraisals conducted after the end of 
the insurance period.

                  8. Cancellation and Termination Date

    The cancellation and termination date is November 20.

                           9. Contract Changes

    All contract changes will be available at your service office by 
August 31 preceding the cancellation date.

                          10. Meaning of Terms

    a. Barrel means 100 pounds of cranberries.
    b. Direct damage means actual physical damage to the equipment or 
facilities which is the direct result of an insurable cause of loss.
    c. Harvest means picking of the cranberries from the vines for the 
purpose of removal from the land.
    d. Irrigation equipment, facilities, and water supply means the 
supply of water and the mechanical and constructed equipment and 
facilities used to deliver the water to the cranberry crop so as to 
prevent damage due to drought or freeze.
    e. Non-contiguous land means land which is not touching at any 
point. Land that is separated only by a public or private right-of-way 
will be considered contiguous.

[54 FR 20501, May 12, 1989, as amended at 62 FR 5905, Feb. 10, 1997]



Sec. 401.129  Tobacco (guaranteed plan) endorsement.

    The provisions of the Tobacco (Guaranteed Plan) Crop Insurance 
Endorsement for the 1990 through the 1998 crop years are as follows:

                   Federal Crop Insurance Corporation

                  Tobacco (Guaranteed Plan) Endorsement

                       1. Insured Crop and Acreage

    a. The crop insured will be any of the following tobacco types you 
elect which are grown on insured acreage and for which a guarantee and 
premium rate are provided by the actuarial table:

Flue Cured
    Type 11A
    Type 11B
    Type 12
    Type 13
    Type 14

[[Page 141]]

Maryland
    Type 32
Cigar Filler
    Type 41
    Type 42
    Type 44
Cigar Wrapper
    Type 61
    Type 55
Fire Cured
    Type 21
    Type 22
    Type 23
Burley
    Type 31
Dark Air
    Type 35
    Type 36
    Type 37
Cigar Binder
    Type 51
    Type 52
    Type 54
    b. In addition to the acreage not insurable under section 2 of the 
general crop insurance policy, we do not insure any acreage:
    (1) On which the tobacco was destroyed or put to another use for the 
purpose of conforming with any other program administered by the United 
States Department of Agriculture; or
    (2) Planted to tobacco of a discount variety under provisions of the 
tobacco price support program.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.

                            3. Annual Premium

    a. The annual premium amount is computed by multiplying the 
production guarantee for the unit times the applicable price election, 
times the premium rate, times the insured acreage, times your share at 
the time of planting, applying any applicable premium adjustment 
percentage for which you may qualify as shown on the actuarial table.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insurance experience through the 1985 crop year 
under the terms of the experience table contained in the guaranteed 
tobacco policy in effect for the 1986 crop year, you will continue to 
receive the benefit of the reduction subject to the following 
conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction amount will not increase because of 
favorable experience;
    (3) The premium reduction amount will decrease because of 
unfavorable experience in accordance with the terms of the policy in 
effect for the 1986 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                           4. Insurance Period

    In lieu of the provisions of section 7 of the general crop insurance 
policy the following will apply:
    Insurance attaches on each unit or part of a unit when the tobacco 
is planted (see subsection 10(e)) and ends at the earliest of:
    a. Total destruction of the tobacco;
    b. Weighing-in at the tobacco warehouse;
    c. Removal of the tobacco from the unit (except for curing, grading, 
packing, or immediate delivery to the tobacco warehouse);
    d. Final adjustment of a loss; or
    e. On the following dates of the crop year:

(1) Types 11 and 12--November 30;
(2) Type 13--October 31;
(3) Type 14--October 15;
(4) Types 31 & 36--February 28;
(5) Types 21, 35 and 37--March 15;
(6) Types 22 and 23--April 15;
(7) Type 32--May 15;
(8) All other types--April 30.

                            5. Unit Division

    1. Tobacco acreage of an insurable type that would otherwise be one 
unit, as defined in section 17 of the general crop insurance policy, may 
be divided into more than one unit if for each proposed unit:
    a. You maintain written verifiable records of planted acreage and 
harvested production for at least the previous crop year and production 
reports based on those records are filed to obtain an insurance 
guarantee; and
    b. Acreage planted to insured tobacco is located on land identified 
by separate ASCS Farm Serial Numbers, provided:
    (1) The boundaries of the ASCS Farm Serial Numbers are clearly 
identified and the insured acreage is easily determined; and
    (2) The tobacco is planted in such a manner that the planting 
pattern does not continue into an adjacent ASCS Farm Serial Number.
    If you have a loss on any unit, production records for all harvested 
units must be provided. If your tobacco acreage is not in a divided unit 
as provided above, your premium will be reduced as provided by the 
actuarial

[[Page 142]]

table. Production that is commingled between optional units will cause 
those units to be combined for insurance purposes only.

                       6. Notice of Damage or Loss

    For purposes of section 8 of the general crop insurance policy; the 
representative sample of the unharvested crop must be at least 10 feet 
wide and the entire length of each field.

                         7. Claim for Indemnity

    a. An indemnity will be determined for each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of tobacco to be 
counted (see subsection 7.b.);
    (3) Multiplying the remainder by the applicable price election; and
    (4) Multiplying this result by your share.
    b. The total production (in pounds) to be counted for a unit will 
include all harvested and appraised production.
    (1) Harvested tobacco production which, due to insurable causes, has 
a value less than the market price for tobacco of the same type, will be 
adjusted by:
    (a) Dividing the average value per pound of the harvested production 
by the market price per pound; and
    (b) Multiplying that result by the number of pounds of such damaged 
harvested tobacco.
    (c) If due to insurable causes there is no market price available 
for the grade being adjusted, the production to count will be reduced 
20% for each grade that the production falls below the lowest grade with 
a market price (see subsection 10.d.(2)).
    (2) All harvested tobacco production which is not damaged by 
insurable causes and cannot be sold in the current market year will be 
considered production to count.
    (3) To enable us to determine the fair market value of tobacco not 
sold through auction warehouses, we must be allowed:
    (a) To inspect such tobacco before it is sold, contracted to be 
sold, or otherwise disposed of; and
    (b) At our option to obtain additional offers on your behalf.
    (4) Appraised production to be counted will include:
    (a) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause;
    (b) Not less than 35 percent of the guarantee for all unharvested 
acreage;
    (c) Unharvested production on harvested acreage; and
    (d) Potential production lost due to uninsured cause and to failure 
to follow recognized good tobacco farming practices.
    (5) We may appraise any acreage of tobacco types 11, 12, 13, or 14 
on which the stalks have been destroyed without our consent at not less 
than the guarantee.
    (6) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of tobacco becomes general 
in the county and reappraised by us; or
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (7) The commingled production of units will be prorated to such 
units in proportion to our liability on the harvested acreage of each 
unit.
    (8) No replanting payment will be made under this endorsement.

                  8. Cancellation and Termination Dates

------------------------------------------------------------------------
                                            Cancellation and termination
             State and county                           dates
------------------------------------------------------------------------
Alabama; Florida; Georgia; South Carolina;  March 31
 and Surry, Wilkes, Caldwell, Burke, and
 Cleveland Counties, North Carolina, and
 all North Carolina counties east thereof..
All other North Carolina Counties and all   April 15
 other states.
------------------------------------------------------------------------

                           9. Contract Changes

    Contract changes will be available at your service office by 
December 31 prior to the cancellation date.

                          10. Meaning of Terms

    a. Average value per pound means the total value of all harvested 
production from the unit divided by the harvested pounds and may include 
the value of any harvested production which is not sold.
    b. County means the land defined in the general crop insurance 
policy and any land identified by an ASCS Farm Serial Number for the 
county but physically located in another county.
    c. Harvest means the completion of cutting or priming of tobacco on 
any acreage from which at least 20 percent of the production guarantee 
per acre shown by the actuarial table is cut or primed with the intent 
of marketing.
    d. Market price:
    (1) For types, 11, 12, 13, 14, 21, 22, 23, 31, 35, 36, 37, 42, 44, 
54, and 55, means the average price support level per pound for the 
insured type of tobacco as announced by the United States Department of 
Agriculture under the tobacco price support program (if for any crop 
year price support for the insured type is not in effect, we will use 
the season average price in the belt or area through the day

[[Page 143]]

tobacco sales are completed on any unit or part thereof which is 
harvested); and
    (2) For types 32, 41, 51, 52, and 61 means the season average price 
for the applicable type of tobacco, (such price will be the season 
average price for the current crop year for any unit or part thereof 
which is harvested) and may be established by including the value of 
sold and unsold production.

    e. Planting means transplanting the tobacco plant from the bed into 
the field.

[54 FR 48070, Nov. 21, 1989, as amended at 63 FR 34551, June 25, 1998]



Sec. 401.130  Grape endorsement.

    The provisions of the Grape Endorsement for the 1991 through 1997 
(1990 through 1997 in California) crop years are as follows:

                   Federal Crop Insurance Corporation

                            Grape Endorsement

                             1. Insured Crop

    a. The crop insured;
    (1) For California only, will be any insurable variety of grapes you 
elect which are grown for wine, juice, raisins or canning.
    (2) For all other states, will be all insurable varieties of grapes 
which are grown for wine, juice, raisins or canning.
    b. In addition to the grapes not insurable under section 2 of the 
General Crop Insurance Policy, we do not insure any grapes:
    (1) If the producing vines, after being set out or grafted, have not 
reached the number of growing seasons designated by the actuarial table;
    (2) If the producing vines have not produced an average of two (2) 
tons of grapes per acre; or
    (3) Produced by vines where there is less than a ninety percent 
(90%) stand of bearing vines based on the current planting pattern;

unless inspected by us and we agree, in writing, to insure such grapes.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption; or
    (6) If applicable, failure of the irrigation water supply; unless 
those causes are excepted, excluded, or limited by the actuarial table 
or section 9 of the General Crop Insurance Policy.
    b. In addition to the causes of loss not insured against under 
section 1 of the General Crop Insurance policy, we will not insure 
against any loss of production due to fire if weeds and other forms of 
undergrowth have not been controlled or vine pruning debris has not been 
removed from the vineyard. We also specifically do not insure against 
the inability to market the grapes as a direct result of quarantine, 
boycott, or refusal of any entity to accept production, unless 
production has actual physical damage due to a cause specified in 
subsection 2.a. above.

    3. Report of Acreage, Share, Practice, and Type (Acreage Report)

    In addition to the information required by section 3 of the General 
Crop Insurance Policy, you must report the crop type and variety.

                 4. Coverage Levels and Price Elections

    Only one coverage level (50%, 65%, or 75%) and only one price 
election set (high, medium, or low) will be applicable to all your 
insurable grapes.

            5. Production Reporting and Production Guarantees

    In addition to the information required in section 4 of the General 
Crop Insurance Policy, you must report:
    a. The number of bearing vines; and
    b. Any vine damage or change in farming practices which may reduce 
yields from previous levels.

                            6. Annual Premium

    The annual premium amount is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share on the date insurance attaches, times 
any applicable premium adjustment percentage for which you may qualify 
as shown in the actuarial table.

                           7. Insurance Period

    a. The calendar date on which insurance attaches is:
    (1) November 21 in Idaho, Oregon, and Washington;
    (2) February 1 in California; and
    (3) December 11 in all other states.
    b. The date harvest should have started on any acreage which is not 
harvested, is added to section 7 of the General Crop Insurance Policy as 
one of the items which ends the insurance period.
    c. The calendar date for the end of the insurance period is:
    (1) October 10 in Mississippi;
    (2) November 10 in California, Idaho, Oregon, and Washington; and
    (3) December 10 in all other states.
    d. If you acquire an insurable share in any insurable acreage on or 
before the acreage

[[Page 144]]

reporting date of any crop year and if we inspect, consider acceptable, 
and agree in writing, to insure such acreage, insurance will be 
considered to have attached to such acreage on the calendar date for the 
beginning of the insurance period. If you relinquish your insurable 
interest on any acreage of grapes on or before the acreage reporting 
date of any crop year insurance will not be considered to have attached 
to such acreage for that crop year unless a transfer of right to an 
indemnity is entered into by all affected parties and the service office 
is notified in writing of such transfer prior to the acreage reporting 
date.

                            8. Unit Division

    a. In California only, in addition to units as defined in section 17 
of the General Crop Insurance Policy, each grape variety will be a 
separate unit. Grape acreage that would otherwise be one unit, as 
provided herein and in section 17 of the General Crop Insurance Policy, 
may be divided into more than one optional unit if, for each proposed 
unit you maintain written, verifiable records of planted acreage and 
harvested production for at least the previous crop year; production 
reports based on those records are filed to obtain an insurance 
guarantee; and the insured grapes are located on land owned by you which 
is noncontiguous. Land rented by you for cash, a fixed commodity payment 
or any consideration other than a share in the insured crop will be 
considered owned by you.
    b. In all other states, grape acreage that would otherwise be one 
unit as defined in section 17 of the General Crop Insurance Policy may 
be divided into more than one optional unit if, for each proposed unit 
you maintain written, verifiable records of planted acreage and 
harvested production for at least the previous crop year; production 
reports based on those records are filed to obtain an insurance 
guarantee; and
    (1) The insured grapes are designated in the actuarial table as 
separate group A or group B varieties;
    (2) The insured grapes are located on noncontiguous land;
    (3) The acreage of insured grapes is located in separate, legally 
identifiable sections or, in the absence of section descriptions, the 
land is identified by separate ASCS Farm Serial Numbers, provided:
    (a) The boundaries of the section or ASCS Farm Serial Number are 
clearly identified and the insured acreage can be easily determined; and
    (b) The grapes are planted in such a manner that the planting 
pattern does not continue into the adjacent section or ASCS Farm Serial 
Number; or
    (4) The acreage of insured grapes is located in a single section or 
ASCS Farm Serial Number and consists of acreage on which both an 
irrigated and nonirrigated practice are carried out, provided:
    (a) Grapes planted on irrigated acreage do not continue into 
nonirrigated acreage in the same rows or planting pattern; and
    (b) Farming practices are carried out in accordance with recognized 
good dryland and irrigated farming practices for the area.
    c. If you have a loss on any unit, production records for all 
harvested units must be provided to us. Production that is commingled 
between optional units will cause those units to be combined.

                       9. Notice of Damage or Loss

    In addition to the notices required in section 8 of the General Crop 
Insurance Policy, and if you are going to claim an indemnity on any 
unit, you must give us notice not later than 72 hours:
    a. After total destruction of the grapes on the unit;
    b. After discontinuance of harvest on the unit; or
    c. Before harvest would normally start if any acreage on the unit is 
not to be harvested.
    If notice is given under this subsection, the notice requirement 
under subsection 8.a.(4) of the General Crop Insurance Policy is not 
applicable.

                         10. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Multiplying this product by the price election;
    (3) Subtracting the dollar amount obtained by multiplying the total 
production to be counted (see subsection 9.c.) by the price election; 
and
    (4) Multiplying this result by your share.
    b. If a unit contains acreage to which more than one price election 
applies, the dollar amount of insurance and the dollar amount of 
production to be counted will be determined separately for such acreage 
and then added together to determine the total amount for the unit.
    c. The total production (tons) to be counted for a unit will include 
all harvested and appraised production:
    (1) Grapes which, due to insurable causes, have a value less than 75 
percent of the average market price of undamaged grapes of the same 
variety will be eligible for quality adjustment. In California, the 
average market price will be the price shown by the Federal State Market 
News California Wine Report for the same week in which the damaged 
grapes were valued. In all other states, the average market price will 
be determined by averaging the prices being paid by usual marketing 
outlets for the area during the

[[Page 145]]

week in which the damaged grapes were valued. Damaged production will be 
adjusted by:
    (a) Dividing the value per ton of the grapes by the highest price 
election available for such grapes; and
    (b) Multiplying the result (not to exceed 1) by the number of tons 
of such grapes.
    (2) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good grape management practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause, or destroyed by you without our 
consent; and
    (c) Any appraised production on unharvested acreage.
    (3) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Further damaged by an insured cause and reappraised by us; or
    (b) Harvested.
    (4) If any grapes are harvested before or after normal maturity or 
for a special use (such as champagne or Botrytis affected grapes), the 
production of such grapes will be increased by the factor obtained by 
dividing the price per ton received for such grapes by the price per ton 
for fully matured grapes of the type for which the claim is being made.

                 11. Cancellation and Termination Dates

    a. The cancellation date in:
    (1) California is January 31 of the calendar year in which the crop 
normally blooms;
    (2) Idaho, Oregon, and Washington is November 20 of the calendar 
year prior to the year of normal bloom; and
    (3) All other states is December 10 of the calendar year prior to 
the year of normal bloom.
    b. The termination date in:
    (1) California is January 31 of the calendar year following the year 
of normal bloom;
    (2) Idaho, Oregon, and Washington is November 20 of the calendar 
year in which the crop normally blooms; and
    (3) All other states is December 10 of the calendar year in which 
the crop normally blooms.

                          12. Contract Changes

    The date by which contract changes will be available in your service 
office is August 31 preceding the cancellation date for all states 
except California, and October 31 preceding the cancellation date for 
California.

                          13. Meaning of Terms

    a. Crop Year means the period beginning with the date insurance 
attaches to the grape crop and extending through normal harvest time, 
and will be designated by the calendar year in which the grapes are 
normally harvested.
    b. Harvest means the mechanical or manual removal of grapes from the 
vines.
    c. Noncontiguous Land means any land whose boundaries do not touch 
at any point. Land which is separated by a public or private right-of-
way, waterway or irrigation canal will be considered to be touching 
(contiguous).
    d. Ton means 2,000 pounds.

[54 FR 43270, Oct. 24, 1989, as amended at 62 FR 33741, June 23, 1997]



Sec. 401.131  High-risk land exclusion option.

    The provisions of the High-Risk Land Exclusion Option for the 1990 
and subsequent crop years are as follows:

                   Federal Crop Insurance Corporation

                     High-Risk Land Exclusion Option

    This is a continuous Option. Refer to item 5 of this Option.

Insured's Name__________________________________________________________
Contract No.____________________________________________________________
Address_________________________________________________________________
Crop Year_______________________________________________________________
Crops___________________________________________________________________
County__________________________________________________________________
Identification No.______________________________________________________
SSN_____________________________________________________________________
TAX_____________________________________________________________________

    Upon our approval of this Option, we agree to amend your Federal 
Crop Insurance Policy to exclude from crop insurance coverage all high-
risk land for the identified crops and county in which you have a share, 
subject to the following terms and conditions:
    1. The Option must be submitted to us on or before the final date 
for accepting applications for the initial crop year in which you wish 
to exclude high-risk land.
    2. In the event of a loss on any insured unit, you must provide 
separate production records showing planted acreage and harvested 
production for any acreage which is excluded from crop insurance 
coverage under this Option.
    3. By signing this Option, you are declining crop insurance coverage 
under the general crop insurance policy and the crop endorsement on your 
high-risk land.
    4. As used in this Option, ``high-risk'' land is any land which is 
not classified as an ``R'' classification contained in the actuarial 
table.
    5. This Option may be cancelled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date provided by the policy, preceding such crop year.

[[Page 146]]

    6. You must report, on the acreage report for each crop year, the 
acreage of the crop planted on high-risk land.
    7. All other provisions of the policy not in conflict with this 
Option are applicable.

_______________________________________________________________________
Insured's Signature
Date____________________________________________________________________
_______________________________________________________________________
Corporation Representative's Signature and Code Number
Date____________________________________________________________________
_______________________________________________________________________

            Collection of Information and Data (Privacy Act)

    To the extent that the information requested herein relates to the 
information supplier's individual capacity as opposed to the supplier's 
entrepreneurial (business) capacity, the following statements are made 
in accordance with the Privacy Act of 1974, as amended (5 U.S.C. 
552(a)). The authority for requesting information to be furnished on 
this form is the Federal Crop Insurance Act, as amended (7 U.S.C. 1501 
et seq.) and the Federal Crop Insurance Corporation Regulations 
contained in 7 CFR Chapter IV.
    The information requested is necessary for the Federal Crop 
Insurance Corporation (FCIC) to process this form to provide insurance, 
determine eligibility, determine the correct parties to the agreement or 
contract, determine and collect premiums, and pay indemnities. 
Furnishing the Tax Identification Number (Social Security Number) is 
voluntary and no adverse action will result from the failure to furnish 
that number. Furnishing the information required by this form, other 
than the Tax identification (Social Security) Number, is also voluntary; 
however, failure to furnish the correct, complete information requested 
may result in rejection of this form, rejection of or substantial 
reduction in any claim for indemnity, ineligibility for insurance, and a 
unilateral determination of the amount of premium due. (See below for 
information on the consequences of furnishing false or incomplete 
information).
    The information furnished on this form will be used by federal 
agencies, FCIC employees, and contractors who require such information 
in the performance of their duties. The information may be furnished to: 
FCIC contract agencies, employees and loss adjusters; reinsured 
companies; other agencies within the United States Department of 
Agriculture; the Internal Revenue Service; the Department of Justice, or 
other federal or State law enforcement agencies; credit reporting 
agencies and collection agencies; and in response to judicial orders in 
the course of litigation.
    A false claim made to the Corporation, or a false statement made on 
a matter within the jurisdiction of the Corporation, may subject the 
maker to criminal and civil penalties (18 U.S.C. 1001, 1006; 31 U.S.C. 
3729, 3730).

[54 FR 43273, Oct. 24, 1989]



Sec. 401.133  Sugarcane endorsement.

    The provisions of the Sugarcane Crop Insurance Endorsement for the 
1991 through 1995 crop years are as follows:

        Federal Crop Insurance Corporation Sugarcane Endorsement

                       1. Insured Crop and Acreage

    a. The crop insured will be sugarcane grown for processing for sugar 
or for seed.
    b. The acreage insured for each crop year will be plant and stubble 
cane grown on insurable acreage.

                            2. Causes of Loss

    The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:

    a. Adverse weather conditions;
    b. Fire;
    c. Insects;
    d. Plant disease;
    e. Wildlife;
    f. Earthquake;
    g. Volcanic eruption; or
    h. If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after insurance attaches;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.

                            3. Annual Premium

    The annual premium amount is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time insurance attaches, times 
any applicable premium adjustment percentage for which you may qualify 
as shown in the actuarial table.

                           4. Insurance Period

    In addition to the provisions in section 7 of the general crop 
insurance policy, the following will apply.
    a. Insurance attaches on plant cane at the time of planting unless 
otherwise provided for in writing by us and on stubble cane on the first 
day following harvest unless the cane was damaged by conditions 
occurring before harvest. If the stubble cane was damaged before 
harvest, insurance will attach on the later of April 15 or 30 days 
following harvest. Notwithstanding the first sentence of this paragraph, 
insurance will attach on

[[Page 147]]

stubble cane in Louisiana, after the second crop year, only on the later 
of April 15 or 30 days after harvest.
    b. The calendar dates for the end of insurance period are:
  (1) Louisiana..............................................January 31;
  (2) All other states.........................................April 30.

                            5. Unit Division

    Sugarcane acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
more than one unit if for each proposed unit:
    a. You maintain written, verifiable records of planted acreage and 
harvested production for at least the previous crop year and production 
reports based on those records are filed to obtain an insurance 
guarantee;
    b. The acreage planted to insured sugarcane is located in separate, 
legally identifiable sections or, in the absence of section 
descriptions, the land is identified by separate Agricultural 
Stabilization and Conservation Service (ASCS) Farm Serial Numbers, 
provided:
    (1) The boundaries of the sections or Farm Serial Numbers are 
clearly identifiable and the insured acreage can be determined; and
    (2) The sugarcane is planted in such a manner that the planting 
pattern does not continue into the adjacent section or Farm Serial 
Number; and
    c. The acreage planted to the insured sugarcane is located in a 
single section or Farm Serial Number and consists of acreage on which 
both irrigated and nonirrigated practices are carried out, provided:
    (1) Sugarcane planted on irrigated acreage does not continue into 
nonirrigated acreage in the same rows or planting pattern; and
    (2) Planting, fertilizing and harvesting are carried out in 
accordance with applicable recognized good dry-land and irrigated 
farming practices for the area.
    If you have a loss of any unit, production records for all harvested 
units must be provided to us. Production that is commingled between 
optional units will cause those units to be combined. If your sugarcane 
acreage is not divided into optional units as provided in this section, 
your premium will be reduced as provided by the actuarial table.

                               6. Notices

    a. You must give us notice at least 15 days before you begin cutting 
any sugarcane for seed. During this time we may make an appraisal for 
the sugar potential. If we do not appraise the acreage, the production 
to count will be the per acre production guarantee for the unit. Your 
notice must include the unit number and the number of acres you intend 
to harvest as seed.
    b. For the purposes of section 8 of the general crop insurance 
policy, in case of damage or probable loss and you intend to harvest, 
the required representative samples of unharvested sugarcane must be at 
least 10 feet wide and the entire length of the field.

                         7. Claim for Indemnity

    If an indemnity is to be claimed on any unit, you must leave the 
stalks on unharvested acreage and the stubble on harvested acreage 
intact until inspected by us.
    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of sugar to be 
counted (see subsection 7.b.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    (b) The total production (in pounds of sugar) to be counted for a 
unit will include all harvested and appraised production.
    (1) Sugar production to count from acreage damaged by freeze within 
the insurance period, which cannot be processed for sugar by the boiling 
house operation, will be determined by dividing the dollar amount 
received from the mill for the damaged sugarcane by the price per pound 
of raw sugar (The applicable price for raw sugar will be the local 
market price on the earlier of the day the loss is adjusted or the day 
such sugar is sold);
    (2) Appraised production to be counted will include:
    (a) Any appraisal under subsections 6.(a), 7.b.(3) and 7.b.(4);
    (b) Unharvested production on harvested acreage, potential 
production lost due to uninsured causes, and failure to follow 
recognized good sugarcane farming practices;
    (c) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (d) Any unharvested production.
    Appraisals and harvested production not processed for sugar will be 
given in pounds of sugar.
    (3) We will make an appraisal of not less than the production 
guarantee per acre on any harvested acreage on which the stubble is 
destroyed prior to our inspection.
    (4) An appraisal for inadequate stand will be made at the time of 
inspection on sugarcane acreage where insurance did not attach the first 
day following harvest. If the product of the number of stalks per acre 
multiplied by 2, multiplied by the factor (percentage of sugar) 
contained in the actuarial table for that purpose does not equal the 
per-acre guarantee, the per acre appraisal for inadequate stand will be 
the difference between the appraised production and the production 
guarantee.

[[Page 148]]

    (5) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production to count unless such acreage is:
    (a) Not put to another use before harvest of sugarcane becomes 
general in the county and is reappraised by us;
    (b) Further damaged by an insured cause and is reappraised by us; or
    (c) Harvested.

                  8. Cancellation and Termination Dates

    The cancellation and termination date is September 30.

                           9. Contract Changes

    The date by which contract changes will be available in your service 
office is August 15 preceding the cancellation date.

                        10. Report of Production

    There is a one-year lag period for reporting your sugarcane 
production. You must report production for the previous crop year before 
the cancellation date for the subsequent crop year.

                          11. Meaning of Terms

    a. Crop year means the period from planting for plant cane and the 
day following harvest for stubble cane until the end of the insurance 
period and is designated by the calendar year in which the sugarcane 
harvest normally begins in the county.
    b. Harvest means the cutting and removing of sugarcane from the 
field.
    c. Plant cane (see definition of sugarcane).
    d. Stubble cane (see definition of sugarcane).
    e. Sugarcane means either:
    (1) Plant cane growing from seed planted that crop year; or
    (2) Stubble cane growing from the stubble left to produce another 
crop from previously harvested sugarcane.

[55 FR 25955, June 26, 1990, as amended at 58 FR 33509, June 18, 1993; 
60 FR 56934, Nov. 13, 1995]



Sec. 401.134  Texas citrus tree endorsement.

    The provisions of the Texas Citrus Tree Endorsement for the 1989 
through 1997 crop years are as follows:

                   Federal Crop Insurance Corporation

                      Texas Citrus Tree Endorsement

                             1. Insured Crop

    a. The crop insured will be any of the following insurable citrus 
tree types (hereafter called trees) you elect:

Type I  Early and mid-season orange trees;
Type II  Late orange (including Temple) trees;
Type III  Grapefruit trees except types IV and V;
Type IV. Rio Red and Star Ruby grapefruit trees; or
Type V  Ruby Red grapefruit trees;

which are set out for the purpose of harvesting citrus as fresh fruit or 
juice.
    b. In addition to the citrus trees not insurable in section 2 of the 
general crop insurance policy, we do not insure any citrus trees;
    (1) Which are not irrigated;
    (2) For the crop year the application for insurance is filed unless 
we inspect the acreage and consider it acceptable;
    (3) Which have been grafted onto existing root stock or nursery 
stock within the one year period prior to the date insurance attaches; 
or
    (4) In any established groves which do not have the potential to 
produce at least 70 percent of the area average yield for the type and 
age, unless we agree in writing to insure such trees;
    c. We may exclude from insurance or limit the amount of insurance on 
any acreage which was not insured by us the previous crop year.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable damage to citrus 
trees resulting from the following causes occurring within the insurance 
period:
    (1) Freeze;
    (2) Excess moisture;
    (3) Hail;
    (4) Fire;
    (5) Tornado;
    (6) Excess wind; or
    (7) Failure of the irrigation water supply;

unless those causes are excluded, or limited by the actuarial table or 
section 9 of the general crop insurance policy.
    b. In addition to the causes of loss not insured against in section 
1 of the general crop insurance policy, we will not insure against any 
damage to trees due to fire if weeds and other forms of undergrowth have 
not been controlled or tree pruning debris has not been removed from the 
grove.

 3. Report of Acreage, Share, Number, Type, Age of Trees, and Practice 
                            (Acreage Report)

    a. In addition to the information required in section 3 of the 
general crop insurance policy, you must report:
    (1) The number and type of trees;
    (2) The date of original set out; and
    (3) The date of replacement or dehorning, if more than 10 percent of 
the trees on any unit have been replaced or dehorned in the previous 5 
years.

[[Page 149]]

    b. If any insurable acreage of trees is set out after June 1, and 
you elect to insure such acreage during that crop year, you must report 
to us within 72 hours of the completion of set out the acreage, 
practice, type, number of trees, date set out is completed, and your 
share.
    c. The date by which you must annually submit the acreage report is 
June 30 of the calendar year in which insurance attaches.

                         4. Amounts of Insurance

    a. The amount of insurance shown on the actuarial table will be 
reduced for any acreage which has not reached the fourth growing season 
after being set out or the fifth year following dehorning. The amount of 
insurance will be the product obtained by multiplying the amount of 
insurance contained in the actuarial table by:
    (1) 33 percent the year of set out or the year following dehorning 
(insurance will be limited to this amount until trees that are set out 
are one year of age or older on June 1);
    (2) 60 percent the first growing season after being set out or the 
second year following dehorning;
    (3) 80 percent the second growing season after being set out or the 
third year following dehorning; or
    (4) 90 percent the third growing season after being set out or the 
fourth year following dehorning.
    b. The amount of insurance will be reduced proportionately for any 
unit on which the stand is less than 90 percent, based on the original 
planting pattern.

                            5. Annual Premium

    The annual premium amount is computed by multiplying the amount of 
insurance per acre times the premium rate, times the insured acreage, 
times your share at the time insurance attaches.

                           6. Insurance Period

    a. In lieu of section 7 of the general crop insurance policy, 
insurance attaches on June 1 for each crop year except that for the 
first crop year insured if the application is accepted by us after June 
1:
    (1) The insurance against excess wind and freeze will attach the 
tenth day after the properly completed application is submitted to the 
service office; and
    (2) If any insurable acreage is set out after June 1, insurance will 
attach on the date set out is completed for the unit if the acreage is 
reported within 72 hours after the date of completion, except for excess 
wind and freeze; and
    (3) For all other instances, insurance attaches on the date the 
application is accepted.
    b. The insurance period ends at the earlier of:
    (1) May 31 following the beginning of the crop year; or
    (2) Total destruction of the insured trees.

                            7. Unit Division

    a. Citrus tree acreage that would otherwise be one unit, as defined 
in section 17 of the general crop insurance policy, may be divided by 
citrus type.
    b. Citrus tree acreage that would otherwise be one unit as defined 
in section 17 of the general crop insurance policy and subsection 7.a. 
above may be divided into more than one unit if you agree to pay 
additional premium if required by the actuarial table and the insured 
trees are located on non-contiguous land.
    If you have a loss on any unit, production records for all harvested 
units must be provided.

                       8. Notice of Damage or Loss

    a. In lieu of section 8 of the general crop insurance policy and in 
case of damage or probable loss, you must within 10 days give us written 
notice of:
    (1) The dates of damage; and
    (2) The causes of damage.
    b. If you are going to claim an indemnity on any unit, we must 
inspect all insured acreage and damaged trees before pruning, dehorning, 
or removal.

                         9. Claim for Indemnity

    a. In addition to the requirements in section 9 of the general crop 
insurance policy you must furnish records to us concerning all trees on 
the unit.
    b. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the amount of insurance;
    (2) Multiplying this result by the applicable percent of loss 
determined by subtracting from the actual percent of damage determined 
in accordance with subsection 9.c., the following applicable amount:
    (a) 25 percent (for Coverage Level 3) and dividing the result by 75 
percent;
    (b) 35 percent (for Coverage Level 2) and dividing the result by 65 
percent; or
    (c) 50 percent (for Coverage Level 1) and dividing the result by 50 
percent; and
    (3) Multiplying this result by your share.
    c. The total amount of indemnity will include both trees damaged and 
trees destroyed due to an insurable cause.
    (1) The percent of damage to count will be:
    (a) The percent of damage determined by dividing the number of 
scaffold limbs (scaffold limbs are limbs directly attached to the trunk) 
damaged in an area from the trunk to a length equal to one-fourth (\1/
4\) the height of the tree, by the total number of scaffold

[[Page 150]]

limbs before damage occurred, (any trees with over 80 percent actual 
damage will be counted as 100 percent damaged unless the damage occurs 
within one year of set out);
    (b) Any grove with over 80 percent actual damage will be counted as 
100 percent damaged unless the damage occurs within one year of set out; 
or
    (c) The percent of damage resulting from insurable causes occurring 
during the crop year of set out as follows:
    (i) 100 percent if the trees are killed back to the root stock; or
    (ii) 90 percent if the trees have less than 12 inches of live wood 
above the bud union, (however, no damage will be considered if more than 
12 inches of wood above the bud union is alive).
    (2) Any percentage of damage by uninsured causes, will not be 
included in the percent of damage.
    d. The amount of indemnity will be determined at the earlier of:
    (1) Total destruction of the trees; or
    (2) The calendar date for the end of the insurance period.

                 10. Cancellation and Termination Dates

    The cancellation and termination dates are May 31 prior to the date 
insurance attaches.

                          11. Contract Changes

    The date by which contract changes will be available in your service 
office is February 28 preceding the cancellation date.

                          12. Meaning of Terms

    a. Crop year means the period beginning June 1 and extending through 
May 31 of the following year and is designated by the calendar year in 
which the insurance period ends.
    b. Dehorning means the cutting back of each scaffold limb to a 
length that is no longer than \1/4\ the height of the tree.
    c. Destroyed means trees which are damaged to the extent that 
removal is required.
    d. Excess wind means a natural movement of air which has sustained 
speeds in excess of 58 miles per hour recorded at the U.S. Weather 
Service reporting station nearest to the crop at the time of crop 
damage.
    e. Freeze means the condition of air temperatures over a widespread 
area remaining sufficiently at or below 32 degrees Fahrenheit to cause 
tree damage.
    f. Non-contiguous land means land which is not touching at any 
point. Land which is separated by only a public or private right-of-way 
will be considered to be touching (contiguous).
    g. Set out means transplanting the citrus tree from the nursery to 
the grove.
    h. Total destruction means the occurrence of damage by unit to the 
trees which have been set out more than one year in excess of 80 
percent.

[53 FR 9101, Mar. 21, 1988, as amended at 62 FR 4117, Jan. 29, 1997]



Sec. 401.135  Malting barley option.

    The provisions of the Malting Barley Option for the 1989 through 
1994 crop years are as follows:

                   Federal Crop Insurance Corporation

                 Barley Insurance Malting Barley Option

    (This is a continuous Option. Refer to section 15 of the General 
Crop Insurance Policy)

Insured's name  ________________________________________________________
Contract No.  __________________________________________________________

                                Crop Year

                                 Address

Identification No.______________________________________________________
SSN  ___________________________________________________________________
Tax  ___________________________________________________________________

    It is hereby agreed to amend the Federal Crop Insurance General Crop 
Insurance Policy and Barley Endorsement under, and in accordance with, 
the following terms and conditions:

 1. The option must be submitted to us on or before the final date for 
 accepting applications for the initial crop year in which you wish to 
          insure your malting barley acreage under this option.

2. You must have a Federal Crop Insurance General Crop Insurance Policy 
           and Barley Endorsement (``Basic Policy'') in force.

           3. You must provide by the acreage reporting date:

    a. Acceptable records of the sale of malting barley for malting 
purposes for 3 of the previous 5 crop years; or
    b. A binding written contract with a buyer of malting barley for 
malting purposes, which states the quantity contracted and purchase 
price or method for determining such price.

[[Page 151]]

   4. All barley acreage in the county planted to an approved malting 
  variety in which you have a share, will be insured under this option 
(``Malting Barley''). All barley acreage of any non-malting variety will 
   be insured under the terms of the Basic Policy (``Basic Barley''). 
Malting barley and basic barley acreage will be separate units. Further 
 unit division may be allowed in accordance with the provisions of the 
                              basic policy.

 5. You must elect the highest price election provided for basic barley.

    6. Your premium rate for malting barley will be provided by the 
                            actuarial table.

    7. In lieu of section 7.b. (1) and (2) of the Barley Endorsement:

    a. Mature malting barley production which otherwise is not eligible 
for quality adjustment will be reduced .12 percent for each one tenth 
(.1) percentage point of moisture in excess of 13.0 percent; or
    b. Mature malting barley production, which due to insurable causes, 
is not accepted by a buyer of malting barley and will not meet the 
applicable standards for two-rowed or six-rowed malting barley (see 
Sec. 10.a.), will be adjusted by:
    (1) Dividing the value per bushel for the insured malting barley 
(see 10.d.) by the price election for malting barley; and
    (2) Multiplying the result (not to exceed one (1.0)) by the number 
of bushels of such barley.
    c. All grade determinations must be made by a grader licensed to 
grade barley under the Unted States Grain Standards Act from samples 
obtained by a licensed sampler or our loss adjuster. Any production 
which is not sampled and graded as provided by this section will be 
considered as malting barley meeting the applicable standards.

 8. All provisions of the basic policy not in conflict with this option 
                             are applicable.

    9. Contract changes will be available at your service office by 
              September 1 preceding the cancellation date.

                       10. As used in this option:

    a. Applicable standards for two-rowed and six-rowed malting barley 
are defined in the Official United States Grain Standards.
    b. Approved malting variety means the varieties specified in the 
actuarial table or approved in writing by us.
    c. Buyer means any business enterprise regularly engaged in the 
malting of barley or brewing of malt beverages for human consumption, or 
its representative which is authorized to engage in the purchase of 
malting barley on behalf of or for sale to the malting or brewing 
company.
    d. Value per bushel for the insured malting barley means;
    (1) The local market price of U.S. No. 2 barley (basic barley) if 
the insured mature malting barley production, due to insurable causes, 
has a test weight of at least 40 pounds per bushel and, as determined by 
a grain grader licensed by the Federal Grain Inspection Service or 
licensed under the United States Warehouse Act, contains more than 85 
percent sound barley; less than 8 percent damaged kernels; less than 35 
percent thin barley; less than 5 percent black barley; and does not 
grade smutty, garlicky, or ergoty; or
    (2) The local market price of basic barley of the same quality as 
the insured malting barley, if the malting barley does not meet all the 
standards in Sec. 10.d.(1).
    The local market price for basic barley as identified in 
Sec. 10.d.(1) and (2) above will be the price on the earlier of the day 
the loss is adjusted or the day the insured barley is sold.

Insured's Signature_____________________________________________________
Date____________________________________________________________________
Corporation Representative's Signature and Code Number__________________
Date____________________________________________________________________

[53 FR 27664, July 22, 1988, as amended at 53 FR 34022, Sept. 2, 1988; 
60 FR 56935, Nov. 13, 1995]



Sec. 401.137  Fresh market tomato minimum value option.

    The provisions of the Fresh Market Tomato Minimum Value Option for 
the 1991 through the 1997 crop years are as follows:

                   Federal Crop Insurance Corporation

                Fresh Market Tomato Minimum Value Option

(This is a continuous option. Refer to section 15 of the General Crop 
Insurance Policy)

Insured's Name____________
Contract No.____________
Address____________
Crop Year____________
Identification No.____________
SSN________ Tax________

    It is hereby agreed to amend the Dollar Plan of Fresh Market Tomato 
Endorsement in accordance with the following terms and conditions.
    1. This option must be submitted to us on or before the final date 
for accepting applications for the initial crop year in which you wish 
to insure your tomatoes under this Option.
    2. You must have a Federal Crop Insurance General Policy and Dollar 
Plan Fresh Market Tomato Endorsement (``basic policy'') in force.

[[Page 152]]

    3. You must select either Option I or II below by marking the 
appropriate space below. All insurable acreage in which you have a share 
in the county will be covered under the option you select.
    [  ] Option I:
    (a) Upon purchase of this option, subsection 9.b.(1)(a) of the 
Dollar Plan of Fresh Market Tomato Endorsement will be amended to change 
the reference from $3.00 to $2.00 in determining the total value of 
harvested production to count.
    (b) The premium rate for this option will be an additional 30 
percent of your premium for basic coverage.
    [  ] Option II:
    (a) Upon purchase of this option, subsection 9.b.(1)(a) of the 
Dollar Plan Fresh Market Tomato Endorsement will not apply to your 
tomato acreage. The total value of harvested production will be the 
dollar amount obtained by multiplying the number of 25-pound cartons of 
tomatoes sold by the price received minus allowable costs as contained 
in the actuarial table; however, such price must not be less than zero 
for any carton.
    (b) The premium rate for this option will be an additional 50 
percent of your premium for basic coverage.
    4. All provisions of the General Policy and Dollar Plan of Fresh 
Market Tomato Endorsement not in conflict with this Option are 
applicable.
    5. All determinations under this Option will be made by us.
    6. This Option may be cancelled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date provided by the ``basic policy,'' preceding such crop 
year.

Insured's Signature____________
Date____________
Corporation Representative's
Signature and Code Number____________
Date____________

[54 FR 48073, Nov. 21, 1989, as amended at 62 FR 14777, Mar. 28, 1997]



Sec. 401.138  Fresh market sweet corn endorsement.

    The provisions of the Fresh Market Sweet Corn Endorsement for the 
1991 through the 1997 crop years are as follows:

                   Federal Crop Insurance Corporation

                   Fresh Market Sweet Corn Endorsement

                             1. Insured Crop

    a. The crop insured will be sweet corn planted for harvest as fresh 
market sweet corn, grown on insurable acreage, and for which an amount 
of insurance and premium rate are set by the actuarial table.
    b. In addition to the sweet corn insurable in section 2 of the 
general crop insurance policy we do not insure any acreage of sweet 
corn:
    (1) Grown by any entity if that entity had not previously:
    (a) grown sweet corn for commercial sales; or
    (b) participated in the management of a sweet corn farming 
operation.
    (2) Grown for direct consumer marketing;
    (3) Which is not irrigated; or
    (4) Unless the acreage is planted in rows far enough apart to permit 
mechanical cultivation.
    c. Paragraph 2.e.(2) of the general crop insurance policy is not 
applicable to ths endorsement.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from one or more of the following causes occurring within the 
insurance period:
    (1) Frost;
    (2) Freeze;
    (3) Hail;
    (4) Fire;
    (5) Tornado;
    (6) Wind or excess precipitation occurring in conjunction with a 
cyclone; or
    (7) Failure of the irrigation water supply due to an unavoidable 
cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.
    b. In addition to causes of loss specified in section 1 of the 
general policy as not insured, we will not insure against any loss of 
production due to:
    (1) Disease
    (2) Insect infestation; or
    (3) Failure to market the sweet corn unless such failure is due to 
actual physical damage from a cause specified in subsection 2.a. of this 
endorsement.

       3. Report of Acreage, Share, and Practice (Acreage Report)

    In addition to the information required by section 3 of the general 
crop insurance policy, you must report by unit for each planting period 
all the acreage of fall, winter, and spring-planted sweet corn (as 
applicable) in the country in which you have a share.

                         4. Amount of Insurance

    a. Subsection 4.d. of the general crop insurance policy is not 
applicable to this endorsement.
    b. The amount of insurance per acre as shown on you policy 
confirmation is progressive by plant growth stage. The stages and 
amounts of insurance are:

[[Page 153]]

    (1) First stage (from planting until the beginning of tasselling, 
(tassel visible above the whorl)) is 65 percent of the final stage 
amount of insurance; and
    (2) Final stage (from tasselling until the acreage is harvested) is 
the final stage amount of insurance (100 percent) as contained in the 
applicable actuarial table.
    c. Any acreage of fresh sweet corn damaged in the first stage to the 
extent that we determine it should not be further cared for, will be 
deemed to have been destroyed, even though you continue to care for it. 
The amount of insurance for such acreage will not exceed the first stage 
guarantee.

                            5. Annual Premium

    The annual premium amount is computed by multiplying the final stage 
amount of insurance times the premium rate, times the insured acreage, 
times you share at the time of planting, times any applicable premium 
adjustment factor for which you may qualify as shown by the actuarial 
table.

                           6. Insurance Period

    In lieu of the provision in section 7 of the general crop insurance 
policy, insurance attaches when the sweet corn is planted in each 
planting period and ends at the earliest of:
    a. Total destruction of the insured crop on the unit;
    b. Discontinuance of harvest of sweet corn on the unit;
    c. The date harvest should have started on the unit on any acreage 
which has not been harvested;
    d. Completion of harvest on a unit; or
    e. Final adjustment of a loss on a unit.
    f. The calendar date for the end of the planting period contained in 
the actuarial table.

                            7. Unit Division

    All insurable sweet corn acreage, by planting period, that would 
otherwise be one unit, as defined in subsection 17.q. of the general 
crop insurance policy, may be divided into more than one unit if, for 
each proposed unit you maintain, written verifiable records of planted 
acreage and harvested production for a least the previous crop year. 
Acreage planted to the insured sweet corn must be located in separate, 
legally identifiable sections or, in the absence of section 
descriptions, on acreage identified by separate ASCS Farm Serial 
Numbers, provided:
    a. The boundaries of the section or ASCS Farm Serial Number are 
clearly identified, and the insured acreage can be easily determined; 
and
    b. The sweet corn is planted in such a manner that the planting 
pattern does not continue into an adjacent section or ASCS Farm Serial 
Number.
    If you have a loss on any unit, production records for all harvested 
units, whether insured or uninsured, must be provided to us. Production 
that is commingled between optional units will cause those units to be 
combined for insurance purposes. If your sweet corn acreage is not 
divided into optional units as provided in this section, your premium 
amount will be reduced as provided by the actuarial table.

                       8. Notice of Damage or Loss

    In lieu of the notices required in subsections 8.a. (3), and (4) of 
the general crop insurance policy, in case of damage or probable loss 
you must give us written notice within three (3) days of the date of 
damage and indicate the cause of damage and whether a claim for 
indemnity is probable. In the event damage occurs within three (3) days 
of or during harvest, immediate notice stating the cause of damage and 
probability of a claim must be given to us. If a notice has been given, 
we must be notified of the expected time of harvest at the time of 
notice or not later than 72 hours before harvest begins, whichever is 
applicable.

                         9. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the amount of insurance per 
acre for the stage of plant growth as defined in subsection 4.c;
    (2) Subtracting therefrom the total dollar value of sweet corn 
production to be counted (see subsection 9.c.); and
    (3) Multiplying this result by your share.
    b. In lieu of subsection 9.d. of the general crop insurance policy, 
if the information reported by you under section 3 of this endorsement 
results in a lower premium than the actual premium determined to be due, 
the amount of insurance on the unit will be computed on the information 
reported, but the value of all production from insurable acreage, 
whether or not reported as insurable, will count against the amount of 
insurance.
    c. The total value of production to be counted for a unit will 
include the value for all harvested and appraised production.
    (1) The total value of harvested production will be the greater of:
    (a) The dollar amount obtained by multiplying the number of 42 pound 
crates of sweet corn harvested on the unit by the minimum value shown 
for the planting period in the actuarial table; or
    (b) The dollar amount obtained by multiplying the number of 42 pound 
crates of sweet corn sold by the price per crate received minus the 
allowable cost established by the actuarial table (subtraction of the 
allowable cost from the price received may not result in an amount per 
crate less than zero).

[[Page 154]]

    (2) The value of any appraised production will not be less than the 
dollar amount obtained by multiplying the appraised number of 42 pound 
crates of sweet corn by the minimum value per crate shown on the 
actuarial table for the planting period and will include:
    (a) The value of any potentially marketable production;
    (b) The value of unharvested production on harvested acreage and the 
value of any potential production lost due to uninsured causes; and
    (c) Not less than the final stage dollar amount of insurance per 
acre for any acreage abandoned or put to another use without prior 
written consent or which is damaged solely by an uninsured cause, or for 
which notice of damage was not given as required by section 8 of this 
endorsement and of the general crop insurance policy.
    (3) Unharvested sweet corn damaged or defective due to insurable 
causes and which is not marketable sweet corn will not be counted as 
production.
    (4) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of sweet corn becomes 
general in the county for the planting period and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    d. A replanting payment is available in accordance with subsection 
9.h. of the general crop insurance policy. The acreage to be replanted 
must have sustained a loss in excess of 25 percent of the plant stand. 
In lieu of subsection 9.h.(1)(c) of the general crop insurance policy, 
no replanting payment will be made on acreage on which a replanting 
payment has been made during the current planting period for the crop 
year. The replanting payment will not exceed the product obtained by 
multiplying $65.00 per acre by your share.

                 10. Cancellation and Termination Dates

------------------------------------------------------------------------
                                            Cancellation and termination
             State and county                          dates
------------------------------------------------------------------------
Florida; Atkinson, Baker, Brantley,        July 31
 Camden, Colquitt, Cook, Early, Mitchell,
 and Ware Counties; Georgia and all
 Georgia counties south thereof which
 have a ``fall planting period.''.
Alabama; all other Georgia counties and    February 15
 South Carolina.
All other states.........................  April 15
------------------------------------------------------------------------

                          11. Contract Changes

    Contract changes will be available at your service office by April 
30 preceding the cancellation date for Florida and Georgia Counties with 
a fall planting period, and by November 30 preceding the cancellation 
date in all other states.

                          12. Meaning of Terms

    For the purposes of fresh market sweet corn crop insurance:
    a. Crop year means the period within which the sweet corn is 
normally grown, beginning July 15 and continuing through the harvesting 
of the spring-planted sweet corn. It is designated by the calendar year 
in which spring-planted sweet corn is normally harvested.
    b. Cyclone means a large-scale, atmospheric wind-and-pressure system 
(without regard to the time of year), named by the United States Weather 
Service and characterized by low pressure at its center and 
counterclockwise, circular wind motion, in which the minimum sustained 
surface wind (1-minute mean) is 34 knots (39 miles per hour) or more at 
the time of loss as recorded by the U.S. Weather Service reporting 
station nearest to the crop damage.
    c. Freeze means the condition that exists when air temperature over 
a widespread area remains at or below 32 degrees Fahrenheit, and causes 
damage to plant tissue.
    d. Frost means a deposit or covering of minute ice crystals formed 
from frozen water vapor which causes damage to plant tissue.
    e. Harvest means the final picking of marketable sweet corn on the 
unit.
    f. Marketable sweet corn means the sweet corn which meets the 
standards for grading U.S. 1 or better and will withstand normal 
handling and shipping.
    g. Planting period means the period of time within the dates set by 
the actuarial table, and is designated as ``fall-planting period,'' 
``winter-planting period,'' or ``spring-planting period.''
    h. Plant stand means the number of live plants per acre before the 
plants were damaged due to insurable causes.
    i. Potential production means the number of 42 crates of sweet corn 
which would have been produced per acre by the end of the insurance 
period.
    j. Sweet corn means a type of corn with kernels containing a high 
percentage of sugar and adapted for table use.
    k. Sweet corn grown for direct consumer marketing means sweet corn 
grown for the purpose of selling from the farm directly to the consumer 
without the intervention of a wholesaler, retailer, or packer.

[55 FR 21739, May 29, 1990, as amended at 62 FR 14783, Mar. 28, 1997]



Sec. 401.139  Fresh market tomato (dollar plan) endorsement.

    The provisions of the Fresh Market Tomato Crop lnsurance Endorsement

[[Page 155]]

for the 1991 through the 1997 crop years are as follows:

  Federal Crop Insurance Corporation Fresh Market Tomato (Dollar Plan) 
                               Endorsement

                             1. Insured Crop

    a. The crop insured will be tomatoes (excluding plum and cherry-type 
tomatoes) planted for harvest as fresh market tomatoes.
    b. In lieu of section 2.e.(11) of the general policy, we will insure 
newly cleared land planted to tomatoes.
    c. In addition to the fresh tomatoes not insurable under section 2 
of the general crop insurance policy we do not insure any acreage grown 
by any entity if that entity had not previously:
    (1) Grown tomatoes for commercial sale; or
    (2) Participated in the management of the tomato farming operation.
    d. We do not insure any acreage of tomatoes:
    (1) Grown for direct consumer marketing;
    (2) Which is not irrigated;
    (3) Which is not grown on plastic mulch unless allowed for by the 
actuarial table;
    (4) On which tomatoes, peppers, eggplants, or tobacco have been 
grown and the soil was not fumigated or otherwise properly prepared 
before planting tomatoes;
    (5) Which was planted to tomatoes the preceding planting period, 
unless the tomato plants of the preceding planting period were destroyed 
prior to reaching stage 2 production as defined in section 3 of this 
endorsement.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Excessive rain;
    (2) Frost;
    (3) Freeze;
    (4) Hail;
    (5) Fire;
    (6) Tornado;
    (7) Wind or excess precipitation occurring in conjunction with a 
cyclone; or
    (8) Failure of the irrigation water supply due to an unavoidable 
cause occurring after the beginning of planting;

Unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.
    b. In addition to the causes of loss specified in section 1 of the 
general policy as not insured, we will not insure against any loss of 
production due to:
    (1) Disease or insect infestation; or
    (2) Failure to market the tomatoes unless such failure is due to 
actual physical damage from a cause specified in subsection 2.a.

                         3. Insurance Guarantees

    a. The insurance guarantees per acre are by stages and increase at 
specified intervals, up to the final stage guarantee. The stages and 
guarantees are as follows:
    (1) First stage is from planting until qualifying for stage 2. The 
first stage guarantee is 50 percent of the final stage guarantee.
    (2) Second stage is 60 days (30 days for transplants) after 
planting, and until qualifying for stage 3. The second stage guarantee 
is 75 percent of the final stage guarantee.
    (3) The third stage is 90 days (60 days for transplants) after 
planting until qualifying for the final stage. The third stage guarantee 
is 90 percent of the final stage guarantee.
    (4) The final stage begins the earlier of 105 days (75 days for 
transplants) after planting, or the beginning of harvest.
    b. Any acreage of tomatoes damaged to the extent that growers in the 
area would not further care for the tomatoes, will be deemed to have 
been destroyed even though the tomatoes continue to be cared for. The 
insurance guarantee for such acreage will be the guarantee for the stage 
in which such damage occurs.

                4. Report of Acreage, Share, and Practice

    In addition to the information required in section 3 of the general 
crop insurance policy, you must report the row width. You must report on 
or before the acreage reporting date for each planting period all the 
acreage of fall, winter, and spring-planted tomatoes as applicable in 
the county in which you have a share.

                            5. Annual Premium

    The amount is computed by multiplying the final stage amount of 
insurance times the premium rate, times the insured acreage, times your 
share at the time of each planting, times any applicable premium 
adjustment percentage for which you may qualify (as shown in the 
actuarial table), because you have not selected optional units.

                           6. Insurance Period

    ln lieu of section 7 of the general crop insurance policy, insurance 
attaches on each unit when the tomatoes are planted in each planting 
period and ends at the earliest of:
    a. Total destruction of the tomatoes on the unit;
    b. Discontinuance of harvest of tomatoes on the unit;
    c. The date harvest should have started on the unit on any acreage 
which will not be harvested;
    d. 140 days after the date of direct seeding, transplanting, or 
replanting;

[[Page 156]]

    e. Final harvest; or
    f. Final adjustment of a loss.

                            7. Unit Division

    In addition to units defined in section 17 of the general crop 
insurance policy, insurable tomato acreage will contain units by 
planting period. Insurable tomato acreage which otherwise would be one 
unit as provided above, may be divided into two or more optional units. 
Written, verifiable records of planted and harvested acreage and 
production for each optional unit must be provided to us at our request. 
For optional unit division, acreage planted to the insured tomatoes must 
be located in separate, legally identifiable sections or, in the absence 
of section descriptions, on land identified by separate ASCS Farm Serial 
Numbers, provided:
    a. The boundaries of the section or farms designated by ASCS Farm 
Serial Number are clearly identified, and the insured acreage can be 
easily determined; and
    b. The tomatoes are planted in such a manner that the planting 
pattern does not continue into an adjacent section or farm designated by 
ASCS Farm Serial Number.
    If you have a loss on any unit, preharvest appraisals for that loss 
unit and production records for all harvested units, whether insured or 
uninsured, must be provided to us. Production that is commingled between 
optional units may cause those units to be combined. If your tomato 
acreage is not divided into optional units as provided in this section, 
your premium amount will be reduced as provided by the actuarial table.

                       8. Notice of Damage or Loss

    a. If a loss is anticipated by you on any unit within 15 days prior 
to or during harvest and you are going to claim an indemnity on any 
unit, you must give us notice not later than 72 hours after the earliest 
of:
    (1) Total destruction of the tomatoes on the unit;
    (2) Discontinuance of harvest of any acreage on the unit;
    (3) The date harvest would normally start if any acreage on the unit 
is not to be harvested; or
    (4) 140 days after the direct seeding, transplanting, or replanting 
of the tomatoes (see section 6).
    b. You must not destroy any tomato acreage within a unit until 
inspected by us if an indemnity is to be claimed or the unit.
    c. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the amount of insurance, 
times the percentage for the stage of production defined in section 3;
    (2) Subtracting therefrom the total value of production to be 
counted (see subsection 9.b.); and
    (3) Multiplying this result by your share.
    b. The total value of production to be counted for a unit will 
include all harvested and appraised production.
    (1) The total value of harvested production will be the greater of:
    (a) The dollar amount obtained by multiplying the number of 25-pound 
cartons of tomatoes harvested in the unit by $3.00; or
    (b) The dollar amount obtained by multiplying the number of 25-pound 
cartons of tomatoes sold by the price received minus allowable cost set 
by the actuarial table (however, such price must not be less than zero 
for any carton).
    (2) The value of appraised production to be counted will include:
    (a) The value of the potential production (see subsection 13.k.) on 
tomato acreage that has not been harvested the second time for ground-
cultured tomatoes (the third time for staked tomatoes);
    (b) The value of unharvested potential production in excess of 30 
cartons after the second harvest for ground culture tomatoes (third 
harvest for staked tomatoes);
    (c) The value of the potential production lost due to uninsured 
causes; and
    (d) An amount not less than the dollar amount of insurance per acre 
for any acreage abandoned or put to another use without prior written 
consent or which is damaged solely by an uninsured cause.
    The value of any appraised production will not be less than the 
dollar amount obtained by multiplying the number of 25-pound cartons of 
tomatoes appraised by $3.00.
    (3) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of tomatoes becomes 
general in the county for the planting period and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    c. A replanting payment is available under this endorsement. The 
acreage to be replanted must have sustained a loss in excess of 50 
percent of the plant stand. The replanting payment per acre will be your 
actual cost per acre for replanting, but will not exceed the product 
obtained by multiplying $175.00 per acre by your share.

                  10. Cancellation and Termination Date

    The cancellation and termination date is July 31.

[[Page 157]]

                          11. Contract Changes

    All contract changes will be available at your service office by 
April 30 preceding the cancellation date.

                     12. Production Reporting Dates

    The production reporting provision found in section 4 of the general 
crop insurance policy does not apply to this contract.

                          13. Meaning of Terms

    For the purpose of tomato crop insurance:
    a. Acre means 43,560 square feet of land on which row widths do not 
exceed 6 feet, or if row width exceeds 6 feet, the land on which at 
least 7260 linear feet rows are planted.
    b. Crop Year, in lieu of the definition in the General Policy, means 
the period within which the tomatoes are normally grown beginning August 
1 and continuing through harvesting of the spring-planted tomatoes and 
is designated by the calendar year in which the spring-planted tomatoes 
are normally harvested.
    c. Cyclone means a large-scale, atmospheric wind-and-pressure system 
(without regard to the time of year), named by the United States Weather 
Service and characterized by low pressure at its center and 
counterclockwise, circular wind motion, in which the minimum sustained 
surface wind (1-minute mean) is 34 knots (39 miles per hour) or more at 
the time of loss as recorded by the U.S. Weather Service reporting 
station nearest to the crop damage.
    d. Direct consumer marketing means the method of selling tomatoes 
from the farm directly to the consumer without the intervention of a 
wholesaler, retailer, or packer.
    e. Excessive rain means more than 10 inches of rain on the tomato 
field within a 24-hour period, after the tomatoes have been seeded or 
transplanted.
    f. Freeze means the condition that exists when air temperatures over 
a widespread area remain at or below 32 degrees Fahrenheit, and cause 
damage to plant tissue.
    g. Frost means a deposition or covering by minute ice crystals 
formed from frozen water vapor, which causes damage to plant tissue.
    h. Harvest means the picking of marketable tomatoes on the unit.
    i. Mature green tomato means a tomato which:
    (1) Has heightened gloss because of the waxy skin that cannot be 
torn by scraping;
    (2) Has well-formed, jelly-like substance in the locules;
    (3) Has seeds that are sufficiently hard so that they are pushed 
aside and not cut by a sharp knife in slicing; and
    (4) Shows no red color.
    j. Planting means transplanting the tomato plants into the field or 
direct seeding in the field.
    k. Planting period means tomatoes planted within the dates set by 
the actuarial table, as fall-planted, winter-planted, or spring-planted.
    l. Plant stand means the number of live plants per acre before the 
plants were damaged due to insurable causes.
    m. Potential production means the number of 25-pound cartons of 
mature green or ripe tomatoes with classification size of 6  x  7 (2\8/
32\ inch minimum diameter) or larger, which the tomato plants would 
produce or, would have produced per acre, by the end of the insurance 
period.
    n. Replanting means performing the cultural practices necessary to 
replant insured acreage to tomatoes.
    o. Ripe Tomato means a tomato which has a definite break in color 
from green to tannish-yellow, pink or red.
    p. Tomatoes grown for direct consumer marketing means tomatoes 
initially intended for direct consumer marketing.

[55 FR 1783, Jan. 19, 1990, as amended at 62 FR 14777, Mar. 28, 1997]



Sec. 401.140  Pear endorsement.

    The provisions of the Pear Crop Insurance Endorsement for the 1989 
and subsequent crop years are as follows:

           Federal Crop Insurance Corporation Pear Endorsement

                             1. Insured Crop

    a. The crop insured will be all pear varieties established as 
adapted to the area and classified as follows:
    (1) Type I: Green Bartlett; and
    (2) Type II: all others.
    b. In addition to the pears not insurable in section 2 of the 
general crop insurance policy, we do not insure any pears:
    (1) Of any type which has not produced an average of 4 tons per acre 
of first grade canning or U.S. number 1 pears in at least one of the 
four previous crop years;
    (2) Which we inspect and consider not acceptable; or
    (3) Which do not have production records acceptable to us.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from any of the following causes occurring within the 
insurance period:
    (1) Drought;
    (2) Earthquake;
    (3) Excess wind;
    (4) Fire;
    (5) Flood;
    (6) Freeze;
    (7) Frost;
    (8) Fruit-set failure;

[[Page 158]]

    (9) Hail;
    (10) Volcanic eruption; or
    (11) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after insurance attaches;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9 of the general crop insurance policy.
    b. In addition to the causes of loss not insured against, contained 
in section 1 of the general crop insurance policy, we will not insure 
against any loss of production due to fire if weeds and other forms of 
undergrowth have not been controlled or tree pruning debris has not been 
removed from the orchard. We also specifically do not insure against 
failure of the fruit to color properly, or the inability to market the 
fruit as a direct result of quarantine, boycott, or refusal of any 
entity to accept production.

         3. Report of Acreage, Share, and Type (Acreage Report)

    a. In addition to the information required in section 3 of the 
general crop insurance policy, you must report the crop type.
    b. The date you must annually submit the acreage report is December 
15 of the calendar year insurance attaches in California and January 15 
of the calendar year the insured crop normally blooms in all other 
states.

            4. Production Reporting and Production Guarantees

    a. In addition to the information required by section 4 of the 
general crop insurance policy, you must report by variety:
    (1) The number of bearing trees;
    (2) The number and age of trees per acre and the current planting 
pattern; and
    (3) Any tree damage or change in farming practices which will or may 
reduce yields from previous levels.

                            5. Annual Premium

    The annual premium amount is computed by multiplying the production 
guarantee (in tons) times the price election, times the premium rate, 
times the insured acreage, times your share on the date insurance 
attaches.

                           6. Insurance Period

    a. The calendar date on which insurance attaches is November 21.
    b. The calendar date for the end of the insurance period is the 
following applicable date of the calendar year in which the pears are 
normally harvested:

------------------------------------------------------------------------
                 Variety                               Date
------------------------------------------------------------------------
Bartlett (green and red)................  September 15.
Star Crimson (Crimson Red)..............  September 15.
all others..............................  October 15.
------------------------------------------------------------------------

                            7. Unit Division

    a. Pear acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy may be divided between 
type I and type II. However, alternating rows of, or interplanting of 
type I and II pears will not be divided into separate units.
    b. Pear acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy and subsection 7.a. 
above may be further divided into more than one unit if:
    (1) You agree to pay an additional premium if provided for by the 
actuarial table;
    (2) For each proposed unit you maintain written, verifiable records 
of acreage and harvested production for at least the previous crop year 
and production reports based on those records are timely filed to obtain 
an insurance guarantee; and
    (3) The acreage of insured pears is located on non-contiguous land.
    c. If you have a loss on any unit, production records for all 
harvested units must be provided. Production that is commingled between 
optional units will cause those units to be combined.

                       8. Notice of Damage or Loss

    In addition to the notices required in the general crop insurance 
policy and in case of damage or probable loss you must give us notice of 
the date and cause of damage within 10 days of such damage.

                         9. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Multiplying this product by the price election;
    (3) Subtracting the dollar amount obtained by multiplying the total 
production to be counted (see subsection 9.c.) by the price election; 
and
    (4) Multiplying the result by your share.
    b. If a unit contains acreage to which both type I and type II pear 
guarantees apply, the dollar amount of insurance and the dollar amount 
of production to be counted will be determined separately for each type 
and then added together to determine the total amount for the unit.
    c. The total production to be counted for a unit will include:
    (1) All harvested and appraised production that meets the following 
applicable U.S.D.A. grade standards except those pears specified in 
subsection 9.d.:
    (a) For Type I pears, first grade canning (under California Tree 
Fruit Agreement Standards) or U.S. Number 1 (under U.S. Standards for 
summer and fall pears) in California, or U.S. Number 1 (under either 
U.S.

[[Page 159]]

standards for summer and fall pears or processing pears) in states other 
than California; or
    (b) For Type II pears, U.S. Number 1 (under U.S. standards for 
summer and fall or winter pears); and
    (2) All production that due to insurable causes does not meet the 
grade requirements in subsection 9.c.(1) but could be marketed for any 
use. The amount of such production to be counted will be determined by:
    (a) Dividing the value of the pears per ton by the highest price 
election available for the insured type and;
    (b) Multiplying the result by the number of tons of such pears.
    c. The amount of size 180 and smaller pears in excess of 10 percent 
of the total production of a type will not be considered as production 
to count except under the provisions of subsection 9.c.(2) if the 
quantity of such pears is the result of an insured cause of loss. (This 
adjustment is not applicable to the Forelle, Seckel, or Winter Nelis 
varieties.)
    d. Appraised production will include:
    (1) Mature and potential production on unharvested acreage;
    (2) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good pear farming practices; and
    (3) Not less than the guarantee for any pears which are abandoned, 
damaged solely by an uninsured cause, or destroyed by you without our 
consent.
    e. Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (1) Further damaged by an insured cause and is reappraised by us; or
    (2) Harvested.
    f. If you are going to claim an indemnity on any unit, all 
production must be inspected by us prior to the beginning of harvest and 
we must give you written consent prior to disposal or sale of any 
damaged fruit. If you fail to meet the requirements of this subsection 
all such production may be considered undamaged and included as 
production to count.

                 10. Cancellation and Termination Dates

    The cancellation and termination dates are November 20.

                          11. Contract Changes

    The date by which contract changes will be available in your service 
office is August 31 preceding the cancellati

                          12. Meaning of Terms

    a. Crop year means the period beginning with the date insurance 
attaches and extending through normal harvest time and is designated by 
the calendar year in which the pears are normally harvested.
    b. Excess wind means a natural movement of air of sufficient 
velocity to separate pears from the trees.
    c. Freeze means the condition that exists when air temperature over 
a widespread area fall to or below 32 degrees fahrenheit, and cause 
damage to plant tissue or fruit.
    d. Frost means a deposit or covering of minute ice crystals formed 
from frozen water vapor which causes damage to plant tissue or fruit.
    e. Fruit-set failure means failure of the pear trees to develop 
blossoms or set fruit due only to adverse weather conditions.
    f. Harvest means the picking of pears from the trees or removing the 
fruit from the ground.
    g. Non-contiguous Land means any land owned by you or rented by you 
for cash, a fixed commodity payment or any consideration other than a 
share in the insured crop, whose boundaries do not touch at any point. 
Land which is separated by a public or private right-of-way, waterway or 
irrigation canal will be considered to be touching (contiguous).
    h. Ton means 2,000 pounds. All production in varying container sizes 
will be converted to tons.

[54 FR 7527, Feb. 22, 1989]



Sec. 401.142  Raisin endorsement.

    The provisions of the Raisin Crop Insurance Endorsement for the 1990 
through 1996 crop years are as follows:

                   Federal Crop Insurance Corporation

                           Raisin Endorsement

                   1. Crop, Tonnage, and Share Insured

    a. The crop insured will be raisins of grape varieties designated as 
insurable by the actuarial table.
    b. The tonnage insured will be the tonnage in which you have a share 
(as reported by you or as determined by us, whichever we elect).
    c. In lieu of subsection 2.c.(2) of the general crop insurance 
policy, for the purpose of determining the amount of indemnity, your 
share will not exceed your share at the time the raisins are removed 
from the vineyard.
    d. In addition to the raisins not insurable under section 2 of the 
general crop insurance policy, we do not insure any raisins:
    (1) Laid on trays after September 8 in vineyards with north-south 
rows in Merced or Stanislaus Counties or after September 20 in all other 
instances;
    (2) Made from table grape strippings; or
    (3) Made from vines that have had manual, mechanical, or chemical 
treatment to produce table grape sizing.

[[Page 160]]

                            2. Causes of Loss

    The insurance provided is against the unavoidable loss of production 
resulting from rain, occurring within the insurance period, while 
raisins are in the vineyard, on trays or in rolls, for drying unless 
limited by the actuarial table.

      3. Report of Tray Count, Tonnage, and Share (Tonnage Report)

    By execution of the application for insurance you authorize us to 
determine or verify the insured tonnage from records maintained by the 
raisin packer, raisin reconditioner, Raisin Administrative Committee 
established under the United States Department of Agriculture, or any 
other party who may have such records.
    In lieu of section 3 of the general crop insurance policy, you must 
report on our form:
    a. For all raisins which are not damaged, the delivered tons of 
insured raisins produced in the county in which you have a share and 
your share as soon as delivery records are available, but in any event 
no later than March 1 following the crop year;
    b. For insured raisins which are damaged:
    (1) The variety;
    (2) The location of the vineyard;
    (3) The number of trays upon which the raisins have been placed for 
drying; and
    (4) Your share.
    c. You must report separately any tonnage that is not insurable. You 
must report if you do not have a share in any insurable tonnage in the 
county. This report must be submitted annually on or before March 1 of 
the year following the crop year. Indemnities may be determined on the 
basis of information you have submitted on this report. If you do not 
submit this report by the reporting date, we may determine by unit the 
insured tonnage and share or we may deny liability on any unit. Any 
report submitted by you may be revised only upon our approval. Errors in 
reporting units may be corrected by us to conform to applicable 
guidelines at the time of adjusting a loss.

            4. Amounts of Insurance and Production Reporting

    a. The amount of insurance for the unit will be determined by 
multiplying the insured tonnage times the amount of insurance per ton, 
times your share. Insured tonnage is determined for raisins:
    (1) Not damaged by rain, by the raisins delivered (delivered tons); 
or
    (2) Damaged by rain, by adding raisins delivered (delivered tons), 
if any, to any verifiable loss of production due to rain damage in the 
vineyard. Tray weights will only be used to establish raisin tonnage on 
trays or in rolls not removed from the vineyard.
    b. Subsection 4.d. of the general crop insurance policy is not 
applicable to this crop.

                            5. Annual Premium

    The annual premium amount is computed by multiplying the amount of 
insurance per ton times the premium rate, times the insured tonnage, 
times your share on the date insurance attaches, times any applicable 
premium adjustment percentage shown on the actuarial table.

                           6. Insurance Period

    In lieu of section 7 of the general crop insurance policy, insurance 
attaches at the time the raisins are placed on trays for drying and ends 
the earlier of:
    a. October 20;
    b. The date the raisins are boxed; or
    c. The date the raisins are removed from the vineyard.

                            7. Unit Division

    a. Raisin acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided into 
units by grape variety.
    b. Raisin acreage that would otherwise be one unit as defined in 
section 17 of the general crop insurance policy and subsection 7.a. 
above may be divided into more than one unit if, for each proposed 
(optional) unit:
    (1) You maintain written, verifiable records of raisin production 
for at least the previous crop year; and
    (2) The acreage of insured raisins is located on noncontiguous land.
    If you have a loss on any unit, production records for all harvested 
units must be maintained and be made available to us at our request. 
Production that is commingled between optional units will cause those 
units to be combined.

                       8. Notice of Damage or Loss

    In lieu of section 8 of the general crop insurance policy, if you 
are going to claim an indemnity on any unit, we must be given notice 
within 72 hours of the time the rain fell on the raisins. We may reject 
any claim for indemnity if such damage is not reported within 72 hours.

                         9. Claim for Indemnity

    a. In lieu of subsection 9.a. of the general crop insurance policy 
any claim for indemnity must be submitted to us on our form not later 
than March 31 after the calendar date for the end of the insurance 
period.
    b. In addition to the requirements in subsection 9.b. of the general 
crop insurance policy, we will not pay any indemnity unless we are 
allowed in writing to examine and obtain any records pertaining to the 
production and marketing of any raisins in which you have a share from 
the raisin packer, raisin reconditioner, Raisin Administrative Committee 
established under order of the United

[[Page 161]]

States Department of Agriculture, or any other party who may have such 
records.
    c. The indemnity will be determined on each unit by:
    (1) multiplying the insured tonnage of raisins by the amount of 
insurance per ton;
    (2) subtracting therefrom the total value of all insured damaged and 
undamaged raisins; and
    (3) multiplying this result by your share.
    d. Undamaged raisins or raisins damaged solely by uninsured causes 
will be valued at the insurance price (see subsection 12.c.).
    e. Raisins damaged partially by rain and partially by uninsured 
causes will be valued at the highest prices obtainable, adjusted for any 
reduction in value due to uninsured causes.
    f. Raisins damaged by rain, but which are reconditioned and meet the 
Raisin Administrative Committee (RAC) standards for raisins, will be 
valued at the insurance price. An allowance for reconditioning will be 
deducted from the value only if you obtained our written consent prior 
to reconditioning. The allowance for reconditioning will be made only 
when the raisins have been inspected by the USDA and, due to rain damage 
while on the tray are found to contain mold, embedded sand, excessive 
moisture, or micro-organisms in excess of RAC tolerances.
    The reconditioning allowance will be made based on the actual 
(unadjusted) weight of raisins to be reconditioned. Additionally, when 
raisins contain excessive moisture due to rain, the reconditioning 
allowances will be made only when the moisture is determined to be in 
excess of 18.0 percent and the raisins are wash-and-dry reconditioned. 
The maximum allowance for reconditioning is contained in the actuarial 
table, but the total reconditioning allowance will not exceed the value 
of the raisins after reconditioning. We may require you to recondition a 
representative sample of not more than 10 tons of raisins to determine 
if they meet RAC standards for marketable raisins. On the basis of 
determinations made after such sampling, we may require you to 
recondition all raisins, or we may value such raisins at the insurance 
price. If the representative sample does not meet RAC standards for 
marketable raisins, the cost of reconditioning the sample will be 
deducted from the total value of the raisins for the unit.
    g. The value to count for any raisins produced on the unit and not 
removed from the vineyard will be the larger of the appraised salvage 
value or $35.00 per ton. You must box and deliver any raisins that can 
be removed from the vineyard.
    h. We may acquire all the rights and title to your share of any 
raisins damaged by rain. In such event, the raisins will be valued at 
``zero'' in determining the amount of loss and we will have the right of 
ingress or egress to the extent necessary to take possession of, care 
for, and remove such raisins.
    i. Raisins destroyed without USDA inspection or put to another use 
without our consent will be valued at the amount of insurance.

                 10. Cancellation and Termination Dates

    The cancellation and termination dates are July 31.

                          11. Contract Changes

    The date by which contract changes will be available in your service 
office is April 30 preceding the cancellation date.

                          12. Meaning of Terms

    a. Crop year means the calendar year in which the raisins are placed 
on trays for drying.
    b. Delivered ton means a ton of raisins or raisin material delivered 
to a packer, processor, buyer or a reconditioner, before any adjustment 
for B and better maturity standards, and after adjustment for moisture 
over 16 percent and adjusted for substandard raisins over 5 percent. 
Raisin tonnage will be reduced 0.12 percent for each 0.10 percent 
moisture in excess of 16.0 percent.
    c. Insurance price means the value established by us for raisin 
tonnage for the purpose of determining indemnities. This value is shown 
in the actuarial table.
    d. Noncontiguous land means land which is not touching at any point. 
Land which is separated by only a public or private right-of-way will be 
considered to be touching (contiguous).
    e. Raisins mean specific varieties of grapes, designated insurable 
by the actuarial table, which have been laid on trays or are in rolls in 
the vineyard to dry.
    f. Raisin tonnage report means a form prescribed by us for annually 
reporting all the tonnage of raisins in the county in which you have a 
share.
    g. Substandard means a quality of raisins that fail to meet the 
requirements of U.S. Grade C except that layer or cluster raisins with 
seeds or Zante Currant raisins will be considered substandard if they 
fail to meet the requirements of U.S. Grade B.
    h. Table grapes mean grapes which are grown for commercial sales as 
fresh grapes on acreage where the cultural practices to produce fresh 
marketable grapes were carried out.
    i. Ton means 2,000 pounds. Raisin tonnage may be computed on the 
basis of one ton of raisins insured for every four and one-half tons of 
fresh grapes when first placed on trays for drying.
    j. USDA inspection means the actual determination by a USDA 
inspector of all defects.

[[Page 162]]

Limited inspections or inspections on submitted samples are not 
considered ``USDA inspections.''

[54 FR 43275, Oct. 24, 1989, as amended at 62 FR 12070, Mar. 14, 1997]



Sec. 401.143  Florida citrus endorsement.

    The provisions of the Florida Citrus Endorsement for the 1990 
through 1997 crop years are as follows:

     Federal Crop Insurance Corporation--Florida Citrus Endorsement

                             1. Insured Crop

    a. The crop insured will be any of the following citrus types you 
elect:
  Type I Early and mid-season oranges;
  Type II Late oranges;
  Type III Grapefruit for which freeze damage will be adjusted on a 
          juice basis for white grapefruit and on a fresh-fruit basis 
          for pink and red grapefruit;
  Type IV Navel oranges, tangelos and tangerines;
  Type V Murcott Honey Oranges (also known as Honey Tangerines) and 
          Temple Oranges;
  Type VI Lemons; or
  Type VII Grapefruit for which freeze damage will be adjusted on a 
          fresh basis for all grapefruit.
    If you insure grapefruit, you must insure all of your grapefruit 
under a single type designation (type III or type VII). ``Meyer Lemons'' 
and oranges commonly know as ``Sour Oranges'' or ``Clementines'' will 
not be included in any of the insurable types of citrus.
    b. In addition to the citrus not insurable in section 2 of the 
general crop insurance policy, we do not insure any citrus;
    (1) Which cannot be expected to mature each crop year within the 
normal maturity period for the type;
    (2) Produced by trees that have not reached the tenth growing season 
after being set out, unless otherwise provided in the actuarial table or 
we agree to insure such citrus in writing;
    (3) Of the Robinson tangerine variety, for any crop year in which 
you have elected to exclude such tangerines from insurance (you must 
elect this exclusion prior to April 30 preceding the crop year for which 
the exclusion is to become effective except that for the first crop 
year, you must elect this exclusion by the later of April 30 or the time 
you submit the application for insurance);
    c. Upon our approval, you may elect to insure or exclude from 
insurance for any crop year any insurable acreage in any unit which has 
a potential of less than 100 boxes per acre. If you:
    (1) Elect to insure such acreage, we will increase the potential to 
100 boxes per acre when determining the amount of loss;
    (2) Elect to exclude such acreage, we will disregard the acreage for 
all purposes related to this contract; or
    (3) Do not elect to insure or exclude such acreage:
    (a) We will disregard the acreage if the production is less than 100 
boxes per acre; or
    (b) If the production from such acreage is 100 or more boxes per 
acre, we will determine the percent of damage on all of the insurable 
acreage for the unit, but will not allow the percent of damage for the 
unit to be increased by including such acreage.
    d. We may exclude from insurance, or limit the amount of insurance 
on, any acreage which was not insured the previous crop year.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
  (1) Fire;
  (2) Freeze;
  (3) Hail;
  (4) Hurricane; or
  (5) Tornado; unless those causes are excepted, excluded, or limited by 
          the actuarial table or section 9 of the general crop insurance 
          policy.
    b. In addition to the causes of loss not insured against in section 
1 of the general crop insurance policy, we will not insure against any 
loss of production due to:
    (1) Any damage to the blossoms or trees;
    (2) Fire, if weeds and other forms of undergrowth have not been 
controlled or tree pruning debris has not been removed from the grove;
    (3) Inability to market the fruit as a direct result of quarantine, 
boycott, or refusal of any entity to accept production unless production 
has actual physical damage due to a cause specified in subsection 2.a.

    3. Report of Acreage, Share, Type, and Practice (Acreage Report)

    a. In addition to the information required in section 3 of the 
general crop insurance policy you must;
    (1) Report the crop type; and
    (2) Designate separately any acreage that is excluded under section 
1 of this endorsement.
    b. The date by which you must annually submit the acreage report is 
April 30 except for the first crop year, the report must be submitted by 
the later of April 30 or the time you submit the application for 
insurance.

[[Page 163]]

                         4. Production Reporting

    Production potential for each unit is determined during loss 
adjustment. Therefore, subsection 4.d. of the general crop insurance 
policy is not applicable to this endorsement. Production history is not 
required.

                            5. Annual Premium

    a. The annual premium amount is computed by multiplying the amount 
of insurance times the premium rate, times the insured acreage, times 
your share at the time insurance attaches.
    b. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1988 crop year 
under the terms of the experience table contained in the citrus policy 
for the 1989 crop year, you will continue to receive the benefit of the 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1989 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                           6. Insurance Period

    a. The calendar date on which insurance attaches is May 1 for each 
crop year, except that for the first crop year, if the application is 
accepted by us after April 20, insurance will attach on the tenth day 
after the application is received in the service office.
    b. The end of the insurance period is the date of the calendar year 
following the year of normal bloom as follows:
    (1) January 31 for tangerines and navel oranges;
    (2) April 30 for lemons, tangelos, early and mid-season oranges; and
    (3) June 30 for late oranges, grapefruit, Temple and Murcott Honey 
Oranges.

                            7. Unit Division

    a. Citrus acreage that would otherwise be one unit, as defined in 
section 17 of the general crop insurance policy, may be divided by 
citrus type.
    b. Citrus acreage that would otherwise be one unit as defined in 
section 17 of the general crop insurance policy and subsection 7.a. 
above may be divided into more than one unit, if you agree to pay 
additional premium if required by the actuarial table and if, for each 
proposed unit:
    (1) You maintain written, verifiable records of acreage and 
harvested production for at least the previous crop year; and
    (2) Acreage planted to insured citrus is located in separate, 
legally identifiable sections, provided:
    (a) The boundaries of the sections are clearly identified and the 
insured acreage is easily determined; and
    (b) The trees are planted in such a manner that the planting pattern 
does not continue into the adjacent section; or
    (3) The acreage of insured citrus is located on noncontiguous land. 
If you have a loss on any unit, production records for all harvested 
units must be provided. Production that is commingled between optional 
units will cause those units to be combined.

                       8. Notice of Damage or Loss

    In addition to the notices required in the general crop insurance 
policy and in case of damage or probable loss:
    a. You must give us written notice of the date and cause of damage; 
and
    b. If an indemnity is to be claimed on any unit you must give us 
notice by the calendar date for the end of the insurance period if 
harvest will not begin by that date.

                         9. Claim for Indemnity

    a. The indemnity will be determined on each unit by:
    (1) Computing the average percent of damage to the citrus which 
(without regard to any percent of damage arrived at through prior 
inspections) will be the ratio of the number of boxes of citrus 
considered damaged from an insured cause to the potential rounded to the 
nearest tenth (.1) of a percent. Citrus will be considered undamaged 
potential if it is:
    (a) Or could be marketed as fresh fruit;
    (b) Harvested prior to an inspection by us; or
    (c) Harvested within 7 days after a freeze;
    (2) For limited and additional coverages, by multiplying the result 
in excess of 10 percent (e.g., 45%-10%=35% payable), times the amount of 
insurance for the unit (the amount of insurance for the unit is 
determined by multiplying the insured acreage on the unit times the 
applicable amount of insurance per acre); or
    (3) For catastrophic risk protection coverage, the result in excess 
of 50 percent divided by 50 percent (e.g. if the insured's average 
percent of damage is 75%; the percentage of the guarantee payable is 50 
percent, (75%-50%)50%); if the insured's average percent of 
damage is 60 percent, the percentage of the guarantee payable is 20 
percent, (60%-50%)50%) times the amount of insurance for the 
unit. The amount of insurance for the unit is determined by multiplying 
the insured acreage on the unit times the applicable amount of insurance 
per acre. For any average percentage of damage less than 50%,

[[Page 164]]

the insured is not eligible for an indemnity payment; and
    (4) Multiplying the product obtained in (2) above for limited and 
additional coverage, or the product obtained in (3) above for 
catastrophic risk protection, by your share.
    b. Pink and red grapefruit of citrus Type III and citrus of Types 
IV, V, and VII which are seriously damaged by freeze (as determined by a 
fresh-fruit cut of a representative sample of fruit in the unit, in 
accorance with the applicable provisions of the Florida Citrus Code), 
and are not or could not be marketed as fresh-fruit will be considered 
damaged to the following extent:
    (1) If 15 percent or less of the fruit in a sample shows serious 
freeze damage, the fruit will be considered undamaged; or
    (2) If 16 percent or more of the fruit in a sample shows serious 
freeze damage, the fruit will be considered 50 percent damaged, except 
that:
    (a) For tangerines of citrus Type IV, damage in excess of 50 percent 
will be the actual percent of damaged fruit; and
    (b) For other applicable varieties, if we determine that the juice 
loss in the fruit exceeds 50 percent, the amount so determined will be 
considered the percent of damage.
    c. Notwithstanding the provisions of subsection 9.b., as to any pink 
and red grapefruit of Type III and citrus of Types IV, V, and VII in any 
unit which is mechanically separated (using the specific gravity 
``floatation'' method) into undamaged and freeze-damaged fruit, the 
amount of damage will be the actual percent of freeze-damaged fruit not 
to exceed 50 percent and will not be affected by subsequent fresh-fruit 
marketing. The 50 percent limitation on freeze-damaged fruit, 
mechanically separated, will not apply to tangerines of citrus Type IV.
    d. Any citrus of Types I, II, and VI and white grapefruit of Type 
III which is damaged by freeze, but may be processed by canning or 
processing plants, will be considered as marketable for juice. The 
percent of damage will be determined by relating the juice content of 
the damaged fruit as determined by test house analysis to:
    (1) The average juice content based on acceptable records, furnished 
by you, showing the juice content of fruit produced on the unit for the 
three previous crop years; or
    (2) The following juice content, if acceptable records are not 
furnished:
  Type I--44 pounds of juice per 90 pound box
  Type II--47 pounds of juice per 90 pound box
  Type III--38 pounds of juice per 85 pound box
  Type VI--43 pounds of juice per 90 pound box
    e. Any citrus on the ground which is not picked up and marketed will 
be considered totally lost if the damage was due to an insured cause.
    f. Any citrus which is unmarketable either as fresh fruit or for 
juice because it is immature, unwholesome, decomposed, adulterated, or 
otherwise unfit for human consumption due to an insured cause will be 
considered totally lost.
    g. Pink and red grapefruit citrus of Type III and citrus Types IV, 
V, and VII which are unmarketable as fresh fruit due to serious damage 
from hail as defined in United States Standards for grades of Florida 
fruit will be considered totally lost.

                 10. Cancellation and Termination Dates

    The cancellation date is April 30 of the calendar year in which the 
crop normally blooms. The termination date is April 30 of the calendar 
year following the year of normal bloom.

                          11. Contract Changes.

    The date by which contract changes will be available in your service 
office is the April 15 immediately preceding the cancellation date.

                          12. Meaning of Terms

    a. Box means a standard field box as prescribed in the Florida 
Citrus Code.
    b. Crop year means the period beginning May 1 and extending through 
June 30 of the following year and will be designated by the calendar 
year in which the insurance period ends.
    c. Harvest means the severance of citrus fruit from the tree either 
by pulling, picking, or severing by mechanical or chemical means or 
picking up the marketable fruit from the ground.
    d. Noncontiguous land means any land owned by you and rented by you 
for cash, a fixed commodity payment or any consideration other than a 
share in the insured crop, whose boundaries do not touch at any point. 
Land which is separated by a public or private right-of-way, waterway or 
irrigation canal will be considered to be touching (contiguous).
    e. Potential means production:
    (1) Which would have been produced had damage not occurred and 
includes citrus which:
    (a) Was picked before damage occurred;
    (b) Remained on the tree after damage occurred;
    (c) Was lost from an insured cause; and
    (d) Was lost from an uninsured cause.
    (2) The potential will not include:
    (a) Citrus lost before insurance attaches for any crop year;
    (b) Citrus lost by normal dropping; or
    (c) Any tangerines which normally would not, by the end of the 
insurance period for tangerines, meet the 210 pack size (2 and \4/16\

[[Page 165]]

inch minimum diameter) under United States Standards.

[54 FR 14203, Apr. 10, 1989, as amended at 60 FR 29750, June 6, 1995; 61 
FR 69001, Dec. 31, 1996]



Sec. 401.146  Fresh plum endorsement.

    The provisions of the Fresh Plum Crop Insurance Endorsement for the 
1990 through the 1997 crop years are as follows:

        Federal Crop Insurance Corporation Fresh Plum Endorsement

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Earthquake;
    (3) Fire;
    (4) Wildlife;
    (5) Volcanic eruption;
    (6) An insufficient number of chilling hours to effectively break 
dormancy; or
    (7) Failure of the irrigation water supply due to an unavoidable 
cause occurring after insurance attaches;
unless these causes of loss are excepted, excluded, or limited by the 
actuarial table or section 9 of the general crop insurance policy.
    b. In addition to the causes of loss not insured under section 1b of 
the general crop insurance policy, we will not insure against any loss 
of production due to:
    (1) Fire, where weeds and other forms of undergrowth have not been 
controlled or tree pruning debris has not been removed from the orchard;
    (2) Disease or insect infestation unless specifically caused by 
adverse weather;
    (3) Fruit cullage caused by: green; overripe; undersize condition; 
and mechanical damage which causes rejection of the crop at the packing 
house; or
    (4) Inability to market as a direct result of quarantine, boycott, 
or refusal of any entity to accept or harvest production unless 
production has actual physical damage due to a cause specified in 
subsection 1.a.

                       2. Insured Crop and Acreage

    a. The crop insured will be plums grown for fresh market fruit or 
processing for which we provide a guarantee and premium rate:
    b. In lieu of the provisions of subsection 2e of general crop 
insurance policy, we do not insure any plum acreage:
    (1) Which is not irrigated;
    (2) On which the trees have not reached the fifth growing season 
after being set out;
    (3) Which has not produced at least 200 lugs fresh market production 
in the preceding crop year unless the acreage is inspected by us and 
approved for coverage;
    (4) For which production records acceptable to us for at least the 
previous crop year are not provided;
    (5) Which we consider not acceptable;
    (6) Which is interplanted with another crop, unless we inspect such 
acreage and give our approval in writing;
    (7) On which is grown a type or variety not established as adapted 
to the area; excluded by the actuarial table; or not regulated for plums 
by the California Tree Fruit agreement, a related crop advisory board, 
or the State;
    (8) From which the fruit is harvested directly by the public; or
    (9) If the orchard practices carried out are not in accordance with 
the orchard practices for which the premium rates have been established.

     3. Report of Acreage, Share, Type and Practice (Acreage Report)

    The acreage report must be filed on or before January 31. You must 
report the crop type in addition to the information required by section 
3 of the general crop insurance policy for the acreage report.

    4. Production Reporting, Coverage Level, Practices for Computing 
                 Indemnities, and Production Guarantees

    a. In addition to the production report required in section 4 of the 
general crop insurance policy, you must report:
    (1) The number of bearing trees;
    (2) The number of trees planted per acre;
    (3) Tree damage or use of production practices which has or may 
reduce the yield from previous levels; and
    (4) If the number of bearing trees (fifth growing season and older) 
is reduced more than 10% from the preceding calendar year (In such 
event, the production guarantee will be reduced 1 percent, through 
adjustment to your average yield for each 1 percent reduction in excess 
of 10 percent).
    b. You may select only one coverage level and price election for 
plums for the crop year.

                            5. Annual Premium

    The annual premium is computed by multiplying the production 
guarantee times the price election, times the premium rate, times the 
insured acreage, times your share at the time insurance attaches.

                           6. Insurance Period

    In lieu of the provisions in section 7 of the general crop insurance 
policy, coverage begins for each crop year on February 1, following our 
inspection and determination of

[[Page 166]]

acceptability. Insurance ends on each area at least one acre in size at 
the earliest of:
    a. Total destruction of the insured crop;
    b. Harvest;
    c. The date harvest would normally start;
    d. Final adjustment of a loss; or
    e. September 30 of the crop year.

                                7. Units

    Plum acreage grown on non-contiguous land that would otherwise be 
one unit, as defined in section 17 of the general crop insurance policy, 
may be divided into more than one unit if, for each proposed unit, you 
maintain written, verifiable records of acreage and harvested production 
for at least the previous crop year.
    If you have a loss on any unit, production records for all harvested 
units must be maintained and be made available to us at our request. 
Production that is commingled between optional units will cause those 
units to be combined.

                       8. Notice of Damage or Loss

    In lieu of the notices required in section 8.a.(2), (3), and (4) of 
the general crop insurance policy, in case of damage or probable loss 
you must give us written notice within 72 hours of the date of damage 
and indicate the causes of damage and whether a claim for indemnity is 
probable. Notwithstanding the previous sentence, if damage occurs within 
72 hours of or during harvest, immediate notice stating the cause of 
damage and probability of a claim must be given to us. If notice is 
given under the first sentence of this paragraph, we must be notified of 
the time of harvest at least 72 hours before harvest begins.

                         9. Claim for Indemnity

    In addition to section 9 of the general crop insurance policy:
    a. The indemnity will be determined separately for each unit of 
plums by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of plums to be 
counted;
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by the insured share.
    b. The total production (standard lug equivalent) (see section 
12.d.) to be counted for a unit will include all production harvested, 
and all appraised production. Such production must meet U.S. 1 
standards as modified (before the date insurance attaches) by the latest 
California Tree Fruit Agreement Publication for fresh plums.
    (1) Mature production of fresh plums damaged by insurable causes 
within the insurance period that could be marketed for any use other 
than fresh packed plums, will be determined by multiplying the number of 
tons that could be marketed by the value per ton of fruit or $50.00 per 
ton, whichever is greater, and dividing that result by the highest price 
election available for the type. This result will be the number of 
standard lug equivalents to be considered as production to count.
    (2) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes;
    (b) Not less than the applicable guarantee for any acreage which is 
abandoned, destroyed by you without our prior written consent; and
    (c) Any appraised production on unharvested acreage.
    (3) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Not harvested before the harvest of plums becomes general in the 
county and is reappraised by us;
    (b) Further damaged by an insured cause and is reappraised by us; or
    (c) Harvested.
    (4) The amount of production of any unharvested plums may be 
determined on the basis of orchard appraisals conducted after the end of 
the insurance period or discontinuance of harvest. We may appraise and 
consider as production to count, any insured fruit remaining on acreage 
not clean harvested.
    (5) We may delay final appraisal until the extent of damage can be 
determined.
    c. In the absence of acceptable records to determine the disposition 
of harvested plums, we may elect to determine such disposition and the 
amount of such production to be counted for the unit.
    d. You must authorize us in writing to examine and obtain any 
records pertaining to production and marketing of any plums, whether 
insured or uninsured, whether this crop year or prior crop years, from 
the broker, shipper, advisory board, marketing order or any other source 
we deem necessary.

                 10. Cancellation and Termination Dates

    The cancellation and termination dates are January 31.

                          11. Contract Changes

    The date by which contract changes will be available in your service 
office is October 31 preceding the cancellation date. Acceptance of any 
change will be conclusively presumed in the absence of notice from you 
to cancel the contract.

                          12. Meaning of Terms

    For the purpose of Plum crop insurance:

[[Page 167]]

    a. Appraisal means an estimate of the potential production 
determined by our representative using our prescribed procedures.
    b. Crop Year means the period beginning with the date insurance 
attaches and extending through the normal harvest time, and will be 
designated by the calendar year in which the insured plums are normally 
harvested.
    c. Harvest means the picking of mature plums from the trees by hand 
or machine.
    d. Lug means a packed container of fresh plums weighing 28 pounds. 
All fresh production to count of varying lug sizes will be converted to 
standard lug equivalents on the basis of 28 pounds of packed plums.

[55 FR 4395, Feb. 8, 1990, as amended at 62 FR 33735, June 23, 1997] s



PART 402--CATASTROPHIC RISK PROTECTION ENDORSEMENT; REGULATIONS FOR THE 1999 AND SUBSEQUENT REINSURANCE YEARS--Table of Contents




Sec.
402.1  General statement.
402.2  Applicability.
402.3  OMB control numbers.
402.4  Catastrophic Risk Protection Endorsement Provisions.

    Authority: 7 U.S.C. 1506(l) and 1506(p).

    Source: 61 FR 42985, Aug. 20, 1996, unless otherwise noted.



Sec. 402.1  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 catastrophic risk protection plan of 
insurance that provides a basic level of insurance coverage to protect 
producers in the event of a catastrophic crop loss due to loss of yield 
or prevented planting, if provided by the Corporation, provided the crop 
loss or prevented planting is due to an insured cause of loss specified 
in the crop insurance policy. This Catastrophic Risk Protection 
Endorsement is a continuous endorsement that is effective in conjunction 
with a crop insurance policy for the insured crop. Catastrophic risk 
protection coverage will be offered through approved insurance providers 
if there are a sufficient number available to service the area. If there 
are an insufficient number available, as determined by the Secretary, 
local offices of the Farm Service Agency will provide catastrophic risk 
protection coverage.



Sec. 402.2  Applicability.

    This Catastrophic Risk Protection Endorsement is applicable to each 
crop for which catastrophic risk protection coverage is available and 
for which the producer elects such coverage.



Sec. 402.3  OMB control numbers.

    The information collection activity associated with this rule has 
been approved by the Office of Management and Budget (OMB) pursuant to 
the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35) under OMB 
control number 0563-0003.



Sec. 402.4  Catastrophic Risk Protection Endorsement Provisions.

    The Catastrophic Risk Protection Endorsement Provisions for the 1999 
and succeeding reinsurance years are as follows:

                        Department of Agriculture

Federal Crop Insurance Corporation

                Catastrophic Risk Protection Endorsement

(This is a continuous endorsement)

    If a conflict exists between this Endorsement and any of the 
policies specified in section 2 or the Special Provisions for the 
insured crop, this endorsement will control.

                          Terms and Conditions

                             1. Definitions

    Additional coverage. Plans of crop insurance providing a level of 
coverage equal to or greater than sixty-five percent (65%) of your 
approved yield indemnified at one hundred percent (100%) of the expected 
market price, or comparable coverage as established by FCIC.
    Administrative fee. An amount the producer must pay for catastrophic 
coverage each crop year on a per crop and county basis as specified in 
section 6.
    Approved insurance provider. A private insurance company, including 
its agents, that has been approved and reinsured by FCIC to provide 
insurance coverage to producers participating in the Federal Crop 
Insurance program.
    Approved yield. The amount of production per acre computed in 
accordance with FCIC's Actual Production History Program (7 CFR part 
400, subpart G) or for crops not included under 7 CFR part 400, subpart 
G, the yield

[[Page 168]]

used to determine the guarantee in accordance with the crop provisions 
or the Special Provisions.
    Catastrophic risk protection. The minimum level of coverage offered 
by FCIC which meets the requirements for a person to qualify for certain 
other USDA program benefits (see sections 4 and 12).
    County. The political subdivision of a state listed in the actuarial 
table and designated on your accepted application, including land in an 
adjoining county, provided such land is part of a field that extends 
into the adjoining county and the county boundary is not readily 
discernable. For peanuts and tobacco, the county will also include any 
land identified by a FSA farm serial number for the county but 
physically located in another county.
    Crop of economic significance. A crop that has either contributed in 
the previous crop year, or is expected to contribute in the current crop 
year, ten percent (10%) or more of the total expected value of your 
share of all crops grown in the county. However, a crop will not be 
considered a crop of economic significance if the expected liability 
under the Catastrophic Risk Protection Endorsement is equal to or less 
than the administrative fee required for the crop.
    Expected market price. (price election) The price per unit of 
production (or other basis as determined by FCIC) anticipated during the 
period the insured crop normally is marketed by producers. This price 
will be set by FCIC before the sales closing date for the crop. The 
expected market price may be less than the actual price paid by buyers 
if such price typically includes remuneration for significant amounts of 
post-production expenses such as conditioning, culling, sorting, 
packing, etc.
    FCIC. The Federal Crop Insurance Corporation, a wholly owned 
Government Corporation within USDA.
    FSA. The Farm Service Agency, an agency of the United States 
Department of Agriculture or any successor agency.
    Insurance is available. When crop information is contained in the 
county actuarial documents for a particular crop.
    Limited coverage. Plans of insurance offering coverage that is equal 
to or greater than fifty percent (50%) of your approved yield 
indemnified at one hundred percent (100%) of the expected market price, 
or a comparable coverage, but less than sixty-five percent (65%) of your 
approved yield indemnified at one hundred percent (100%) of the expected 
market price, or a comparable coverage.
    Limited resource farmer. A producer or operator of a farm, with an 
annual gross income of $20,000 or less derived from all sources of 
revenue, including income from spouse's or other members of the 
household, for each of the prior two years. Notwithstanding the previous 
sentence, a producer on a farm or farms of less than 25 acres aggregated 
for all crops, where a majority of the producer's gross income is 
derived from such farm or farms, but the producer's gross income from 
farming operations does not exceed $20,000, will be considered a limited 
resource farmer.
    Linkage requirement. The legal requirement that a producer must 
obtain at least catastrophic risk protection coverage for any crop of 
economic significance as a condition of receiving benefits for such crop 
from certain other USDA programs in accordance with section 12(e), 
unless the producer executes a waiver of any eligibility for emergency 
crop loss assistance in connection with the crop.
    Secretary. The Secretary of the United States Department of 
Agriculture.
    USDA. The United States Department of Agriculture.
    Zero acreage report. An acreage report filed by you that certifies 
you do not have a share in the crop for that crop year.

      2. Eligibility, Life of Policy, Cancellation, and Termination

    (a) You must have one of the following policies in force to elect 
this Endorsement:
    (1) The General Crop Insurance Policy (7 CFR 401.8) and crop 
endorsement;
    (2) The Common Crop Insurance Policy (7 CFR 457.8) and crop 
provisions;
    (3) The Group Risk Plan Policy, if available for catastrophic risk 
protection; or
    (4) A specific named crop insurance policy.
    (b) You must have made application for catastrophic risk protection 
on or before the sales closing date for the crop in the county.
    (c) You must be a ``person'' as defined in the crop policy to be 
eligible for catastrophic risk protection coverage.

                            3. Unit Division

    (a) This section is in lieu of the unit provisions specified in the 
applicable crop policy.
    (b) For catastrophic risk protection coverage, a unit will be all 
insurable acreage of the insured crop in the county on the date coverage 
begins for the crop year:
    (1) In which you have one hundred percent (100%) 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 you own, you rent land from five 
landlords, three on a crop share basis and two on a cash basis, you 
would be entitled to four units; one for each crop share lease and one 
that combines the two cash leases and the land you own.)

    (c) Further division of the units described in paragraph (b) above 
is not allowed under this Endorsement.

[[Page 169]]

  4. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    (a) Notwithstanding any provision contained in any other policy 
document, for the 1995 through 1998 crop years, catastrophic coverage 
will offer protection equal to fifty percent (50%) of your approved 
yield indemnified at sixty percent (60%) of the expected market price, 
or a comparable coverage as established by FCIC.
    (b) Notwithstanding any provision contained in any other policy 
document, for the 1999 and subsequent crop years, catastrophic coverage 
will offer protection equal to fifty percent (50%) of your approved 
yield indemnified at fifty-five percent (55%) of the expected market 
price, or a comparable coverage as established by FCIC.
    (c) If the crop policy denominates coverage in dollars per acre or 
other measure, or any other alternative method of coverage, such 
coverage will be converted to the amount of coverage that would be 
payable at fifty percent (50%) of your approved yield indemnified at 
sixty percent (60%) of the expected market price for the 1995 through 
1998 crop years and fifty percent (50%) of your approved yield 
indemnified at fifty-five percent (55%) of the expected market price for 
the 1999 and subsequent crop years.
    (d) You may elect catastrophic coverage for any crop insured or 
reinsured by FCIC on either an individual yield and loss basis or an 
area yield and loss basis, if both options are offered as set out in the 
Actuarial Table or the Special Provisions.
    (e) To be eligible for an indemnity under this endorsement you must 
have suffered at least a 50 percent loss in yield.

                          5. Report of Acreage

    (a) The report of crop acreage that you file in accordance with the 
crop policy must be signed on or before the acreage reporting date. For 
catastrophic risk protection, unless the other person with an insurable 
interest in the crop objects in writing prior to the acreage reporting 
date and provides a signed acreage report on their own behalf, the 
operator may sign the acreage report for all other persons with an 
insurable interest in the crop without a power of attorney. All persons 
with an insurable interest in the crop, and for whom the operator 
purports to sign and represent, are bound by the information contained 
in that acreage report.
    (b) For the purpose of determining the amount of indemnity only, 
your share will not exceed your insurable interest at the earlier of the 
time of loss or the beginning of harvest. Unless the accepted 
application clearly indicates that insurance is requested for a 
partnership or joint venture, insurance will only cover the crop share 
of the person completing the application. The share will not extend to 
any other person having an interest in the crop except as may otherwise 
be specifically allowed in this endorsement. Any acreage or interest 
reported by or for your spouse, child or any member of your household 
may be considered your share. A lease containing provisions for both a 
minimum payment (such as a specified amount of cash, bushels, pounds, 
etc.) and a crop share will be considered a crop share lease. A lease 
containing provisions for either a minimum payment (such as a specified 
amount of cash, bushels, pounds, etc.,) or a crop share will be 
considered a cash lease. Land rented for cash, a fixed commodity 
payment, or any consideration other than a share in the insured crop on 
such land will be considered as owned by the lessee.

                6. Annual Premium and Administrative Fees

    (a) Notwithstanding any provision contained in any other policy 
document, you will not be responsible to pay a premium, nor will the 
policy be terminated because the premium has not been paid. FCIC will 
pay a premium subsidy equal to the premium established for the coverage 
provided under this endorsement.
    (b) In return for catastrophic risk protection coverage, you must 
pay an administrative fee to the insurance provider within 30 days after 
you have been billed (You will be billed by the billing date stated in 
the Special Provisions);
    (1) The administrative fee owed for each crop in the county is equal 
to $10 plus the greater of either $50 or 10 percent of the premium 
subsidy provided for the catastrophic risk protection coverage.
    (2) Payment of an administrative fee will not be required if you 
file a bona fide zero acreage report on or before the acreage reporting 
date for the crop (if you falsely file a zero acreage report you may be 
subject to criminal and administrative sanctions).
    (c) The administrative fee provisions of paragraph (b) of this 
section do not apply if you meet the definition of a limited resource 
farmer (see section 1). If you qualify as a limited resource farmer and 
desire to be exempted from paying the administrative fee you must sign 
the waiver at the time of application (on or before the sales closing 
date.)
    (d) When a crop policy has provisions to allow you the option to 
separately insure individual crop types or varieties, you must pay a 
separate administrative fee in accordance with paragraph (b) of this 
section for each type or variety you elect to separately insure.
    (e) If the administrative fee is not paid when due, you, and all 
persons with an insurable interest in the crop under the same contract, 
may be ineligible for certain other USDA program benefits as set out in 
section 12, and all such benefits already received for the crop year 
must be refunded.

[[Page 170]]

                             7. Insured Crop

    The crop insured is specified in the applicable crop policy, 
however:
    (a) Notwithstanding any other policy provision requiring the same 
insurance coverage on all insurable acreage of the crop in the county, 
if you purchase limited or additional coverage for a crop, you may 
separately insure acreage under catastrophic coverage that has been 
designated as ``high risk'' land by FCIC, provided that you execute a 
High Risk Land Exclusion Option and obtain a catastrophic risk 
protection policy with the same approved insurance provider, if 
available, on or before the applicable sales closing date. If 
catastrophic coverage is not available from the same insurance provider, 
you may obtain the catastrophic risk protection policy for the high risk 
land from another approved insurance provider or FSA, if available. You 
will be required to pay a separate administrative fee for both the 
limited or additional coverage policy and the catastrophic coverage 
policy unless the maximum administrative fee would be exceeded.
    (b) A tobacco producer may insure one hundred percent (100%) of the 
tobacco crop that is identified by a tobacco marketing card issued by 
FSA for a specific producer and Farm Serial Number under one CAT policy, 
provided the producer and other persons each have a share in the crop, 
all the shareholders agree in writing to such arrangement, and none of 
the persons hold any other interest in another tobacco crop for which 
they are required to obtain at least catastrophic coverage. If the 
tobacco crop is insured under one policy:
    (1) The linkage requirements will be satisfied for each shareholder 
of the crop; and
    (2) The producer insuring the crop will:
    (i) Make application for insurance and provide the name and social 
security number, or employer identification number, of each person with 
a share in the tobacco crop;
    (ii) File the acreage report showing a one-hundred percent (100%) 
share in the crop (all insurable acreage covered by such marketing card 
will be considered as one unit);
    (iii) Be responsible to pay the one administrative fee for all the 
producers within the county;
    (iv) Fulfill all requirements under the crop insurance contract; and
    (v) Receive any indemnity payment under his or her social security 
number or employer identification number and distribute the indemnity 
payments to the other persons sharing in the crop.
    (c) A landowner will be allowed to obtain catastrophic coverage to 
satisfy linkage requirements for all other landowners who hold an 
undivided interest in the insurable acreage, provided:
    (1) All the landowners must agree in writing to such arrangement and 
have their social security number or employer identification number 
listed on the application, without regard to the actual amount of their 
interest in the insured acreage;
    (2) All landowners must have an undivided interest in the insurable 
acreage;
    (3) None of the landowners may hold any share in other acreage for 
which they are required to obtain at least catastrophic coverage;
    (4) The total cumulative liability under the Catastrophic Risk 
Protection Endorsement for all landowners must be $2,500 or less;
    (5) The landowner insuring the crop will:
    (i) Make application for insurance and provide the name and social 
security number or employer identification number of each person with an 
undivided interest in the insurable acreage;
    (ii) Be responsible to pay the one administrative fee for all the 
producers within the county;
    (iii) Fulfill all requirements under the insurance contract; and
    (iv) Receive any indemnity payment under the landowner's social 
security number, or when applicable, employer identification number, and 
distribute the indemnity payments to the other persons sharing in the 
crop.

                          8. Replanting Payment

    Notwithstanding any provision contained in any other crop insurance 
document, no replant payment will be paid whether or not replanting of 
the crop is required under the policy.

                         9. Claim for Indemnity

    (a) If two or more insured crop types, varieties, or classes are 
insured within the same unit, and multiple price elections are 
applicable, the dollar amount of insurance and the dollar amount of 
production to be counted will be determined separately for each type, 
variety, class, etc., that have separate price elections and then 
totaled to determine the total liability or dollar amount of production 
to be counted for the unit.
    (b) If you are eligible to receive an indemnity under this 
endorsement and benefits compensating you for the same loss under any 
other USDA program, you must elect the program from which you wish to 
receive benefits. Only one payment or program benefit is allowed. 
However, if other USDA program benefits are not available until after 
you filed a claim for indemnity, you may refund the total amount of the 
indemnity and receive the other program benefit. Farm ownership and 
operating loans, may be obtained from the USDA in addition to crop 
insurance indemnities.

[[Page 171]]

                        10. Concealment or Fraud

    Notwithstanding any provision contained in any other crop insurance 
document, your CAT policy may be voided by us on all crops without 
waiving any of our rights, including the right to collect any amounts 
due:
    (a) If at any time you conceal or misrepresent any material fact or 
commit fraud relating to this or any other contract issued under the 
authority of the Federal Crop Insurance Act with any insurance provider; 
and
    (b) The voidance will be effective as of the beginning of the crop 
year during which such act or omission occurred. After the policy has 
been voided, you must make a new application to obtain catastrophic risk 
protection coverage for any subsequent crop year. If your policy is 
voided under this section, any waiver of eligibility for emergency crop 
loss assistance in connection with the crop will not be effective for 
the crop for the year in which the voidance occurred.

                        11. Exclusion of Coverage

    (a) Options or endorsements that extend the coverage available under 
any crop policy offered by FCIC will not be available under this 
endorsement, except the Late Planting Agreement Option. Written 
agreements are not available for any crop insured under this 
endorsement.
    (b) Notwithstanding any provision contained in any other crop 
policy, hail and fire coverage and high-risk land may not be excluded 
under catastrophic risk protection.

             12. Eligibility for Other USDA Program Benefits

    (a) Even if it was a crop of economic significance for the previous 
crop year, if you do not intend to plant the crop in the current crop 
year, you do not have to obtain crop insurance or execute a waiver of 
your eligibility for any emergency crop loss assistance in connection 
with the crop to remain eligible for the USDA program benefits specified 
in subsection (e). However, if, after the sales closing date, you plant 
that crop, you will be unable to obtain insurance for that crop and you 
must execute a waiver of your eligibility for emergency crop loss 
assistance in connection with the crop to remain eligible for the USDA 
program benefits specified in section 12(e). Failure to execute such a 
waiver will require you to refund any benefits already received under a 
program specified in section 12(e).
    (b) You are initially responsible to determine the crops of economic 
significance in the county. The insurance provider may assist you in 
making these initial determinations. However, these determinations will 
not be binding on the insurance provider. To determine the percentage 
value of each crop:
    (1) Multiply the acres planted to the crop, times your share, times 
the approved yield, and times the price;
    (2) Add the values of all crops grown by the producer in the county; 
and
    (3) Divide the value of the specific crop by the result of section 
12(b)(2).
    (c) You may use the type of price such as the current local market 
price, futures price, established price, highest amount of insurance, 
etc., for the price when calculating the value of each crop, provided 
that you use the same type of price for all crops in the county.
    (d) You may be required to justify the calculation and provide 
adequate records to enable the insurance provider to verify whether a 
crop is of economic significance.
    (e) You must obtain at least catastrophic coverage for each crop of 
economic significance in the county in which you have an insurable 
share, if insurance is available in the county for the crop, unless you 
execute a waiver of any eligibility for emergency crop loss assistance 
in connection with the crop to be eligible for:
    (1) Benefits under the Agricultural Market Transition Act;
    (2) Loans or any other USDA provided farm credit, including: 
guaranteed and direct farm ownership loans, operating loans, and 
emergency loans under the Consolidated Farm and Rural Development Act 
provided after October 13, 1994; and
    (3) Benefits under the Conservation Reserve Program derived from any 
new or amended application or contracts executed after October 13, 1994.
    (f) Failure to comply with all provisions of the policy constitutes 
a breach of contract and may result in ineligibility for certain other 
farm program benefits for that crop year and any benefit already 
received must be refunded. If you breach the insurance contract, the 
execution of a waiver of any eligibility for emergency crop loss 
assistance will not be effective for the crop year in which the breach 
occurs.

[61 FR 42985, Aug. 20, 1996, as amended at 63 FR 40631, July 30, 1998]



PART 403--GENERAL CROP INSURANCE REGULATION--Table of Contents




Sec.
403.1  Availability of peach crop insurance.
403.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
403.3  OMB control numbers.
403.4  Creditors.
403.5  Good faith reliance on misrepresentation.
403.6  The contract.
403.7  The application and policy.


[[Page 172]]


    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 50 FR 43648, Oct. 29, 1985, unless otherwise noted.



Sec. 403.1  Availability of peach crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
peaches in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 403.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for peaches which will be included in the actuarial table on 
file in the applicable service offices for the county and which may be 
changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 403.3  OMB control numbers.

    The OMB control numbers are contained in subpart H of part 400, 
title 7 CFR.



Sec. 403.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 403.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the peach insurance contract, 
whenever: (a) An insured under a contract of crop insurance entered into 
under these regulations, as a result of a misrepresentation or other 
erroneous action or advice by an agent or employee of the Corporation: 
(1) Is indebted to the Corporation for additional premiums; or (2) has 
suffered a loss to a crop which is not insured or for which the insured 
is not entitled to an indemnity because of failure to comply with the 
terms of the insurance contract, but which the insured believed to be 
insured, or believed the terms of the insurance contract to have been 
complied with or waived; and (b) the Board of Directors of the 
Corporation, or the Manager in cases involving not more than 
$100,000.00, finds that: (1) An agent or employee of the Corporation did 
in fact make such misrepresentation or take other erroneous action or 
give erroneous advice; (2) said insured relied thereon in good faith; 
and (3) to require the payment of the additional premiums or to deny 
such insured's entitlement to the idemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto. Requests for relief under this section must be 
submitted to the Corporation in writing.



Sec. 403.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the peach crop 
as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Any changes 
made in the contract shall not affect its continuity from year to year. 
The forms referred to in the contract are available at the applicable 
service offices.



Sec. 403.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the peach crop as landlord, owner-operator, or tenant. The application 
shall be submitted to the Corporation at the service office on or before 
the applicable closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also,

[[Page 173]]

for the same reason, may reject any individual application. The Manager 
of the Corporation is authorized in any crop year to extend the closing 
date for submitting applications in any county, by placing the extended 
date on file in the applicable service offices and publishing a notice 
in the Federal Register upon the Manager's determination that no adverse 
selectivity will result during the extended period. However, if adverse 
conditions should develop during such period, the Corporation will 
immediately discontinue the acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1986 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a peach 
insurance contract issued under such prior regulations, without the 
filing of a new application.
    (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 Peach Insurance Policy for the 
1986 through 1997 crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                       Peach Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Frost;
    (2) Freeze;
    (3) Hail;
    (4) Tornado;
    (5) Cyclone;
    (6) Drought;
    (7) Wind;
    (8) Lightning;
    (9) Flood;
    (10) Fire;
    (11) Earthquake;
    (12) Volcanic eruption;
    (13) An insufficient number of chilling hours to effectively break 
the dormant period for the crop year; or
    (14) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after insurance attaches;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9f(5).
    b. We will not insure against any loss of production due to:
    (1) Disease or insect infestation;
    (2) The neglect, mismanagement, or wrongdoing by you, any member of 
your household, your tenants, or employees;
    (3) The failure to follow recognized good peach farming practices;
    (4) The failure or breakdown of irrigation equipment or facilities;
    (5) The failure to follow good peach irrigation practices; 
    (6) The impoundment of water by any governmental, public or private 
dam or reservoir project;
    (7) Split pits regardless of cause; or
    (8) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be any of the types or varieties of peaches 
which are grown for the production of Fresh or Processing Peaches 
(except processing peaches in California) on insured acreage and for 
which a guarantee and premium rate are provided by the actuarial table.
    b. The acreage insured for each crop year will be peaches grown on 
insurable acreage as designated by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured peaches at the time insurance attaches. However, 
for the purpose of determining the amount of indemnity, your share will 
not exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any acreage:
    (1) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (2) From which the peaches are harvested by the public;
    (3) On which the trees have not reached the fourth growing season 
after being set out unless such acreage has produced at least 100 
bushels of peaches per acre;
    (4) Planted with a vine or tree crop other than peaches;

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    (5) Which we inspect and consider not acceptable; or
    (6) Of a type or variety of peaches not established as adapted to 
the areas or excluded by the actuarial table.
    e. If insurance is provided for an irrigated practice, you must 
report as irrigated only the acreage for which you have adequate 
facilities and water, at the time insurance attaches, to carry out a 
good peach irrigation practice.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to the date insurance attaches.

   3. Report of Acreage, Share, Practice, and Number of Bearing Trees

    You must report on our form:
    a. All the acreage of peaches in the county in which you have a 
share;
    b. The practice;
    c. Your share on the date insurance attaches; and
    d. The number of bearing trees.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any peaches grown in the 
county. This report must be submitted annually on or before January 10. 
All indemnities may be determined on the basis of information you submit 
on this report. If you do not submit this report by January 10, we may 
elect to determine by unit the insured acreage, share, practice, and 
number of bearing trees or we may deny liability on any unit. Any report 
submitted by you may be revised only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. If the number of bearing trees (fourth growing season and older) 
is reduced more than 10 percent from the preceding calendar year, the 
production guarantee may be reduced 1 percent (through adjustment to 
your average yield) for each 1 percent reduction in excess of 10 
percent.
    c. Coverage level 2 will apply if you do not elect a coverage level.
    d. You may change the coverage level and price election on or before 
the closing date for submitting applications for the crop year as 
established by the actuarial table.
    e. You must furnish a report of production to use for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the subsequent crop year. The yield 
assigned by us will be 75% of the yield assigned for the purpose of 
determining your guarantee for the present crop year. If you have filed 
a claim for the previous crop year, the yield determined in adjusting 
your indemnity claim will be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable on the date insurance 
attaches. The amount is computed by multiplying the production guarantee 
times the price election, times the premium rate, times the insured 
acreage, times your share on the date insurance attaches.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1984 crop year 
under the terms of the experience table contained in the peach policy in 
effect for the 1985 crop year, you will continue to receive the benefit 
of that reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1985 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                          6. Deduction for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you, or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    Insurance attaches for each crop year on December 1 and ends at the 
earliest of:
    a. Total destruction of the peaches;
    b. The date harvest of the peaches (by variety) should have ended;
    c. Harvest of the peaches;
    d. Final adjustment of a loss; or
    e. September 30 of the crop year.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice of:
    (a) The dates of damage; and

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    (b) The causes of damage.
    (2) You must give us written notice if during the period before 
harvest, the peaches on any unit are damaged and you decide not to 
further care for or harvest any part of them.
    (3) If you are going to claim an indemnity on any unit, you must 
give us notice:
    (a) At least 15 days before the beginning of harvest;
    (b) Immediately, if damage occurs within the 15 days prior to 
harvest or during harvest; or
    (c) By September 30, if harvest will not begin by this date.
    b. You must obtain written consent from us before you destroy any of 
the peaches which are not to be harvested.
    c. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the peaches on the unit;
    (2) Harvest of the unit; or
    (3) September 30 of the crop year.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of peaches on the unit at the 
time of harvest and that any loss of production has been directly caused 
by one or more of the insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Multiplying this result by the price election;
    (3) Subtracting therefrom the dollar amount obtained by multiplying 
the total production of peaches to be counted (see section 9f) by the 
larger of the price election or the actual price per bushel of peaches; 
and
    (4) Multiplying this result by your share.
    d. If a unit contains insured acreage of both fresh and processing 
type peaches, the dollar amounts of insurance and production to count as 
established in 9.c. above will be determined separately for each type 
and then added together to determine the total amounts for the unit.
    e. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    f. The total production to be counted for a unit will include all 
appraised production plus any production harvested prior to appraisal.
    (1) Mature peach production may be adjusted downward as a result of 
a loss in quality because of hail, wind and misshapen fruit. Any 
production which is disposed of without being inspected by us will be 
considered undamaged. The amount of production will be determined for:
    (a) Peaches grown for fresh use by:
    (i) Dividing the value per \3/4\-bushel carton of the damaged 
peaches by the price per \3/4\-bushel carton of U.S. Extra No. 1 two-
inch peaches; and
    (ii) Multiplying this result by the number of bushels of such 
peaches.
    The applicable price per \3/4\-bushel carton of U.S. Extra No. 1 
two-inch peaches (if not available, the next larger size for which a 
price is available) will be the applicable average F.O.B. shipping point 
price reported by the Market News Service of the United States 
Department of Agriculture for 7 consecutive days commencing with the day 
harvest of the variety begins.
    (b) Peaches grown for processing by:
    (i) Dividing the value per bushel of the damaged peaches by the 
price per bushel of undamaged peaches; and
    (ii) Multiplying this result by the number of bushels of such 
peaches.
    The applicable price per bushel of undamaged peaches will be the 
average price for processing peaches determined for 7 consecutive days 
commencing with the day harvest of the variety begins.
    (2) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized peach farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause, destroyed by you without our 
consent or not inspected by us prior to the completion of harvest; and
    (c) All unharvested production.
    (3) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is exceeded by the 
actual harvested production.
    (4) We reserve the right to delay any appraisal of damage until the 
extent of damage can be determined.
    (5) If you elect to exclude hail and fire as insured causes of loss 
and the peaches are damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire''.
    g. You must not abandon any acreage to us.
    h. You may not sue unless you have complied with all policy 
provisions. If a claim is denied, you may sue us in the United States 
District Court under the provisions of 7

[[Page 176]]

U.S.C. 1508(c). You must bring suit within 12 months of the date notice 
of denial is received by you.
    i. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury.
    j. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than individual and such entity is dissolved 
after insurance attaches for any crop year, any indemnity will be paid 
to the persons determined to be beneficially entitled thereto.
    k. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.
    For the purpose of this section, the amount of loss from fire will 
be the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale, or other disposition of all peaches 
produced on each unit, including separate records showing the same 
information for production from any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records applied, 
assignment of production to units by us, or a determination that no 
indemnity is due. Any person designated by us will have access to such 
records and the farm for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Therefore, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the

[[Page 177]]

amount is due. The date of payment of the amount due:
    (1) If deducted from an indemnity will be the date you sign the 
claim; or
    (2) If deducted from payment under another program administered by 
the United States Department of Agriculture will be the date both such 
other payment and setoff are approved.
    d. The cancellation and termination dates are November 30.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by August 31 preceding the cancellation 
date. Acceptance of any change will be conclusively presumed in the 
absence of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of peach crop insurance:
    a. Actual price per bushel for:
    (1) ``Fresh peaches'' means the average price per bushel for U.S. 
Extra No. 1 two-inch peaches (if not available, the next larger size for 
which a price is available) determined from applicable prices reported 
by the Market News Service of the United States Department of 
Agriculture for 7 consecutive days commencing with the day harvest of 
the variety begins less the allowable cost designated by the actuarial 
table; and
    (2) ``Processing peaches'' means the average price per bushel for 
processor peaches determined for 7 consecutive days commencing with the 
day harvest of the variety begins less the allowable cost designated by 
the actuarial table.
    b. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
uninsurable types or varieties, insurable and uninsurable acreage, and 
related information regarding peach insurance in the county.
    c. Average yield means the yield established from your actual 
production records, which is approved by us and shown on our form.
    d. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county as shown by the actuarial table.
    e. Crop year means the period beginning with the date insurance 
attaches and extending through the normal harvest time and will be 
designated by the calendar year in which the peaches are normally 
harvested.
    f. Cyclone means only a large-scale, atmospheric wind-and-pressure 
system characterized by low pressure at its center and counterclockwise 
circular wind motion which has been named by the United States Weather 
Service and which has sustained winds in excess of 58 miles per hour at 
the nearest U.S. Weather Service reporting station to the crop damage at 
the time of the crop damage.
    g. Freeze means the condition that exists when air temperatures over 
a widespread area remain at or below 32 degrees Fahrenheit.
    h. Frost means the condition that exists when the air temperature 
around the plant falls to 32 degrees Fahrenheit or below.
    i. Harvest means the picking of mature peaches from the trees either 
by hand or machine.
    j. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    k. Insured means the person who submitted the application accepted 
by us.
    l. Loss ratio means the ratio of indemnity to premium.
    m. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State, a political subdivision of a State, or any agency 
thereof.
    n. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    o. Tenant means a person who rents land from another person for a 
share of the peaches or a share of the proceeds therefrom.
    p. Unit means all insurable acreage of peaches in the county on the 
date insurance attaches for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the peaches on such land will be 
considered as owned by the lessee. Land which would otherwise be one 
unit may be

[[Page 178]]

divided according to applicable guidelines on file in your service 
office. Units will be determined when the acreage is reported. Errors in 
reporting units may be corrected by us to conform to applicable 
guidelines when adjusting a loss. We may consider any acreage and share 
thereof reported by or for your spouse or child or any member of your 
household to be your bona fide share or the bona fide share of any other 
person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[50 FR 43648, Oct. 29, 1985, as amended at 51 FR 29205--29207, Aug. 15, 
1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 52 FR 6775, 
Mar. 5, 1987; 54 FR 24320, June 7, 1989; 55 FR 35888, Sept. 4, 1990; 62 
FR 39923, July 25, 1997]

                          PART 404  [RESERVED]



PART 405--APPLE CROP INSURANCE REGULATIONS FOR THE 1986 THROUGH THE 1998 CROP YEARS--Table of Contents




Sec.
405.1  Availability of apple crop insurance.
405.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
405.3  OMB control numbers.
405.4  Creditors.
405.5  Good faith reliance on misrepresentation.
405.6  The contract.
405.7  The application and policy.
405.8  Apple fresh fruit option.
405.9  Apple sunburn option.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 50 FR 43655, Oct. 29, 1985, unless otherwise noted.



Sec. 405.1  Availability of apple crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
apples in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 405.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for apples which will be included in the actuarial table on 
file in the applicable service offices for the county and which may be 
changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 405.3  OMB control numbers.

    The OMB control numbers are contained in subpart H of part 400, 
title 7 CFR.



Sec. 405.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.

[[Page 179]]



Sec. 405.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the apple insurance contract, 
whenever: (a) An insured under a contract of crop insurance entered into 
under these regulations, as a result of a misrepresentation or other 
erroneous action or advice by an agent or employee of the Corporation: 
(1) Is indebted to the Corporation for additional premiums; or (2) has 
suffered a loss to a crop which is not insured or for which the insured 
is not entitled to an indemnity because of failure to comply with the 
terms of the insurance contract, but which the insured believed to be 
insured, or believed the terms of the insurance contract to have been 
complied with or waived; and (b) the Board of Directors of the 
Corporation, or the Manager in cases involving not more than 
$100,000.00, finds that: (1) An agent or employee of the Corporation did 
in fact make such misrepresentation or take their erroneous action or 
give erroneous advice; (2) said insured relied thereon in good faith; 
and (3) to require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto. Application for relief under this section must be 
submitted to the Corporation in writing.



Sec. 405.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the apple crop 
as provided in the policy. The contract shall consist of the 
application, the policy, the Fresh Fruit Option, if applicable, and the 
county actuarial table. Any changes made in the contract shall not 
affect its continuity from year to year. The forms referred to in the 
contract are available at the applicable service offices.



Sec. 405.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the apple crop as landlord, owner-operator, or tenant. The application 
shall be submitted to the Corporation at the service office on or before 
the applicable closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period. However, if adverse conditions should develop 
during such period, the Corporation will immediately discontinue the 
acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1986 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of an apple 
contract issued under such prior regulations, without the filing of a 
new application.
    (d) The application is found at subpart D of part 400, General 
Administrative Regulations (7 CFR 400.37, 400.38). The provisions of the 
Apple Insurance Policy for the 1986 through 1998 crop years are as 
follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                       Apple Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We shall provide the insurance described in 
this policy in return for the premium and your compliance with all 
applicable provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from

[[Page 180]]

the following causes occurring within the insurance period:
    (1) Drought;
    (2) Freeze;
    (3) Frost;
    (4) Wind;
    (5) Hail;
    (6) Fire;
    (7) Earthquake;
    (8) Volcanic eruption;
    (9) Fruit-set failure; or
    (10) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after insurance attaches;

unless those causes are expected, excluded, or limited by the actuarial 
table or section 9e(4).
    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants, or employees;
    (2) The failure to follow recognized good apple management 
practices;
    (3) The failure or breakdown of irrigation equipment or facilities;
    (4) The failure to follow good apple irrigation practices;
    (5) The impoundment of water by any governmental, public or private 
dam or reservoir project; or
    (6) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be a variety of apples established as 
adopted to the area, which is located on insured acreage and for which a 
guarantee and premium rate are provided by the actuarial table.
    b. The acreage insured for each crop year will be apples located on 
insurable acreage as designated by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured apples at the time insurance attaches.
    d. We do not insure any acreage:
    (1) Which in area A has not produced a minimum of 10 bins per acre;
    (2) Which in area B has not produced a minimum of 150 bushels per 
acre;
    (3) Which in Colorado, has not produced a minimum of 200 bushels per 
acre;
    (4) Unless we agree, in writing, to insure such acreage;
    (5) Which we inspect and consider not acceptable;
    (6) The crop year the application is filed until the acreage has 
been inspected and accepted by us; or
    (7) Acquired for the crop year until inspected and accepted by us.
    e. If insurance is provided for an irrigated practice you must 
report as irrigated only the acreage for which you have adequate 
facilities and water, at the time insurance attaches, to carry out a 
good apple irrigation practice.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to the time insurance attaches.

            3. Report of acreage, share, and Number of Trees

    You must report on our form:
    a. All the acreage of apples in the county in which you have a 
share;
    b. Your share at the time insurance attaches; and
    c. The number of bearing trees.

You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any apples located in the 
county.
    This report will be submitted annually on or before the reporting 
date established by the actuarial table. All indemnities may be 
determined on the basis of information you submit on this report. If you 
do not submit this report by the reporting date, we may elect to 
determine by unit the insured acreage, share, and number of trees or we 
may deny liability on any unit. Any report submitted by you may be 
revised only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. Coverage level 2 will apply if you do not elect a coverage level.
    c. You may change the coverage level and price election on or before 
the closing date for submitting applications for the crop year as 
established by the actuarial table.
    d. You must furnish a report of production to us for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the subsequent crop year. The yield 
assigned by us will be 75% of the yield assigned for the purpose of 
determining your guarantee for the present crop year. If you have filed 
a claim for the previous crop year, the yield determined in adjusting 
your indemnity claim will be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable when insurance attaches. 
The amount is

[[Page 181]]

computed by multiplying the production guarantee times the price 
election, times the premium rate, times the insured acreage, times your 
share when insurance attaches.
    b. Interest will accrue at the rate of one and one-half percent 
(1\1/2\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1984 crop year 
under the terms of the experience table contained in the Eastern or 
Western apple policy in effect for the 1985 crop year, you will continue 
to receive the benefit of that reduction subject to the following 
conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1985 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    Insurance attaches for each crop year on November 21 except that for 
the first crop year, if we accept your application for apple insurance 
after November 21, insurance will attach on the thirtieth day after you 
submit a properly completed application. Insurance ends at the earliest 
of:
    a. Total destruction of the apples;
    b. Harvest of the unit;
    c. Final adjustment of a loss; or
    d. The earlier of:
    (1) The end of the normal harvest period by variety for the crop 
year; or
    (2) November 5 of the crop year.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us notice of the date and cause of damage within 
10 days of such damage.
    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (3) If probable loss is later determined or damage occurs during 
harvest, immediate notice must be given.
    (4) In addition to the notices required by this section, if you are 
going to claim an indemnity on any unit, we must be given notice not 
later than 10 days after the earliest of:
    (i) Total destruction of the apples on the unit;
    (ii) Harvest of the unit; or
    (iii) The calendar date for the end of the insurance period.
    b. You must obtain written consent from us before you destroy any of 
the apples which are not to be harvested.
    c. We may reject any claim for indemnity if any of the requirements 
of this section or section 9 are not complied with.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the apples on the unit;
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of apples on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of apples to be 
counted (see section 9e);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this product by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. The total production to be counted for a unit will include all 
harvested and appraised production determined to be marketable.
    (1) Appraised production to be counted will include:
    (i) Unharvested marketable production, and potential production lost 
due to uninsured causes and failure to follow recognized good apple 
management practices; and
    (ii) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause, or destroyed by you without our 
consent.

[[Page 182]]

    (2) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Not harvested before the harvest of apples becomes general in 
the county and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (3) The amount of production of any unharvested apples may be 
determined on the basis of field appraisals conducted after the end of 
the insurance period.
    (4) If you elect to exclude hail and fire as insured causes of loss 
and the apples are damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire''.
    f. You must not abandon any acreage to us.
    g. You may not sue us unless you have complied with all policy 
provisions. If a claim is denied, you may sue us in the United States 
District Court under the provisions of 7 U.S.C. 1508(c). You must bring 
suit within 12 months of the date notice of denial is received by you.
    h. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity.
    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 on or about January 1 
and July 1 of each year.
    The interest rate to be paid on any indemnity will vary with the 
rate announced by the Secretary of the Treasury.
    i. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after insurance attaches for any crop year, any indemnity will 
be paid to the person determined to be beneficially entitled thereto.
    j. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.

For the purpose of this section, the amount of loss from fire will be 
the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale or other disposition of all apples 
produced on each unit, including separate records showing the same 
information for production from any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply, 
assignment of production

[[Page 183]]

to units by us, or a determination that no indemnity is due. Any person 
designated by us will have access to such records and the farm for 
purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due:
    (1) If deducted from an indemnity will be the date you sign the 
claim; or
    (2) If deducted from payment under another program administered by 
the United States Department of Agriculture will be the date both such 
other payment and setoff are approved.
    d. The cancellation and termination dates are November 20.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by August 31 preceding the cancellation 
date. Acceptance of any change will be conclusively presumed in the 
absence of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of apple crop insurance:
    a. Area A includes Montana, Wyoming, Utah, New Mexico, and all 
states west thereof.
    b. Area B includes all other states except Colorado.
    c. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
apple insurance in the county.
    d. Bin means a standard container, accepted by the industry: (1) 
Containing a minimum of 875 pounds of apples; or (2) as designated by 
the actuarial table.
    e. Bushel means a standard container, containing 42 pounds of apples 
(40 pounds in Colorado).
    f. Contiguous land means land which is touching at any point, except 
that land which is separated by only a public or private right-of-way 
will also be considered contiguous.
    g. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county as shown by the actuarial table.
    h. Crop year means the period beginning with the date insurance 
attaches and extending through the normal harvest time and shall be 
designated by the calendar year in which the apples are normally 
harvested.
    i. Freeze means the condition that exists when air temperatures over 
a widespread area remain at or below 32 degrees (Fahrenheit).
    j. Frost means the condition that exists when the air temperature 
around the plant falls to 32 degrees (Fahrenheit) or below.
    k. Fruit-set failure means failure of the apple trees to develop 
blossoms or set fruit due only to adverse weather conditions, but shall 
not include poor pollination resulting from inadequate pollenizers in 
the orchard or failure to set fruit due to spray damage or other 
manageable causes.
    l. Harvest means the picking of marketable apples from the trees or 
from the ground.
    m. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    n. Insured means the person who submitted the application accepted 
by us.
    o. Loose field box means a standard container containing: (1) 35 
pounds of apples; or (2) a quantity designated by the actuarial table.
    p. Loss ratio means the ratio of indemnity to premium.
    q. Marketable means apples which grade U.S. No. 1, 2, or Cider in 
accordance with the United States Standards for Apples for Processing.

[[Page 184]]

    r. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State, a political subdivision of a State, or any agency 
thereof.
    s. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    t. Tenant means a person who rents land from another person for a 
share of the apples or a share of the proceeds therefrom.
    u. Unit means all insurable acreage of apples in the county located 
on contiguous land, on the date insurance attaches for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.

Land rented for cash, a fixed commodity payment, or any consideration 
other than a share in the apples on such land will be considered as 
owned by the lessee. Land which would otherwise be one unit may be 
divided according to applicable guidelines on file in your service 
office. Units will be determined when the acreage is reported. Errors in 
reporting units may be corrected by us to conform to applicable 
guidelines when adjusting a loss. We may consider any acreage and share 
thereof reported by or for your spouse or child or any member of your 
household to be your bona fide share or the bona fide share of any other 
person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[50 FR 43655, Oct. 29, 1985, as amended at 51 FR 29206, 29207, Aug. 15, 
1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 55 FR 35555, 
Aug. 31, 1990; 55 FR 35888, Sept. 4, 1990; 63 FR 17054, Apr. 8, 1998]



Sec. 405.8  Apple fresh fruit option.

    (a) Notwithstanding the provisions of Sec. 405.7(d), section 9.e. of 
this part, an insured producer may, upon submission and approval of a 
Fresh Fruit Option Amendment (Amendment) elect to insure any insurable 
acreage or any designated portion thereof, under the provisions of the 
Amendment. Only apple acreage which is managed with the intent of 
producing fresh-market apples will be insurable under the Amendment. If 
management practices are carried out for the production of both fresh 
and processing apples on insurable acreage, and the election is made to: 
(1) Insure fresh market apples under the Amendment and; (2) insure those 
insurers intended for processing under the Apple policy; the election to 
insure on both a fresh and processing basis must be made when the 
Amendment is submitted. The Amendment is continuous until cancelled and 
may only be cancelled prior to the cancellation date.
    (b) For those insureds who elect to insure apples under the 
Amendment, all provisions of the Apple crop insurance policy will apply 
except those provisions in conflict with the Amendment.
    (c) The Option reads as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                        Apple Fresh Fruit Option

    This is a continuous amendment (see section 15 of the basic policy).

Insured's Name__________________________________________________________
Contract No.____________________________________________________________
Address_________________________________________________________________
Crop Year_______________________________________________________________
Identification No.______________________________________________________
SSN_____________________________________________________________________
Tax_____________________________________________________________________

    It is hereby agreed to amend the basic Federal Crop Insurance Apple 
Policy under the following terms and conditons:
    1. This Option must be submitted to us on or before the final date 
for accepting applications for the initial crop year in which you

[[Page 185]]

wish to insure your applies under this Option.
    2. You must have an apple policy in force.
    3. You must insure all the acreage of applies in the county in which 
you have a share regardless of the intended use (fresh-market or 
processing).
    4. In addition to section 8 of the apple policy, inspection and 
grading of the fruit must be done by us prior to harvest or no quality 
adjustment will be made.
    5. Separate line entries according to intended use (fresh-market or 
processing) must be included on the acreage report required under 
section 3 of the apple policy.
    6. Your apples intended for processing will be insured under the 
quality provisons of A only (See below).
    7. Your apples intended for fresh-market will be insured under the 
quality provisions of either A or B, whichever you select.
    8. If you select A only, A will apply to all of your apples intended 
for processing and fresh-market.
    9. If you select B, those provisions will apply to all of your 
apples intended for fresh-market and the provisions of A will apply to 
all of your apples intended for processing.
    10.a. You must select either A or B by marking the appropriate space 
below.
    A----
    In addition to section 9.e. and in lieu of 17.q. of the Apple 
Policy, your production to count for any acreage designated for 
processing or fresh-market will be adjusted when your apples are damaged 
by hail to the extent that such apples will not grade U.S. No. 1 
(processing) (7 CFR 51.430 et seq.)). The adjustment factor (not to 
exceed 1) will be the ratio of the average market price (received by you 
or determined by us, whichever is larger) for your damaged production to 
the average market price for U.S. No. 1 (processing) apples. There will 
be no adjustment for quality if the apples do not grade U.S. No. 1 
because of size, color, or russeting.
    B----
    In lieu of sections 9.e.(1), 9.e.(2), 17.1, and 17.q of the Apple 
Policy, the total production to be counted for a unit must include all 
harvested and appraised production. Harvested apple production which, 
due to hail damage, does not grade 80 percent U.S. Fancy or better, in 
accordance with applicable USDA Standards (7 CFR 51.300 et seq.), will 
be adjusted as follows:
    (1) Production with 21 through 40 percent not grading U.S. Fancy or 
better due to hail damage will be reduced 2 percent for each percent in 
excess of 20 percent. The difference between the reduced production and 
the total production will be considered cull production.
    (2) Production with 41 through 50 percent not grading U.S. Fancy or 
better due to hail damage will be reduced 40 percent plus an additonal 3 
percent for each percent in excess of 40 percent. The difference between 
the reduced production and the total production will be considered cull 
production.
    (3) Production with 51 through 64 percent not grading U.S. Fancy or 
better due to hail damage will be reduced 70 percent plus an additional 
2 percent for each percent in excess of 50 percent. The difference 
between the reduced production and the total production will be 
considered cull production.
    (4) Production with 65 percent or more not grading U.S. Fancy or 
better due to hail damage will be considered 100 percent cull 
production.
    b. Apples which are knocked to the ground by wind or frozen to the 
extent that they can be harvested but not packed or marketed as fresh 
apples will be considered 100 percent cull production.
    c. Fifteen (15) percent of all cull production will be counted as 
production.
    d. No reduction in grade will be applied to any apple grading less 
than U.S. Fancy due solely to shape, russeting, or color.
    e. Appraised production to be counted must include:
    (1) Potential production lost due to uninsured causes and failure to 
follow recognized good apple management practices; and
    (2) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause, or destroyed without our consent.
    f. Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (1) Harvested;
    (2) Further damaged by an insured cause and reappraised by us; or
    (3) In whole or part knocked to the ground by wind or hail or frozen 
on the tree to the extent that harvest is not practical.
    11. Your premium rate for Apples under either A or B, as elected by 
you, will be established by the actuarial table.
    12. All provisions of the apple policy not in conflict with this 
option are applicable.
    13. All determinations under this option will be made by us.
    14. This Option may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date provided by the policy, preceding such crop year.

Insured's Signature_____________________________________________________
Date____________________________________________________________________
Corporation representative's signature and Code Number__________________
Date____________________________________________________________________

[50 FR 43655, Oct. 29, 1985, as amended at 53 FR 46846, Nov. 21, 1988]

[[Page 186]]



Sec. 405.9  Apple sunburn option.

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                          Apple Sunburn Option

    This is not a continuous option. Applications for this option must 
be made prior to the sale closing date if you want this optional 
coverage. Upon our approval this option is applicable only for the 
19____ crop year.

Insured's name__________________________________________________________
Contract No.____________________________________________________________
Address_________________________________________________________________
Crop Year_______________________________________________________________
Identification No.______________________________________________________
SSN_____________________________________________________________________
Tax_____________________________________________________________________

    It is hereby agreed to amend the Federal Crop Insurance Apple Policy 
in accordance with the following terms and conditions:

 1. This option must be submitted to us on or before the final date for 
 accepting applications for each crop year in which you wish to insure 
                        apples under this option.

 2. You must have an apple policy and the Apple Fresh Fruit Option B in 
                                 force.

3. You must insure all the acreage of apples in the county to which the 
    Apple Fresh Fruit Option B applies and in which you have a share.

4. In addition to the causes of loss specified in paragraph 1.a. of the 
 Apple Crop Insurance policy, excess sun is an insurable cause of loss.

    5. In lieu of sections 9.e.(1), 9.e.(2), 17.l, and 17.q. of the 
Apple Policy, the total production to be counted for a unit must include 
all harvested and appraised production. Harvested apple production 
which, due solely to excessive sun or along with hail damage, does not 
grade 80 percent U.S. Fancy or better, in accordance with applicable 
USDA Standards, will be adjusted as follows:
    a. Production with 21 thru 40 percent not grading U.S. Fancy or 
better due solely to excessive sun or along with hail damage will be 
reduced 2 percent for each percent in excess of 20 percent. The 
difference between the reduced production and the total production will 
be considered cull production.
    b. Production with 41 thru 50 percent not grading U.S. Fancy or 
better due solely to excessive sun or along with hail damage will be 
reduced 40 percent plus an additional 3 percent for each percent in 
excess of 40 percent. The difference between the reduced production and 
the total production will be considered cull production.
    c. Production with 51 thru 64 percent not grading U.S. Fancy or 
better due solely to excessive sun or along with hail damage will be 
reduced 70 percent plus an additional 2 percent for each percent in 
excess of 50 percent. The difference between the reduced production and 
the total production will be considered cull production.
    d. Production with 65 percent or more not grading U.S. Fancy or 
better due solely to excessive sun or along with hail damage will be 
considered 100 percent cull production.
    Fifteen (15) percent of all cull production, will be counted as 
production.

   6. The premium for this sunburn option will be established by the 
                            actuarial table.

 7. All provisions of the apple policy and the Fresh Fruit Option-B not 
              in conflict with this option are applicable.

       8. All determinations under this option will be made by us.

9. a. Excessive sun is defined as the exposure of the unharvested apples 
 to direct or indirect sun sufficient to cause the apples to grade less 
                     than U.S. Fancy due to sunburn.

    b. Sunburn is defined in accordance with applicable U.S.D.A. 
Standards.

Insured's Signature_____________________________________________________
Date____________________________________________________________________
Corporation representative's Signature and Code Number__________________
Date____________________________________________________________________

[53 FR 46846, Nov. 21, 1988; 54 FR 11935, Mar. 23, 1989]



PART 406--NURSERY CROP INSURANCE REGULATIONS--Table of Contents




Sec.
406.1  Availability of nursery crop insurance.
406.2  Premium rates, amounts of insurance, and coverage levels at which 
          indemnities shall be computed.
406.3  OMB control numbers.
406.4  Creditors.
406.5  Good faith reliance on misrepresentation.
406.6  The contract.
406.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 54 FR 3412, Jan. 24, 1989, unless otherwise noted.



Sec. 406.1  Availability of nursery crop insurance.

    (a) Insurance shall be offered under the provisions of this subpart 
on the insured crop in counties within the limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended (the Act).

[[Page 187]]

The counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.
    (b) The insurance is offered through two methods. First, the 
Corporation offers the contract contained in this part directly to the 
insured through Agents of the Corporation. Those contracts are 
specifically identified as being offered by the Federal Crop Insurance 
Corporation. Second, companies reinsured by the Corporation (hereinafter 
``Reinsured companies'') offer contracts containing substantially the 
same terms and conditions as the contract set out in this part.
    (c) No person may have in force more than one contract on the same 
crop for the crop year, whether insured by the Corporation or insured by 
a Reinsured company.
    (d) If a person has more than one contract under the Act outstanding 
on the same crop for the same crop year, all such contracts will be 
voided for that crop year but the person will still be liable for the 
premium on all contracts unless the person can show to the satisfaction 
of the Corporation that the multiple contract insurance was inadvertent 
and without the fault of the insured.
    (e) If the multiple contract insurance is shown to be inadvertent 
and without the fault of the insured, the contract with the earliest 
application will be valid and all other contracts on that crop for that 
crop year will be cancelled. No liability for indemnity or premium will 
attach to the contracts so cancelled.
    (f) The person must repay all amounts received in violation of this 
section with interest at the rate contained in the contract for 
delinquent premiums.
    (g) An insured whose contract with the Corporation or with a 
Reinsured company under the Act has been terminated because of violation 
of the terms of the contract is not eligible to obtain multi-peril crop 
insurance under the Act with the Corporation or with a Reinsured company 
unless the insured can show that the default in the prior contract was 
cured prior to the sales closing date of the contract applied for or 
unless the insured can show that the termination was improper and should 
not result in subsequent ineligibility.
    (h) All applicants for insurance under the Act must advise the 
agent, in writing, at the time of application, of any previous 
applications for a Contract under the Act and the present status of the 
applications or contracts.



Sec. 406.2  Premium rates, amounts of insurance, and coverage levels at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, amounts of insurance, 
and coverage levels, for the insured crop which will be included in the 
actuarial table on file in the applicable service offices for the county 
and which may be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level from among those contained in the actuarial 
table for the crop year.



Sec. 406.3  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 406.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 406.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the nursery insurance 
contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation or a 
Reinsured company:
    (1) Is indebted to the Corporation or a Reinsured company for 
additional premiums; or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the

[[Page 188]]

insured believed to be insured, or believed the terms of the insurance 
contract to have been complied with or waived; and
    (b) The Board of Directors of the Corporation (the Manager in cases 
involving not more than $100,000) or a Reinsured company finds that:
    (1) An agent or employee of the Corporation or a Reinsured company 
did in fact make such misrepresentation or take other erroneous action 
or give erroneous advice;
    (2) Said insured relied thereon in good faith; and
    (3) To require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto. Request for relief under this section must be 
submitted, in writing, to the Corporation or to the Reinsured Company, 
whichever is applicable.

[54 FR 3412, Jan. 24, 1989, as amended at 54 FR 33494, Aug. 15, 1989]



Sec. 406.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation or a Reinsured company of a duly executed application 
for insurance on a form prescribed by the Corporation or a Reinsured 
company and payment of the premium due. The contract shall cover the 
nursery crop as provided in the policy. The contract shall consist of 
the application, the policy and any amendments thereto, and the county 
actuarial table. Changes made in the contract shall not affect its 
continuity from year to year. No indemnity will be paid unless the 
insured complies with all terms and conditions of the contract. The 
forms referred to in the contract are available at the applicable 
service offices.



Sec. 406.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation must be made by any person to cover such person's share in 
the nursery crop as owner if the person wishes to participate in the 
program. The application shall be submitted to the Corporation or a 
Reinsured company at the service office on or before the applicable 
sales closing date on file in the service office.
    (b) The Corporation or a Reinsured company may discontinue the 
acceptance of any application or applications in any county upon its 
determination that the insurance risk is excessive. The Manager of the 
Corporation is authorized in any crop year to extend the sales closing 
date for submitting applications in any county, by placing the extended 
date on file in the applicable service offices and publishing a notice 
in the Federal Register upon the Manager's determination that no adverse 
selectivity will result during the extended period. However, if adverse 
conditions should develop during such period, the Corporation will 
immediately discontinue the acceptance of applications.
    (c) A contract in the form provided for in this subpart will come 
into effect as a continuation of the contract issued under such prior 
regulations, without the filing of a new application.
    (d) The application for the 1989 through 1995 crop years is found at 
subpart D of part 400, General Administrative Regulations (7 CFR 400.37, 
400.38). The provisions of the Nursery Crop Insurance Policy for the 
1989 through 1995 crop years are as follows:

                   Federal Crop Insurance Corporation

                         Nursery Crop Insurance

(This is a continuous contract. Refer to Section 15.)

    Note:  This is a contract with the Federal Crop Insurance 
Corporation, a United States Government Agency. The terms of the 
contract are published in the Federal Register under the provisions of 
the Federal Register Act (44 U.S.C. 1501), and may not be waived or 
varied in any way by the crop insurance agent or any other agent or 
employee of FCIC.

    Agreement to Insure: We will provide the insurance described in this 
policy in return for the premium and your compliance with ALL provisions 
of the crop insurance contract.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation. Unless the context indicates 
otherwise, use of the plural form of a word includes the singular and 
use of the singular form of the word includes the plural.

[[Page 189]]

                            1. Insured Crops

    a. The crops insured will be all nursery crops grown in the county 
in standard nursery containers which are listed on the eligible plant 
listing located in the actuarial table.
    b. We do not insure any nursery crops which:
    (1) Are not grown in standard nursery containers;
    (2) Are not classified as woody, herbaceous, or foliage landscape 
plants;
    (3) Produce citrus fruit or other edible fruits or berries;
    (4) Are grown in the field;
    (5) Are not listed on the eligible plant listing located in the 
actuarial table;
    (6) Have not been inspected prior to submission of your application;
    (7) Are inspected by us and determined unacceptable;
    (8) Are not grown in a hardiness zone listed on the eligible plant 
listing for those crops; or
    (9) Are not grown in accordance with the production practices for 
which premium rates have been established.

                            2. Causes of Loss

    a. The insurance provided is against unavoidable damage resulting 
from the following causes occurring within the insurance period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after insurance attaches;

unless those causes are excepted, excluded, or limited by the actuarial 
table.
    b. We do not insure against any loss caused by:
    (1) The neglect, mismanagement, or wrongdoing by you, any member of 
your family or household, your tenants, or employees;
    (2) The failure to follow recognized good production practices for 
nursery crops;
    (3) Water contained by any governmental, public, or private dam or 
reservoir project;
    (4) Flooding on any unit subject to a flood or water flowage 
easement;
    (5) Failure or breakdown of irrigation equipment or facilities;
    (6) Failure to carry out a good irrigation practice for the nursery 
crops;
    (7) The inability to market the nursery crop as a direct result of 
quarantine, boycott or refusal of any entity to accept production;
    (8) Any loss of production due to fire, where weeds and other forms 
of undergrowth have not been controlled; or
    (9) Any cause not specified in this policy as an insured cause of 
loss.
    c. You must not obtain any other crop insurance under the Federal 
Crop Insurance Act (Multiple Peril Crop Insurance Policy or Federal Crop 
Insurance Policy) on the insured crops. More than one policy will result 
in our voiding the policies and collecting the premium from you unless 
the violation of this provision is found by us to have been inadvertent. 
If we determine that the violation was inadvertent, the policy with the 
earliest date of application will be the one in force and all other 
policies will be void. Nothing in this paragraph prevents the insured 
from obtaining other hail and fire insurance not issued under the Act 
and which is subject to the provisions of section 9 hereof.
    d. Although your violation of a number of federal statutes including 
the Federal Crop Insurance Act may cause cancellation, termination, or 
voidance of your insurance contract, you are specifically directed to 
the provisions of Title XII of the Food Security Act of 1985 (Pub. L. 
99-198) and the regulations promulgated thereunder, generally referred 
to as the sodbuster, swampbuster, and controlled substance provisions. 
Your insurance policy will be cancelled if you are determined to be in 
violation of these provisions. We will recover any and all monies paid 
to you or received by you and your premium will be refunded.

                         3. Nursery Crop Report

    a. You must submit an annual crop report to us of all of your 
eligible nursery crops in the county by unit, type, container size, 
number of plants and wholesale price of plants for each month of the 
crop year. This report must be submitted on or before September 30 
preceding the crop year.
    b. Your crop report may be revised only with our consent.
    c. We may determine all losses on the basis of information on your 
crop report or the inventory as determined by us.
    d. You must designate separately any inventory which is not 
insurable. Your annual crop report will be used as the basis to 
determine your premium and the amount of insurance for each unit. If you 
do not submit the report by the reporting date, we may elect to 
determine the inventory for each unit or we may deny liability on any 
unit. Errors in reporting units may be corrected by us at the time of 
adjusting a loss.

                4. Amount of Insurance and Coverage Level

    a. The amount of insurance and coverage levels are contained in the 
actuarial table and must be elected on or before September 30 prior to 
the crop year.
    b. You may change the amount of insurance and the coverage level on 
or before the sales closing date for that crop year.

[[Page 190]]

                           5. Annual Premium.

    a. The annual premium is earned and payable on or before September 
30 preceding each crop year and will be earned in full when the policy 
becomes effective. Interest will begin to accrue on March 31 of the crop 
year. Premium will be delinquent on the termination date.
    b. Except for the 1993 and 1994 crop years, coverage will not begin 
if the premium due under this policy is not paid when due and payable. 
For the 1993 and 1994 crop year only insurance will attach on October 1, 
preceding the crop year.
    c. The annual premium amount for each unit is computed in accordance 
with these subsections:
    (1) Develop an inventory of all eligible containerized crops, by 
type of crop and container size, for each month of the proposed policy 
period.
    (2) Apply market values to these inventory numbers using your 
wholesale price list. If you discount prices published in your wholesale 
price list, the discounted prices must be used in calculating market 
values. Record these monthly values by type of crop on your insurance 
application.
    (3) Add the total monthly market values separately for each type of 
crop and divide that monthly total for each crop by the number of months 
in the crop year to get the ``Average Monthly Market Value''.
    (4) Add the Average Monthly Market Value for each of the eligible 
crops in the unit to get the ``Yearly Average''.
    (5) Multiply the Yearly Average by 90% to obtain the ``Field Market 
Value''.
    (6) Multiply Field Market Value by the coverage level.
    (7) Multiply this result by the applicable premium rate contained in 
the actuarial table.

                            6. Amounts Due Us

    a. Interest will accrue at the rate of one and one-fourth percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid balance due us. Interest will start on the date that notice 
is issued to you for the collection of any amount determined to be due. 
Interest, penalties and costs will be charged in accordance with 31 
U.S.C. 3717 and 4 CFR 102.13. The penalty for accounts more than 90 days 
past due (31 U.S.C. 3717(e)(2)) is six percent (6%) per annum. Interest 
on any amount due us found to have been received by you because of fraud 
or misrepresentation will start on the date you received the amount with 
the penalty beginning 90 days after the notice of amount due is issued 
to you.
    b. All amounts paid will be applied first to costs and penalties, 
second to accrued interest, and then to reduction of the principal 
balance.
    c. If we determine that it is necessary to contract with a 
collection agency or to employ an attorney to assist in collection, you 
agree to pay all of the expenses of collection. Those expenses will be 
paid before the application of any amounts to interest, penalties or 
principal.
    d. Any amount due us may be deducted from any indemnity payment due 
you, or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies and from any amounts due you from any other United States 
Government Agency.

                           7. Insurance Period

    Insurance attaches on October 1 and ends for each unit at the 
earliest of:
    a. Sale or disposal of all or a portion of the crop;
    b. Final adjustment of the loss on the part of the insured crop 
damaged; or
    c. September 30 of the crop year.

                       8. Notice of Damage or Loss

    In case of damage or probable loss you must:
    a. Provide sufficient care to protect the crop from further damage;
    b. Provide us with written notice within 72 hours of your discovery 
of the loss and obtain our written consent prior to:
    (1) Destroying, selling or otherwise disposing of any crop that is 
damaged; or
    (2) Changing or discontinuing your normal growing practices with 
respect to care and maintenance of the insured crop; and
    c. Upon our request, provide complete copies of your nursery crop 
wholesale price list for the 12-month period immediately preceding the 
loss and your marketing records for the same period.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Your loss; or
    (2) September 30 of the crop year.
    b. We will not pay any indemnity unless you:
    (1) Establish the value of the insured crop on the unit and that any 
loss of value has been directly caused by one or more of the insured 
causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The production to count (containers) will be all plants eligible 
for insurance in a unit.
    d. The indemnity will not exceed the lesser of:

[[Page 191]]

    (1) The amount of insurance applicable to the unit less 90% of the 
value of the crop remaining on the unit after the loss; or
    (2) The amount, calculated for each unit as follows:
    (a) Subtract field market value B from field market value A (see 
section 17) to determine the total amount of loss; and
    (b) Subtract therefrom the annual loss deductible.
    e. Annual Loss Deductible amounts will be applied on an annual 
aggregate loss deductible basis for each individual unit insured for the 
crop year. Individual insured losses occurring on the same unit during 
the crop year may be accumulated (but each loss must be reported and 
valued by us). The total amount of insured losses on a unit during the 
crop year, less the annual aggregate loss deductible applicable to that 
unit, is the amount payable under this policy for that unit during the 
crop year, as limited by the amount of insurance for that unit.
    f. The value of production of any insured crop may be determined on 
the basis of our field appraisals conducted after the end of the 
insurance period.
    g. If you elect to exclude hail and fire as insured causes of loss 
and the insured crop is damaged by hail or fire, appraisals will be made 
in accordance with the applicable Form FCI-78 or FCI-78-A, ``Request To 
Exclude Hail And Fire.''
    h. You must not abandon any part of the insured crop to us.
    i. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    j. An indemnity will not be paid unless you comply with all policy 
provisions.
    k. Under no circumstances will we be liable for the payment of 
damages (compensatory, punitive, or other), attorney's fees, or other 
charges in connection with any claim for indemnity, whether we approve 
or disapprove such claim. (State and local laws to the contrary are not 
applicable to this insurance contract). We will pay simple interest 
computed on the net indemnity ultimately found to be due by us or by the 
final judgment of a court of competent jurisdiction, from and including 
the 61st day after the date you sign, date and submit to us the properly 
completed FCIC claim form. Interest will be paid only if the reason for 
our failure to timely pay is not due to your failure to provide 
information or other material necessary for the computation or payment 
of the indemnity. 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 will vary 
with each publication.
    l. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after insurance attaches for any crop year, any indemnity will 
be paid to the person determined to be beneficially entitled thereto.
    m. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance. (For the purpose of this subsection, 
the amount of loss from fire will be the difference between the fair 
market value of the production on the unit before the fire and after the 
fire).

                        10. Concealment or Fraud

    We may void the insurance contract on all crops without affecting 
your liability for premiums or waiving any right, including the right to 
collect any amount due us, if at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to this 
or any other contract with us. The voidance will be effective as of the 
beginning of the crop year with respect to which such act or omission 
occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to the applicable indemnity. The transfer must be on 
our form and approved by us. Both you and the person to whom you 
transfer your interest are jointly and severally liable for the payment 
of the premium. The transferee has all rights and responsibilities under 
the contract consistent with the transferee's interest.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year. The assignment must be on our form and will not be effective 
until approved in writing by us. The assignee may submit all notices and 
forms required to protect the insurance contract and to claim an 
indemnity.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid

[[Page 192]]

you plus our expenses, the excess will be paid to you.

                          14. Access to Nursery

    Any person designated by us will have access to the nursery for 
purposes related to the contract.

          15. Contract Term, Cancellation and Termination Dates

    a. This contract will be in effect for the crop year specified on 
the application and may not be cancelled by you for such crop year after 
insurance attaches. Thereafter, the contract will continue in force for 
each succeeding crop year unless cancelled or terminated as provided in 
this section or unless the premium is not paid.
    b. This contract may be cancelled by either you or us for any 
succeeding crop year by giving written notice on or before September 30, 
preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
September 30 preceding such crop year for the contract on which the 
amount is due.
    d. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    e. The contract will terminate if no premium is earned for three 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. The date by which contract changes will be available in your 
service office is August 15 preceding the crop year.

                          17. Meaning of Terms

    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the amount of insurance, coverage levels, 
premium rates, practices, and related information regarding crop 
insurance in the county.
    b. Amount of insurance means the value computed by:
    (1) multiplying the Yearly Average by .9 to equal field market 
value; and
    (2) multiplying the result by the coverage level.
    c. Annual loss deductible means the value computed by subtracting 
the amount of insurance from the Field Market Value for that unit.
    d. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county as shown by the actuarial table.
    e. Crop means all plants eligible for insurance on the unit as 
reported on the nursery crop report.
    f. Crop year means the period beginning October 1 and extending 
through September 30 of the next calendar year and is designated by the 
year in which the crop year ends. (The 1988 crop year would be from 
October 1, 1987 through September 30, 1988).
    g. Field Market Value ``A'' means the total market value of the 
insured crop for the unit involved (prior to the loss occurrence) had 
the crop been sold in your markets for the values which would have been 
reasonably expected in the month which the loss occurred, less 10% of 
such market value to eliminate costs for packing, shipping and sales 
commissions or other expenses not insured.
    h. Field Market ``B'' means the total market value of the insured 
crop for the unit involved in the loss (following the loss occurrence) 
less 10% of such market value to eliminate costs for packing, shipping 
and sales commissions or other expenses not insured.
    i. Insured means the person who submitted the application accepted 
by us and does not extend to any other person unless specifically 
indicated on the application and accepted by us.
    j. Insured crops means the crops insured under the provisions of 
this policy.
    k. Loss ratio means the ratio of indemnity to premium.
    l. Person means a partnership, association, corporation, estate, 
trust, or other legal entity, and wherever applicable, a State or a 
political subdivision or agency of a State.
    m. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    n. Unit means all growing locations within a five mile radius of the 
name insured location designated on your crop report. Growing locations 
outside of the five mile radius of the name insured location but within 
the county may be designated in the unit or as a separate unit. If they 
are not designated in the unit or as a separate unit, they will be 
included in the closest unit listed.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

[[Page 193]]

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations (7 CFR 
part 400, subpart J).

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.

                     21. Dates, Reports, and Notices

    To preserve your rights under this insurance contract you are 
required to file a number of reports and notices with us by certain 
dates. The actual content requirements and time limits of those reports 
and notices are set out elsewhere in this contract and you must refer to 
those sections for those requirements.
    As a convenience to you and without limitation on our rights under 
this contract, a short description of most of the dates, reports and 
notices have been compiled in this section. Omission of any date, report 
or notice, or any of the requirements thereof, from this section does 
not relieve you of the requirement to comply with the terms of this 
contract.
    a. Application-- A form required by subpart D of part 400 of 7 CFR 
and each individual program regulation. The application for insurance 
form must be completed and filed in the service office prior to the 
sales closing date (contained in the actuarial table) for the first crop 
year for which an insurance policy is requested by the insured.
    b. Assignment of indemnity-- A transfer of contract rights, made on 
our form, and effective when approved by us. It is the arrangement 
whereby you assign your right to an indemnity payment to any party of 
your choice for the crop year.
    c. Claim for indemnity (See: section 9)--A claim made by the insured 
for damage or loss to the insured crop.
    d. Contract change date The date by which FCIC makes any contract 
changes available for inspection in the service office (See: Section 
16).
    e. Crop report-- A report required by section 3 of this contract. 
This report contains, in addition to other information, the report of 
the insured's share of all inventory of nursery crops in the county 
whether insurable or uninsurable and must be filed on or before 
September 30 prior to the crop year.
    f. Damage, notice of-- (See: Probable loss, Notice of).
    g. End of insurance period, Date of-- The date upon which the 
insured's crop insurance coverage ceases (See: section 7).
    h. Insurance attaches, Date-- October 1 of the crop year.
    i. Intent to abandon, Notice of-- The written notice to the 
Corporation by the insured indicating that because of damage from an 
insured cause, the insured has decided to no longer care for the crop.
    j. Probable loss, notice of-- A written notice required to be filed 
in the service office whenever an insured believes that the nursery 
crops have been damaged to the extent that a loss is probable (See: 
section 8).
    k. Reporting date-- The crop reporting date (contained in the 
Actuarial Table) by which you are required to report all your insurable 
and uninsurable inventory in the county in which you have a share at the 
time insurance attaches.
    l. Sales closing date-- The date contained in the actuarial table on 
file in the respective service office which sets out the final date when 
an application for insurance may be filed. The sales closing date of 
this policy is September 30.
    22. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[54 FR 3412, Jan. 24, 1989; 54 FR 14206, Apr. 10, 1989, as amended at 55 
FR 35888, Sept. 4, 1990; 57 FR 54683, Nov. 20, 1992; 58 FR 33508, June 
18, 1993; 58 FR 46074, Sept. 1, 1993; 59 FR 35614, July 13, 1994; 59 FR 
39414, Aug. 3, 1994; 60 FR 56935, Nov. 13, 1995]

                        PARTS 407-408  [RESERVED]



PART 409--ARIZONA-CALIFORNIA CITRUS INSURANCE REGULATIONS--Table of Contents




       Subpart--Regulations for the 1987 and Succeeding Crop Years

Sec.
409.1  Availability of Arizona-California Citrus crop insurance.
409.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
409.3  OMB control numbers.
409.4  Creditors.
409.5  Good faith reliance on misrepresentation.
409.6  The contract.
409.7  The application and policy.

    Authority: 7 U.S.C. 1506, 1516.

[[Page 194]]


    Source: 50 FR 43662, Oct. 29, 1985, unless otherwise noted.



       Subpart--Regulations for the 1987 and Succeeding Crop Years



Sec. 409.1  Availability of Arizona-California Citrus crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
citrus in counties within limits prescribed by and in accordance with 
the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 409.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for Arizona-California citrus which will be included in the 
actuarial table on file in the applicable service offices for the county 
and which may be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect an amount of insurance per acre from among those amounts 
shown on the actuarial table for the crop year.



Sec. 409.3  OMB control numbers.

    The OMB control numbers are contained in subpart H of part 400, 
title 7 CFR.



Sec. 409.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 409.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the Arizona-California Citrus 
insurance contract, whenever: (a) An insured under a contract of crop 
insurance entered into under these regulations, as a result of a 
misrepresentation or other erroneous action or advice by an agent or 
employee of the Corporation: (1) Is indebted to the Corporation for 
additional premiums; or (2) has suffered a loss to a crop which is not 
insured or for which the insured is not entitled to an indemnity because 
of failure to comply with the terms of the insurance contract, but which 
the insured believed to be insured, or believed the terms of the 
insurance contract to have been complied with or waived; and (b) the 
Board of Directors of the Corporation, or the Manager in cases involving 
not more than $100,000.00 finds that: (1) An agent or employee of the 
Corporation did in fact make such misrepresentation or take other 
erroneous action or give erroneous advice; (2) said insured relied 
thereon in good faith; and (3) to require the payment of the additional 
premiums or to deny such insured's entitlement to the indemnity would 
not be fair and equitable, such insured shall be granted relief the same 
as if otherwise entitled thereto. Requests for relief under this section 
must be submitted to the Corporation in writing.



Sec. 409.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the citrus crop 
as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Any changes 
made in the contract shall not affect its continuity from year to year. 
The forms referred to in the contract are available at the applicable 
service offices.



Sec. 409.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the citrus crop as landlord, owner-operator, or tenant. The application 
shall be submitted to the Corporation at the service office on or before 
the applicable closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the

[[Page 195]]

insurance risk is excessive, and also, for the same reason, may reject 
any individual application. The Manager of the Corporation is authorized 
in any crop year to extend the closing date for submitting applications 
in any county, by placing the extended date on file in the applicable 
service offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period. However, if adverse conditions should develop 
during such period, the Corporation will immediately discontinue the 
acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1987 and succeeding crop years, a contract in the form provided for 
under this subpart will come into effect as a continuation of a citrus 
insurance contract issued under such prior regulations, without the 
filing of a new application.
    (d) The application for the 1987 and succeeding crop years is found 
at Subpart D of Part 400-General Administrative Regulations (7 CFR 
400.37, 400.38) and may be amended from time to time for subsequent crop 
years. The provisions of the Arizona-California Citrus Insurance Policy 
for the 1987 and succeeding crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

            Arizona--California Citrus Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption;
    (6) Failure of the irrigation water supply due to an unavoidable 
cause occurring after insurance attaches; or
    (7) Direct Mediterranean Fruit Fly damage;

unless those causes are expected, excluded, or limited by the actuarial 
table or section 9f(7).
    b. We will not insure against any loss of production due to:
    (1) Fire, where weeds and other forms of undergrowth have not been 
controlled or tree pruning debris has not been removed from the grove;
    (2) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants, or employees;
    (3) The failure to follow recognized good citrus grove practices;
    (4) The failure or breakdown of irrigation equipment or facilities;
    (5) The failure to follow good citrus irrigation practices;
    (6) The impoundment of water by any governmental, public, or private 
dam or reservoir project; or
    (7) Any cause not specified in section 1a as an insured loss;

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be any of the following citrus types, which 
are grown on insured acreage and for which a guarantee and premium rate 
are provided by the actuarial table, which you elect:
    Type I--Navel oranges;
    Type II--Sweet oranges;
    Type III--Valencia oranges;
    Type IV--Grapefruit;
    Type V--Lemons;
    Type VI--Kinnow mandarins;
    Type VII--Minneola tangelos; or
    Type VIII--Orlando tangelos;
    b. The acreage insured for each crop year will be that acreage of 
citrus located on insurable acreage as designated by the actuarial table 
and in which you have a share, as reported by you or as determined by 
us, whichever we elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured citrus on the date insurance attaches.
    d. We do not insure any acreage:
    (1) Which is not irrigated;
    (2) On which the trees have not reached the sixth growing season 
after being set out; and
    (3) Which does not have acceptable records of production, unless 
inspected by us and considered acceptable and we agree, in writing, to 
insure such acreage.
    e. Insurance will not attach or be considered to have attached to 
any acreage of the crop, for the crop year the application is filed 
until the acreage has been inspected and accepted by us.

[[Page 196]]

    f. Insurance may attach only by written agreement with us on any 
acreage with less than 90 percent of a stand, based on the original 
planting pattern.
    g. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to the date insurance attaches.

       3. Report of Acreage, Share, Number of Trees, and Practice

    You must report on our form:
    a. All the acreage of citrus in the county in which you have a 
share;
    b. The practice;
    c. Your share on the date insurance attaches; and
    d. The number of bearing trees.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any citrus grown in the 
county. This report must be submitted annually on or before January 10. 
All indemnities may be determined on the basis of information you submit 
on this report. If you do not submit this report by January 10, we may 
elect to determine by unit the insured acreage, share, and practice or 
we may deny liability on any unit. Any report submitted by you may be 
revised only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. Coverage level 2 will apply if you do not elect a coverage level.
    c. You may change the coverage level and price election on or before 
the closing date for submitting applications for the crop year as 
established by the actuarial table.
    d. You must furnish a report of production to us for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the subsequent crop year. The yield 
assigned by us will be 75% of the yield assigned for the purpose of 
determining your guarantee for the present crop year. If you have filed 
a claim for the previous crop year, the yield determined in adjusting 
your indemnity claim will be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable on the date insurance 
attaches. The amount is computed by multiplying the production guarantee 
times the price election, times the premium rate, times the insurance 
acreage, times your share at the time insurance attaches.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1985 crop year 
under the terms of the experience table contained in the citrus policy 
in effect for the 1986 crop year, you will continue to receive the 
benefit of that reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1986 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you, or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    a. Insurance attaches on December 1 prior to the calendar year of 
normal bloom, and ends at the earliest of:
    (1) Total destruction of the citrus;
    (2) Harvest of the citrus;
    (3) Final adjustment of a loss; or
    (4) The date following the year in which the bloom is normally set 
as follows:
    (a) August 31 for Navel oranges and Southern California lemons;
    (b) November 30 for Valencia oranges; or
    (c) July 31 for all other types of citrus.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us prompt written notice.
    (a) After insured damage to the citrus becomes apparent, giving the 
dates and causes of such damage; or
    (b) If you decide not to further care for or harvest any part of it.
    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (3) If probable loss is later determined, immediate notice must be 
given. If harvest will

[[Page 197]]

begin after the end of the insurance period, notice must be given on or 
before the calendar date for the end of the insurance period.
    b. You must obtain written consent from us before you destroy any of 
the citrus which is not to be harvested.
    c. We may reject any claim for indemnity if any of the requirements 
of this section or section 9 are not complied with.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the citrus on the unit;
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of citrus on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of citrus to be 
counted (see section 9f);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. If a determination is made that frost protection equipment was 
not properly utilized or not properly reported, the indemnity for the 
unit will be reduced by the percentage of premium reduction allowed for 
frost protection equipment. You must, at our request, provide us records 
showing the start-stop times by date for each period the equipment was 
used.
    f. The total production (cartons) to be counted for each unit will 
include all harvested production marketed as fresh packed fruit and all 
appraised production determined to be marketable as fresh packed fruit.
    (1) Any production will be considered marketed or marketable as 
fresh packed fruit unless, due to insurable causes, such production was 
not marketed or marketable as fresh packed fruit.
    (2) In the absence of acceptable records to determine the 
disposition of harvested citrus, we may determine such disposition and 
the amount of such production to be counted for the unit.
    (3) Appraised production to be counted will include:
    (a) Unharvested production, and potential production lost due to 
uninsured causes and failure to follow recognized good citrus grove 
practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause or destroyed by you without our 
consent.
    (4) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Not harvested before harvest of the insured citrus type becomes 
general in the county and reappraised by us;
    (b) Harvested; or
    (c) Further damaged by an insured cause and reappraised by us.
    (5) Citrus which cannot be marketed due to insurable causes will not 
be considered production.
    (6) The amount of production of any unharvested citrus may be 
determined on the basis of field appraisals conducted after the end of 
the insurance period.
    (7) If you elect to exclude hail and fire as insured causes of loss 
and the citrus is damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire.''
    g. You must not abandon any acreage to us.
    h. You may not sue us unless you have complied with all policy 
provisions. If a claim is denied, you may sue us in the United States 
District Court under the provisions of 7 U.S.C. 1508(c). You must bring 
suit within 12 months of the date notice of denial is received by you.
    i. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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

[[Page 198]]

about January 1 and July 1. The interest rate to be paid on any 
indemnity will vary with the rate announced by the Secretary of the 
Treasury.
    j. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the date insurance attaches for any crop year, any 
indemnity will be paid to the person determined to be beneficially 
entitled thereto.
    k. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.
    For the purpose of this section, the amount of loss from fire will 
be the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Grove

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale, or other disposition of all citrus 
produced on each unit, including separate records showing the same 
information for production from any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply, 
assignment of production to units by us, or a determination that no 
indemnity is due. Any person designated by us will have access to such 
records and the grove for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due:
    (1) If deducted from an indemnity will be the date you sign the 
claim; or
    (2) If deducted from payment under another program administered by 
the United States Department of Agriculture will be the date both such 
other payment and setoff are approved.
    d. The cancellation and termination dates are November 30.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

[[Page 199]]

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by August 31 preceding the cancellation 
date. Acceptance of any change will be conclusively presumed in the 
absence of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of Arizona-California citrus crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
citrus insurance in the county.
    b. Carton as to each insured citrus type means the standard 
container for marketing fresh packed fruit as shown below by citrus 
type. In the absence of marketing records on such a carton basis, 
production will be converted to cartons on the basis of the following 
average net pounds of packed fruit in a standard packed carton.

------------------------------------------------------------------------
            Container size                  Types of fruit        Pounds
------------------------------------------------------------------------
Container #58........................  Navel oranges, Valencia        38
                                        oranges & Sweet oranges.
Container #58........................  Lemons..................       40
Container #59........................  Grapefruit..............       32
Container #63........................  Tangerines (including          25
                                        Tangelos) and Mandarin
                                        oranges.
------------------------------------------------------------------------

    c. Contiguous land means land which is touching at any point, except 
that land which is separated by only a public or private right-of-way 
will be considered contiguous.
    d. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county as shown by the actuarial table.
    e. Crop year means the period beginning with the date insurance 
attaches to the citrus crop and extending through normal harvest time, 
and will be designated by the calendar year following the year in which 
the bloom is normally set.
    f. Direct Mediterranean Fruit Fly damage means the actual physical 
damage to the citrus on the unit which causes such citrus to be 
unmarketable and will not include unmarketability of such citrus as a 
direct result of a quarantine, boycott, or refusal to accept the citrus 
by any entity without regard to actual physical damage to such citrus.
    g. Harvest means the severance of mature citrus from the tree either 
by pulling, picking, or severing by mechanical or chemical means, or 
picking up the marketable fruit from the ground.
    h. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    i. Insured means the person who submitted the application accepted 
by us.
    j. Loss ratio means the ratio of indemnity to premium.
    k. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State, a political subdivision of a State, or any agency 
thereof.
    l. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    m. Tenant means a person who rents land from another person for a 
share of the citrus or a share of the proceeds therefrom.
    n. Unit means all insurable acreage in the county of any one of the 
citrus types referred to in section 2 of this policy, located on 
contiguous land on the date insurance attaches for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the citrus on such land will be 
considered as owned by the lessee. Land which would otherwise be one 
unit may be divided according to applicable guidelines on file in your 
service office. Units will be determined when the acreage is reported. 
Errors in reporting units may be corrected by us to conform to 
applicable guidelines when adjusting a loss. We may consider any acreage 
and share thereof reported by or for your spouse or child or any member 
of your household to be your bona fide share or the bona fide share of 
any other person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

[[Page 200]]

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.

    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[50 FR 43662, Oct. 29, 1985, as amended at 51 FR 29205--29207, Aug. 15, 
1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 54 FR 38962, 
Sept. 22, 1989; 55 FR 35888, Sept. 4, 1990]

                        PARTS 410-411  [RESERVED]



PART 412--PUBLIC INFORMATION--FREEDOM OF INFORMATION--Table of Contents




Sec.
412.1  General statement.
412.2  Public inspection and copying.
412.3  Index.
412.4  Requests for records.
412.5  Appeals.
412.6  Timing of responses to requests.

    Authority: 5 U.S.C. 552 and 7 U.S.C. 1506.

    Source: 62 FR 67694, Dec. 30, 1997, unless otherwise noted.



Sec. 412.1  General statement.

    This part is issued in accordance with the regulations of the 
Secretary of Agriculture published at 7 CFR 1.1-1.23, and appendix A, 
implementing the Freedom of Information Act (5 U.S.C. 552). The 
Secretary's regulations, as implemented by this part, and the Risk 
Management Agency (RMA) govern availability of records of the Federal 
Crop Insurance Corporation (FCIC) as administration of the crop 
insurance program for FCIC.



Sec. 412.2  Public inspection and copying.

    (a) Members of the public may request access to the information 
specified in Sec. 412.2(d) for inspection and copying.
    (b) To obtain access to specified information, the public should 
submit a written request, in accordance with 7 CFR 1.6, to the Appeals, 
Litigation and Legal Liaison Staff, Risk Management Agency, United 
States Department of Agriculture, 1400 Independence Avenue, SW, STOP 
0807, room 6618-S, Washington, DC 20250-0807, from 9:00 a.m.--4:00 pm., 
EDT Monday through Friday, except holidays.
    (c) When the information requested is not located at the office of 
the Appeals, Litigation and Legal Liaison Staff, the Appeals, Litigation 
and Legal Liaison Staff will direct the request to the appropriate 
office where the information can be obtained. The requester will be 
informed that the request has been forwarded to the appropriate office.
    (d) FCIC will make available for inspection and copying, unless 
otherwise exempt from publication under sections 552(a)(2)(C) and 
552(b):
    (1) Final opinions, including concurring and dissenting opinions and 
orders made in the adjudication of cases; and
    (2) Those statements of policy and interpretations that have been 
adopted by FCIC and RMA and are not published in the Federal Register; 
and
    (3) Administrative staff manuals and instructions to staff that 
affect a member of the public.



Sec. 412.3  Index.

    5 U.S.C. 552(a)(2) requires that each agency publish, or otherwise 
make available, a current index of all materials available for public 
inspection and copying. RMA and FCIC will maintain a current index 
providing identifying information for the public as to any material 
issued, adopted, or promulgated by the Agency since July 4, 1967, and 
required by section 552(a)(2). Pursuant to the Freedom of Information 
Act provisions, RMA and FCIC have determined that in view of the small 
number of public requests for such index, publication of such an index 
would be unnecessary and impracticable. Copies of the index will be 
available upon request in person or by mail at the address stated in 
Sec. 412.2(b).



Sec. 412.4  Requests for records.

    The Director of the Appeals, Litigation and Legal Liaison staff, RMA 
located at the above stated address, is

[[Page 201]]

the person authorized to receive Freedom of Information Act and to 
determine whether to grant or deny such requests in accordance with 7 
CFR 1.8.



Sec. 412.5  Appeals.

    Any person whose request under Sec. 412.4 is denied shall have the 
right to appeal such denial. This appeal shall be submitted in 
accordance with 7 CFR 1.13 and addressed to the Manager, Federal Crop 
Insurance Corporation, United States Department of Agriculture, 1400 
Independence Avenue, SW., STOP 0807, room 6618-S, Washington, DC 20250-
0807.



Sec. 412.6  Timing of responses to requests.

    (a) In general, FCIC will respond to requests according to their 
order of receipt.
    (b) Existing responsive documents or information may be maintained 
in RMA's field offices. Therefore, extra time may be necessary to search 
and collect the documents.

                          PART 413  [RESERVED]



PART 414--FORAGE SEEDING CROP INSURANCE--Table of Contents




        Subpart--Regulations for the 1981 Through 1997 Crop Years

Sec.
414.1  Availability of forage seeding crop insurance.
414.2  Premium rates and amounts of insurance.
414.3  OMB control numbers.
414.4  Creditors.
414.5  Good faith reliance on misrepresentation.
414.6  The contract.
414.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 45 FR 49511, July 25, 1980, unless otherwise noted.



        Subpart--Regulations for the 1981 Through 1997 Crop Years



Sec. 414.1  Availability of forage seeding crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
Forage Seeding in counties within limits prescribed by, and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended. The counties shall be designated by the Manager of the 
Corporation from those approved by the Board of Directors of the 
Corporation.

[50 FR 27928, July 9, 1985]



Sec. 414.2  Premium rates and amounts of insurance.

    (a) The Manager shall establish premium rates and amounts of 
insurance for forage seeding which shall be shown on the county 
actuarial table on file in the office for the county and may be changed 
from year to year.
    (b) At the time the application for insurance is made, the applicant 
shall elect an amount of insurance from among those amounts shown on the 
actuarial table for the crop year.



Sec. 414.3  OMB control numbers.

    The information collection requirements contained in these 
regulations (7 CFR part 414) have been approved by the Office of 
Management and Budget (OMB) under the provisions of 44 U.S.C. Chapter 35 
and have been assigned OMB control numbers 0563-0003 and 0563-0007.

[Amdt. No. 2, 49 FR 6335, Feb. 21, 1984]



Sec. 414.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, or an 
involuntary transfer shall not entitle the holder of the interest to any 
benefit under the contract except as provided in the policy.



Sec. 414.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the forage seeding insurance 
contract, whenever
    (a) An insured person under a contract of crop insurance entered 
into under these regulations, as a result of a misrepresentation or 
other erroneous action or advice by an agent or employee of the 
Corporation, (1) is indebted to the Corporation for additional premiums, 
or (2) has suffered a loss to a crop which is not insured or

[[Page 202]]

for which the insured person is not entitled to an indemnity because of 
failure to comply with the terms of the insurance contract, but which 
the insured person believed to be insured, or believed the terms of the 
insurance contract to have been complied with or waived, and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00 finds (1) that an agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice, (2) that said 
insured person relied thereon in good faith, and (3) that to require the 
payment of the additional premiums or to deny such insured's entitlement 
to the indemnity would not be fair and equitable, such insured person 
shall be granted relief the same as if otherwise entitled thereto.

[45 FR 49511, July 25, 1980, as amended at 48 FR 48451, Oct. 19, 1983]



Sec. 414.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the Forage 
Seeding crop as provided in the policy. The contract shall consist of 
the application, the policy, and the county actuarial table. Any changes 
made in the contract shall not affect its continuity from year to year. 
The forms referred to in the contract are available at the applicable 
service office.

[50 FR 27928, July 9, 1985]



Sec. 414.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's insurable 
share in the forage seeding crop as landlord, owner-operator, or tenant. 
The application shall be submitted to the Corporation at the office for 
the county on or before the applicable closing date on file in the 
office for the county.
    (b) The Corporation reserves the right to discontinue the acceptance 
of applications in any county upon its determination that the insurance 
risk involved is excessive, and also, for the same reason, to reject any 
individual application. The Manager of the Corporation is authorized in 
any crop year to extend the closing date for submitting applications or 
contract changes in any county, by placing the extended date on file in 
the office for the county and publishing a notice in the Federal 
Register upon the Manager's determination that no adverse selectivity 
will result during the period of such extension: Provided, however, That 
if adverse conditions should develop during such period, the Corporation 
will immediately discontinue the acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1978 and succeeding crop years, a contract in the form provided for 
under this subpart will come into effect as a continuation of a forage 
seeding contract issued under such prior regulations, without the filing 
of a new application.
    (d) The application for the 1984 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 Forage Seeding Insurance Policy 
for the 1984 through 1997 crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                  Forage Seeding--Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We shall provide the insurance described in 
this policy in return for the premium and your compliance with all 
applicable provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of or failure 
to establish a stand of forage resulting from any of the following 
causes occurring within the insurance period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;

[[Page 203]]

    (5) Wildlife;
    (6) Earthquake; or
    (7) Volcanic eruption unless those causes are excepted, excluded, or 
limited by the actuarial table or section 9h.
    b. We shall not insure against any loss of production due to:
    (1) The neglect or malfeasance of you, any member of your household, 
your tenants or employees;
    (2) The failure to follow recognized good forage seeding practices;
    (3) Damage resulting from the impoundment of water by any 
governmental, public or private dam or reservoir project; or
    (4) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured shall be forage seeded or reseeded (hereafter 
called the crop) to establish a stand of forage intended for harvest as 
livestock feed; which is seeded on insured acreage; and for which an 
amount of insurance and premium rate are provided by the actuarial 
table.
    b. The acreage insured for each crop year shall be acreage of the 
crop seeded on insurable acreage as designated by the actuarial table 
and in which you have a share, as reported by you or as determined by 
us, whichever we shall elect.
    c. The insured share shall be your share as landlord, owner-
operator, or tenant in the insured crop at the time of seeding.
    d. We do not insure any acreage:
    (1) Where the farming practices carried out are not in accordance 
with the farming practices for which the premium rates have been 
established;
    (2) Which is irrigated and an irrigated practice is not provided for 
in the actuarial table unless you elect to insure the acreage as 
nonirrigated by reporting it as insurable under section 3;
    (3) Which is destroyed, it is practical to reseed to the crop, and 
such acreage was not reseeded;
    (4) Initially seeded after the final seeding date contained in the 
actuarial table;
    (5) Of volunteer forage;
    (6) Seeded to a type, variety or mixture not established as adapted 
to the area or excluded in the actuarial table;
    (7) Seeded with another crop (excluding nurse crops); or
    (8) Seeded for the development or production of hybrid seed or for 
experimental purposes.
    e. Where insurance is provided for an irrigated practice:
    (1) You shall report as irrigated only the acreage for which you 
have adequate facilities and water to carry out a good forage seeding 
irrigation practice at the time of seeding; and
    (2) Any loss of production caused by failure to carry out a good 
forage seeding irrigation practice, except failure of the water supply 
from an unavoidable cause occurring after the beginning of seeding, 
shall be considered as due to an uninsured cause. The failure or 
breakdown of irrigation equipment or facilities shall not be considered 
as a failure of the water supply from an unavoidable cause.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to seeding.

                     3. Report of Acreage and Share

    You shall report on our form:
    a. All the acreage of forage seeding and reseeding in the county in 
which you have a share; and
    b. Your share at the time of seeding or reseeding.

You shall designate separately any acreage that is not insurable. You 
shall report if you do not have a share in any forage seeding or 
reseeding in the county. This report shall be submitted annually on or 
before the reporting date established by the actuarial table. We may 
determine all indemnities on the basis of information you have submitted 
on this report. If you do not submit this report by the reporting date, 
we may elect to determine by unit the insured acreage and share or we 
may deny liability on any unit. Any report submitted by you may be 
revised only upon our approval.

                         4. Amounts of Insurance

    a. The amounts of insurance will be contained in the actuarial 
table.
    b. You may change the amount of insurance on or before the closing 
date for submitting applications for the crop year as established by the 
actuarial table.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time of seeding. 
The amount is computed by multiplying the amount of insurance times the 
premium rate, times the insured acreage, times you share at the time of 
seeding, times the applicable premium adjustment percentage contained in 
the following table.

[[Page 204]]



                                          Premium Adjustment Table \1\
                       [Percent adjustments for favorable continuous insurance experience]
----------------------------------------------------------------------------------------------------------------
                                          Numbers of years continuous experience through previous year
                               ---------------------------------------------------------------------------------
                                                                                                           15 or
                                 0    1    2    3    4    5    6    7    8    9    10   11   12   13   14   more
----------------------------------------------------------------------------------------------------------------
                                               Percentage adjustment factor for current crop year
 
----------------------------------------------------------------------------------------------------------------
    Loss ratio \2\ through
      previous crop year
 
.00 to .20....................  100   95   95   90   90   85   80   75   70   70   65   65   60   60   55     50
.21 to .40....................  100  100   95   95   90   90   90   85   80   80   75   75   70   70   65     60
.41 to .60....................  100  100   95   95   95   95   95   90   90   90   85   85   80   80   75     70
.61 to .80....................  100  100   95   95   95   95   95   95   90   90   90   90   85   85   85     80
.81 to 1.09...................  100  100  100  100  100  100  100  100  100  100  100  100  100  100  100    100
----------------------------------------------------------------------------------------------------------------


                           [Percent adjustments for unfavorable insurance experience]
----------------------------------------------------------------------------------------------------------------
                                                  Numbers of loss years through previous year \3\
                                 -------------------------------------------------------------------------------
                                   0    1    2    3    4    5    6    7    8    9    10   11   12   13   14   15
----------------------------------------------------------------------------------------------------------------
                                                Percentage adjustment factor for current crop year
 
----------------------------------------------------------------------------------------------------------------
 Loss ratio \2\ through previous
            crop year
 
1.10 to 1.19....................  100  100  100  102  104  106  108  110  112  114  116  118  120  122  124  126
1.20 to 1.39....................  100  100  100  104  108  112  116  120  124  128  132  136  140  144  148  152
1.40 to 1.69....................  100  100  100  108  116  124  132  140  148  156  164  172  180  188  196  204
1.70 to 1.99....................  100  100  100  112  122  132  142  152  162  172  182  192  202  212  222  232
2.00 to 2.49....................  100  100  100  116  128  140  152  164  176  188  200  212  224  236  248  260
2.50 to 3.24....................  100  100  100  120  134  148  162  176  190  204  218  232  246  260  274  288
3.25 to 3.99....................  100  100  105  124  140  156  172  188  204  220  236  252  268  284  300  300
4.00 to 4.99....................  100  100  110  128  146  164  182  200  218  236  254  272  290  300  300  300
5.00 to 5.99....................  100  100  115  132  152  172  192  212  232  252  272  292  300  300  300  300
6.00 and up.....................  100  100  120  136  158  180  202  224  246  268  290  300  300  300  300  300
----------------------------------------------------------------------------------------------------------------
\1\ For premium adjustment purposes, only the years during which premiums were earned shall be considered.
\2\ Loss Ratio means the ratio of indemnity(ies) paid to premium(s) earned.
\3\ Only the most recent 15 crop years shall be used to determine the number of ``Loss Years''. (A crop year is
  determined to be a ``Loss Year'' when the amount of indemnity for the year exceeds the premium for the year.)

    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. Any premium adjustment applicable to the contract shall be 
transferred to:
    (1) The contract of your estate or surviving spouse if you die;
    (2) The contract of the person who succeeds you if such person had 
previously participated in the farming operation; or
    (3) Your contract if you stop farming in one county and start 
farming in another county.
    d. If participation is not continuous, any premium shall be computed 
on the basis of previous unfavorable insurance experience but no premium 
reduction under section 5a shall be applicable.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    Insurance attaches at the time of seeding and ends at the earliest 
of:
    a. Total destruction of the crop;
    b. Harvest of the forage crop if not reseeded;
    c. Final adjustment of a loss;
    d. May 21 following the calendar year of seeding for spring-seeded 
forage; or
    e. October 15 following the calendar year of seeding for fall-seeded 
forage.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if:
    (a) During the period before harvest, the crop on any unit is 
damaged and you decide:
    (i) Not to further care for the crop; or
    (ii) To reseed the acreage in the spring by the final seeding date 
for spring-seeded acreage;

[[Page 205]]

    (b) You want our consent to put the acreage to another use. Insured 
acreage may not be put to another use until we have appraised the crop 
and given written consent. We shall not consent to another use until it 
is too late to reseed. You must notify us when such acreage is put to 
another use.
    (2) In addition to the notices required by this section, if you are 
going to claim an indemnity on any unit, we must be given notice not 
later than 30 days after the earlier of:
    (a) Total destruction of the crop on the unit; or
    (b) The calendar date for the end of the insurance period.
    b. You must obtain our written consent before you destroy any of the 
crop which is not to be harvested.
    c. We may reject any claim for indemnity if any of the requirements 
of this section or section 9 are not complied with.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit shall be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the crop on the unit; or
    (2) The calendar date for the end of the insurance period.
    b. We shall not pay any indemnity unless you:
    (1) Establish the acreage seeded on the unit and that any loss has 
been directly caused by one or more of the insured causes during the 
insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity shall be determined on each unit by:
    (1) Multiplying the insured acreage by the amount of insurance;
    (2) Subtracting therefrom the total amount obtained by multiplying 
the sum of the acres with an established stand plus 10 percent of the 
seeded acres for the unit times the amount of insurance; and
    (3) Multiplying this result by your share.
    d. If the information reported by you results in a lower premium 
than the actual premium determined to be due, the indemnity shall be 
reduced proportionately.
    e. The acres with an established stand shall include:
    (1) Acreage which has at least 75 percent of a normal stand;
    (2) Acreage abandoned or put to another use without our prior 
written consent;
    (3) Acreage damaged solely by an uninsured cause; or
    (4) Acreage which is harvested and not reseeded.
    f. The amount of indemnity on any spring-seeded acreage determined 
in accordance with section 9c shall be reduced 50 percent if the stand 
is less than 75 percent but more than 55 percent of a normal stand.
    g. A reseeding payment shall be made on any insured fall-seeded 
acreage with less than a 75 percent stand on which we have given written 
consent to reseed and which is reseeded in the next succeeding spring by 
the final spring seeding date. The amount of the reseeding payment shall 
be equal to 50 percent of the amount of indemnity determined in 
accordance with section 9c.
    h. When you have elected to exclude hail and fire as insured causes 
of loss and the crop is damaged by hail or fire, appraisals for 
uninsured causes shall be made in accordance with Form FCI-78, ``Request 
to Exclude Hail and Fire''.
    i. You shall not abandon any acreage to us.
    j. You may not bring suit or action against us unless you have 
complied with all policy provisions. If a claim is denied, you may sue 
us in the United States District Court under the provisions of 7 U.S.C. 
1508(c). You must bring suit within 12 months of the date notice of 
denial is mailed to and received by you.
    k. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fee, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date and submit to us the properly completed claim form 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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 semi-annually on or about January 1 and July 1. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury. Interest will be paid in 
accordance with this section beginning with all claims for payment of 
indemnity initially filed on or after March 1, 1985.
    l. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the seeding for any crop year, any indemnity shall be 
paid to the person(s) we determine to be beneficially entitled thereto.
    m. If you have other fire insurance and fire damage occurs during 
the insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of:

[[Page 206]]

    (1) The amount of idemnity determined pursuant to this contract 
without regard to any other insurance; or
    (2) The amount by which the loss from fire exceeds the indemnity 
paid or payable under such other insurance. For the purposes of this 
section, the amount of loss from fire shall be the difference between 
the fair market value of the production on the unit before the fire and 
after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract, and such voidance shall be effective as of the beginning of 
the crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee shall have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may only assign to another party your right to an indemnity for 
the crop year on our form and with our approval. The assignee shall have 
the right to submit the loss notices and forms required by the contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
rights. If we pay you for your loss then your right of recovery shall at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess shall be paid to you.

                     14. Records and Access to Farm

    You shall keep, for two years after the time of loss, records of the 
seeding on each unit including separate records showing the same 
information for seeding on any uninsured acreage. Any person designated 
by us shall have access to such records and the farm for purposes 
related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract shall be in effect for the crop year specified on 
the application and may not be canceled for such crop year. Thereafter, 
the contract shall continue in force for each succeeding crop year 
unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract shall terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due:
    (1) If deducted from an indemnity claim shall be the date you sign 
such claim; or
    (2) If deducted from payment under another program administered by 
the United States Department of Agriculture shall be the date such 
payment was approved.
    d. The cancellation and termination dates are:

------------------------------------------------------------------------
                                               Cancellation termination
                   State                                 date
------------------------------------------------------------------------
New Hampshire, New York, Pennsylvania,       July 31.
 Vermont.
All other states...........................  April 15.
------------------------------------------------------------------------

    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract shall terminate as of the date of death, judicial declaration, 
or dissolution. However, if such event occurs after insurance attaches 
for any crop year, the contract shall continue in force through the crop 
year and terminate at the end thereof. Death of a partner in a 
partnership shall dissolve the partnership unless the partnership 
agreement provides otherwise. If two or more persons having a joint 
interest are insured jointly, death of one of the persons shall dissolve 
the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your amount of insurance is no longer offered, the actuarial 
table will provide the amount of insurance which you are deemed to have 
elected. All contract changes will be available at your service office 
by December 31 for counties with an April 15 cancellation date (January 
20, 1986, for the 1985, 1986 transition) and by April 30 for all other 
counties. Acceptance of any change will be conclusively presumed in the 
absence of any notice from you to cancel the contract.

[[Page 207]]

                          17. Meaning of Terms

    For the purposes of forage seeding crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the amounts of insurance, premium rates, 
insurable and uninsurable acreage, and related information regarding 
forage seeding insurance in the county.
    b. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county, as shown by the actuarial table.
    c. Crop year means the period within which the seeding is or 
normally would become established and shall be designated by the 
calendar year in which the seeding is made for spring-seeded acreage and 
the next succeeding calendar year for fall-seeded acreage.
    d. Harvest means the severance of the forage plant from the land for 
the intended use as livestock feed.
    e. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    f. Insured means the person who submitted the application accepted 
by us.
    g. Person means an individual, partnership, association, 
corporation, estate, trust, or other business enterprise or legal 
entity, and wherever applicable, a State, a political subdivision of a 
State, or any agency thereof.
    h. Reseed means the mechanical incorporation of seed into the soil 
at not less than 50 percent of the original seeding rate.
    i. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    j. Tenant means a person who rents land from another person for a 
share of the crop or a share of the proceeds therefrom.
    k. Unit means all insurable acreage of either fall-seeded or spring-
seeded forage in the county on the date of seeding for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.

Land rented for cash, a fixed commodity payment, or any consideration 
other than a share in the crop on such land shall be considered as owned 
by the lessee. Land which would otherwise be one unit may be divided 
according to guidelines on file in your service office or by written 
agreement with. Units as herein defined will be determined when the 
acreage is reported. Errors in reporting such units may be corrected by 
us to conform to guidelines when adjusting a loss. We may consider any 
acreage and share thereof reported by or for your spouse or child or any 
member of your household to be your bona fide share or the bona fide 
share any other person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy shall be made by us. If 
you disagree with our determinations you may obtain reconsideration of 
or appeal those determinations in accordance with FCIC Appeal 
Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirements. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. The time of the notice will be determined at the time of our 
receipt of the written notice.

[45 FR 49511, July 25, 1980, as amended by Amdt. 2, 49 FR 6335, Feb. 21, 
1984; 50 FR 49027, Nov. 29, 1985; 50 FR 52758, Dec. 26, 1985; 51 FR 
7546, Mar. 5, 1986; 51 FR 29205, Aug. 15, 1986; 52 FR 3214, Feb. 3, 
1987; 55 FR 50814, Dec. 11, 1990; 62 FR 13291, Mar. 20, 1997]



PART 415--FORAGE PRODUCTION CROP INSURANCE REGULATIONS--Table of Contents




        Subpart--Regulations for the 1986 Through 1997 Crop Years

Sec.
415.1  Availability of forage production crop insurance.
415.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
415.3  OMB control numbers.
415.4  Creditors.
415.5  Good faith reliance on misrepresentation.
415.6  The contract.
415.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1516(p).

    Source: 50 FR 26341, June 26, 1985, unless otherwise noted.

[[Page 208]]



        Subpart--Regulations for the 1986 Through 1997 Crop Years



Sec. 415.1  Availability of forage production crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
forage production in counties within limits prescribed by, and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended. The counties shall be designated by the Manager of the 
Corporation from those approved by the Board of Directors of the 
Corporation.

[50 FR 27928, July 9, 1985]



Sec. 415.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for forage production which will be included in the actuarial 
table on file in applicable service offices for the county and which may 
be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 415.3  OMB control numbers.

    OMB control numbers are contained in subpart H to part 400 in title 
7 CFR.



Sec. 415.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 415.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the forage production 
insurance contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation (1) is 
indebted to the Corporation for additional premiums; or (2) has suffered 
a loss to a crop which is not insured or for which the insured is not 
entitled to an indemnity because of failure to comply with the terms of 
the insurance contract, but which the insured believed to be insured, or 
believed the terms of the insurance contract to have been complied with 
or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice; (2) said insured 
relied thereon in good faith; and (3) to require the payment of the 
additional premiums or to deny such insured's entitlement to the 
indemnity would not be fair and equitable, such insured shall be granted 
relief the same as if otherwise entitled thereto.

Application for relief under this section must be submitted to the 
Corporation in writing.



Sec. 415.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the forage 
production crop as provided in the policy. The contract shall consist of 
the application, the policy, and the county actuarial table. Any changes 
made in the contract shall not affect its continuity from year to year. 
The forms referred to in the contract are available at the applicable 
service office.

[50 FR 27928, July 9, 1985]



Sec. 415.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the forage production crop as landlord, owner-operator, or tenant. The 
application shall be submitted to the Corporation at the

[[Page 209]]

service office on or before the applicable closing date on file in the 
service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the period of such extension. However, if adverse conditions should 
develop during such period, the Corporation will immediately discontinue 
the acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1986 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a forage 
production contract issued under such prior regulations, without the 
filing of a new application.
    (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 Forage Production Insurance 
Policy for the 1986 through 1997 crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                 Forage Production Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following losses occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption ; or
    (8) Failure of the irrigation water supply due to an unavoidable 
cause occurring after insurance attaches;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9e(6).
    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants, or employees;
    (2) The failure to follow recognized good forage production farming 
practices;
    (3) The impoundment of water by any governmental, public, or private 
dam or reservoir project; or
    (4) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be forage which is planted for harvest as 
livestock feed, which is grown on insured acreage, and for which we 
provide a guarantee and premium rate in the actuarial table.
    b. The acreage insured for each crop year will be forage planted on 
insurable acreage as designated by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share will be your share as landlord, owner-operator, 
or tenant in the insured forage at the time insurance attaches.
    d. We do not insure any acreage:
    (1) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (2) Which is irrigated and an irrigated practice is not provided for 
by the actuarial table unless you elect to insure the acreage as 
nonirrigated by reporting it as insurable under section 3;
    (3) If forage ground cover is less than 75 percent at the beginning 
of the insurance period;
    (4) If the current age of the forage stand exceeds the limitations 
established by the actuarial table unless otherwise approved in writing 
by us;
    (5) Planted to a type or variety or mixture not estabished as 
adapted to the area or excluded by the actuarial table;
    (6) Grown with another crop; or
    (7) Grown for experimental purposes.
    e. If insurance is provided for an irrigated practice:

[[Page 210]]

    (1) You must report as irrigated only the acreage for which you have 
adequate facilities and water to carry out a good forage irrigation 
practice at the time insurance attaches; and
    (2) Any loss of production caused by failure to carry out a good 
irrigation practice, except failure of the water supply from an 
unavoidable cause occurring after insurance attaches, will be considered 
as due to an uninsured cause. The failure or breakdown of irrigation 
equipment or facilities will not be considered as a failure of the water 
supply from an unavoidable cause.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to the time insurance attaches.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of insurable types of forage grown in the county 
in which you have a share;
    b. The practice; and
    c. Your share at the time insurance attaches.

You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any forage grown in the 
county. This report must be submitted annually on or before the 
reporting date established by the actuarial table. All indemnities may 
be determined on the basis of information you submit on this report. If 
you do not submit this report by the reporting date, we may elect to 
determine by unit the insured acreage, share, and practice or we may 
deny liability on any unit. Any report submitted by you may be revised 
only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. Coverage level 2 will apply if you have not elected a coverage 
level.
    c. You may change the coverage level and price election on or before 
the closing date for submitting applications for the crop year as 
established in the actuarial table.
    d. You must furnish a report of production to us for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the subsequent crop year. The yield 
assigned by us will be 75% of the yield assigned for the purpose of 
determining your guarantee for the present crop year. If you have filed 
a claim for the previous crop year, the yield determined in adjusting 
your indemnity claim will be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time insurance 
attaches. The amount is computed by multiplying the production guarantee 
times the price election, times the premium rate, times the insured 
acreage, times your share at the time insurance attaches.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1948 crop year 
under the terms of the experience table contained in the forage 
production policy in effect for the 1985 crop year, you will continue to 
receive the benefit of that reduction subject to the following 
conditions:
    (1) No premium reduction will be retained after the 1991 crop year.
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1985 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    a. Insurance attaches on acreage with an adequate stand:
    (1) For the calendar year following the year of seeding on:
    (a) February 1 for spring-seeded forage in California;
    (b) April 15 for spring-seeded forage in Colorado, Idaho, Nebraska, 
Nevada, Oregon, Utah, and Washington;
    (c) May 22 for spring-seeded forage in Iowa, Minnesota, Montana, New 
Hampshire, New York, North Dakota, Pennsylvania, Wisconsin, Wyoming and 
all other states;
    (d) October 16 for fall-seeded forage in all states except 
California; and
    (e) December 16 for fall-seeded forage in California.

[[Page 211]]

    (2) For subsequent years on:
    (a) October 16 in all states except California; and
    (b) January 1 in California.
    b. Insurance ends at the earliest of:
    (1) Total destruction of the forage crop;
    (2) Removal from the windrow or the field;
    (3) Final adjustment of a loss; or
    (4) The following dates of the calendar year in which the majority 
of the forage is normally harvested:
(a) All states except California.............................October 15.
(b) California..............................................December 31.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss, you must give us written 
notice if:
    (1) During the period before harvest, the forage on any unit is 
damaged and you decide not to further care for or harvest any part of 
it;
    (2) You want our consent to put the acreage to another use; or
    (3) After consent to put acreage to another use is given, additional 
damage occurs.

Insured acreage may not be put to another use until we have appraised 
the forage and given written consent. You must notify us when such 
acreage is put to another use.
    b. If you are going to claim an indemnity on any unit, you must give 
us notice:
    (1) Of probable loss at least 15 days before the beginning of any 
cutting or immediately, if probable loss is later determined; and
    (2) At least 5 days before any feeding of the insured forage begins. 
The notice before feeding must include the number of acres harvested and 
tons produced from each unit.
    c. You must obtain written consent from us before you destroy any of 
the forage which is not to be harvested.
    d. We may reject any claim for indemnity if any of the requirements 
of this section or section 9 are not complied with.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the forage on the unit;
    (2) Final harvest of the units; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of forage on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of forage to be 
counted (see section 9e);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported and not on the actual information determined. All production 
from insurable acreage, whether or not reported as insurable, will count 
against the production guarantee.
    e. The total production to be counted for a unit will include all 
harvested and appraised production.
    (1) Any production from volunteer plants growing in the forage will 
be counted as forage on a weight basis.
    (2) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good forage farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (c) Any appraised production on unharvested acreage.
    (3) When forage is harvested as other than air-dry hay, the 
production to count will be adjusted to the equivalent of air-dry hay.
    (4) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of forage becomes general 
in the county;
    (b) Harvested; or
    (c) Further damaged by an insured cause before the acreage is put to 
another use.
    (5) We may determine the amount of production of any unharvested 
forage on the basis of field appraisals conducted after the normal time 
for each cutting for the area.
    (6) If you elect to exclude hail and fire as insured causes of loss 
and the forage is damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire.''
    (7) The commingled production of units will be allocated to such 
units in proportion to our liability on the harvested acreage of each 
unit.
    f. You must not abandon any acreage to us.
    g. You may not sue us unless you have complied with all policy 
provisions. If a claim is denied, you may sue us in the United States 
District Court under the provisions of 7 U.S.C. 1508(c). You must bring

[[Page 212]]

suit within 12 months of the date notice of denial is received by you.
    h. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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 semi-annually on or about January 1 and July 1. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury.
    i. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after insurance attaches for any crop year, any indemnity will 
be paid to the person(s) we determine to be beneficially entitled 
thereto.
    j. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of:
    (1) The amount of indemnity determined pursuant to this contract 
without regard to any other insurance; or
    (2) The amount by which the loss from fire exceeds the indemnity 
paid or payable under such other insurance. For the purpose of this 
section, the amount of loss from fire will be the difference between the 
fair market value of the production on the unit before the fire and 
after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

            11. Transfer of Right Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
out option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for 2 years after the time of loss, records of the 
harvesting, storage, shipments, sale, or other disposition of all forage 
produced on each unit including separate records showing the same 
information for production from any uninsured acreage. Any person 
designated by us will have access to such records and the farm for 
purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due:
    (1) If deducted from an indemnity will be the date you sign such 
claim; or
    (2) If deducted from payment under another program administered by 
the United States Department of Agriculture will be the

[[Page 213]]

date both such other payment and setoff are approved.
    d. The cancellation and termination date is:

------------------------------------------------------------------------
                                                   Cancellation and
                   State                           termination date
------------------------------------------------------------------------
All States.................................  Nov. 30.
------------------------------------------------------------------------

    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by August 15 preceding the cancellation 
date. Acceptance of any change will be conclusively presumed in the 
absence of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of forage production crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
forage production insurance in the county.
    b. Alfalfa means a pure stand of alfalfa or a stand of alfalfa and 
grass in which 60 percent or more of the ground cover is alfalfa.
    c. Alfalfa-grass mixture means a mixed stand of alfalfa and grass in 
which alfalfa comprises more than 25 percent but less than 60 percent of 
the ground cover.
    d. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county as shown by the actuarial table.
    e. Crop year means the period from the date insurance attaches until 
harvest is normally completed and will be designated by the calendar 
year in which the majority of the forage is normally harvested.
    f. Cutting means the severance of the forage plant from the land for 
the purpose of livestock feed.
    g. Forage means Alfalfa, Alfalfa Grass-mixture or Grass-mixture.
    h. Grass-mixture means a mixed stand of locally recognized forage 
grasses and alfalfa in which alfalfa comprises less than 25 percent of 
the ground cover.
    i. Harvest means the removal from the windrow or field.
    j. Insurable acreage means the land classified as insurable by us 
and shown as such in the actuarial table.
    k. Insured means the person who submitted the application accepted 
by us.
    l. Loss ratio means the ratio of indemnity(ies) to premium(s).
    m. Person means an individual, partnership, association, 
corporation, estate, trust, or other business enterprise or legal 
entity, and wherever applicable, a State, a political subdivision of a 
State, or any agency thereof.
    n. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    o. Tenant means a person who rents land from another person for a 
share of the forage production or a share of the proceeds therefrom.
    p. Unit means all insurable acreage of forage in the county on the 
date insurance attaches:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.

Land rented for cash, a fixed commodity payment, or any consideration 
other than a share in the forage on such land will be considered as 
owned by the lessee. Units will be determined when the acreage is 
reported. Errors in reporting such units may be corrected by us when 
adjusting a loss. We may consider any acreage and share thereof reported 
by or for your spouse or child or any member of your household to be 
your bona fide share or the bona fide share of any other person having 
an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our

[[Page 214]]

determinations, you may obtain reconsideration of or appeal those 
determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.

[50 FR 26341, June 26, 1985; 50 FR 32160, Aug. 9, 1985; 50 FR 49027, 
Nov. 27, 1985; 51 FR 29205--29207, Aug. 15, 1986; 51 FR 45296, Dec. 18, 
1986; 52 FR 3214, Feb. 3, 1987; 55 FR 40789, Oct. 5, 1990; 58 FR 33509, 
June 18, 1993; 62 FR 14285, Mar. 26, 1997]



PART 416--PEA CROP INSURANCE REGULATIONS FOR THE 1986 THROUGH 1997 CROP YEARS--Table of Contents


Sec.
416.1  Availability of pea crop insurance.
416.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
416.3  OMB control numbers.
416.4  Creditors.
416.5  Good faith reliance on misrepresentation.
416.6  The contract.
416.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 50 FR 7729, Feb. 26, 1985, unless otherwise noted.



Sec. 416.1  Availability of pea crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
pea crop in counties within limits prescribed by, and in accordance with 
the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.

[50 FR 27928, July 9, 1985]



Sec. 416.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for peas which will be included in the actuarial table on file 
in applicable service offices for the county and which may be changed 
from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 416.3  OMB control numbers.

    The information collection requirements contained in these 
regulations (7 CFR part 416) have been approved by the Office of 
Management and Budget (OMB) under the provisions of 44 U.S.C. Chapter 35 
and have been assigned OMB Nos. 0563-0003 and 0563-0007.



Sec. 416.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 416.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the pea insurance contract, 
whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation (1) is 
indebted to the Corporation for additional premiums; or (2) has suffered 
a loss to a crop which is not insured or for which the insured is not 
entitled to an indemnity because of failure to comply with the terms of 
the insurance contract, but which the insured believed to be insured, or 
believed the terms of the insurance contract to have been complied with 
or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, find that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice; (2) said insured 
relied thereon in good faith;

[[Page 215]]

and (3) to require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto. Application for relief under this section must be 
submitted to the Corporation in writing.



Sec. 416.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the pea crop as 
provided in the policy. The contract shall consist of the application, 
the policy, and the county actuarial table. Any changes made in the 
contract shall not affect its continuity from year to year. The forms 
referred to in the contract are available at the applicable service 
offices.

[50 FR 27928, July 9, 1985]



Sec. 416.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the pea crop as landlord, owner-operator, or tenant. The application 
shall be submitted to the Corporation at the service office on or before 
the applicable closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the period of such extension. However, if adverse conditions should 
develop during such period, the Corporation will immediately discontinue 
the acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1986 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a pea contract 
issued under such prior regulations, without the filing of a new 
application.
    (d) The application is found at subpart D of part 400, General 
Administrative Regulations (7 CFR 400.37, 400.38). The provisions of the 
Pea Insurance Policy for the 1986 through 1997 crop years are as 
follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                       Pea--Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown in the accepted Application and ``we,'' ``us'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease on acreage not planted to peas the previous crop 
year;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply due to an unavoidable 
cause occurring after the beginning of planting; unless those causes are 
expected, excluded, or limited by the actuarial table or section 9e(8).
    b. We will not insure against loss of production due to:
    (1) Green peas not being timely harvested unless such delay in 
harvesting is solely and directly due to adverse weather conditions, 
(specifically, no indemnity will be paid if the delay in harvesting is 
in any way caused by the non-availability of labor or equipment, by the 
volume of peas ready for harvest at approximately the same time, or by 
any other reason except adverse weather conditions);
    (2) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants or employees;

[[Page 216]]

    (3) The failure to follow recognized good pea farming practices;
    (4) The impoundment of water by any governmental, public or private 
dam or reservoir project; or
    (5) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be either green peas or day peas which are 
planted for harvest as peas, which are grown on insured acreage and for 
which a guarantee and premium rate are provided by the actuarial table.
    b. The acreage insured for each crop year will be peas planted on 
insurable acreage as designated by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share will be your share as landlord, owner-operator, 
or tenant in the insured peas at the time of planting.
    d. We do not insure any acreage:
    (1) Of green peas not grown under a contract executed with a 
processor or excluded from the processor contract for, or during, the 
crop year (the contract must be executed and be effective before you 
report your acreage);
    (2) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (3) Which is irrigated and an irrigated practice is not provided by 
the actuarial table unless you elect to insure the acreage as 
nonirrigated by reporting it as insurable under section 3;
    (4) Which is destroyed; it is practical to replant to the same type 
of green peas or the same varietal group of dry peas; and such acreage 
is not replanted;
    (5) Initially planted after the final planting date contained in the 
actuarial table;
    (6) Of volunteer peas;
    (7) Planted to a type or variety of peas not established as adapted 
to the area or excluded by the actuarial table;
    (8) Planted with a crop other than peas; or
    (9) Planted for the development or production of hybrid seed or for 
experimental purposes.
    e. If insurance is provided for an irrigated practice:
    (1) You must report as irrigated only the acreage for which you have 
adequate facilities and water to carry out a good irrigation practice 
for peas at the time of planting; and
    (2) Any loss of production caused by failure to carry out a good pea 
irrigation practice, except failure of the water supply from an 
unavoidable cause occurring after the beginning of planting, will be 
considered as due to an uninsured cause. The failure or breakdown of 
irrigation equipment or facilities will not be considered as a failure 
of the water supply from an unavoidable cause.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to planting.
    g. An instrument in the form of a ``lease'' under which you retain 
control of the acreage on which the insured peas are grown and which 
provides for delivery of the peas under certain conditions and at a 
stipulated price will, for the purpose of this contract, be treated as a 
contract under which you have the share in the peas.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of peas in the county in which you have a share;
    b. The practice; and
    c. Your share at the time of planting.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any peas planted in the 
county. This report must be submitted annually on or before the 
reporting date established by the actuarial table. All indemnities may 
be determined on the basis of information you have submitted on this 
report. If you do not submit this report by the reporting date, we may 
elect to determine by unit the insured acreage, share, and practice or 
we may deny liability on any unit. Any report submitted by you may be 
revised only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. Coverage level 2 will apply if you have not elected a coverage 
level.
    c. You may change the coverage level and price election on or before 
the closing date for submitting applications for the crop year as 
established by the actuarial table.
    d. You must furnish a report of production to us for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the subsequent crop year. The yield 
assigned by us will be 75% of the yield assigned for the purpose of 
determining your guarantee for the present crop year. If you have filed 
a claim for the previous crop year, the yield determined in adjusting 
your indemnity claim will be used as your production report.

[[Page 217]]

                            5. Annual Premium

    a. The annual premium is earned and payable at the time of planting. 
The amount is computed by multiplying the production guarantee, times 
the price election, times the premium rate, times the insured acreage, 
times your share at the time of planting.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience throughout the 1984 crop year 
under the terms of the Experience Table contained in the pea policy for 
the 1985 crop year, you will continue to receive the benefit of that 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the 1985 policy;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will be applicable, and
    (5) Participation must be continuous.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    Insurance attaches when the peas are planted and ends at the 
earliest of:
    a. Total destruction of the peas;
    b. Combining, vining, or removal from the field;
    c. Final adjustment of a loss;
    d. For green peas, the date the green peas should have been 
harvested unless we give consent to harvest the green peas as dry peas; 
or
    e. September 15 of the calendar year in which peas are normally 
harvested.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us notice if:
    (a) During the period before harvest, the peas on any unit are 
damaged and you decide not to further care for or harvest any part of 
them;
    (b) During the period before harvest, the green peas on any unit are 
damaged and you want our consent to harvest the green peas as dry peas;
    (c) You want our consent to put the acreage to another use; or
    (d) After consent to put acreage to another use is given, additional 
damage occurs.
    Insured acreage may not be put to another use until we have 
appraised the peas and given written consent. We will not consent to 
another use until it is too late to replant. You must notify us when 
such acreage is put to another use.
    (2) If you anticipate a loss on any dry pea unit, you must give us 
notice:
    (a) At least 15 days before the beginning of harvest; or
    (b) Immediately, if probable loss is later determined on dry peas. A 
representative sample of the unharvested dry peas (at least 10 feet wide 
and the entire length of the field) must remain unharvested for a period 
of 15 days from the date of notice, unless we give you written consent 
to harvest the sample.
    (3) If you anticipate a loss on any green pea unit, you must give us 
notice:
    (a) Not later than 15 days before the beginning of harvest; or
    (b) Not later than 48 hours after:
    (i) Total destruction of the green peas on the unit; or
    (ii) Discontinuance of harvest on the unit prior to completion.
    If such notice is not given or if the unharvested acreage is not 
left unharvested, the appraisal on such acreage will be the production 
guarantee.
    (4) Unless notice has been given under subsection (3) above, and in 
addition to the other notices required by this section, if you are going 
to claim an indemnity on any unit, we must be given notice not later 
than 30 days after the earlier of:
    (a) Harvest of the unit; or
    (b) The calendar date for the end of the insurance period.
    b. You must obtain written consent from us before you destroy any of 
the peas which are not to be harvested.
    c. We may reject any claim for indemnity if any of the requirements 
of this section or section 9 are not complied with.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the peas on the unit;
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of peas on the unit and that any 
loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and

[[Page 218]]

    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of peas to be counted 
(see section 9e);
    (3) Multiplying the remainder by:
    (a) Dry peas--the price election; or
    (b) Green peas--the lower of
    (i) The applicable contract price per pound for the tenderometer or 
serve size contained in the actuarial table; or
    (ii) Your price election for such peas; and
    (4) Multiplying this product by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported and not on the actual information determined. All production 
from insurable acreage, whether or not reported as insurable will count 
against the production guarantee.
    e. The total production (pounds) to be counted for a unit will 
include all harvested and appraised production.
    (1) If, due to insurable causes, mature dry pea production does not 
grade No. 3 or better, or lentils do not grade No. 2 or better, in 
accordance with the Official United States Standards for dry peas and 
lentils, the production will be adjusted by:
    (a) Dividing the value per pound of such peas by the price per pound 
for the same variety of dry peas grading No. 3 (No. 2 for lentils); and
    (b) Multiplying the result by the number of pounds of such peas. The 
applicable price for No. 3 dry peas (No. 2 lentils) will be the local 
market price on the earlier of the day the loss is adjusted or the day 
the peas were sold.
    (2) The pounds of production for harvested green peas will be 
determined by dividing the dollar amount received from the processor by 
the contract price for the tenderometer reading or sieve size designated 
by the actuarial table.
    (3) If any acreage of green peas is not timely harvested, the 
production to count will be the greater of:
    (a) The appraised production with no adjustment for quality; or
    (b) The dollar amount received from the processor divided by the 
processor's contract price per pound for the tenderometer reading or 
sieve size designated by the actuarial table.
    (4) If any acreage reported as green peas is harvested as dry peas 
or we have given consent for the acreage to be harvested as dry peas, 
the guarantee for such acreage will be reduced 40 percent.
    (5) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good pea farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (c) Any appraised production on unharvested acreage.
    (6) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of peas becomes general in 
the county;
    (b) Harvested; or
    (c) Further damaged by an insured cause before the acreage is put to 
another use.
    (7) The amount of production of any unharvested peas may be 
determined on the basis of field appraisals conducted after the end of 
the insurance period.
    (8) If you have elected to exclude hail and fire as insured causes 
of loss and the peas are damaged by hail or fire, appraisals will be 
made in accordance with Form FCI-78, ``Request to Exclude Hail and 
Fire''.
    (9) The commingled production of units will be allocated to such 
units in proportion to our liability on the harvested acreage of each 
unit.
    f. You must not abandon any acreage to us.
    g. You may not bring suit or action against us unless you have 
complied with all policy provisions. If a claim is denied, you may sue 
us in the United States District Court under the provisions of 7 U.S.C. 
1508(c). You must bring suit within 12 months of the date notice of 
denial is mailed to and received by you.
    h. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fee, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date and submit to us the properly completed claim form 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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 semi-annually on or about January 1 and July 1. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of

[[Page 219]]

the Treasury. Interest will be paid in accordance with this section 
beginning with all claims for payment of indemnity initially filed on or 
after March 1, 1985.
    i. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the peas are planted for any crop year, any indemnity 
will be paid to the person(s) we determine to be beneficially entitled 
thereto.
    j. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount;
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance. For the purposes of this section, 
the amount of loss from fire will be the difference between the fair 
market value of the production on the unit before the fire and after the 
fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract, and such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale or other disposition of all peas 
produced on each unit including separate records showing the same 
information for production from any uninsured acreage. Any person 
designated by us will have access to such records and the farm for 
purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any crop 
year by giving written notice on or before the cancellation date 
preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due:
    (1) If deducted from an indemnity claim will be the date you sign 
the claim; or
    (2) If deducted from payment under another program administered by 
the United States Department of Agriculture will be the date both such 
payment and set-off are approved.
    d. The cancellation and termination dates are April 15.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which

[[Page 220]]

you are deemed to have elected. All contract changes will be available 
at your service office by December 31 preceding the cancellation date 
(January 20, 1986, for the 1985, 1986 transition). Acceptance of any 
change will be conclusively presumed in the absence of any notice from 
you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of pea crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding pea 
insurance in the county.
    b. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county, as shown by the actuarial table.
    c. Crop year means the period within which the peas are normally 
grown and is designated by the calendar year in which the peas are 
normally harvested.
    d. Combining (See ``Vining'')
    e. Harvest as to any green pea acreage means the vining or combining 
and acceptance by the processor of the peas from such acreage. 
``Harvest'' as to any dry pea acreage means combining peas which are or 
could be marketed as dry peas.
    f. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    g. Insured means the person who submitted the application accepted 
by us.
    h. Loss ratio means the ratio of indemnity(ies) to premium(s).
    i. Person means an individual, partnership, association, 
corporation, estate, trust, or other business enterprise or legal 
entity, and wherever applicable, a State, a political subdivision of a 
State, or any agency thereof.
    j. Peas mean either:
    (1) Canning and freezing peas (``green peas'') grown under contract 
with a processor executed before you report your acreage; or
    (2) All spring-planted smooth green and yellow, and wrinkled 
varieties of dry peas and lentils (``dry peas'').
    k. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    l. Tenant means a person who rents land from another person for a 
share of the peas or a share of the proceeds therefrom.
    m. Unit means all insurable acreage of any one type of green peas or 
varietal group of dry peas (see the actuarial table) in the county on 
the date of planting for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the peas on such land shall be 
considered as owned by the lessee. Land which would otherwise be one 
unit may be divided according to applicable guidelines on file in your 
service office or by written agreement with us. Units will be determined 
when the acreage is reported. Errors in reporting such units may be 
corrected by us to conform to applicable guidelines when adjusting a 
loss. We may consider any acreage and share thereof reported by or for 
your spouse or child or any member of your household to be your bona 
fide share of the bona fide share of any other person having an interest 
therein.
    n. Vining or combining means separating the peas from the pods.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[50 FR 7729, Feb. 26, 1985, as amended at 50 FR 49027, Nov. 29, 1985; 
Amdt. 1, 50 FR 49921, Dec. 6, 1985; 50 FR 52758, Dec. 26, 1985; Amdt. 1, 
51 FR 7546, 7547, Mar. 5, 1986; 51 FR 29205--29207, Aug. 15, 1986; 51 FR 
45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 54 FR 20507, May 12, 
1989; 55 FR 35888, Sept. 4, 1990; 62 FR 61903, Nov. 20, 1997]

                        PARTS 417-421  [RESERVED]

[[Page 221]]



PART 422--POTATO CROP INSURANCE REGULATIONS--Table of Contents



 Subpart--Regulations for the 1986 (1987 in certain California Counties 
and Florida) through 1997 Crop Years (1998 in Alabama; Arizona; certain 
California Counties; Delaware; Florida; Maryland; Missouri; New Jersey; 
       New Mexico; North Carolina; Oklahoma; Texas; and Virginia)


Sec.
422.1  Availability of potato crop insurance.
422.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
422.3  OMB control numbers.
422.4  Creditors.
422.5  Good faith reliance on misrepresentation.
422.6  The contract.
422.7  The application and policy.
422.8  Certified seed potato option amendment.
422.9  Quality potato option.
422.10  Frost/freeze option.
422.11  Processing potato quality option.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 51 FR 5690, Feb. 18, 1986, unless otherwise noted.




 Subpart--Regulations for the 1986 (1987 in certain California Counties 
and Florida) through 1997 Crop Years (1998 in Alabama; Arizona; certain 
California Counties; Delaware; Florida; Maryland; Missouri; New Jersey; 
       New Mexico; North Carolina; Oklahoma; Texas; and Virginia)



Sec. 422.1  Availability of potato crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
potatoes in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 422.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for potatoes which will be included in the actuarial table on 
file in the applicable service offices for the county and which may be 
changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 422.3  OMB control numbers.

    The OMB control numbers are contained in subpart H of part 400, 
title 7 CFR.



Sec. 422.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 422.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the potato insurance 
contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation:
    (1) Is indebted to the Corporation for additional premiums; or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the insured believed 
to be insured, or believed the terms of the insurance contract to have 
been complied with or waived; and

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    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that:
    (1) An agent or employee of the Corporation did in fact make such 
misrepresentation or take other erroneous action or give erroneous 
advice;
    (2) Said insured relied thereon in good faith; and
    (3) To require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto. Requests for relief under this section must be 
submitted to the Corporation in writing.



Sec. 422.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the potato crop 
as provided in the policy. The contract shall consist of the 
application, the policy, the Certified Seed Potato Option Amendment, if 
applicable, the Quality Potato Option Amendment, if applicable, and the 
county actuarial table. Any changes made in the contract shall not 
affect its continuity from year to year. The forms referred to in the 
contract are available at the applicable service offices.



Sec. 422.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation must be made by any person to cover such person's share in 
the potato crop as landlord, owner-operator, or tenant if the person 
wishes to participate in the program. The application shall be submitted 
to the Corporation at the service office on or before the applicable 
sales closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the sales closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period.

However, if adverse conditions should develop during the such period, 
the Corporation will immediately discontinue the acceptance of 
applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1986 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a potato 
insurance contract issued under such prior regulations, without the 
filing of a new application.
    (d) The application for the 1986 and succeeding crop year 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 (1987 in certain California counties and Florida) through 1997 
Crop Years (1998 in Alabama; Arizona; certain California counties; 
Delaware; Florida; Maryland; Missouri; New Jersey; New Mexico; North 
Carolina; Oklahoma; Texas; and Virginia) are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                      Potato--Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;

[[Page 223]]

    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting; unless 
those causes are expected, excluded, or limited by the actuarial table 
or section 9e(5).
    b. We will not insure against any loss of production due to:
    (1) Damage that occurs or becomes evident after the potatoes have 
been placed in storage;
    (2) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants, or employees;
    (3) The failure to follow recognized good potato irrigation 
practices;
    (4) The failure or breakdown of irrigation equipment or facilities;
    (5) The failure to follow recognized good potato farming practices;
    (6) The impoundment of water by any governmental, public, or private 
dam or reservoir project; or
    (7) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be potatoes planted for harvest as 
certified seed stock or for human consumption, grown on insured acreage, 
and for which a guarantee and premium rate are provided by the actuarial 
table.
    b. The acreage insured for each crop year will be potatoes planted 
on insurable acreage as designated by the actuarial table and in which 
you have a share, as reported by you or as determined by us, whichever 
we elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured potatoes at the time of each planting period. 
However, only for the purpose of determining the amount of indemnity, 
your share will not exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any acreage:
    (1) Planted with noncertified seed unless allowed by the actuarial 
table;
    (2) Which does not meet the rotation procedures required by the 
actuarial table;
    (3) Where the farming practices carried out are not in accordance 
with the farming practices for which the premium rates have been 
established;
    (4) Which is irrigated and an irrigated practice is not provided for 
by the actuarial table unless you elect to insure the acreage as 
nonirrigated by reporting it as insurable under section 3;
    (5) Which is destroyed, it is practical to replant to potatoes, and 
such acreage is not replanted;
    (6) Initially planted after the final planting date set by the 
actuarial table unless you agree, in writing, on our form to coverage 
reduction;
    (7) Of volunteer potatoes;
    (8) Planted to a type or variety of potatoes not established as 
adapted to the area or excluded by the actuarial table;
    (9) Planted with a crop other than potatoes; or
    (10) Planted for the development or production of hybrid seed or for 
experimental purposes.
    e. If insurance is provided for an irrigated practice, you must 
report as irrigated only the acreage for which you have adequate 
facilities and water, at the time of planting, to carry out a good 
potato irrigation practice.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to planting.

                3. Report of Acreage, Share, and Practice

    You must report at the time of each planting period on our form:
    a. All the acreage of fall, winter, spring, and summer-planted 
potatoes in the county in which you have a share;
    b. The practice; and
    c. Your share at the time of planting.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any potatoes planted in the 
county. This report must be submitted for each planting period on or 
before the reporting date established by the actuarial table for each 
planting period. All indemnities may be determined on the basis of 
information you submit on this report. If you do not submit this report 
by the reporting date, we may elect to determine, by unit, for each 
planting period, the insured acreage, share, and practice or we may deny 
liability on any unit for any planting. Any report submitted by you may 
be revised only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. Coverage level 2 will apply if you do not elect a coverage level.
    c. You may change the coverage level and price election on or before 
the sales closing date as established by the actuarial table for 
submitting applications for the crop year.
    d. You must furnish a report of production to us for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished.

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The production report or assigned yield will be used to compute your 
production history for the purpose of determining your guarantee for the 
subsequent crop year. The yield assigned by us will be 75% of the yield 
assigned for the purpose of determining your guarantee for the present 
crop year. If you have filed a claim for the previous crop year, the 
yield determined in adjusting your indemnity claim will be used as your 
production report.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time of planting. 
The amount is computed by multiplying the production guarantee times the 
price election, times the premium rate, times the insured acreage, times 
your share at the time of planting.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1983 crop year 
under the terms of the experience table contained in the potato policy 
for the 1984 crop year, you will continue to receive the benefit of that 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year.
    (2) The premium reduction will not increase because of favorable 
experience.
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1984 crop year.
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply.
    (5) Participation must be continuous.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    a. Insurance attaches when the potatoes are planted (in Alabama, 
California and Florida insurance attaches when the potatoes are planted 
in each planting period).
    b. Insurance ends at the earliest of:
    (1) Total destruction of the potatoes on the unit;
    (2) Harvesting or removal from the field;
    (3) Final adjustment of a loss;
    (4) The following dates of the calendar year in which the potatoes 
are normally harvested:
    (a) Missouri and all Texas counties except Bailey, Castro, Dallam, 
Deaf Smith, Floyd, Gaines, Hale, Hartley, Knox, Lamb, and Parmer--July 
15;
    (b) North Carolina--July 25;
    (c) Virginia, and Knox County, Texas--August 15;
    (d) Alaska--October 1;
    (e) Nebraska and Wyoming--October 10;
    (f) Connecticut, Massachusetts, Nevada, New York and Pennsylvania--
October 31;
    (g) Idaho, Maine, Oregon, and Washington (Russett type only)--
October 31;
    (h) Idaho, Maine, Oregon, and Washington (all other types)--October 
15;
    (i) Alabama, California, and Florida, the dates established by the 
actuarial table for each planting period; and
    (j) Bailey, Castro, Dallam, Deaf Smith, Floyd, Gaines, Hale, 
Hartley, Lamb, and Parmer Counties, Texas, and all other states--October 
15.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if:
    (a) During the period before harvest, the potatoes on any unit are 
damaged and you decide not to further care for or harvest any part of 
them;
    (b) You want our consent to put the acreage to another use; or
    (c) After consent to put acreage to another use is given, additional 
damage occurs.
    Insured acreage may not be put to another use until we have 
appraised the potatoes and given written consent. We will not consent to 
another use until it is too late to replant for that planting period. 
You must notify us when such acreage has been put to another use.
    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (3) If probable loss is determined within 15 days prior to or during 
harvest, immediate notice must be given and a representative sample of 
the unharvested potatoes (at least 10 feet wide and the entire length of 
the field) must remain unharvested for a period of 15 days from the date 
of notice, unless we give you written consent to harvest the sample.
    (4) In addition to the notices required by this section, if you are 
going to claim an indemnity on any unit, you must give us notice not 
later than 10 days after the earliest of:
    (a) Total destruction of the potatoes on the unit;
    (b) Harvest of the unit; or
    (c) The calendar date for the end of the insurance period.
    b. We must be given the opportunity to inspect any harvested 
production on any unit for which you have given notice of probable

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loss if such production will not be delivered directly to a processing 
plant.
    c. You must obtain written consent from us before you destroy any of 
the potatoes which are not to be harvested.
    d. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the potatoes on the unit;
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of potatoes on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Substracting therefrom the total production of potatoes to be 
counted (see section 9e);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. The total production (in hundredweight) to be counted for a unit 
will include all harvested and appraised production.
    (1) The extent of any loss may be determined at the time the 
potatoes are placed in storage or delivered to a processor.
    (2) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production loss due to uninsured causes;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause;
    (c) Not less than the guarantee for any acreage from which the 
harvested production is disposed of without our prior written consent 
and such disposition prevents accurate determination of production; and
    (d) Any appraised production on unharvested acreage.
    (3) Any appraisal we have made on insured acreage for which we have 
given written consent for another use will be considered production 
unless such acreage is:
    (a) Not put to another use before harvest of potatoes becomes 
general in the county for the planting period and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (4) The amount of production of any unharvested potatoes may be 
determined on the basis of field appraisals conducted after the end of 
the insurance period.
    (5) If you elect to exclude hail and fire as insured causes of loss 
and the potatoes are damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire.''
    f. You must not abandon any acreage to us.
    g. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    h. An indemnity will not be paid unless all policy provisions are 
complied with.
    i. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury.
    j. If you die, disappear, or are judicially declared imcompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the potatoes are planted for any crop year, any 
indemnity will be paid to the persons determined to be beneficially 
entitled thereto.
    k. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for

[[Page 226]]

loss due to fire only for the smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.
    For the purpose of this section, the amount of loss from fire will 
be the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment of Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our prescribed form and with our approval. The 
assignee will have the right to submit the loss notices and forms 
required by the contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expensse, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale, or other disposition of all 
potatoes produced on each unit, including separate records showing the 
same information for production from any uninsured acreage. Failure to 
keep and maintain such records may, at our option, result in 
cancellation of the contract prior to the crop year to which the records 
apply, assignment of production to units by us, or a determination that 
no indemnity is due. Any person designated by us will have access to 
such records and the farm for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due if deducted 
from:
    (1) An indemnity will be the date you sign the claim; or
    (2) Payment under another program administered by the United States 
Department of Agriculture will be the date both such other payment and 
setoff are approved.
    d. The cancellation and termination dates are:

------------------------------------------------------------------------
                                            Cancellation and termination
             State and county                           dates
------------------------------------------------------------------------
Manatee, Hardee, Highlands, Okeechobee,     Sept. 30.
 and St. Lucie Counties, Florida, and all
 Florida counties lying south thereof.
Contra Costa, San Joaquin, Calaveras, and   Nov. 30.
 Alpine Counties, California, and all
 California counties lying south thereof,
 and all Texas counties except Bailey,
 Castro, Dallam, Deaf Smith, Floyd,
 Gaines, Hale, Hartley, Knox, Lamb, and
 Parmer.
Alabama, Delaware, Maryland, Missouri, New  Dec. 31.
 Jersey, North Carolina, Virginia, and all
 other Florida counties.
Knox County, Texas (effective beginning     Feb. 28.
 with the 1988 crop year).
Bailey, Castro, Dallam, Deaf Smith, Floyd,  Apr. 15.
 Gaines, Hale, Hartley, Lamb, and Parmer
 counties, Texas, all other California
 counties and all other states.
------------------------------------------------------------------------

    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a

[[Page 227]]

partnership will dissolve the partnership unless the partnership 
agreement provides otherwise. If two or more persons having a joint 
interest are insured jointly, death of one of the persons will dissolve 
the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by:
    a. August 15 prior to 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; or
    c. December 31 preceding the cancellation date for counties with an 
April 15 cancellation date.
    Acceptance of changes will be conclusively presumed in the absence 
of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of potato crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
potato insurance in the county.
    b. ASCS means the Agricultural Stabilization and Conservation 
Service of the United States Department of Agriculture.
    c. County means:
    (1) The county shown on the application;
    (2) Any additional land located in a local producing area bordering 
on the county, as shown by the actuarial table; and
    (3) Any land identified by the same ASCS farm serial number for the 
county but physically located in another county within the State.
    d. Crop year means the period within which the potatoes are normally 
grown and is designated by the calendar year in which the spring-planted 
potatoes are normally harvested.
    e. Harvest means the digging of potatoes on the unit.
    f. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    g. Insured means the person who submitted the application accepted 
by us.
    h. Loss ratio means the ratio of indemnity to premium.
    i. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State or a political subdivision or agency of a State.
    j. Planting period means potatoes planted within the dates set by 
the actuarial table, as fall-planted, winter-planted, spring-planted, or 
summer-planted
    k. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    l. Tenant means a person who rents land from another person for a 
share of the potatoes or a share of the proceeds therefrom.
    m. Unit means all insurable acreage of potatoes in the county on the 
date of planting for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owed by one entity and operated by another entity on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the potatoes on such land will be 
considered as owned by the lessee. Land which would otherwise be one 
unit may be divided according to applicable guidelines on file in your 
service office. Units will be determined when the acreage is reported. 
Errors in reporting units may be corrected by us to conform to 
applicable guidelines when adjusting a loss. We may consider any acreage 
and share thereof reported by or for your spouse or child or any member 
of your household to be your bona fide share or the bona fide share of 
any other person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.

[[Page 228]]

    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[51 FR 5690, Feb. 18, 1986, as amended at 51 FR 29205--29207, Aug. 15, 
1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 52 FR 23425, 
June 22, 1987; 53 FR 6115, Mar. 1, 1988; 54 FR 20508, May 12, 1989; 54 
FR 43277, Oct. 24, 1989; 55 FR 35888, Sept. 4, 1990; 58 FR 33508, June 
18, 1993; 62 FR 65331, Dec. 12, 1997]



Sec. 422.8  Certified seed potato option amendment.

    (a) Notwithstanding the provisons of Sec. 422.7(d)(9)(e) of this 
part, an insured producer may, upon submission and approval of a 
Certified Seed Potato Option Amendment elect to insure all of the 
insurable acreage of potatoes grown for certified seed in which the 
insured has a share, under the provisions of the Certified Seed Potato 
Option Amendment. To be eligible for this amendment:
    (1) Insurance must be in effect under the provisions of the potato 
policy,
    (2) All potatoes grown for seed must be insured;
    (3) The insured must be a certified seed producer having acceptable 
production records; and
    (4) The management practices required for the production of 
certified seed potatoes as stated in the amendment must be met.
    The Certified Seed Potato Option Amendment shall be applicable only 
for one crop year. A new amendment must be submitted for each subsequent 
crop year.
    (b) For those insureds who elect to insure potatoes under this 
Amendment, all provisions of the Potato crop insurance policy shall 
apply except those in conflict with the amendment. The terms of the 
amendment are:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                      Potato Crop Insurance Policy

                 Certified Seed Potato Option Amendment

Insured's Name _________________________________________________________
Address ________________________________________________________________
 ______________________________________________________________________
Contract No. ___________________________________________________________
Crop Year ______________________________________________________________
Identification No. _____________________________________________________
SSN ---- Tax ----_______________________________________________________
    When you submit this Amendment each crop year on or before the final 
date for accepting applications and we approve such amendment, your 
insurable acreage of potatoes grown for certified seed will be insured, 
if:
    1. You are currently insured under the potato insurance program;
    2. All potatoes which are grown for certified seed on insurable 
acreage are insured;
    3. You are a person whose potatoes have qualified for entry into the 
Certified Seed porgram for the previous 3 years, (After initial 
approval, you will be exempt from this requirement provided you have 
discontinued participation in the program for not more than one crop 
year out of any three consecutive crop years);
    4. You provide acceptable records of your certified seed potato 
acreage and production for at least the previous 3 years;
    5. Potatoes for seed are not grown on the same land on which 
potatoes of the same variety as the seed potatoes have been grown more 
than 2 years out of the preceding 4 years;
    6. Elite or high-grade foundation seed potatoes or seed potatoes 
having a winter test reading of not more than 3 percent common virus are 
used in planting; and
    7. Your acreage insured for certified seed production is managed in 
accordance with standard practices and procedures required for 
certification as prescribed by the certifying agency and applicable 
state regulations regarding seed potato certification.
    Your production guarantee and premium rate will be provided by the 
actuarial table for certified seed potatoes. If, due to insurable causes 
occurring within the insurance period, potato production will not 
qualify as certified seed on any insured certified seed potato acreage 
within a unit, we will pay you one dollar ($1.00) per cwt., times your 
production guarantee for such acreage, times your share. Any production 
which will not qualify as certified seed because of your failure to 
carry out the standard practices and procedures required for 
certification will be considered lost due to uninsured causes.
    Insurable acreage grown under the provisions of this amendment may 
be designated as a separate unit.
    Any claim for indemnity on a unit must be submitted to us on our 
form no later than 10 working days after you receive your records from 
the certification agency.
    All provisions of the potato policy not in conflict with this 
amendment are applicable.
    This amendment is not continuous. A new amendment must be submitted 
each crop year to take advantage of the certified seed potato option.

[[Page 229]]

    The insured estimates that the Certified Seed Potato Acreage for 
the____ crop year will be ____

Insured's Signature_____________________________________________________
Date____________________________________________________________________

Corporation Representative's
Signature and Code Number_______________________________________________
Date____________________________________________________________________

Field Actuarial Office

Approval________________________________________________________________
Date____________________________________________________________________

    Following is the Privacy Act Statement found on the reverse side of 
the Certified Seed Potato Option Amendment:

            Collection of Information and Data (Privacy Act)

    The following statements are made in accordance with the Privacy Act 
of 1974 (5 U.S.C. 552(a)):
    The authority for requesting the information to be supplied on this 
form is the Federal Crop Insurance Act, as amended (7 U.S.C. 1501 et 
seq.), and the regulations for insuring potatoes under the Potato Crop 
Insurance Regulations (7 CFR part 422). The information requested is 
necessary for the Federal Crop Insurance Corporation (FCIC) to process 
the amendment to insure certified seed potatoes, determine the correct 
premium and indemnity, and to determine the correct parties to the 
insurance contract. The information may be furnished to FCIC contract 
agencies and contract loss adjusters, reinsured companies, other U.S. 
Department of Agriculture agencies, Internal Revenue Service, Department 
of Justice, other State and Federal law enforcement agencies if 
litigation becomes necessary, a court in response to its orders, an 
administrative tribunal, or opposing counsel as evidence in the course 
of litigation.
    Furnishing the Social Security Number is voluntary and no adverse 
action will result from failure to do so. Furnishing the information, 
other than the Social Security Number, is also voluntary; however, 
failure to furnish the correct, complete information requested, except 
the Social Security Number, may result in rejection of the amendment for 
insuring certified seed potatoes, and/or subsequent denial of any claim 
for indemnity which may be filed under such amendment or may 
substantially delay acceptance of the Certified Seed Potato Option 
Amendment, and any subsequent claim for indemnity.



Sec. 422.9  Quality potato option.

    (a) Notwithstanding the provisions of subsection Sec. 422.7(d)9.e. 
of this part, an insured producer may, upon submission to the 
Corporation or a reinsured company and subsequent approval of a Quality 
Potato Option (Option), elect to insure all insurable acreage of 
potatoes under this option. The Option is continuous and will remain in 
effect until the underlying potato insurance policy (basic policy) is 
cancelled or terminated in accordance with the basic policy's terms, or 
until the Option is cancelled or terminated by the insured or the 
Corporation in the same manner as the basic policy may be cancelled or 
terminated.
    (b) For those who elect to insure potatoes under this Option, all 
provisions of the basic policy will apply except those in conflict with 
this Option. The terms of the Option are:

                 UNITED STATES DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

           Potato Crop Insurance Policy, Quality Potato Option

(This is a continuous Option. Refer to section 15 of the Potato Crop 
Insurance Policy)

Insured's Name__________________________________________________________
Contract No.____________________________________________________________
Address_________________________________________________________________
Crop Year_______________________________________________________________
Identification No.______________________________________________________
SSN_____________________________________________________________________
TAX_____________________________________________________________________
    1. You must have a Federal Crop Insurance Potato Policy (basic 
policy) in force. This Quality Potato Option (Option) provides 
guaranteed production on a hundredweight (cwt.) basis only.
    2. This Option must be submitted to us on or before the sales 
closing date for the initial crop year in which you wish to insure your 
potatoes under this Option.
    3. If you elect this Option, all acreage of potatoes insured under 
the basic policy must be insured under this Option except for any 
acreage:
    a. Specifically excluded by the Actuarial Table;
    b. Grown for seed if you elect to exclude the acreage from coverage; 
or;
    c. Insured under the Processing Potato Quality Option.
    4. Production to count determined under subsection 9.e. of the basic 
policy will be further modified as follows:
    a. Production to count, unharvested appraised production, production 
stored after an acceptable inspection, and marketed production 
containing potatoes that grade less

[[Page 230]]

than U.S. No. 2 \1\ will be determined by dividing the actual percentage 
of potatoes grading U.S. No. 2 \1\ or better by the percentage factor, 
and multiplying the result, not to exceed 1.000, by the number of weight 
(cwt.) of such potatoes; or
---------------------------------------------------------------------------

    \1\ The actuarial table may provide for U.S. No. 1 in place of U.S. 
No. 2.
---------------------------------------------------------------------------

    b. Production to count of potatoes stored without an acceptable 
inspection will be 100 percent of the gross cwt. of such potatoes.
    5. If you have a Frost/Freeze Potato Option and this Option in 
effect on the same production, the production to count will be based on 
the Option which results in the least production to count.
    6. All sampling and grade determinations must be made by a potato 
grader licensed or certified by the applicable State or United States 
Department of Agriculture. However, if such a grader is not available to 
sample or grade the potatoes, the sampling or grading for the purposes 
of this Option will be performed by us.
    7. Your premium rate for this Option will be contained in the 
Actuarial Table.
    8. ``Acceptable Inspection'' means that prior to storage the 
potatoes are evaluated by us and grade determinations are made in 
accordance with section 6 of this Option.
    9. ``Percentage factor'' means the historical average percentage of 
potatoes grading U.S. No. 2 \1\ or better, by type, determined from your 
records as established by us. If at least four continous years of 
records are available, the percentage factor will be the simple average 
of the available records not to exceed 10 years. If less than four years 
of records are available, the percentage factor will be the one 
contained in the actuarial table. The Actuarial Table may provide 
different percentage factors by type.
Insured's Signature_____________________________________________________
Date____________________________________________________________________
Corporation Representative's Signature and Code Number__________________
_______________________________________________________________________
Date____________________________________________________________________

            Collection of Information and Data (Privacy Act)

    The following statements are made in accordance with the Privacy Act 
of 1974 (5 U.S.C. 552(a)). The authority for requesting information to 
be supplied on this form is the Federal Corp Insurance Act, as amended 
(7 U.S.C. 1501 et seq.), or any of the crop insurance regulations 
contained in 7 CFR part 400 et seq.
    The information requested is necessry for the Federal Crop Insurance 
Corporation (FCIC) to process this form to provide insurance, determine 
eligibility, determine the correct parties to the agreement or contract, 
collect premiums, pay indemnities, or other purposes. Furnishing the 
Social Security number is voluntary and no adverse action will result 
from failure to do so.
    Furnishing the information required by this form, other than the 
Social Security number, is also voluntary; however, failure to furnish 
the correct, complete information requested may result in rejection of 
this form, rejection of any claim for indemnity, or the ineligibility of 
any applicant for insurance, Failure to provide certain requested 
information may result in appropriate action being taken, including suit 
against the policyholder/debtor to recover an indebtedness. The 
information contained in this form will be used by Federal Agency 
Officers and FCIC employees who have a need for such information in the 
performance of their duties.
    The information may be furnished to FCIC contract agencies and 
contract loss adjusters, reinsured companies, other U.S. Department of 
Agriculture agencies, Internal Revenue Service, Department of Justice, 
or other State and Federal law enforcement agencies if litigation 
becomes necessary, credit reporting agencies and U.S. Government 
contract collection agencies, and in response to orders of a court, 
magistrate, administrative tribunal or opposing counsel as evidence in 
the course of discovery in litigation.

[54 FR 3417, Jan. 24, 1989]



Sec. 422.10  Frost/freeze option.

    (a) Notwithstanding the provisions of Sec. 422.7(d)9.e. of this 
part, an insured producer may, upon submission to the Corporation or a 
reinsured company and subsequent approval of a Frost-Freeze Potato 
Option (Option), elect to insure all insurable acreage of potatoes under 
this Option. The Option is continuous and will remain in effect until 
the underlying potato insurance policy (basic policy) is cancelled or 
terminated in accordance with the basic policy's terms, or until the 
Option is cancelled or terminated by the insured or the Corporation in 
the same manner as the basic policy may be cancelled or terminated.
    (b) For those who elect to insure potatoes under this Option, all 
provisions of the basic policy will apply except those in conflict with 
this Option. The terms of the Option are:

[[Page 231]]

                 UNITED STATES DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

        Potato Crop Insurance Policy, Frost/Freeze Potato Option

(This is a continuous Option. Refer to section 15 of the Potato Crop 
Insurance Policy)

Insured's Name__________________________________________________________
Contract No.____________________________________________________________
Address_________________________________________________________________
Crop Year_______________________________________________________________
Identification No.______________________________________________________
SSN_____________________________________________________________________
TAX_____________________________________________________________________
    1. You must have a Federal Crop Insurance Potato Policy (basic 
policy) in force. This Frost-Freeze Potato Option (Option) provides 
guaranteed protection on a hundredweight (cwt.) basis only.
    2. This Option must be submitted to us on or before the sales 
closing dateor the initial crop year in which you wish to insure your 
potatoes under this Option.
    3. If you elect this Option, all acreage of potatoes insured under 
the basic policy must be insured under this Option.
    4. If the actuarial table provides a date after which loss of 
production due to frost or freeze damage is not insurable, this Option 
will provide coverage only with such date.
    5. Production to count for a unit damaged by frost or freeze will be 
determined by applying the percentage obtained from the following table 
to the production to count determined under the basic policy:

------------------------------------------------------------------------
                                                           Percent of
        Percent damage due to frost or freeze            production to
                                                             count
------------------------------------------------------------------------
0-5..................................................                100
6....................................................                 90
7....................................................                 80
8....................................................                 70
9....................................................                 60
10...................................................                 50
11...................................................                 45
12...................................................                 40
13...................................................                 35
14...................................................                 30
15...................................................                 25
16...................................................                 20
17...................................................                 15
18...................................................                 10
19...................................................                  5
20...................................................                  0
------------------------------------------------------------------------

    The adjusted production to count will then be counted against your 
production guarantee to determine the amount of loss. We must inspect 
the production prior to harvest to determine the amount of frost or 
freeze damage.
    If the frost or freeze damage is determined to be 20 percent or more 
at the time of harvest, you may with our written permission, destroy the 
crop, (it will be considered a total loss) and you will be indemnified 
accordingly. You may also elect to market or store the crop and apply 
the total harvested production minus the frost or freeze damaged 
potatoes against the guarantee. This decision must be made by you on the 
day the potatoes are determined to be 20 percent or more frost or freeze 
damaged.
    6. If you have the Potato Quality Option or the Processing Potato 
Quality Option and this Option in effect, the production to count will 
be based on the Option which results in the least production to count.
    7. Your premium rate for this Option will be established by the 
actuarial table.

Insured's Signature_____________________________________________________
Date____________________________________________________________________
Corporation Representative's Signature and Code Number__________________
_______________________________________________________________________
Date____________________________________________________________________

            Collection of Information and Data (Privacy Act)

    The following statements are made in accordance with the Privacy Act 
of 1974 (5 U.S.C. 552(a)). The authority for requesting information to 
be supplied on this form is the Federal Crop Insurance Act, as amended 
(7 U.S.C. 1501 et seq.), or any of the crop insurance regulations 
contained in 7 CFR part 400 et seq.
    The information requested is necessary for the Federal Crop 
Insurance Corporation (FCIC) to process this form to provide insurance, 
determine eligibility, determine the correct parties to the agreement or 
contract, collect premiums, pay indemnities, or other purposes. 
Furnishing the Social Security number is voluntary and no adverse action 
will result from failure to do so. Furnishing the information required 
by this form, other than the Social Security number, is also voluntary; 
however, failure to furnish the correct, complete information requested 
may result in rejection of this form, rejection of any claim for 
indemnity, or the ineligibility of any applicant for insurance. Failure 
to provide certain requested information may result in appropriate 
action being taken, including suit against the policyholder/debtor to 
recover an indebtedness. The information contained in this form will be 
used by Federal Agency Officers and FCIC employees who have a need for 
such information in the performance of their duties.
    The information may be furnished to FCIC contract agencies and 
contract loss adjusters, reinsured companies, other U.S. Department of 
Agriculture agencies, Internal Revenue Service, Department of Justice, 
or other State and Federal law enforcement agencies if litigation 
becomes necessary, credit reporting agencies and U.S. Government 
contract collection agencies, and in response to orders of a court, 
magistrate, administrative

[[Page 232]]

tribunal or opposing counsel as evidence in the course of discovery in 
litigation.

[54 FR 3418, Jan. 24, 1989]



Sec. 422.11  Processing potato quality option.

    (a) Notwithstanding the provisions of Sec. 422.7(d)9.e. of this 
part, an insured producer may, upon submission to the Corporation or a 
reinsured company and subsequent approval of a Processed Potato Quality 
Option (Option), elect to insure all insurable acreage of potatoes 
contracted with a processor under this option. The Option is continuous 
and will remain in effect until the underlying potato insurance policy 
(basic policy) is cancelled or terminated in accordance with the basic 
policy's terms, or until the Option is cancelled or terminated by the 
insured or the Corporation in the same manner as the basic policy may be 
cancelled or terminated.
    (b) For those who elect to insure potatoes under this Option, all 
provisions of the basic policy will apply except those in conflict with 
this Option. The terms of the Option are:

                 UNITED STATES DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

     Potato Crop Insurance Policy, Processing Potato Quality Option

(This is a continuous Option. Refer to section 15 of the Potato Crop 
Insurance Policy)

    1. You must have a Federal Crop Insurance Potato Policy (basic 
policy) in force. This Processing Potato Quality Option (Option) 
provides guaranteed production on a hundredweight (cwt.) basic only.
    2. This Option must be submitted to us on or before the sales 
closing date for the initial crop year in which you wish to insure your 
potatoes under this Option.
    3. A written contract must be executed with a processor for the 
potato types insured under this Option and a copy submitted to us on or 
before the acreage reporting date for potatoes. If you elect this 
Option, all insurable acreage of the types of potatoes under contract 
with a processor must be insured under this Option.
    4. This Option does not apply to potatoes damaged by frost or 
freeze.
    5. Production to count, determined in accordance with subsection 
9.e. of the policy, will be further modified as follows:
    a. Production to count of unharvested appraised potatoes, potatoes 
stored after an acceptable inspection, and potatoes marketed (unless the 
potatoes were marketed to a processor for human consumption) which grade 
less than U.S. No. 2 \2\:
---------------------------------------------------------------------------

    \2\ The actuarial table may provide for U.S. No. 1 grade in place of 
U.S. No. 2.
---------------------------------------------------------------------------

    (1) For factors other than those listed in subsection (2) below, 
will be determined by dividing the percentage of potatoes grading U.S. 
No. 2 \2\ or better by the percentage factor, and multiplying the 
result, not to exceed 1.000, by the number of cwt. of such potatoes, or:
    (2) Due to internal defects, because of a specific gravity of less 
than 1.070, or have a fry color of No. 3 or darker due to either sugar 
exceeding 10% or sugar ends exceeding 19%, production will be:
    (i) Zero for unharvested appraised potatoes;
    (ii) Twenty five percent (25%) of the gross weight for potatoes 
stored after an acceptable inspection; or
    6. All grade determinations for the purposes of this Option will be 
made using the United States Standards for Grades of Potatoes for 
Processing.
    7. If you have the Frost/Freeze Potato Option and this Option in 
effect, the production to count will be based on the Option which 
results in the least production to count.
    8. All sampling and grade determinations must be made by a potato 
grader licensed or certified by the applicable State or United States 
Department of Agriculture. However, if such a grader is not available, 
sampling or grading for the purposes of this Option will be performed by 
us.
    9. Your premium rate for this Option will be established by the 
actuarial table.
    10. ``Acceptable Inspection'' means that prior to storage the 
potatoes are evaluated by us and grades determined in accordance with 
section 8 of this Option.
    11. ``Percentage Factor'' means the historical average percentage of 
potatoes grading U.S. No. 2 \2\ or better, by type, determined from your 
records or established by us. If at least four continuous years of 
records are available, the percentage factor will be the simple average 
of the available records not to exceed 10 years. If less than four years 
of records are available, the percentage factor will be the one 
contained in the actuarial table. The Actuarial Table may provide 
different percentage factors by type.

Insured's Signature_____________________________________________________
DATE____________________________________________________________________
Corporation Representative's Signature and Code Number__________________
_______________________________________________________________________
DATE____________________________________________________________________

[[Page 233]]

            Collection of Information and Data (Privacy Act)

    The following statements are made in accordance with the Privacy Act 
of 1974 (5 U.S.C. 552(a)). The authority for requesting information to 
be supplied on this form is the Federal Crop Insurance Act, as amended 
(7 U.S.C. 1501 et seq.), or any of the crop insurance regulations 
contained in 7 CFR part 400 et seq.
    The information requested is necessary for the Federal Crop 
Insurance Corporation (FCIC) to process this form to provide insurance, 
determine eligibility, determine the correct parties to the agreement or 
contract, collect premiums, pay indemnities, or other purposes. 
Furnishing the Social Security number is voluntary and no adverse action 
will result from failure to do so. Furnishing the information required 
by this form, other than the Social Security number, is also voluntary; 
however, failure to furnish the correct, complete information requested 
may result in rejection of this form, rejection of any claim for 
indemnity, or the ineligibility of any applicant for insurance. Failure 
to provide certain requested information may result in appropriate 
action being taken, including suit against the policyholder/debtor to 
recover an indebtedness. The information contained in this form will be 
used by Federal Agency Officers and FCIC employees who have a need for 
such information in the performance of their duties.
    The information may be furnished to FCIC contract agencies and 
contract loss adjusters, reinsured companies, other U.S. Department of 
Agriculture agencies, Internal Revenue Service, Department of Justice, 
or other State and Federal law enforcement agencies if litigation 
becomes necessary, credit reporting agencies and U.S. Government 
contract collection agencies, and in response to orders of a court, 
magistrate, administrative tribunal or opposing counsel as evidence in 
the course of discovery in litigation.

[54 FR 3419, Jan. 24, 1989]

                        PARTS 423-424  [RESERVED]



PART 425--PEANUT CROP INSURANCE REGULATIONS FOR THE 1993 THROUGH 1998 CROP YEARS--Table of Contents




Sec.
425.1  Availability of peanut crop insurance.
425.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities will be computed.
425.3  OMB control numbers.
425.4  Creditors
425.5  Good faith reliance on misrepresentation.
425.6  The contract.
425.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 57 FR 52585, Nov. 4, 1992, unless otherwise noted.



Sec. 425.1  Availability of peanut crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
peanuts in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 425.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities will be computed.

    (a) The Manager will establish premium rates, production guarantees, 
coverage levels, and prices at which indemnities will be computed for 
peanuts which will be shown on the actuarial table on file in applicable 
service offices and which may be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 425.3  OMB control numbers.

    Office of Management and Budget (OMB) control numbers are contained 
in subpart H to part 400 in title 7 CFR.



Sec. 425.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 425.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the peanut insurance 
contract, whenever:
    (a) An insured person under a contract of crop insurance entered 
into

[[Page 234]]

under these regulations, as a result of a misrepresentation or other 
erroneous action or advice by an agent or employee of the Corporation:
    (1) Is indebted to the Corporation for additional premiums, or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured person is not entitled to an indemnity because of failure to 
comply with the terms of the insurance contract, but which the insured 
person believed to be insured, or believed the terms of the insurance 
contract to have been complied with or waived, and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that:
    (1) An agent or employee of the Corporation did in fact make such 
misrepresentation or take other erroneous action or give erroneous 
advice;
    (2) Said insured person relied thereon in good faith; and
    (3) To require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured person shall be granted relief the same as if 
otherwise entitled thereto. Application for relief under this section 
must be submitted to the Corporation in writing.



Sec. 425.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract will cover the peanut crop 
as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Any changes 
made in the contract shall not affect its continuity from year to year. 
The forms referred to in the contract are available at the applicable 
service offices.



Sec. 425.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the peanut crop as landlord, owner-operator, or tenant. The application 
shall be submitted to the Corporation at the service office on or before 
the applicable closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the closing date for submitting applications in any 
county, by placing the extended date on file in the application service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the period of such extension. However, if adverse conditions should 
develop during such period, the Corporation will immediately discontinue 
the acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1991 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a peanut 
contract issued under such prior regulations, without the filing of a 
new application.
    (d) The application for the 1993 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 Peanut Insurance Policy for the 
1993 through 1998 crop years are as follows:

 Department of Agriculture, Federal Crop Insurance Corporation, Peanut 
                          Crop Insurance Policy

(This is a continuous contract. Refer to Section 15.)

    Agreement to Insure: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us'' and ``our'' refer 
to the Federal Corp Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from any of the following causes occurring within the 
insurance period:

[[Page 235]]

    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or Sec. 9.f(7).

    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants or employees;
    (2) The failure to follow recognized good peanut farming practices;
    (3) Failure to market the peanuts unless such failure is due to 
actual physical damage from a cause specified in subsection 1.a;
    (4) The impoundment of water by any governmental, public or private 
dam or reservoir project; or
    (5) Any cause not specified in section 1.a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be peanuts planted for the purpose of 
digging, maturing, and marketing as farmers' stock peanuts, which are 
grown on insured acreage and for which a guarantee and premium rate are 
provided by the actuarial table.
    b. The acreage insured for each crop year will be peanuts planted on 
insurable acreage as designated by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share will be your share as landlord, owner-operator, 
or tenant in the insured peanuts at the time of planting.
    d. We do not insure any acreage:
    (1) Not planted to a type of peanuts designated as insurable by the 
actuarial table;
    (2) On which the peanuts were destroyed for the purpose of 
conforming with any other program administered by the United States 
Department of Agriculture;
    (3) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (4) Which is irrigated and an irrigated practice is not provided for 
by the actuarial table unless you elect to insure the acreage as non-
irrigated by reporting it as insurable under section 3;
    (5) Which is destroyed, it is practical to replant to peanuts, and 
such acreage is not replanted;
    (6) Initially planted after the final planting date contained in the 
actuarial table, unless you agree in writing on our form to coverage 
reduction; or
    (7) Planted for experimental purposes.
    e. If insurance is provided for an irrigated practice:
    (1) You must report as irrigated only the acreage for which you have 
adequate facilities and water to carry out a good peanut irrigation 
practice at the time of planting; and
    (2) Any loss of production caused by failure to carry out a good 
peanut irrigation practice, except failure of the water supply from an 
unavoidable cause occurring after the beginning of planting, will be 
considered as due to an uninsured cause. The failure or breakdown of 
irrigation equipment or facilities will not be considered as a failure 
of the water supply from an unavoidable cause.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to planting.

        3. Report of Acreage, Share, Poundage Quota, and Practice

    You must report on our form:

    a. All the acreage of peanuts in the county in which you have a 
share;
    b. The practice;
    c. Your share at the time of planting; and
    d. The effective poundage marketing quota, if any, applicable to the 
unit for the current crop year as provided under ASCS Peanut Marketing 
Quota Regulations.

    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any peanuts planted in the 
county. This report must be submitted annually on or before the 
reporting date established by the actuarial table. All indemnities may 
be determined on the basis of information you have submitted on this 
report. If you do not submit this report by the reporting date, we may 
elect to determine by unit the insured acreage, share, and practice or 
we may deny liability on any unit. Any report submitted by you may be 
revised only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are in the actuarial table.
    b. Coverage level 2 will apply if you have not elected a coverage 
level.
    c. You may change the coverage level and price election on or before 
the closing date for submitting applications for the crop year as 
established by the actuarial table.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time of planting. 
The amount of premium is computed by multiplying the production 
guarantee for the unit (insured acreage times the applicable production 
guarantee), which may consist of quota and

[[Page 236]]

non-quota (additional) peanuts, times the applicable price election, 
times the premium rate, times your share at the time of planting, times 
any applicable premium adjustment percentage for which the insured may 
qualify as shown on the actuarial table.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1983 crop year 
under the terms of the Experience Table contained in the peanut policy 
for the 1984 crop year, you will continue to receive the benefit of that 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1993 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the 1984 policy;
    (4) Once the loss ratio exceeds .80 no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you, or from a replanting payment if the billing date has passed on 
the date you are paid the replanting payment, or from any loan or 
payment due you under any Act of Congress or program administered by the 
United States Department of Agriculture or its Agencies.

                           7. Insurance Period

    Insurance attaches when the peanuts are planted and ends at the 
earliest of:

    a. Total destruction of the peanuts;
    b. Threshing or removal from the field;
    c. Final adjustment of a loss; or
    d. The following dates immediately after planting:
    (1) Duval and La Salle Counties, Texas--November 30;
    (2) New Mexico, Oklahoma and all other Texas counties--December 31;
    (3) All other states--November 30.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if:
    (i) You want our consent to replant peanuts damaged due to any 
insured cause. (To qualify for a replanting payment, the acreage 
replanted must be at least the lesser of 10 acres or 10 percent of the 
insured acreage on the unit.);
    (ii) During the period before threshing, the peanuts on any unit are 
damaged and you decide not to further care for or thresh any part of 
them;
    (iii) You want our consent to put the acreage to another use; or
    (iv) After consent to put acreage to another use is given, 
additional damage occurs.

    Insured acreage may not be put to another use until we have 
appraised the peanuts and given written consent. We will not consent to 
another use until it is too late to replant. You must notify us when 
such acreage is replanted or put to another use.

    (2) You must give us notice at least 15 days before the beginning of 
harvest if you anticipate a loss on any unit.
    (3) If probable loss is later determined, immediate notice must be 
given. A representative sample of the unharvested peanuts (at least 10 
feet wide and the entire length of the field) must remain unharvested 
for a period of 15 days from the date of notice, unless we give you 
written consent to harvest the sample.
    (4) In addition to the notices required by this section, if you are 
going to claim an indemnity on any unit, we must be given notice not 
later than 30 days after the earliest of:
    (i) Total destruction of the peanuts on the unit;
    (ii) The completion of harvest or otherwise disposing of the peanuts 
on the unit; or
    (iii) The calendar date for the end of the insurance period.
    b. You may not destroy or replant any of the peanuts on which a 
replanting payment will be claimed until we give consent.
    c. You must obtain written consent from us before you destroy any of 
the peanuts which are not to be harvested.
    d. We may reject any claim for indemnity if any of the requirements 
of this section or section 9 are not complied with.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the peanuts on the unit;
    (2) Completion of harvest or otherwise disposing of the peanuts on 
the unit; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of peanuts on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.

[[Page 237]]

    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of peanuts to be 
counted (see section 9f);
    (3) Multiplying this remainder applicable to quota and/or non-quota 
(additional) production by the applicable price election; and
    (4) Multiplying this product by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported and not on the actual information determined. All production 
from insurable acreage, whether or not reported as insurable, will count 
against the production guarantee.
    e. The total production to count will be identified as quota and/or 
non-quota (additional) production by:
    (1) Counting all threshed and appraised production less than or 
equal to the unit's effective poundage quota as quota production unless 
the peanuts grade Segregation II or III and their inclusion as quota 
peanuts is waived by the producer; and
    (2) Counting any threshed and appraised production in excess of the 
unit's effective poundage quota as non-quota (additional) production.
    f. The total production to be counted for a unit will include all 
threshed and appraised production.
    (1) Threshed production will be the net weight in pounds shown on 
the United States Department of Agriculture ``Inspection Certificate and 
Sales Memorandum''.
    (2) Mature peanut production which is damaged due to insurable 
causes will be adjusted by:
    (i) Dividing the value per pound for the insured type of peanuts by 
the applicable average price per pound; FCIC will count production 
against the highest valued peanuts first (based on price election) and 
the lowest valued peanuts last. FCIC will use the maximum non-quota 
price election to quality adjust seg. II and seg. III non-quota peanuts; 
and
    (ii) Multiplying the result by the number of pounds of such 
production.
    (3) To enable us to determine the net weight and quality of 
production of any peanuts for which a United States Department of 
Agriculture ``Inspection Certificate and Sales Memorandum'' has not been 
issued, we must be given the opportunity to have such peanuts inspected 
and graded before you dispose of them. If you dispose of any production 
without giving us the opportunity to have the peanuts inspected and 
graded, the gross weight of such production will be used in determining 
total production to count unless you submit a marketing record 
satisfactory to us which clearly shows the net weight and quality of 
such peanuts.
    (4) Appraised production to be counted will include:
    (i) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good peanut farming practices;
    (ii) Not less than the guarantee for any acreage which is abandoned 
or put to another use (other than harvest) without our prior written 
consent or damaged solely by an uninsured cause; and
    (iii) Appraised production on all other unharvested acreage.
    (5) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (i) Not put to another use before harvest of peanuts becomes general 
in the county;
    (ii) Harvested; or
    (iii) Further damaged by an insured cause before the acreage is put 
to another use.
    (6) The amount of production of any unharvested peanuts may be 
determined on the basis of field appraisals conducted after the end of 
the insurance period.
    (7) If you have elected to exclude hail and fire as insured causes 
of loss and the peanuts are damaged by hail or fire, appraisals will be 
made in accordance with Form FCI-78, ``Request to Exclude Hail and 
Fire''.
    (8) The commingled production of units will be allocated to such 
units in proportion to our liability on the harvested acreage of each 
unit.
    g. A replanting payment may be made on any insured peanuts replanted 
after we have given consent and the acreage replanted is at least the 
lesser of 10 acres or 10 percent of the insured acreage for the unit.
    (1) No replanting payment will be made on acreage:
    (i) On which our appraisal exceeds 90 percent of the guarantee;
    (ii) Initially planted prior to the date we determine reasonable; or
    (iii) On which a replanting payment has been made during the current 
crop year.
    (2) The replanting payment per acre will be your actual cost per 
acre for replanting but will not exceed $80.00 per acre, multiplied by 
your share.

    If the information reported by you results in a lower premium than 
the actual premium determined to be due, the replanting payment will be 
reduced proportionately.

    h. You must not abandon any acreage to us.
    i. You may not bring suit or action against us unless you have 
complied with all policy provisions. If a claim is denied, you may sue 
us in the United States District Court under the provisions of 7 U.S.C. 
1508(c). You must

[[Page 238]]

bring suit within 12 months of the date notice of denial is mailed to 
and received by you.
    j. We will pay the loss within 30 days after we reach agreement with 
you on entry of a final judgment. In no instance will we be liable for 
interest or damages in connection with any claim for indemnity, whether 
we approve or disapprove such claim.
    k. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the peanuts are planted for any crop year, any indemnity 
will be paid to the person(s) we determine to be beneficially entitled 
thereto.
    l. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of:
    (1) The amount of indemnity determined pursuant to this contract 
without regard to any other insurance; or
    (2) The amount by which the loss from fire exceeds the indemnity 
paid or payable under such other insurance.

    For the purposes of this section, the amount of loss from fire will 
be the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract, and such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
rights. If we pay you for your loss then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale or other disposition of all peanuts 
produced on each unit including separate records showing the same 
information for production from any uninsured acreage. Any persons 
designated by us will have access to such records and the farm for 
purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will be canceled if you do not furnish satisfactory 
records of the previous year's production to us on or before the 
cancellation date. If the insured, prior to the cancellation date, 
shows, to our satisfaction, that records are unavailable due to 
conditions beyond the insured's control, such as fire, flood or other 
natural disaster, the Field Actuarial Office may assign a yield for that 
year. The assigned yield will not exceed the ten-year average.
    d. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due:
    (1) If deducted from an indemnity will be the date you sign the 
claim; or
    (2) If deducted from payment under another program administered by 
the United States Department of Agriculture will be the date both such 
other payment and set off are approved.
    e. The cancellation and termination dates are:

------------------------------------------------------------------------
                                            Cancellation and termination
             State and county                          dates
------------------------------------------------------------------------
Dual and La Salle Counties, Texas........  February 15.

[[Page 239]]

 
New Mexico; Oklahoma; Brown, Baylor,       April 15.
 Callahan, Collingsworth, Commanche,
 Dallam, Eastland, Erath, Gaines, Garza,
 Hood, Jones, Montague, Motley, Palo
 Pinto, Parker, Somervell and Stonewall
 Counties, Texas and Virginia.
All other Texas counties and all other     March 31.
 states.
------------------------------------------------------------------------

    f. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    g. The contract will terminate if no premium is earned for three 
consecutive years.

                          16. Contract Changes

    We may change any of the terms and provisions of the contract from 
year to year. If your price election at which indemnities are computed 
is no longer offered, the actuarial table will provide the price 
election which you are deemed to have elected. All contract changes will 
be available at your service office by December 31 preceding the 
cancellation date for counties with a April 15 cancellation date and by 
November 30 preceding the cancellation date for all other counties. 
Acceptance of any changes will be conclusively presumed in the absence 
of any notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of peanut crop insurance:

    a. Actuarial table--The forms and related material for the crop year 
approved by us which are available for public inspection in your service 
office, and which show the production guarantees, coverage levels, 
premium rates, prices for computing indemnities, practices, insurable 
and uninsurable acreage, and related information regarding peanut 
insurance in the county.
    b. ASCS-- The Agricultural Stabilization and Conservation Service of 
the United States Department of Agriculture.
    c. Average price per pound--
    (1) The average Commodity Credit Corporation (CCC) price support per 
pound, by type, for Segregation I, Segregation II and III peanuts 
eligible to be valued as quota peanuts; or
    (2) The highest non-quota price election provided by us for all CCC 
non-quota (additional) Segregation II and III peanuts.
    d. Average price support per pound-- The average price support level 
per pound by type for quota peanuts as announced by the United States 
Department of Agriculture under the peanut price support program.
    e. County-- The county shown on the application and:
    (1) Any additional land located in a local producing area bordering 
on the county, as shown by the actuarial table; and
    (2) Any land identified by an ASCS farm serial number for the county 
but physically located in another county.
    f. Crop year-- The period within which the peanuts are normally 
grown and will be designated by the calendar year in which the peanuts 
are normally harvested.
    g. Effective poundage marketing quota-- The farm marketing quota as 
established and recorded by ASCS.
    h. Harvest-- The completion of combining or threshing of peanuts.
    i. Insurable acreage-- The land classified as insurable by us and 
shown as such by the actuarial table.
    j. Insured-- The person who submitted the application accepted by 
us.
    k. Loss ratio-- The ratio of indemnity to premium.
    l. Person-- An individual, partnership, association, corporation, 
estate, trust, or other business enterprise or legal entity, and 
wherever applicable, a State, a political subdivision of a State, or any 
agency thereof.
    m. Replanting-- Performing the cultural practices necessary to 
replant insured acreage to the same crop.
    n. Replant payment-- That payment made to the insured in accordance 
with the provisions of section 9 of this policy which is subject to 
offset for premium owed.
    o. Service office-- The office servicing your contract as shown on 
the application for insurance or such other approved office as may be 
selected by you or designated by us.
    p. Tenant-- A person who rents land from another person for a share 
of the peanuts or a share of the proceeds therefrom.
    q. Unit-- All insurable acreage of peanuts in the county in which 
you have an insured share on the date of planting for the crop year and 
which is identified by a single ASCS farm serial number at the time 
insurance first attaches under this policy for the crop year. Units will 
be determined when the acreage is reported. We may reject or modify any 
ASCS reconstitution for the purpose of unit definition if the 
reconstitution was in whole or part to defeat the purpose of the Federal 
Crop Insurance Program or to gain disproportionate advantage under this 
policy. Errors in reporting units may be corrected by us when adjusting 
a loss.

[[Page 240]]

    r. Value per pound-- The ``value per pound including loose shell 
kernels'', as shown on the United States Department of Agriculture 
``Inspection Certificate and Sales Memorandum,'' except for Segregation 
II, III and non-quota (additional) peanuts for which the value per pound 
will be determined by us.
    s. Written agreement-- An agreement in writing between you and us 
which is in accordance with FCIC policy.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.

                         21. Written Agreements

    If provided for under the terms and conditions of the policy, 
written agreements between FCIC and the policyholder will be in 
accordance with the provisions of official procedures issued by FCIC.

[57 FR 52585, Nov. 4, 1992; 57 FR 56963, Dec. 2, 1992, , as amended at 
63 FR 31335, June 9, 1998]

                        PARTS 426-429  [RESERVED]



PART 430--SUGAR BEET CROP INSURANCE REGULATIONS--Table of Contents




 Subpart--Regulations for the 1986 and Succeeding Crop Years (1987 and 
            Succeeding Crop Years in California and Arizona)

Sec.
430.1  Availability of sugar beet crop insurance.
430.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
430.3  OMB control numbers.
430.4  Creditors.
430.5  Good faith reliance on misrepresentation.
430.6  The contract.
430.7  The application and policy.

    Authority: 7 U.S.C. 1506, 1516.

    Source: 51 FR 5150, Feb. 12, 1986, unless otherwise noted.



 Subpart--Regulations for the 1986 and Succeeding Crop Years (1987 and 
             Succeeding Crop Years in California and Arizona



Sec. 430.1  Availability of sugar beet crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
sugar beets in counties within the limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended. The counties shall be designated by the Manager of the 
Corporation from those approved by the Board of Directors of the 
Corporation.



Sec. 430.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for sugar beets which will be included in the actuarial table 
on file in the applicable service offices for the county and which may 
be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 430.3  OMB control numbers.

    The OMB control numbers are contained in subpart H of part 400, 
title 7 CFR.



Sec. 430.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or

[[Page 241]]

other similar interest shall not entitle the holder of the interest to 
any benefit under the contract.



Sec. 430.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the sugar beet insurance 
contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation: (1) Is 
indebted to the Corporation for additional premiums; or (2) has suffered 
a loss to a crop which is not insured or for which the insured is not 
entitled to an indemnity because of failure to comply with the terms of 
the insurance contract, but which the insured believed to be insured, or 
believed the terms of the insurance contract to have been complied with 
or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice; (2) said insured 
relied thereon in good faith; and (3) to require the payment of the 
additional premiums or to deny such insured's entitlement to the 
indemnity would not be fair and equitable, such insured shall be granted 
relief the same as if otherwise entitled thereto. Requests for relief 
under this section must be submitted to the Corporation in writing.



Sec. 430.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the sugar beet 
crop as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Changes made in 
the contract shall not affect its continuity from year to year. The 
forms referred to in the contract are available at the applicable 
service offices.



Sec. 430.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation must be made by any person to cover such person's share in 
the sugar beet crop as landlord, owner-operator, or tenant if the person 
wishes to participate in the program. The application shall be submitted 
to the Corporation at the service office on or before the applicable 
sales closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the sales closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period. However, if adverse conditions should develop 
during such period, the Corporation will immediately discontinue the 
acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1986 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a sugar beet 
contract issued under such prior regulations, without the filing of a 
new application.
    (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) and may be amended from time to time for subsequent crop 
years. The provisions of the Sugar Beet Crop Insurance Policy for the 
1986 and succeeding crop years (1987 and succeeding crop years in 
California and Arizona) are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                    Sugar Beet Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)

[[Page 242]]

    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting; unless 
those causes are excepted, excluded, or limited by the actuarial table 
or section 9e(7).
    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants, or employees;
    (2) The failure or breakdown of irrigation equipment or facilities;
    (3) The failure to follow recognized good sugar beet irrigation 
practices;
    (4) The failure to follow recognized good sugar beet farming 
practices;
    (5) The impoundment of water by any governmental, public, or private 
dam or reservoir project; or
    (6) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be sugar beets grown under a contract with 
a processor for processing as sugar, which are grown on insured acreage 
and for which a guarantee and premium rate are set by the actuarial 
table.
    b. The acreage insured for each crop year will be sugar beets 
planted on insurable acreage as designated by the actuarial table and in 
which you have a share, as reported by you or as determined by us, 
whichever we elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured sugar beets at the time of planting. However, only 
for the purpose of determining the amount of indemnity, your share will 
not exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any acreage:
    (1) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (2) Which is irrigated and an irrigated practice is not provided for 
in the actuarial table unless you elect to insure the acreage as 
nonirrigated by reporting it as insurable under section 3;
    (3) Which is destroyed, it is practical to replant to sugar beets 
and such acreage is not replanted;
    (4) Initially planted after the final planting date set by the 
actuarial table, unless you agree, in writing, on our form to coverage 
reduction;
    (5) Of sugar beets not grown under a contract executed with a 
processor or excluded from the processor contract for, or during, the 
crop year (The contract must be executed and effective before you report 
your acreage);
    (6) Planted to a type or variety of sugar beets not established as 
adapted to the area or excluded by the actuarial table;
    (7) Planted to sugar beets:
    (a) The preceding crop year in Michigan, Minnesota, North Dakota, 
and Ohio unless the acreage is designated as insurable by the actuarial 
table; or
    (b) The two preceding crop years in all other states unless the 
acreage is designated as insurable by the actuarial table;
    (8) In California, except Imperial county, planted before filing of 
the application until a normal stand is obtained;
    (9) Of volunteer sugar beets; or
    (10) Planted with another crop.
    e. If insurance is provided for an irrigated practice you must 
report as irrigated only the acreage for which you have adequate 
facilities and water, at the time of planting, to carry out a good sugar 
beet irrigation practice.
    f. Acreage which is planted for the development or production of 
hybrid seed or for experimental purposes is not insured, unless we 
agree, in writing, to insure such acreage.
    g. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to planting.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of sugar beets in the county in which you have a 
share;
    b. The practice; and
    c. Your share at the time of planting.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any sugar beets planted in the 
county. This report must be submitted annually on or before the 
reporting date established by the actuarial table. All indemnities may 
be determined on the basis of information you submit on this report. If

[[Page 243]]

you do not submit this report by the reporting date, we may elect to 
determine, by unit, the insured acreage, share, and practice or we may 
deny liability on any unit. Any report submitted by you may be revised 
only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. The second stage production guarantees are in the actuarial 
table. The first stage guarantee is 60 percent of the second stage 
guarantee. The stages are:
    (1) First stage is from planting until July 1 except in California 
and Arizona where the first stage is from planting until the earlier of 
thinning or 90 days after planting. The first stage also applies to any 
acreage damaged in the first stage to the extent that growers in the 
area generally would not further care for the sugar beets;
    (2) Second stage applies to all insured sugar beets after the first 
stage.
    The production guarantee applicable to any acreage within a unit 
will be that established for the stage reached by the sugar beets on 
that acreage.
    c. Coverage level 2 will apply if you do not elect a coverage level.
    d. You may change the coverage level and price election on or before 
the sales closing date set by the actuarial table for submitting 
applications for the crop year.
    e. You must furnish a report of production to use for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the subsequent crop year. The yield 
assigned by us will be 75% of the yield assigned for the purpose of 
determining your guarantee for the present crop year. If you have filed 
a claim for the previous crop year, the yield determined in adjusting 
your indemnity claim will be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time of planting. 
The amount is computed by multiplying the production guarantee times the 
price election, times the premium rate, times the insured acreage, times 
your share at the time of planting.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1984 crop year 
(1985 crop year in California and Arizona) under the terms of the 
experience table contained in the sugar beet policy in effect for the 
1985 crop year (1986 crop year in California and Arizona), you will 
continue to receive the benefit of that reduction subject to the 
following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1985 crop year (1986 crop year in California and Arizona);
    (4) Once your loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                          6. Deduction for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you, or from any replant payment, or from any loan or payment due you 
under any Act of Congress or program administered by the United States 
Department of Agriculture or its Agencies.

                           7. Insurance Period

    Insurance attaches when the sugar beets are planted and ends at the 
earliest of:
    (a) Total destruction of the sugar beets;
    (b) Harvest of the sugar beets on the unit;
    (c) Final adjustment of a loss; or
    (d) The following calendar dates:
    (1) July 15 for Arizona and Imperial County, California;
    (2) The dates established by practice as contained in the actuarial 
table for all other California counties;
    (3) November 25 in Ohio;
    (4) December 31 in Texas; and
    (5) November 15 in all other states.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if:
    (a) You want our consent to replant sugar beets damaged due to any 
insured cause (see subsection 9f);
    (b) During the period before harvest, the sugar beets on any unit 
are damaged and you decide not to further care for or harvest any part 
of them;
    (c) You want our consent to put the acreage to another use; or
    (d) After consent to put acreage to another use is given, additional 
damage occurs.
    Insured acreage may not be put to another use until we have 
appraised the sugar beets

[[Page 244]]

and given written consent. We will not consent to another use until it 
is too late to replant. You must notify us when such acreage is 
replanted or put to another use.
    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (3) If probable loss is determined within 15 days prior to or during 
harvest, immediate notice must be given and a representative sample of 
the unharvested sugar beets (at least 10 feet wide and the entire length 
of the field) must remain unharvested for a period of 15 days from the 
date of notice unless we give you written consent to harvest the sample.
    (4) In addition to the notices required by this section, if you are 
going to claim an indemnity on any unit, you must give us notice not 
later than 10 days after the earliest of:
    (a) Total destruction of the sugar beets on the unit;
    (b) Harvest of the unit; or
    (c) The calendar date for the end of the insurance period.
    b. You may not destroy or replant any of the sugar beets on which a 
replanting payment will be claimed until we give written consent.
    c. You must obtain written consent from us before you destroy any of 
the sugar beets which are not to be harvested.
    d. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the sugar beets on the unit;
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of sugar beets on the unit and 
that any loss of production has been directly caused by one or more of 
the insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of sugar beets to be 
counted (see section 9e);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. The total production (in tons) to be counted for a unit will 
include all harvested and appraised production.
    (1) Any harvested production of undamaged sugar beets will be 
determined by:
    (a) Dividing the average percentage of sugar in such sugar beets, by 
the percentage of sugar shown in the actuarial table; and
    (b) Multiplying the results (rounded to three places) by the tons of 
such sugar beets.
    The average percentage of sugar will be determined by the processor 
from individual tests taken at the time of delivery. If individual tests 
of sugar content are not made at the time of delivery, the factor will 
be 1.000.
    (2) (a) The production to count from acreage damaged due to 
insurable causes occurring within the insurance period, will be 
determined by:
    (i) Dividing the gross amount received for the damaged sugar beets 
(including cooperative stock, patronage refunds, dollar values, etc.) by 
the applicable price per pound of sugar;
    (ii) Dividing that result by 2,000; and
    (iii) Dividing that result by the factor contained in the actuarial 
table for that purpose.
    (b) The applicable price per pound for sugar will be the local 
market price on the earlier of:
    (i) The day the loss is adjusted; or
    (ii) The day the damaged sugar beets are sold.
    (c) If the price per pound received for the damaged sugar beets is 
less than the highest average amount paid by the processor to any 
producer for sugar beets which were damaged by the cause of loss as 
claimed by you, you will be considered to have received that average 
amount per pound in determining the gross amount received.
    (3) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause;
    (c) Only the appraised production in excess of the difference 
between the first and second stage production guarantee for acreage not 
covered by (a) and (b) of this subsection (3) and which does not qualify 
for the second stage guarantee will be counted except as provided in (d) 
of this subsection (3); and
    (d) The total appraisal for uninsured causes.

[[Page 245]]

    (4) There will be no adjustment for quality on any appraisal.
    (5) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of sugar beets becomes 
general in the county and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (6) The amount of production of any harvested or unharvested sugar 
beets may be determined on the basis of field appraisals or inspections 
conducted after the end of the insurance period.
    (7) If you elect to exclude hail and fire as insured causes of loss 
and the sugar beets are damaged by hail or fire, appraisals will be made 
in accordance with Form FCI-78, ``Request to Exclude Hail and Fire.''
    f. A replanting payment may be made on any insured sugar beets 
replanted after we have given consent and the acreage replanted is at 
least the lesser of 20 acres or 20 percent of the insured acreage for 
the unit, (as determined on the final planting date).
    (1) No replanting payment will be made on acreage:
    (a) On which our appraisal exceeds 90 percent of the second stage 
guarantee;
    (b) Initially planted prior to the date established by the actuarial 
table; or
    (c) On which a replanting payment has been made during the current 
crop year.
    (2) The replanting payment per acre will be your actual cost per 
acre for replanting, but will not exceed one ton multiplied by the price 
election times your share.
    (3) The Corporation will transfer the original liability to the 
replanted crop without reduction by the amount of the replant payment 
and without increase in the original premium charged for insurance 
coverage when the crop is replanted in accordance with the requirements 
of the original planting.
    (4) If seasonal conditions dictate replanting by broadcast method, 
and such method differs from the requirements of the original planting, 
the Corporation will transfer the original liability to the replanted 
crop reduced by the amount of the replant payment and without increase 
in the original premuim charged for insurance coverage.

If the information reported by you results in a lower premium than the 
actual premium determined to be due, the replanting payment will be 
reduced proportionately.
    g. You must not abandon any acreage to us.
    h. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    i. An indemnity will not be paid unless you comply with all policy 
provisions.
    j. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury.
    k. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the sugar beets are planted for any crop year, any 
indemnity will be paid to the persons determined to be beneficially 
entitled thereto.
    l. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.
    For the purpose of this section, the amount of loss from fire will 
be the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

[[Page 246]]

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be made on our 
form and approved by us. We may collect the premium from either you or 
your transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale, or other disposition of all sugar 
beets produced on each unit, including separate records showing the same 
information for production from any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply, 
assignment of production to units by us, or a determination that no 
indemnity is due. Any person designated by us will have access to such 
records and the farm for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due if deducted 
from:
    (1) An indemnity, will be the date you sign the claim; or
    (2) Payment under another program administered by the United States 
Department of Agriculture, will be the date both such other payment and 
setoff are approved.
    d. The cancellation and termination dates are:

------------------------------------------------------------------------
                                            Cancellation and termination
             State and county                           dates
------------------------------------------------------------------------
Arizona and Imperial County, California...  August 31.
All other California Counties.............  March 31,
All other states..........................  April 15.
------------------------------------------------------------------------

    e. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by:
    (a) April 30 preceding the cancellation date for Arizona and 
Imperial County, California;
    (b) November 30 preceding the cancellation date for all other 
California counties;
    (c) December 31 preceding the cancellation date for all other 
states.
    Acceptance of changes will be conclusively presumed in the absence 
of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of sugar beet crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
sugar beet insurance in the county.
    b. ASCS means the Agricultural Stabilization and Conservation 
Service of the United States Department of Agriculture.
    c. County means:
    (1) The county shown on the application;
    (2) Any additional land located in a local producing area bordering 
on the county, as shown by the actuarial table; and
    (3) Any land identified by the same ASCS farm serial number for the 
county but physically located in another county within the State.
    d. Crop year means the period within which the sugar beets are 
normally grown and designated by the calendar year in which the

[[Page 247]]

sugar beets are normally harvested; however, in California and Arizona, 
it will be the period from planting until the applicable date for the 
end of the insurance period and is designated by:
    (1) The calendar year in which planted if planted on or before July 
15; or
    (2) The next calendar year if planted after July 15.
    e. Harvest means the completion of topping and lifting of sugar 
beets on any acreage for delivery to a processor.
    f. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    g. Insured means the person who submitted the application accepted 
by us.
    h. Loss ratio means your ratio of indemnity to premium.
    i. Normal stand means the number of live plants after thinning 
required to produce an average yield per acre for the area.
    j. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State or a political subdivision or agency of a State.
    k. Replanting means performing the cultural practices necessary to 
replant insured acreage to sugar beets.
    l. Replant payment means that payment made to the insured in 
accordance with the provisions of subsection 9.f. of this policy which 
payment is subject to offset for premium owed.
    m. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    n. Tenant means a person who rents land from another person for a 
share of the sugar beets or a share of the proceeds therefrom.
    o. Unit means all insurable acreage of sugar beets in the county on 
the date of planting for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the sugar beets on such land will be 
considered as owned by the lessee. Land which would otherwise be on unit 
may be divided according to applicable guidelines on file in your 
service office. Units will be determined when the acreage is reported. 
Errors in reporting units may be corrected by us to conform to 
applicable guidelines when adjusting a loss. We may consider any acreage 
and share thereof reported by or for your spouse or child or any member 
of your household to be your bona fide share or the bona fide share of 
any person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.

    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[51 FR 5150, Feb. 12, 1986, as amended at 51 FR 29205--29207, Aug. 15, 
1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 52 FR 6775, 
Mar. 5, 1987; 52 FR 17547, 17548, May 11, 1987; 54 FR 20509, May 12, 
1989; 55 FR 35888, Sept. 4, 1990; 55 FR 50815, Dec. 11, 1990; 58 FR 
66250, Dec. 20, 1993]

                        PARTS 431-432  [RESERVED]



PART 433--DRY BEAN CROP INSURANCE REGULATIONS--Table of Contents




        Subpart--Regulations for the 1986 Through 1996 Crop Years

Sec.
433.1  Availability of dry bean crop insurance.
433.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
433.3  OMB control numbers.
433.4  Creditors.
433.5  Good faith reliance on misrepresentation.
433.6  The contract.
433.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 50 FR 10202, Mar. 14, 1985, unless otherwise noted.

[[Page 248]]



        Subpart--Regulations for the 1986 Through 1996 Crop Years



Sec. 433.1  Availability of dry bean crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
dry beans in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 433.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for dry beans which will be included in the actuarial table on 
file in applicable service offices for the county and which may be 
changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 433.3  OMB control numbers.

    The information collection requirements contained in these 
regulations (7 CFR part 433) have been approved by the Office of 
Management and Budget (OMB) under the provisions of 44 U.S.C. Chapter 35 
and have been assigned OMB numbers 0563-0003 and 0563-0007.



Sec. 433.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 433.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the dry bean insurance 
contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation; (1) is 
indebted to the Corporation for additional premiums; or (2) has suffered 
a loss to a crop which is not insured or for which the insured is not 
entitled to an indemnity because of failure to comply with the terms of 
the insurance contract, but which the insured believed to be insured, or 
believed the terms of the insurance contract to have been complied with 
or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice; (2) said insured 
relied thereon in good faith; and (3) to require the payment of the 
additional premiums or to deny such insured's entitlement to the 
indemnity would not be fair and equitable, such insured shall be granted 
relief the same as if otherwise entitled thereto. Application for relief 
under this section must be submitted to the Corporation in writing.



Sec. 433.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the dry bean 
crop as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Any changes 
made in the contract shall not affect its continuity from year to year. 
The forms referred to in the contract are available at the service 
offices.



Sec. 433.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the dry bean crop as landlord, owner-operator, or tenant. The 
application shall be submitted to the Corporation at the service office 
on or before the applicable

[[Page 249]]

closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the period of such extension. However, if adverse conditions should 
develop during such period, the Corporation will immediately discontinue 
the acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1986 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a dry bean 
contract issued under such prior regulations, without the filing of a 
new application.
    (d) The application for the 1986 and succeeding crop years is found 
at subpart D or part 400--General Administrative Regulations (7 CFR 
400.37, 400.38). The provisions of the Dry Bean Insurance Policy for the 
1986 through 1996 crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                     Dry Bean Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9f(5).
    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants, or employees;
    (2) The failure to follow recognized good bean farming practices;
    (3) The failure or breakdown of irrigation equipment or facilities;
    (4) The failure to follow good bean irrigation practices;
    (5) The impoundment of water by any governmental, public, or private 
dam or reservoir project; or
    (6) Any cause not specified in section 1a as an insured loss.

                   2. Crop Acreage, and Share Insured

    a. The crop insured will be dry beans (``beans'') and will consist 
of:
    (1) Dry edible beans, planted for harvest as dry beans, of a class 
designated in the actuarial table; and
    (2) Bush varieties of garden seed beans (contract seed beans), 
planted for harvest as seed and grown under a contract (with a seed 
company executed before the acreage reporting date), which are grown on 
insured acreage and for which a guarantee and premium rate are provided 
by the actuarial table.
    In addition to the classes of dry beans listed on the actuarial 
table for your county, we will insure other classes of beans provided:
    (i) The class you intend to plant has been demonstrated to be 
adapted to the area. (Evidence of adaptability includes results of test 
plots and recommendations by universities and seed companies. Two years 
of personal experience producing the class in your production area may 
be submitted for this requirement.);
    (ii) You submit your production report and prices received by the 
sales closing date, or the test plot results and price information on or 
before the sales closing date; and
    (iii) We provide you, in writing, an approved insurance offer which 
you accept in writing.
    b. An instrument in the form of a ``lease'' under which you retain 
control of the acreage on which the insured beans are grown and which 
provides for delivery of the beans under certain conditions and at a 
stipulated

[[Page 250]]

price will, for the purpose of this contract, be treated as a contract 
under which you have the share in the beans.
    c. The acreage insured for each crop year will be beans planted on 
insurable acreage as designated by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    d. The insured share is your share as landlord, owner-operator, or 
tenant in the insured beans at the time of planting. However, only for 
the purpose of determining the amount of indemnity, your share will not 
exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    e. We do not insure any acreage:
    (1) Of bush varieties of garden seed beans not grown under contract 
or excluded from the contract for, or during, the crop year;
    (2) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (3) Which is irrigated and an irrigated practice is not provided for 
by the actuarial table unless you elect to insure the acreage as 
nonirrigated by reporting it as insurable under section 3;
    (4) Which is destroyed, it is practical to replant to the same 
varietal group of garden seed beans or the same varietal group of dry 
edible beans, and such acreage is not replanted;
    (5) Initially planted after the final planting date contained in the 
actuarial table unless you agree, in writing, on our form to coverage 
reduction;
    (6) Of volunteer beans;
    (7) Planted to a class of dry edible beans or a bush variety of 
garden seed beans not established as adapted to the area or excluded by 
the actuarial table;
    (8) Which does not meet the rotation requirements designated by the 
actuarial table; or
    (9) Planted with a crop other than beans.
    f. If insurance is provided for an irrigated practice you must 
report as irrigated only the acreage for which you have adequate 
facilities and water at the time of planting to carry out a good bean 
irrigation practice.
    g. Unless otherwise provided by the actuarial table, insurance will 
attach only on acreage initially planted in rows far enough apart to 
permit cultivation, however, if insured acreage is destroyed and 
replanted by broadcasting, drilling, or in rows too close to permit 
cultivation, it will be regarded as insured acreage.
    h. Any acreage of beans which is destroyed and replanted to an 
insurable class of dry edible beans or bush varieties of garden seed 
beans will be regarded as insured acreage.
    i. Acreage which is planted for the development or production of 
hybrid seed or for experimental purposes is not insured unless we agree, 
in writing, to insure such acreage.
    j. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress if we advise you of the limit 
prior to planting.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of beans in the county in which you have a share;
    b. The practice; and
    c. Your share at the time of planting.

You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any beans planted in the 
county. This report must be submitted annually on or before the 
reporting date established by the actuarial table. All indemnities may 
be determined on the basis of information you submit on this report. If 
you do not submit this report by the reporting date, we may elect to 
determine, by unit, the insured acreage, share, and practice or we may 
deny liability on any unit. Any report submitted by you may be revised 
only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. Coverage level 2 will apply if you do not elect a coverage level.
    c. You may change the coverage level and price election on or before 
the sales closing date as established by the actuarial table for 
submitting applications for the crop year.
    d. You must furnish a report of production to us for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the subsequent crop year. The yield 
assigned by us will be 75% of the yield assigned for the purpose of 
determining your guarantee for the present crop year. If you have filed 
a claim for the previous crop year, the yield determined in adjusting 
your indemnity claim will be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time of planting. 
The amount is computed by multiplying the production guarantee times the 
price election, times the premium rate, times the insured acreage, times 
your share at the time of planting.

[[Page 251]]

    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1984 crop year 
under the terms of the experience table contained in the dry bean policy 
for the 1985 crop year, you will continue to receive the benefit of that 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the 1985 policy;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                          6. Deduction for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you, or from any replant payment, or from any loan or payment due you 
under any Act of Congress or program administered by the United States 
Department of Agriculture or its Agencies.

                           7. Insurance Period

    Insurance attaches when the beans are planted and ends at the 
earliest of:
    a. Total destruction of the beans;
    b. Combining, threshing, or removal from the field;
    c. Final adjustment of a loss; or
    d. November 15 of the calendar year in which the beans are normally 
harvested.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if:
    (a) You want our consent to replant beans damaged due to any insured 
cause (See section 9.g.);
    (b) During the period before harvest, the beans on any unit are 
damaged and you decide not to further care for or harvest any part of 
them;
    (c) You want our consent to put the acreage to another use; or
    (d) After consent to put acreage to another use is given, additional 
damage occurs.

Insured acreage may not be put to another use until we have appraised 
the beans and given written consent. We will not consent to another use 
until it is too late to replant. You must notify us when such acreage is 
replanted or put to another use.
    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (3) If probable loss is later determined, immediate notice must be 
given and a representative sample of the unharvested beans (at least 10 
feet wide and the entire length of the field) must remain unharvested 
for a period of 15 days from the date of notice, unless we give you 
written consent to harvest the sample.
    (4) In addition to the notices required by this section, if you are 
going to claim an indemnity on any unit, you must give us notice not 
later than 10 days after the earliest of:
    (a) Total destruction of the beans on the unit;
    (b) Harvest of the unit; or
    (c) The calendar date for the end of the insurance period.
    b. You may not destroy or replant any of the beans on which a 
replanting payment will be claimed until we give written consent.
    c. You must obtain written consent from us before you destroy any of 
the beans which are not to be harvested.
    d. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the beans on the unit;
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of beans on the unit and that any 
loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit of dry edible beans 
by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of dry edible beans 
to be counted (see section 9f);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. The amount of indemnity on each unit of bush varieties of garden 
seed beans will be determined by subtracting the value of production 
from the dollar amount of insurance and multiplying the remainder by the 
insured share.

[[Page 252]]

    (1) The value of production is obtained by multiplying, by variety, 
the total production to be counted by the applicable price per pound at 
which indemnities will be computed and totaling such amounts. The 
applicable price per pound at which indemnities will be computed will be 
the lesser of the amount designated by:
    (a) The actuarial table; or
    (b) The contract with the seed company.
    (2) The dollar amount of insurance is obtained by multiplying, by 
variety, the production guarantee per acre by the insured acreage, and 
the result by the price per pound at which indemnities will be computed 
and totaling such amounts. The price per pound at which indemnities will 
be computed will be the lesser of the amount designated by:
    (a) The actuarial table; or
    (b) The contract with the seed company.
    e. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    f. The total production (in pounds) to be counted for a unit will 
include all harvested and appraised production.
    (1) Mature dry edible bean production:
    (a) Which otherwise is not eligible for quality adjustment will be 
reduced .12 percent for each .1 percentage point of moisture in excess 
of 18.0 percent;
    (b) Of the classes of pea and medium white with a pick in excess of 
4 percent due to insurable causes and of any other classes which, due to 
insurable causes, does not grade No. 2 or better, in accordance with the 
Official United States Grain Standards, will be adjusted by multiplying 
the number of pounds of such beans by the conversion factor designated 
by the actuarial table for the applicable grade or pick; or
    (c) Which, due to insurable causes, does not meet any U.S. Grade or 
pick shown in the actuarial table, or would not meet these requirements 
if properly handled, or if a conversion factor is not designated by the 
actuarial table, any mature beans which do not grade No. 2 or better in 
accordance with the Office United States Grain Standards, will be 
adjusted by:
    (i) Dividing the value per hundredweight of such beans by the price 
per hundredweight of U.S. No. 2 beans (except that for the classes of 
pea and medium while, the price will be the local market price per 
hundredweight for these classes with a 4 percent pick); and
    (ii) Multiplying the result by the number of pounds of such beans.

The applicable price for No. 2 beans will be the local market price on 
the earlier of the day the loss is adjusted or the day such beans were 
sold.

    (2) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good bean farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (c) Any appraised production on unharvested acreage.
    (3) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of beans becomes general 
in the county and reappraised by us;
    (b) Further damage by an insured cause and reappraised by us; or
    (c) Harvested.
    (4) The amount of production of any unharvested beans may be 
determined on the basis of field appraisals conducted after the end of 
the insurance period.
    (5) If you elect to exclude hail and fire as insured causes of loss 
and the beans are damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire.''
    g. A replanting payment may be made on any insured beans replanted 
after we have given consent and the acreage replanted is at least the 
lesser of 20 acres or 20 percent of the insured acreage for the unit, as 
determined on the final planting date.
    (1) No replanting payment will be made on acreage:
    (a) On which our appraisal exceeds 90 percent of the guarantee;
    (b) Initially planted prior to the date established by the actuarial 
table; or
    (c) On which a replanting payment has been made during the current 
crop year.
    (2) The replanting payment per acre will be your actual cost per 
acre for replanting but will not exceed the product obtained by 
multiplying 100 pounds times the price election, times your share.
    (3) The Corporation will transfer the original liability to the 
replanted crop without reduction by the amount of the replant payment 
and without increase in the original premium charged for insurance 
coverage when the crop is replanted in accordance with the requirements 
of the original planting.
    (4) If seasonal conditions dictate replanting by broadcast method, 
and such method differs from the requirements of the original planting, 
the Corporation will transfer the original liability to the replanted 
crop reduced by the amount of the replant payment

[[Page 253]]

and without increase in the original premium charged for insurance 
coverage.

If the information reported by you results in a lower premium than the 
actual premium determined to be due, the replanting payment will be 
reduced proportionately.

    h. You must not abandon any acreage to us.
    i. You may not sue us unless you have complied with all policy 
provisions. If a claim is denied, you may sue us in the United States 
District Court under the provisions of 7 U.S.C. 1508(c). You must bring 
suit within 12 months of the date notice of denial is received by you.
    j. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim form, 
if the reason for our failure to timely pay is not due to your failure 
to provide information or other material necessary for the computation 
or payment of the indemnity. The interest rate will be that established 
by the Secretary of the Treasury under section 12 of the Contract 
Dispute Act of 1978 (41 U.S.C. 611), and published in the Federal 
Register semiannually on or about January 1 and July 1. The interest 
rate to be paid on any indemnity will vary with the rate announced by 
the Secretary of the Treasury.
    k. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the beans are planted for any crop year, any indemnity 
will be paid to the persons determined to beneficially entitled thereto.
    l. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.

For the purpose of this section, the amount of loss from fire will be 
the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with approval. The assignee will have 
the right to submit the loss notices and forms required by the contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale, or other disposition of all beans 
produced on each unit, including separate records showing the same 
information for production from any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply, 
assignment of production to units by us, or a determination that no 
indemnity is due. Any person designated by us will have access to such 
records and the farm for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless

[[Page 254]]

canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due if deducted 
from:
    (1) An indemnity will be the date you sign the claim; or
    (2) Payment under another program administered by the United States 
Department of Agriculture will be the date both such other payment and 
setoff are approved.
    d. The cancellation and termination dates are:

------------------------------------------------------------------------
                                            Cancellation and termination
                   State                                dates
------------------------------------------------------------------------
California................................  March 31.
All other states..........................  April 15.
------------------------------------------------------------------------

    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by December 31 preceding the 
cancellation date (February 15, 1997, for the 1997 crop year only). 
Acceptance of any change will be conclusively presumed in the absence of 
any notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of dry bean crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding dry 
bean insurance in the county.
    b. ASCS means the Agricultural Stabilization and Conservation 
Service of the United States Department of Agriculture.
    c. County means: (1) The county shown on the application;
    (2) Any additional land located in a local producing area bordering 
on the county, as shown by the actuarial table; and
    (3) Any land identified by an ASCS farm serial number for the county 
but physically located in another county.
    d. Crop year means the period within which the beans are normally 
grown and will be designated by the calendar year in which the beans are 
normally harvested.
    e. Harvest means the completion of combining or threshing of beans 
on the unit.
    f. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    g. Insured means the person who submitted the application accepted 
by us.
    h. Loss ratio means the ratio of indemnity to premium.
    i. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State, a political subdivision of a State, or any agency 
thereof.
    j. Pick means the percentage, on a weight basis, of the defects such 
as splits, damaged (including discolored) beans, contrasting classes, 
and foreign material remaining in the beans after dockage has been 
removed by the proper use of screens or sieves.
    k. Replanting means performing the cultural practices necessary to 
replant insured acreage to dry beans.
    l. Replant payment means that payment made to the insured in 
accordance with the provisions of subsection 9.g. of this policy which 
payment is subject to offset for premium owed.
    m. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    n. Tenant means a person who rents land from another person for a 
share of the beans or a share of the proceeds therefrom.
    o. Unit means all insurable acreage of either dry edible beans or 
bush varieties of garden seed beans in the county on the date of 
planting for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.

Land rented for cash, a fixed commodity payment, or any consideration 
other than a share in the beans on such land will be considered as owned 
by the lessee. Land which

[[Page 255]]

would otherwise be one unit may be divided according to applicable 
guidelines on file in your service office. Units will be determined when 
the acreage is reported. Errors in reporting units may be corrected by 
us to conform to applicable guidelines when adjusting a loss. We may 
consider any acreage and share thereof reported by or for your spouse or 
child or any member of your household to be your bona fide share or the 
bona fide share of any other person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.

[50 FR 10202, Mar. 14, 1985, as amended by Amdt. 1, 50 FR 49520, Dec. 3, 
1985; 50 FR 52758, Dec. 26, 1985; 51 FR 7546, Mar. 5, 1986; 51 FR 
29205--29207, Aug. 15, 1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, 
Feb. 3, 1987; 52 FR 17547, 17548, May 11, 1987; 54 FR 20510, May 12, 
1989; 55 FR 50816, Dec. 11, 1990; 61 FR 68543, Dec. 30, 1996; 62 FR 
6105, Feb. 11, 1997]

                           PART 434 [RESERVED]



PART 435--TOBACCO (QUOTA PLAN) CROP INSURANCE REGULATIONS; REGULATIONS FOR THE 1985 THROUGH 1998 CROP YEARS--Table of Contents




Sec.
435.1  Availability of quota plan tobacco crop insurance.
435.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
435.3  OMB control numbers.
435.4  Creditors.
435.5  Good faith reliance on misrepresentation.
435.6  The contract.
435.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 50 FR 2951, Jan. 23, 1985, unless otherwise noted.



Sec. 435.1  Availability of quota plan tobacco crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
tobacco in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 435.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for tobacco which will be included in the actuarial table on 
file in service offices for the county and which may be changed from 
year to year.
    (b) At the time application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 435.3  OMB control numbers.

    The information collection requirements contained in these 
regulations (7 CFR part 435) have been approved by the Office of 
Management and Budget (OMB) under the provisions of 44 U.S.C. Chapter 35 
and have been assigned OMB numbers 0563-0003 and 0563-0007.



Sec. 435.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.

[[Page 256]]



Sec. 435.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the tobacco insurance 
contract, whenever--
    (a) An insured person under a contract of crop insurance entered 
into under these regulations, as a result of a misrepresentation or 
other erroneous action or advice by an agent or employee of the 
Corporation (1) is indebted to the Corporation for additional premiums, 
or (2) has suffered a loss to a crop which is not insured or for which 
the insured person is not entitled to an indemnity because of failure to 
comply with the terms of the insurance contract, but which the insured 
person believed to be insured, or believed the term of the insurance 
contract to have been complied with or waived, and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give, erroneous advice; (2) said insured 
person relied thereon in good faith; and (3) to required the payment of 
the additional premiums or to deny such insured's entitlement to the 
indemnity would not be fair and equitable, such insured person shall be 
granted relief the same as if otherwise entitled thereto.

Application for relief under this section must be submitted to the 
Corporation in writing.



Sec. 435.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the tobacco crop 
as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Any changes 
made in the contract shall not affect its continuity from year to year. 
The forms referred to in the contract are available at the applicable 
service offices.



Sec. 435.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the tobacco crop as landlord, owner-operator, or tenant. The application 
shall be submitted to the Corporation at the service office on or before 
the applicable closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the period of such extension. However, if adverse conditions should 
develop during such period, the Corporation will immediately discontinue 
the acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1985 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a tobacco 
contract issued under such prior regulations, without the filing of a 
new application.
    (d) The application is found at subpart D of part 400--General 
Administrative Regulations (7 CFR 400.37, 400.38). The provisions of the 
Tobacco (Quota Plan) Insurance Policy for the 1985 through 1998 crop 
years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

              Quota Plan of Tobacco--Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted

[[Page 257]]

Application and ``we, ``us'' and ``our'' refer to the Federal Crop 
Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply due to an unavoidable 
cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9d(6).
    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement or wrongdoing of you, any member of 
your household, your tenants or employees;
    (2) The failure to follow recognized good tobacco farming practices;
    (3) The impoundment of water by any governmental, public or private 
dam or reservoir project; or
    (4) Any cause not specified in section 1a as an insured loss.

       2. Crop, Acreage, Insured Poundage Quota, and Share Insured

    a. The crop insured will be tobacco of the type shown as insurable 
in the actuarial table, which is grown on insured acreage, and for which 
a premium rate is provided by the actuarial table.
    b. The acreage insured for each crop year will be an insurable type 
of tobacco planted on insurable acreage and in which you have a share, 
as reported by you or as determined by us, whichever we elect.
    c. The insured share will be your share as landlord, owner-operator, 
or tenant in the insured tobacco at the time of planting.
    d. We do not insure any acreage:
    (1) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (2) On which the tobacco was destroyed for the purpose of conforming 
with any other program administered by the United States Department of 
Agriculture;
    (3) Which is destroyed, it is practical to replant to tobacco, and 
such acreage was not replanted;
    (4) Initially planted after the final planting date contained in the 
actuarial table, unless you agree to coverage reduction on our form;
    (5) Planted to tobacco of a discount variety under provisions of the 
tobacco price support program;
    (6) Planted to a type or variety of tobacco not established as 
adapted to the area or excluded by the actuarial table;
    (7) Designated as uninsurable by the actuarial table; or
    (8) Planted for experimental purposes.
    e. The insured poundage quota for each crop year will be the 
effective poundage marketing quota applicable to the unit as provided 
under ASCS Tobacco Marketing Quota Regulations for the crop year plus 
any additional poundage you intend to produce on the unit that crop 
year, as reported by you or as determined by us, whichever we elect.

                                However:

    (1) The insured poundage quota may not include any amount which 
would be subject to a marketing quota penalty under ASCS Tobacco 
Marketing Quota Regulations;
    (2) The poundage marketing quota may be reduced for any carryover 
tobacco to be marketed under the poundage quota applicable to the unit 
when such poundage reduction is clearly specified by you in filing the 
acreage and quota report;
    (3) The insured poundage quota will never exceed the pounds obtained 
by multiplying the insured acres by the applicable farm yield per acre; 
and
    (4) Unless otherwise provided by the actuarial table, for any crop 
year in which tobacco poundage marketing quota regulations are not in 
effect, the insured poundage quota will be the pounds obtained by 
multiplying the applicable farm yield per acre times the lower of the 
reported or insured acreage on the unit.
    f. If insurance is provided for an irrigated practice:
    (1) You must report as irrigated only the acreage for which you have 
adequate facilities and water to carry out a good tobacco irrigation 
practice at the time of planting; and
    (2) Any loss of production caused by failure to carry out a good 
tobacco irrigation practice, except failure of the water supply from an 
unavoidable cause occurring after the beginning of planting, will be 
considered as due to an uninsured cause. The failure or breakdown of 
irrigation equipment or facilities will not be considered as a failure 
of the water supply from an unavoidable cause.
    (3) Insurance will not attach on an irrigated basis to acreage 
otherwise insurable on such basis unless it is designated as irrigated 
at the time the acreage is reported.
    g. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to planting.

[[Page 258]]

             3. Report of Acreage, Share, and Poundage Quota

    You must report on our form:
    a. All the acreage of insurable types of tobacco in the county in 
which you have a share;
    b. Your share at the time of planting; and
    c. The effective poundage marketing quota applicable to the unit as 
provided under ASCS Tobacco Marketing Quota Regulations plus any 
additional poundage you intend to produce on the unit in that crop year. 
Such poundage marketing quota may be reduced for any carryover tobacco 
to be marketed under the poundage quota applicable to the unit provided 
such poundage reduction is clearly specified in filing the acreage and 
quota report. The quota so reported will not be subject to change by 
you.

You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any tobacco planted in the 
county. This report must be submitted annually on or before the 
reporting date established by the actuarial table. All indemnities may 
be determined on the basis of information you have submitted on this 
report. If you do not submit this report by the reporting date, we may 
elect to determine by unit the insured acreage, share, and practice or 
we may deny liability on any unit. Any report submitted by you may be 
revised only upon our approval.

               4. Amounts of Insurance and Coverage Levels

    a. The coverage levels are contained in the actuarial table.
    b. The amount of insurance for a unit will be the dollar amount 
determined by multiplying the insured poundage quota for the unit by the 
percentage guarantee for the applicable coverage level established by 
the actuarial table and multiplying this product by the current year's 
support price for type 31 tobacco (rounded to the nearest cent) less six 
cents per pound for warehouse charges.
    c. Coverage level 2 will apply if you have not elected a coverage 
level.
    d. You may change the coverage level on or before the closing date 
for submitting applications for the crop year as established by the 
actuarial table.
    e. You must furnish a report of production to use for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the subsequent crop year. The yield 
assigned by us will be 75% of the yield assigned for the purpose of 
determining your guarantee for the present crop year. If you have filed 
a claim for the previous crop year, the yield determined in adjusting 
your indemnity claim will be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time of planting. 
The amount is computed by multiplying the amount of insurance for the 
unit times the premium rate, times your share at the time of planting.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1983 crop year 
under the terms of the Experience Table contained in the tobacco policy 
for the 1984 crop year, you will continue to receive the benefit of that 
reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the 1984 policy;
    (4) Once the loss ratio exceeds .80 no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    Insurance attaches when the tobacco is planted and ends at the 
earliest of:
    a. Total destruction of the tobacco;
    b. Weighing-in at the tobacco warehouse;
    c. Removal of the tobacco from the unit (except for curing, grading, 
packing or immediate delivery to the tobacco warehouse);
    d. Final adjustment of a loss; or
    e. February 28, immediately following the normal harvest period.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if:
    (a) During the period before harvest, the tobacco on any unit is 
damaged and you decide not to further care for or harvest any part of 
it;
    (b) You want our consent to put the acreage to another use; or

[[Page 259]]

    (c) After consent to put acreage to another use is given, additional 
damage occurs.

Insured acreage may not be put to another use until we have appraised 
the tobacco and given written consent. We will not consent to another 
use until it is too late to replant. You must notify us when such 
acreage is put to another use.
    (2) You must give us notice at least 15 days before the beginning of 
harvest if you anticipate a loss on any unit.
    (3) If probable loss is later determined, immediate notice must be 
given. A representative sample of the unharvested tobacco (at least 10 
feet wide and the entire length of the field) must remain unharvested 
for a period of 15 days from the date of notice, unless we give you 
written consent to harvest the sample.
    (4) Notice must be given immediately if any tobacco is destroyed or 
damaged by fire during the insurance period.
    (5) If tobacco is not to be sold through auction warehouses and an 
indemnity is to be claimed, notice must be given in sufficient time to 
allow us to inspect the cured tobacco prior to its sale or other 
disposition.
    (6) In addition to the notices required by this section, if you are 
going to claim an indemnity on any unit, we must be given notice not 
later than 30 days after the earliest of:
    (a) Total destruction of the tobacco on the unit;
    (b) The date marketing or other disposal of the insured tobacco on 
the unit is completed; or
    (c) The calendar date for the end of the insurance period.
    b. You must obtain written consent from us before you destroy any of 
the tobacco which is not to be harvested.
    c. We may reject any claim for indemnity if any of the requirements 
of this section or section 9 are not complied with.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the tobacco on the unit;
    (2) The date marketing or other disposal of the insured tobacco on 
the unit is completed; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of tobacco on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Subtracting from the amount of insurance for the unit, the value 
of the total production of tobacco to be counted (see section 9d); and
    (2) Multiplying the remainder by your share.
    d. The value of the total production to be counted for a unit will 
include the value of all harvested and appraised production.
    (1) Production to count will include:
    (a) The gross returns (less six cents per pound for warehouse 
charges) from tobacco sold on the warehouse floor;
    (b) The fair market value of the tobacco sold other than on the 
warehouse floor;
    (c) The fair market value of the tobacco harvested and not sold;
    (d) The fair market value of any unharvested tobacco as if such 
tobacco were harvested and cured; and
    (e) The current year's support price per pound (less six cents per 
pound for warehouse charges) for appraisals made by us for poor farming 
practices or uninsured causes of loss. (If a price support program is 
not in effect, such appraised production will be valued at the market 
price for the current crop year.)
    (2) To enable us to determine the fair market value of tobacco not 
sold through auction warehouses, we must be given the opportunity to 
inspect such tobacco before it is sold, contracted to be sold, or 
otherwise disposed of and, if the best offer you receive for any such 
tobacco is considered by us to be inadequate, to obtain additional 
offers on your behalf.
    (3) The value of appraised production to be counted will include:
    (a) The value of unharvested production on harvested acreage and 
potential production lost due to uninsured causes and failure to follow 
recognized good tobacco farming practices;
    (b) Not less than the average amount of insurance per insured acre 
for the unit for any acreage which is abandoned or put to another use 
without our prior written consent or damaged solely by an uninsured 
cause;
    (c) Not less than 35 percent of the average amount of insurance per 
insured acre for the unit for all other unharvested acreage.
    (4) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of tobacco becomes general 
in the county;
    (b) Harvested; or
    (c) Further damaged by an insured cause before the acreage is put to 
another use.
    (5) The amount of production of any unharvested tobacco may be 
determined on the basis of field appraisals conducted after the end of 
the normal harvest period.

[[Page 260]]

    (6) If you have elected to exclude hail and fire as insured causes 
of loss and the tobacco is damaged by hail or fire, appraisals will be 
made in accordance with Form FCI-78, ``Request to Exclude Hail and 
Fire''.
    (7) The commingled production of units will be allocated to such 
units in proportion to our liability on the harvested acreage of each 
unit.
    e. You must not abandon any acreage to us.
    f. You may not bring suit or action against us unless you have 
complied with all policy provisions. If a claim is denied, you may sue 
us in the United States District Court under the provisions of 7 U.S.C. 
1508(c). You must bring suit within 12 months of the date notice of 
denial is mailed to and received by you.
    g. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fee, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date and submit to us the properly completed claim form 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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 semi-annually on or about January 1 and July 1. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury. Interest will be paid in 
accordance with this section beginning with all claims for payment of 
indemnity initially filed on or after March 1, 1985.
    h. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the tobacco is planted for any crop year, any indemnity 
will be paid to the person(s) we determine to be beneficially entitled 
thereto.
    i. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of:
    (1) The amount of indemnity determined pursuant to this contract 
without regard to any other insurance; or
    (2) The amount by which the loss from fire exceeds the indemnity 
paid or payable under such other insurance. For the purposes of this 
section, the amount of loss from fire will be the difference between the 
fair market value of the production on the unit before the fire and 
after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract, and such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
rights. If we pay you for your loss then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale or other disposition of all tobacco 
produced on each unit including separate records showing the same 
information for production from any uninsured acreage. Any person 
designated by us will have access to such records and the farm for 
purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.

[[Page 261]]

    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due:
    (1) If deducted from an indemnity will be the date you sign the 
claim; or
    (2) If deducted from payment under another program administered by 
the United States Department of Agriculture will be the date both such 
other payment and set off are approved.
    d. The cancellation and termination dates are April 15.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. All contract changes will be available at your service office by 
December 31 preceding the cancellation date except that, for the 1985, 
1986 transition only, all contract changes will be available at your 
service office by January 20, 1986. Acceptance of any change will be 
conclusively presumed in the absence of any notice from you to cancel 
the contract.

                          17. Meaning of Terms

    For the purposes of quota tobacco crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the coverage levels, premium rates, 
practices, insurable and uninsurable acreage, and related information 
regarding tobacco insurance in the county.
    b. ASCS means the Agricultural Stabilization and Conservation 
Service of the United States Department of Agriculture.
    c. Carryover tobacco means any tobacco on hand from the previous 
year's production.
    d. County means the county shown on the application and:
    (1) Any additional land located in a local producing area bordering 
on the county, as shown by the actuarial table; and
    (2) Any land identified by an ASCS Farm Serial Number for the county 
but physically located in another county.
    e. Crop year means the period within which the tobacco is normally 
grown and will be designated by the calendar year in which the tobacco 
is normally harvested.
    f. Effective poundage marketing quota means the farm marketing quota 
as established and recorded by ASCS.
    g. Farm yield means the yield per acre used by ASCS in establishing 
the basic farm marketing poundage quota for the tobacco farm, unless we 
have established a yield for the farm in the actuarial table.
    h. Harvest means the completion of cutting of tobacco on any acreage 
from which acreage at least 20 percent of the amount of tobacco in 
pounds per acre (obtained by multiplying the applicable insured poundage 
quota for the unit by the applicable percentage of guarantee shown in 
the actuarial table for such acreage and dividing this result by the 
insured acreage in the unit) is cut.
    i. Insurable acreage means that acreage planted to an insurable type 
of tobacco excluding any acreage designated as noninsurable by the 
actuarial table.
    j. Insured means the person who submitted the application accepted 
by us.
    k. Loss ratio means the ratio of indemnity(ies) to premium(s).
    l. Market Price for a crop year means the average auction price for 
the applicable type (less six cents per pound for warehouse charges) in 
the belt or area. The market price will be designated by the actuarial 
table.
    m. Person means an individual, partnership, association, 
corporation, estate, trust, or other business enterprise or legal 
entity, and wherever applicable, a State, a political subdivision of a 
State, or any agency thereof.
    n. Planting means transplanting the tobacco plant from the bed to 
the field.
    o. Rounded means rounding up for \1/2\ and above and rounding down 
for less than \1/2\.
    p. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    q. Support price per pound means the average price support level per 
pound for the insured type of tobacco as announced by the United States 
Department of Agriculture under the tobacco price support program. For 
any crop year in which a price support for the insured type is not in 
effect, the market price for that crop year will be used.

[[Page 262]]

    r. Tenant means a person who rents land from another person for a 
share of the tobacco or a share of the proceeds therefrom.
    s. Unit means all insurable acreage of an insurable type of tobacco 
in the county in which you have an insured share on the date of planting 
for the crop year and which is identified by a single ASCS Farm Serial 
Number at the time insurance first attaches under this policy for the 
crop year. Units will be determined when the acreage is reported. We may 
reject or modify any ASCS reconstitution for the purpose of unit 
definition if the reconstitution was in whole or part to defeat the 
purpose of the Federal Crop Insurance Program or to gain 
disproportionate advantage under this policy. Errors in reporting units 
may be corrected by us when adjusting a loss.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[50 FR 2951, Jan. 23, 1985, as amended at 50 FR 49027, Nov. 29, 1985; 50 
FR 52758, Dec. 26, 1985; 51 FR 7546, Mar. 5, 1986; 51 FR 29205--29207, 
Aug. 15, 1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 52 
FR 6775, Mar. 5, 1987; 54 FR 20372, May 11, 1989; 55 FR 35888, Sept. 4, 
1990; 63 FR 34782, June 26, 1998]

                          PART 436  [RESERVED]



PART 437--SWEET CORN CROP INSURANCE REGULATIONS FOR THE 1985 THROUGH 1997 CROP YEARS--Table of Contents




Sec.
437.1  Availability of sweet corn crop insurance.
437.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
437.3  OMB control numbers.
437.4  Creditors.
437.5  Good faith reliance on misrepresentation.
437.6  The contract.
437.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 50 FR 1825, Jan. 14, 1985, unless otherwise noted.



Sec. 437.1  Availability of sweet corn crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
sweet corn in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 437.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for sweet corn which will be included in the actuarial table on 
file in service offices for the county and which may be changed from 
year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 437.3  OMB Control numbers.

    The information collection requirements contained in these 
regulations (7

[[Page 263]]

CFR part 437) have been approved by the Office of Management and Budget 
(OMB) under the provisions of 44 U.S.C. Chapter 35 and have been 
assigned OMB Nos. 0563-0003 and 0563-0007.



Sec. 437.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 437.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the sweet corn insurance 
contract, whenever
    (a) An insured person under a contract of crop insurance entered 
into under these regulations, as a result of a misrepresentation or 
other erroneous action or advice by an agency or employee of the 
Corporation (1) is indebted to the Corporation for additional premiums, 
or (2) has suffered a loss to a crop which is not insured or for which 
the insured person is not entitled to an indemnity because of failure to 
comply with the terms of the insurance contract, but which the insured 
person believed to be insured, or believed the terms of the insurance 
contract to have been complied with or waived, and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice; (2) said insured 
person relied thereon in good faith; and (3) to require the payment of 
the additional premiums or to deny such insured's entitlement to the 
indemnity would not be fair and equitable, such insured person shall be 
granted relief the same as if otherwise entitled thereto. Application 
for relief under this section must be submitted to the Corporation in 
writing.



Sec. 437.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the sweet corn 
crop as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Any changes 
made in the contract shall not affect its continuity from year to year. 
The forms referred to in the contract are available at the applicable 
service offices.



Sec. 437.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the sweet corn crop as landlord, owner-operator, or tenant. The 
application shall be submitted to the Corporation at the service office 
on or before the applicable closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
office and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the period of such extension. However, if adverse conditions should 
develop during such period, the Corporation will immediately discontinue 
the acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1985 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a sweet corn 
contract issued under such prior regulations, without the filing of a 
new application.
    (d) The application is found at subpart D of part 400, General 
Administrative Regulations (7 CFR 400.37, 400.38). The provisions of the 
Sweet Corn Insurance Policy for the 1985 through 1997 crop years are as 
follows:

[[Page 264]]

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                    Sweet Corn--Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply due to an unavoidable 
cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9e(5).
    b. We will not insure against any loss of production due to:
    (1) Sweet corn not being timely harvested, unless it is determined 
that, due to unusual weather conditions, a substantial number of acres 
of sweet corn in the area were ready for harvest at the same time;
    (2) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants or employees;
    (3) The failure to follow recognized good sweet corn farming 
practices;
    (4) The impoundment of water by any governmental, public or private 
dam or reservoir project; or
    (5) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be canning and freezing sweet corn grown on 
insured acreage, for which a guarantee and premium rate are provided by 
the actuarial table.
    b. The acreage insured for each crop year will be sweet corn planted 
on insurable acreage as designated by the actuarial table and in which 
you have a share, as reported by you or as determined by us, whichever 
we elect.
    c. The insured share will be your share as landlord, owner-operator, 
or tenant in the insured sweet corn at the time of planting.
    d. We do not insure any acreage:
    (1) Of sweet corn not grown under a contract executed with a 
processor or excluded from the processor contract for, or during, the 
crop year (The contract must be executed and effective before you report 
your acreage.);
    (2) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (3) Which is irrigated and an irrigated practice is not provided by 
the actuarial table unless you elect to insure the acreage as 
nonirrigated by reporting it as insurable under section 3;
    (4) Which is destroyed, it is practical to replant to sweet corn, 
and such acreage is not replanted;
    (5) Initially planted after the final planting date contained in the 
actuarial table;
    (6) Of volunteer sweet corn;
    (7) Planted to a type or variety of sweet corn not established as 
adapted to the area or excluded by the actuarial table;
    (8) Planted for the development or production of hybrid seed or for 
experimental purposes; or
    (9) Planted with a crop other than sweet corn.
    e. If insurance is provided for an irrigated practice:
    (1) You must report as irrigated only the acreage for which you have 
adequate facilities and water to carry out a good sweet corn irrigation 
practice at the time of planting; and
    (2) Any loss of production caused by failure to carry out a good 
sweet corn irrigation practice, except failure of the water supply from 
an unavoidable cause occurring after the beginning of planting, will be 
considered as due to an uninsured cause. The failure or breakdown of 
irrigation equipment or facilities will not be considered as a failure 
of the water supply from an unavoidable cause.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to planting.
    g. An instrument in the form of a ``lease'' under which you retain 
control of the acreage on which the insured crop is grown and which 
provides for delivery of the crop under certain conditions and at a 
stipulated price(s) will, for the purpose of this contract, be treated 
as a contract under which you have the share in the crop.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of sweet corn in the county in which you have a 
share;
    b. The practice; and

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    c. Your share at the time of planting;

You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any sweet corn planted in the 
county. This report must be submitted annually on or before the 
reporting date established by the actuarial table. All indemnities may 
be determined on the basis of information you have submitted on this 
report. If you do not submit this report by the reporting date, we may 
elect to determine by unit the insured acreage, share, and practice or 
we may deny liability on any unit. Any report submitted by you may be 
revised only upon our approval.

     4. Production Guarantees, Coverage Levels, and Prices at Which 
                      Indemnities Shall be Computed

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are in the actuarial table.
    b. Coverage level 2 will apply if you have not elected a coverage 
level.
    c. You may change the coverage level and price election on or before 
the closing date for submitting applications for the crop year as 
established by the actuarial table.
    d. You must furnish a report of production to us for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the subsequent crop year. The yield 
assigned by us will be 75% of the yield assigned for the purpose of 
determining your guarantee for the present crop year. If you have filed 
a claim for the previous crop year, the yield determined in adjusting 
your indemnity claim will be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time of planting. 
The amount is computed by multiplying the production guarantee times the 
price election, times the premium rate, times the insured acreage, times 
your share at the time of planting.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on your insuring experience through the 1983 crop year 
under the terms of the Experience Table contained in the sweet corn 
policy for the 1984 crop year, you will continue to receive the benefit 
of that reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the 1984 policy;
    (4) Once the loss ratio exceed .80 no further premium reduction will 
be applicable; and
    (5) Participation must be continuous.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    Insurance attaches when the sweet corn is planted and ends at the 
earliest of:
    a. Total destruction of the sweet corn;
    b. Harvest;
    c. Final adjustment of a loss;
    d. The date by which sweet corn acreage should have been harvested; 
or
    e. The following dates of the calendar year in which the sweet corn 
is normally harvested:
(1) Benton, Clackamas, Columbia, Lane, Linn, Marion, Multnomah, Polk, 
Washington, and Yamhill Counties, Oregon; and Clark and Cowlitz Counties 
    Washington...............................................October 20;
(2) All other Washington     Counties........................October 10;
(3) All other Oregon counties and all other states.........September 20.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if:
    (a) During the period before harvest, the sweet corn on any unit is 
damaged and you decide not to further care for or harvest any part of 
it;
    (b) You want our consent to put the acreage to another use; or
    (c) After consent to put acreage to another use is given, additional 
damage occurs.

Insured acreage may not be put to another use until we have appraised 
the sweet corn and given written consent. We will not consent to another 
use until it is too late to replant. You must notify us when such 
acreage is put to another use.
    (2) If you anticipate a loss on any unit, you must give us notice:
    (a) At least 15 days before the beginning of harvest; or

[[Page 266]]

    (b) Immediately, if probable loss is later determined. A 
representatve sample of the unharvested sweet corn (at least 10 feet 
wide and the entire length of the field) must be left intact for a 
period of 15 days from the date of notice unless we give you written 
consent to harvest the sample.
    (3) If you are going to claim an indemnity on any unit which is not 
to be harvested or on which harvest has been discontinued, notice must 
be given not later than 48 hours:
    (a) Before the time harvest would normally start; or
    (b) After discontinuance of harvest.

If such notice is not given or if unharvested acreage is not left 
intact, the appraisal on such acreage will be the production guarantee.
    (4) Unless notice has been given under subsection (3) above, and in 
addition to the other notices required by this section, if you are going 
to claim an indemnity on any unit, we must be given notice not later 
than 30 days after the earliest of:
    (a) Total destruction of the sweet corn on the unit;
    (b) Harvest of the unit; or
    (c) The calendar date for the end of the insurance period.
    b. You must obtain written consent from us before you destroy any of 
the sweet corn which is not to be harvested.
    c. We may reject any claim for indemnity if any of the requirements 
of this section or section 9 are not complied with.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliers of:
    (1) Total destruction of the sweet corn on the unit;
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of sweet corn on the unit and 
that any loss of production has been directly caused by one or more of 
the insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of sweet corn to be 
counted (see section 9e);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. If the information reported by you under section 3 of the policy:
    (1) In the 1985 crop year results in a lower premium than the actual 
premium determined to be due, the indemnity will be reduced 
proportionately.
    (2) In the 1986 and succeeding crop years results in a lower premium 
than the premium determined to be due, the production guarantee on the 
unit will be computed on the information reported and not on the 
information actually determined. All production from insurable acreage, 
whether or not reported as insurable will count against the production 
guarantee.
    e. The total production (Tons) to be counted for a unit will include 
all harvested and appraised production.
    (1) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good sweet corn farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause;
    (c) Any appraised production on unharvested acreage.
    (2) If any acreage of sweet corn is not timely harvested the 
production to count will be the greater of the:
    (a) Appraised production; or
    (b) Dollar amount received from the processor divided by the 
processor's base contract price per ton.
    (3) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of sweet corn becomes 
general in the county;
    (b) Harvested; or
    (c) Further damaged by an insured cause before the acreage is put to 
another use.
    (4) The amount of production of any unharvested sweet corn may be 
determined on the basis of field appraisals conducted after the end of 
the insurance period.
    (5) If you have elected to exclude hail and fire as insured causes 
of loss and the sweet corn is damaged by hail or fire, appraisals will 
be made in accordance with Form FCI-78, ``Request to Exclude Hail and 
Fire''.
    (6) The commingled production of units will be allocated to such 
units in proportion to our liability on the harvested acreage of each 
unit.
    f. You must not abandon any acreage to us.
    g. You may not bring suit or action against us unless you have 
complied with all policy provisions. If a claim is denied, you may sue 
us in the United States District Court under the provisions of 7 U.S.C. 
1508(c). You must bring suit within 12 months of the date notice of 
denial is mailed to and received by you.

[[Page 267]]

    h. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fee, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date and submit to us the properly completed claim form 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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 semi-annually on or about January 1 and July 1. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury. Interest will be paid in 
accordance with this section beginning with all claims for payment of 
indemnity initially filed on or after March 1, 1985.
    i. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the sweet corn is planted for any crop year, any 
indemnity will be paid to the person(s) we determine to be beneficially 
entitled thereto.
    j. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance. For the purposes of this section, 
the amount of loss from fire will be the difference between the fair 
market value of the production on the unit before the fire and after the 
fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract, and such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
rights. If we pay you for your loss then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale or other disposition of all sweet 
corn produced on each unit including separate records showing the same 
information for production from any uninsured acreage. Any person 
designated by us will have access to such records and the farm for 
purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any crop 
year by giving written notice on or before the cancellation date 
preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due:
    (1) If deducted from an indemnity claim will be the date you sign 
the claim; or
    (2) If deducted from payment under another program administered by 
the United States Department of Agriculture will be the

[[Page 268]]

date both such other payment of set-off are approved.
    d. The cancellation and termination dates are April 15.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by December 31 preceding the 
cancellation date (January 20, 1986, for the 1985, 1986 transition). 
Acceptance of any change will be conclusively presumed in the absence of 
any notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of sweet corn crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
sweet corn insurance in the county.
    b. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county, as shown by the actuarial table.
    c. Crop year means the period within which the sweet corn is 
normally grown and is designated by the calendar year in which the sweet 
corn is normally harvested.
    d. Harvest means the removal of the ears and husks from the stalks 
for the purpose of delivery to the processor.
    e. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    f. Insured means the person who submitted the application accepted 
by us.
    g. Loss ratio means the ratio of indemnity(ies) to premium(s).
    h. Person means an individual, partnership, association, 
corporation, estate, trust, or other business enterprise or legal 
entity, and wherever applicable, a State, a political subdivision of a 
State, or any agency thereof.
    i. Service office means the office servicing your contract as shown 
on the application for insurance or such approved office as may be 
selected by you or designated by us.
    j. Tenant means a person who rents land from another person for a 
share of the sweet corn or a share of the proceeds therefrom.
    k. Unit means all insurable acreage of sweet corn in the county on 
the date of planting for the crop year:
    (1) In which you have 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.

Land rented for cash, a fixed commodity payment, or any consideration 
other than a share in the sweet corn on such land will be considered as 
owned by the lessee. Land which would otherwise be one unit may be 
divided according to applicable guidelines on file in your service 
office or by written agreement with us. We will determine units as 
herein defined when the acreage is reported. Errors in reporting such 
units may be corrected by us to conform to applicable guidelines when 
adjusting a loss. We may consider any acreage and share thereof reported 
by or for your spouse or child or any member of your household to be 
your bona fide share or the bona fide share of any other person having 
an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part,

[[Page 269]]

coverage under the terms of such crop insurance policy will be effective 
subject to the availability of appropriations.

[50 FR 1825, Jan. 14, 1985, as amended at 50 FR 49027, Nov. 29, 1985; 50 
FR 52758, Dec. 26, 1985; 51 FR 7546, Mar. 5, 1986; 51 FR 29205--29207, 
Aug. 15, 1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 54 
FR 20512, May 12, 1989; 55 FR 35888, Sept. 4, 1990; 62 FR 65342, Dec. 
12, 1997]

                        PARTS 438-440  [RESERVED]



PART 441--TABLE GRAPE CROP INSURANCE REGULATIONS FOR THE 1987 THROUGH 1997 CROP YEARS--Table of Contents




Sec.
441.1  Availability of table grape crop insurance.
441.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
441.3  OMB control numbers.
441.4  Creditors.
441.5  Good faith reliance on misrepresentation.
441.6  The contract.
441.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 51 FR 37893, Oct. 27, 1986, unless otherwise noted.



Sec. 441.1  Availability of table grape crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
table grapes in counties within the limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended. The counties shall be designated by the Manager of the 
Corporation from those approved by the Board of Directors of the 
Corporation.



Sec. 441.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for table grapes which will be included in the actuarial table 
on file in applicable service offices for the county and which may be 
changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices set by the actuarial table 
for the crop year.



Sec. 441.3  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 441.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 441.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the table grape crop 
insurance contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation:
    (1) Is indebted to the Corporation for additional premiums; or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the insured believed 
to be insured, or believed the terms of the insurance contract to have 
been complied with or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that:
    (1) An agent or employee of the Corporation did in fact make such 
misrepresentation or take other erroneous action or give erroneous 
advice;
    (2) Said insured relied thereon in good faith; and
    (3) To require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto.

[[Page 270]]


Requests for relief under this section must be submitted to the 
Corporation in writing.



Sec. 441.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the table grape 
crop as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Changes made in 
the contract shall not affect its continuity from year to year. The 
forms referred to in the contract are available at the applicable 
service offices.



Sec. 441.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the table grape crop as landlord, owner-operator, or tenant if the 
person wishes to participate in the program. The application shall be 
submitted to the Corporation at the service office on or before the 
applicable sales closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the sales closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period. However, if adverse conditions should develop 
during such period, the Corporation will immediately discontinue the 
acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1987 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a table grape 
contract issued under such prior regulations, without the filing of a 
new application.
    (d) The application for the 1987 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 Table Grape Insurance Policy for 
the 1987 through 1997 crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                   Table Grape--Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption;
    (6) Direct Mediterranean Fruit Fly damage; or;
    (7) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after insurance attaches;

unless those causes are excepted, excluded, or limited by the actuarial 
table or subsection 9.e.(6).
    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement, or wrongdoing by you, any member of 
your household, your tenants, or employees;
    (2) The failure to follow recognized good table grape management 
practices;
    (3) The failure or breakdown of irrigation equipment or facilities;
    (4) The failure to follow recognized good table grape irrigation 
practices;
    (5) The impoundment of water by any governmental, public, or private 
dam or reservoir project; or
    (6) Any cause not specified in subsection 1.a. as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be any insurable variety of grapes grown 
for harvest as table

[[Page 271]]

grapes, grown on insured acreage on which the cultural practices to 
produce table grapes are carried out, and for which a guarantee and 
premium rate are set by the actuarial table.
    b. The acreage insured for each crop year will be grapes grown on 
insurable acreage as designated by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured grapes at the time insurance attaches. However, 
only for the purpose of determining the amount of indemnity, your share 
will not exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any acreage:
    (1) On which the vines, after being set out, have not reached the 
number of growing seasons designated by the actuarial table;
    (2) Which has not produced an average of 150 lugs of table grapes 
per acre;
    (3) Which does not have acceptable records of acreage and production 
unless we agree, in writing, to insure acreage; or
    (4) With less than a 90 percent stand of bearing vines based on the 
original planting pattern, unless we agree, in writing, to insure such 
acreage.
    e. If insurance is provided for an irrigated practice, you must 
report as irrigated only the acreage for which you have adequate 
facilities and water, at the time insurance attaches, to carry out a 
good grape irrigation practice.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to the date insurance attaches.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of grapes in the county on which cultural 
practices to produce table grapes are carried out and in which you have 
a share;
    b. The practice;
    c. Your share on the date insurance attaches; and
    d. The number of bearing vines (if less than 90 percent of a stand 
based on the original planting pattern).
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any grapes grown in the 
county. This report must be submitted annually on or before the 
reporting date established by the actuarial table. All indemnities may 
be determined on the basis of information you submit on this report. If 
you do not submit this report by the reporting date, we may elect to 
determine, by unit, the insured acreage, share, and practice or we may 
deny liability on any unit. Any report submitted by you may be revised 
only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. Coverage level 2 will apply if you do not elect a coverage level.
    c. You may change the coverage level and price election on or before 
the sales closing date set by the actuarial table for submitting 
applications for the crop year.
    d. You must report production to us for the prior crop year before 
the sales closing date as established by the actuarial table. If you do 
not provide the required production report, we will assign a yield for 
the crop year for which the report is not furnished. The production 
report or assigned yield will be used to compute your production history 
for the purpose of determining your guarantee for the insured crop year. 
The yield assigned by us will be 75% of the yield assigned for the 
purpose of determining your guarantee for the prior crop year as 
adjusted for crop and vineyard conditions. If you have filed a claim for 
the previous crop year, the yield determined in adjusting your indemnity 
claim will be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable on the date insurance 
attaches. The amount is computed by multiplying the production guarantee 
times the price election, times the premium rate, times the insured 
acreage, times your share on the date insurance attaches.
    b. Interest will accrue at the rate of one and one-fourth percent 
(1-\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    Insurance attaches on February 1 and ends on the earliest of:
    a. Total destruction of the grapes on the unit;
    b. Discontinuance of cultural practices to produce table grapes;
    c. The date harvest would normally start on the unit on any acreage 
which will not be harvested as table grapes;
    d. Harvest;

[[Page 272]]

    e. Discontinuance of harvesting of table grapes on the unit;
    f. Final adjustment of a loss; or
    g. The following applicable date of the calendar year in which the 
grapes are normally harvested:

------------------------------------------------------------------------
      State and county(ies)             Variety              Date
------------------------------------------------------------------------
Arizona:
  All counties..................  Perlette..........  June 15.
                                  Flame Seedless....  July 15.
                                  All others........  July 31.
California:
  Fresno, Kern, Kings, Madera,    Perlette..........  August 15.
   and Tulare.                    Cardinal..........  August 15.
                                  Exotic............  August 31.
                                  Flame Seedless....  August 31.
                                  Superior Seedless.  August 31.
                                  Red Malaga........  September 15.
                                  Queen.............  September 15.
                                  Thompson Seedless.  September 15.
                                  Black Rose........  September 30.
                                  Italia............  September 30.
                                  White Malaga......  October 15.
                                  Ribier............  October 15.
                                  Ruby Seedless.....  October 15.
                                  All others........  October 31.
  Merced, Stanislaus, and San     Flame Seedless....  September 15.
   Joaquin.                       Thompson Seedless.  September 30.
                                  Ribier............  October 15.
                                  Flame Tokay.......  October 15.
                                  All others........  October 31.
  Riverside, and San Bernadino..  Beauty Seedless...  July 15
                                  Perlette..........  July 15
                                  All others........  July 31.
------------------------------------------------------------------------

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if, during the period before 
harvest, the grapes on any unit are damaged and you decide not to 
further care for or harvest any part of them.
    (2) You must give us notice:
    (a) At least 15 days before the beginning of harvest if you 
anticipate a loss on any unit; or
    (b) Immediately, if damage occurs within 15 days prior to harvest or 
during harvest.
    (3) If you are going to claim an indemnity on any unit, you must 
give us notice not later than 72 hours after the earliest of:
    (a) Total destruction of the grapes on the unit;
    (b) Discontinuance of cultural practices to produce table grapes;
    (c) Discontinuance of harvest of any acreage on the unit; or
    (d) The date harvest would normally start if any acreage on the unit 
is not to be harvested as table grapes.
    (4) Unless notice has been given under subsection (3) above, and in 
addition to the other notices required by this subsection, if you are 
going to claim an indemnity on any unit, you must give us notice not 
later than 10 days after the earlier of:
    (a) Harvest of the unit; or
    (b) The calendar date for the end of the insurance period 
(Subsection 7.g.).
    b. You must obtain written consent from us before you destroy any of 
the grapes which are not to be harvested.
    c. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the end of the insurance period (see 
section 7).
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of grapes on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of grapes to be 
counted (see subsection 9.3.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. The total production (in lugs) to be counted for a unit will 
include all production harvested as table grapes and all appraised 
production, that meets the California Department of Food and Agriculture 
minimum standards.
    (1) Table grape production damaged by insurable causes within the 
insurance period that could be marketed for any use as other than table 
grapes will be determined by multiplying the greater of the total value 
of the grapes per ton or $50 times the number of tons and dividing that 
result by the highest price election available for the insured unit. 
This result will be the number of lugs to count.
    (2) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and any change in management 
practices (cluster thinning and removal);

[[Page 273]]

    (b) Not less than the applicable guarantee for any acreage which is 
abandoned, damaged solely by an uninsured cause, or destroyed by you 
without our prior written consent;
    (c) Any unharvested production where table grape cultural practices 
were discontinued following an appraisal; and
    (d) Any appraised production on unharvested acreage.
    (3) Any appraisal we have made on insured acreage will be considered 
production to count unless such acreage is:
    (a) Not harvested before the harvest of grapes becomes general in 
the country and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (4) If any grapes are harvested before normal maturity, the 
production of such grapes will be increased by the factor obtained by 
dividing the price per lug received for such grapes by the price per lug 
for fully matured grapes.
    (5) We may determine the amount of production of any unharvested 
grapes on the basis of field appraisals conducted after discontinuance 
of harvest or the end of the insurance period.
    (6) If you elect to exclude hail and fire as insured causes of loss 
and the grapes are damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire.''
    f. You must not abandon any acreage to us.
    g. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    h. An indemnity will not be paid unless you comply with all policy 
provisions.
    i. We have a policy of paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury.
    j. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the date insurance attaches for any crop year, any 
indemnity will be paid to the persons determined to be beneficially 
entitled thereto.
    k. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount.
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance. For the purpose of this subsection, 
the amount of loss from fire will be the difference between the fair 
market value of the production on the unit before the fire and after the 
fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another person your right to an indemnity for the 
crop year, only in writing on our form, and with our approval. The 
assignee will have the right to submit the loss notices and forms 
required by the contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid

[[Page 274]]

you plus our expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for 2 years after the time of loss, records of the 
harvesting, storage, shipment, sale, or other disposition of all grapes 
produced on each unit including separate records showing the same 
information for production from any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply, 
assignment of production to units by us, or a determination that no 
indemnity is due. Any person designated by us will have access to such 
records and the farm for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due if deducted 
from:
    (1) An indemnity, will be the date you sign the claim; or
    (2) Payment under another program administered by the United States 
Department of Agriculture, will be the date both such other payment and 
setoff are approved.
    d. The cancellation and termination dates are January 31.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by October 31 preceding the 
cancellation date. Acceptance of change will be conclusively presumed in 
the absence of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of table grape crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us. The table is available for public inspection in 
your service office, and shows the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
table grape insurance in the county.
    b. Cluster thinning and removal means removing parts of a cluster or 
the entire cluster of grapes.
    c. Contiguous land means land which is touching at any point, except 
that land which is separated by only a public or private right-of-way 
will also be consider contiguous.
    d. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county, as shown by the actuarial table.
    e. Crop year means the period beginning with the date insurance 
attaches and extending through normal harvest time and is designated by 
the calendar year in which the grapes are normally harvested.
    f. Direct Mediterranean fruit fly damage means the actual physical 
damage to the grapes on the unit which causes such grapes to be 
unmarketable and will not include unmarketability of such grapes as a 
direct result of a quarantine, boycott, or refusal to accept the grapes 
by any entity without regard to actual physical damage to such grapes.
    g. Harvest means picking the grapes from the vines.
    h. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    i. Insured means the person who submitted the application accepted 
by us.
    j. Loss ratio means the ratio of indemnity to premium.
    k. Lug means 22 pounds of table grapes in the Coachella Valley, 
California district, and 23 pounds in all other California districts.
    l. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable,

[[Page 275]]

a State or a political subdivision or agency of a State.
    m. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    n. Table grapes means the grapes which are grown for commercial 
sales as fresh grapes, on acreage which the cultural practices to 
produce fresh marketable grapes were carried out.
    o. Tenant means a person who rents land from another person for a 
share of the grapes or a share of the proceeds therefrom.
    p. Unit means all insurable acreage of grapes in the county located 
on contiguous land on the date insurance attaches for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the grapes on such land will be 
considered as owned by the lessee. Land which would otherwise be one 
unit may be divided according to applicable guidelines on file in your 
service office. Units will be determined when the acreage is reported. 
Errors in reporting units may be corrected by us to conform to 
applicable guidelines when adjusting a loss. We may consider any acreage 
and share thereof reported by or for your spouse or child or any member 
of your household to be your bona fide share or the bona fide share of 
any other person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with the Appeal Regulations, 
(7 CFR part 400, subpart J).

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[51 FR 37893, Oct. 27, 1986; 51 FR 41757, Nov. 19, 1986; 52 FR 3214, 
Feb. 3, 1987; 53 FR 46848, Nov. 21, 1988; 55 FR 35888, Sept. 4, 1990; 62 
FR 47747, Sept. 11, 1997]

                          PART 442  [RESERVED]



PART 443--HYBRID SEED CROP INSURANCE REGULATIONS FOR THE 1986 THROUGH 1997 CROP YEARS--Table of Contents




Sec.
443.1  Availability of hybrid seed crop insurance.
443.2  Premium rates, coverage levels, and amounts of insurance.
443.3  OMB control numbers.
443.4  Creditors.
443.5  Good faith reliance on misrepresentation.
443.6  The contract.
443.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 51 FR 5697, Feb. 18, 1986, unless otherwise noted.



Sec. 443.1  Availability of hybrid seed crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
hybrid seed in counties within limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 443.2  Premium rates, coverage levels, and amounts of insurance.

    (a) The Manager shall establish premium rates, coverage levels, and 
amounts of insurance for hybrid seed which will be included in the 
actuarial table in file in the applicable service offices for the county 
and which may be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect an amount of insurance per acre and a coverage level from 
among those

[[Page 276]]

levels and amounts shown on the actuarial table for the crop year.



Sec. 443.3  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 443.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefits under the contract.



Sec. 443.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the Hybrid Seed insurance 
contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation of other erroneous 
action or advice by an agent or employee of the Corporation:
    (1) Is indebted to the Corporation for additional premiums; or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the insured believed 
to be insured, or believed the terms of the insurance contract to have 
been complied with or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00 finds that:
    (1) An agent or employee of the Corporation did in fact make such 
misrepresentation or take other erroneous action or give erroneous 
advice;
    (2) Said insured relied thereon in good faith; and
    (3) To require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto.

Requests for relief under this section must be submitted to the 
Corporation in writing.



Sec. 443.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the hybrid seed 
crop as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Changes made in 
the contract shall not affect its continuity from year to year. The 
forms referred to in the contract are available at the applicable 
service offices.



Sec. 443.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation must be made by any person to cover such person's share in 
the hybrid seed crop as landlord, owner-operator, or tenant if the 
person wishes to participate in the program. The application shall be 
submitted to the Corporation at the service office on or before the 
applicable sales closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the sales closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period. However, if adverse conditions should develop 
during such period, the Corporation will immediately discontinue the 
acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in polices issued under FCIC regulations for the 1986 
and succeeding crop years, a contract in the form provided for under 
this subpart will come into effect as a continuation of a hybrid seed 
insurance contract issued under such prior regulations, without the 
filing of a new application.

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    (d) The application for the 1986 through 1997 crop years is found at 
subpart D of part 400, General Administrative Regulations (7 CFR 400.37 
and 400.38). The provisions of the Hybrid Seed Crop Insurance 
Regulations for the 1986 through 1997 crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                    Hybrid Seed Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9e(5).
    b. We will not insure against any loss of production due to:
    (1) The use of unadapted, incompatible or genetically deficient male 
or female seed;
    (2) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants, or employees;
    (3) The failure to follow recognized good farming practices or the 
grower provisions of the seed contract;
    (4) The impoundment of water by any governmental, public, or private 
dam or reservoir project;
    (5) Frost or freeze after the date set by the actuarial table;
    (6) Inadequate germination even though a result of an insured cause 
of loss unless inspected and accepted by us before harvest is completed;
    (7) The failure to plant the male seed at a time sufficient to 
assure adequate pollination of the female plant;
    (8) The failure or breakdown of irrigation equipment or facilities;
    (9) The failure to follow recognized good hybrid seed irrigation 
practices; or
    (10) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be any type of female seed (``crop'') you 
elect:
    (1) Which is planted for harvest and the production is intended for 
the purpose of commercial seed to produce a type of the crop for grain 
or silage;
    (2) Which is grown under a contract executed with a seed company 
before the acreage reporting date;
    (3) Which is grown on insured acreage; and
    (4) For which an amount of insurance per acre and premium rate are 
set by the actuarial table.
    b. An instrument in the form of a ``lease'' under which you retain 
control of the acreage on which the insured crop is grown and which 
provides for delivery of the crop under certain conditions and at a 
stipulated price will be treated as a contract under which you have the 
share in the crop.
    c. The acreage insured for each crop year will be the crop planted 
on insurable acreage as designated by the actuarial table and in which 
you have a share, as reported by you or as determined by us, whichever 
we elect.
    d. The insured share is your share as landlord, owner-operator, or 
tenant in the insured crop at the time of planting. However, only for 
the purpose of determining the amount of indemnity, your share will not 
exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    e. We do not insure any acreage:
    (1) Which is destroyed, it is practical to replant the crop, and 
such acerage is not replanted;
    (2) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (3) Which is irrigated and an irrigated practice is not provided by 
the actuarial table unless you elect to insure the acreage as 
nonirrigated by reporting it as insurable under section 3;
    (4) Of a volunteer crop;
    (5) Planted to a type or variety of the crop not established as 
adapted to the area or indicated as noninsurable by the actuarial table;
    (6) Planted with another type of crop;
    (7) Occupied by rows planted with a mixture of female and male seed;
    (8) Planted and occupied by the male plants;

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    (9) Planted for experimental purposes;
    (10) Planted for any purpose other than for commercial seed; or
    (11) Grown under a contract with any seed company and that seed 
company refuses to provide us with the records we require to determine 
the dollar value per bushel of production for each type and variety.
    f. If insurance is provided for an irrigated practice you must 
report as irrigated only the acreage for which you have adequate 
facilities and water, at the time of planting, to carry out a good crop 
irrigation practice.
    g. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to planting.

             3. Report of Acreage, Share, Type, and Practice

    You must report on our form:
    a. All the acreage of the crop planted in the county in which you 
have a share;
    b. The practice;
    c. The type; and
    d. Your share at the time of planting.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any acreage of the insured 
crop in the county. This report must be submitted annually on or before 
the reporting date established by the actuarial table. All indemnities 
may be determined on the basis of information you submit on this report. 
If you do not submit this report by the reporting date, we may elect to 
determine, by unit, the insured acreage, share, practice, and type or we 
may deny liability on any unit. Any report submitted by you may be 
revised only upon our approval.

               4. Coverage Levels and Amounts of Insurance

    a. The amounts of insurance and coverage levels are contained in the 
actuarial table.
    b. Coverage level 2 will apply if you do not elect a coverage level.
    c. You may change the coverage level and the amount of insurance per 
acre on or before the sales closing date set by the actuarial table for 
submitting applications for the crop year.

                            5. Annual premium

    a. The annual premium is earned and payable at the time of planting. 
The amount is computed by multiplying the amount of insurance per acre 
times the premium rate, times the insured acreage, times your share at 
the time of planting.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.
    c. If you are eligible for a premium reduction in excess of 5 
percent based on insuring experience through the 1983 crop year under 
the terms of the experience table contained in the hybrid seed policy in 
effect for the 1984 crop year, you will continue to receive the benefit 
of that reduction subject to the following conditions:
    (1) No premium reduction will be retained after the 1991 crop year;
    (2) The premium reduction will not increase because of favorable 
experience;
    (3) The premium reduction will decrease because of unfavorable 
experience in accordance with the terms of the policy in effect for the 
1984 crop year;
    (4) Once the loss ratio exceeds .80, no further premium reduction 
will apply; and
    (5) Participation must be continuous.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    Insurance attaches for each type and variety when both the male 
plant seed and the female plant seed of that type and variety are 
planted in accordance with the production management practices of the 
seed company. Insurance terminates at the earliest of:
    a. Total destruction of the crop;
    b. Combining, threshing, or picking;
    c. Final adjustment of a loss; or
    d. The calendar date established by the actuarial table.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us prompt written notice if:
    (a) During the period before harvest, the crop on any unit is 
damaged and you decide not to further care for or harvest any part of 
it;
    (b) You want our consent to put the acreage to another use; or
    (c) After consent to put acreage to another use is given, additional 
damage occurs. Insured acreage may not be put to another use until we 
have appraised the crop and given written consent. We will not consent 
to another use until it is too late to replant. You must notify us when 
such acreage has been put to another use.
    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate either a germination rate of 
less than 80 percent or a loss on any unit.

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    (3) If probable loss is determined within 15 days prior to or during 
harvest, immediate notice must be given and a representative area of the 
field of the unharvested crop (at least 10 feet wide and the entire 
length of the field) must remain unharvested for a period of 15 days 
from the date of notice, unless we give you written consent to harvest 
the area.
    (4) In addition to the notices required by this section, if you are 
going to claim an indemnity on any unit, you must give us notice not 
later than 10 days after the earliest of:
    (a) Total destruction of the crop on the unit;
    (b) Harvest of the unit; or
    (c) The calendar date for the end of the insurance period.
    b. You must obtain written consent from us before you destroy any of 
the crop which is not to be harvested.
    c. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    (a) Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the crop on the unit;
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production for the type and variety of the 
crop on the unit at the time of harvest and that any loss of production 
has been directly caused by one or more of the insured causes during the 
insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the amount of insurance per 
acre;
    (2) Subtracting from this product the sum of:
    (a) The dollar amount obtained by multiplying seed production to 
count for each type and variety (see section 9e) by the respective 
dollar value per bushel of production plus;
    (b) The dollar amount obtained by multiplying non-seed production to 
count (see section 9e) by the local market price of such production on 
the earlier of the date the loss is adjusted or the date such production 
is sold; and
    (3) Multiplying this result by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the amount of insurance on the unit will be computed on the information 
reported, but the value of all production from insurable acreage, 
whether or not reported as insurable, will count against the amount of 
insurance.
    e. The total production to be counted for a unit will include all 
harvested and appraised seed and non-seed production.
    (1) For crop type field corn:
    (a) Total seed production to count will include:
    (i) All corn delivered to and accepted by the seed company;
    (ii) All corn which would pass over 16/64 screen unless the 
germination rate is less than 80 percent warm test as determined by a 
certified seed test conducted from a clean sample taken at the time of 
delivery or if the mature corn is appraised, at the time of appraisal; 
and
    (iii) All harvested and appraised production which does not qualify 
under paragraphs (i) and (ii) above because the damage was caused by 
uninsured causes.
    (b) For the purpose of determining the quantity of mature 
production:
    (i) Shelled corn will be adjusted .12 percent for each .1 percentage 
point of moisture to 15.5; and
    (ii) Ear corn will be measured at 70 pounds of ear corn equaling 56 
pounds (one bushel) of shelled corn. The weight of ear corn required to 
equal one bushel of shelled corn will be increased 2.0 pounds for each 
percentage point of moisture in excess of 14 percent.
    (c) When records of seed production, provided by the seed company, 
have been adjusted to a shelled corn basis of 15.5 percent moisture, and 
56-pound test weight (b) above will not apply for harvested production 
and the records of the seed company will be used to determine the amount 
of indemnity; provided, that such production records were based on the 
same criteria as the criteria used to determine the dollar value per 
bushel.
    (2) Appraised production to count as seed production will include:
    (a) Unharvested production on harvested acreage and the percent of 
the approved yield lost due to uninsured causes;
    (b) Not less than the dollar amount of insurance for any acreage 
which is abandoned or put to another use without our prior written 
consent or damaged solely by an uninsured cause;
    (c) Any appraisal on non-mature production; and
    (d) Any appraised production on unharvested acreage.
    (3) Any appraisal we have made on insured acreage and given written 
consent to be put to another use will be considered as seed production 
unless such acreage is:
    (a) Not put to another use before harvest of the crop becomes 
general in the county and reappraised by us;

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    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (4) The amount of production of any unharvested acreage of the crop 
may be determined on the basis of field appraisals conducted after the 
end of the insurance period.
    (5) If you elect to exclude hail and fire as insured causes of loss 
and the crop is damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire.''
    f. You must not abandon any acreage to us.
    g. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    h. An indemnity will not be paid unless you comply with all policy 
provisions.
    i. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury.
    j. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the crop is planted for any crop year, any indemnity 
will be paid to the persons determined to be beneficially entitled 
thereto.
    k. If you have other insurance against the perils insured under this 
contract and damage as a result of those perils occurs during the 
insurance period, we will be liable for loss due to those perils only 
for the smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from those perils exceeds the indemnity paid 
or payable under such other insurance. For the purpose of this section, 
the amount of loss from those perils will be the difference between the 
fair market value of the production on the unit before the loss and 
after the loss. The fair market value of production on the unit before 
the loss is limited to 1\1/2\ times the highest price election 
available.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you or the seed company have 
concealed or misrepresented any material fact or committed any fraud 
relating to the contract. Such voidance will be effective as of the 
beginning of the crop year with respect to which such act or omission 
occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year only on our form and with our approval. The assignee will have 
the right to submit the loss notices and forms required by the contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Becuse you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will paid to you.

                     14. Records and Access to Farm

    You must keep, for 2 years after the time of loss, records of the 
harvesting, storage, shipment, sale, or other disposition of all of the 
crop produced on each unit, including separate records showing the same 
information for production for any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply, 
assignment of production to units by us, or a determination that no 
indemnity is due. Any person designated by us will have access to such 
records and the farm for purposes related to the contract.

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           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice to the other on or before 
the cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due if deducted 
from:
    (1) An indemnity, will be the date you sign the claim; or
    (2) A payment under another program administered by United States 
Department of Agriculture, will be the date both such other payment and 
setoff are approved.
    d. The cancellation and termination dates are April 15.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your amount of insurance is no longer offered, the actuarial 
table will provide the amount of insurance which you are deemed to have 
elected. All contract changes will be available at your service office 
by December 31 preceding the cancellation date. Acceptance of changes 
will be conclusively presumed in the absence of notice from you to 
cancel the contract.

                17. Late Planting and Prevented Planting

    (a) Insurance will be provided for acreage planted to the insured 
crop during the late planting period (see subparagraph (c)), and acreage 
you were prevented from planting (see subparagraph (d)). These coverages 
provide reduced amounts of insurance for such acreage. The reduced 
amounts of insurance will be combined with the amount of insurance for 
timely planted acreage for each unit. The premium amount for late 
planted acreage and eligible prevented planting acreage will be the same 
as that for timely planted acreage. For example assume you insure one 
unit in which you have a 100 percent share. The unit consists of 200 
acres of the same type and variety, of 100 percent share. The unit 
consists of 200 acres of the same type and variety, of which 150 acres 
are occupied by the female plant. Fifty acres were planted timely, 50 
acres were planted 7 days after the final planting date (late planted), 
and 50 acres are unplanted and eligible for prevented planting coverage. 
To calculate the amount of any indemnity which may be due to you, the 
amount of insurance will be computed as follows:
    (1) For timely planted acreage, multiply the per acre amount of 
insurance for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the per acre amount of 
insurance for timely planted acreage by ninety-three percent (0.93) and 
multiply the result by the 50 acres planted late; and
    (3) For prevented planting acreage, multiply the per acre amount of 
insurance for timely planted acreage by:
    (i) Forty percent (0.40) and multiply the result by the 50 acres you 
were prevented from planting, if the acreage is eligible for prevented 
planting coverage, and if the acreage is left idle for the crop year, or 
if a cover crop is planted not for harvest. Prevented planting 
compensation hereunder will not be denied because the cover crop is 
hayed or grazed; or
    (ii) Twenty percent (0.20) and multiply the result by the 50 acres 
you were prevented from planting, if the acreage is eligible for 
prevented planting coverage, and if you elect to plant a substitute crop 
for harvest after the 10th day following the final planting date for the 
insured crop. (This subparagraph (ii) is not applicable, and prevented 
planting coverage is not available hereunder, if you elected the 
Catastrophic Risk Protection Endorsement or you elected to exclude 
prevented planting coverage when a substitute crop is planted (see 
subparagraph 17(d)(1)(iii))).
    The total of the three calculations will be the amount of insurance 
for the unit. Your premium will be based on the result of multiplying 
the per acre amount of insurance for timely planted acreage by the 150 
insured crop acres in the unit.
    (b) If you were prevented from planting, you must provide written 
notice to us not later than the acreage reporting date.
    (c) Late Planting
    (1) For acreage planted after the final planting date, but on or 
before 25 days after

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the final planting date, the amount of insurance for each acre will be 
reduced for each day planted after the final planting date by:
    (i) One percent (.01) for the first through the tenth day; and
    (ii) Two percent (.02) for the eleventh through the twenty-fifth 
day.
    (2) In addition to the requirements of section 3 (Report of Acreage, 
Share, Type and Practice), you must report the dates on which the 
acreage is planted within the late planting period.
    (3) If planting of the insured crop continues after the final 
planting date, or you are prevented from planting the insured crop 
during the late planting period, the acreage reporting date will be the 
later of:
    (i) The acreage reporting date contained in the Actuarial Table; or
    (ii) Five (5) days after the end of the late planting period.
    (d) Prevented Planting (Including Planting After the Late Planting 
Period).
    (1) If you were prevented from planting the insured crop (see 
subsection 18(w)), you may elect:
    (i) To plant the insured crop during the late planting period. The 
amount of insurance for such acreage will be determined in accordance 
with paragraph 17(c)(1);
    (ii) Not to plant this acreage to any crop except a cover crop not 
for harvest. You may also elect to plant the insured crop after the late 
planting period. In either case, the amount of insurance for such 
acreage will be forty percent (40%) of the amount of insurance for 
timely planted acres. For example, if your amount of insurance for 
timely planted acreage is 200 dollars per acre, your prevented planting 
amount of insurance would be 80 dollars per acre (200 dollars multiplied 
by 0.40). If you elect to plant the insured crop after the late planting 
period, production to count for such acreage will be determined in 
accordance with subsection 9e.; or
    (iii) Not to plant the intended crop but plant a substitute crop for 
harvest, in which case:
    (A) No prevented planting amount of insurance will be provided for 
such acreage if the substitute crop is planted on or before the tenth 
day following the final planting date for the insured crop; or
    (B) An amount of insurance equal to twenty percent (20%) of the 
amount of insurance for timely planted acres will be provided for such 
acreage, if the substitute crop is planted after the tenth day following 
the final planting date for the insured crop. If you elected the 
Catastrophic Risk Protection Endorsement or excluded this coverage, and 
plant a substitute crop, no prevented planting coverage will be 
provided. For example, if your amount of insurance for timely planted 
acreage is 200 dollars per acre, your prevented planting amount of 
insurance would be 40 dollars per acre (200 dollars multiplied by 0.20). 
You may elect to exclude prevented planting coverage when a substitute 
crop is planted for harvest and receive a reduction in the applicable 
premium rate. If you wish to exclude this coverage, you must so 
indicate, on or before the sales closing date, on your application or on 
a form approved by us. Your election to exclude this coverage will 
remain in effect from year to year unless you notify us in writing on 
our form by the applicable sales closing date for the crop year for 
which you wish to include this coverage. All acreage of the crop insured 
under this policy will be subject to this exclusion.
    (2) Proof may be required that you had the inputs available to plant 
and produce the intended crop with the expectation of at least producing 
the yield upon which your amount of insurance is based.
    (3) In addition to the provisions of section 7 (Insurance Period), 
the insurance period for prevented planting coverage begins:
    (i) On the sales closing date contained in the Special Provisions 
for the insured crop in the county for the crop year the application for 
insurance is accepted; or
    (ii) For any subsequent crop year, on the sales closing date for the 
insured crop in the county for the previous crop year, provided 
continuous coverage has been in effect since that date. For example: If 
you make application and purchase a hybrid seed crop insurance policy 
for the 1996 crop year, prevented planting coverage will begin on the 
1996 sales closing date for the insured crop in the county. If the 
hybrid seed coverage remains in effect for the 1997 crop year (is not 
terminated or canceled during or after the 1996 crop year, except the 
policy may have been canceled to transfer the policy to a different 
insurance provider, if there is no lapse in coverage), prevented 
planting coverage for the 1997 crop year began on the 1996 sales closing 
date.
    (4) The acreage to which prevented planting coverage applies will 
not exceed the total eligible acreage on all Farm Service Agency (FSA) 
Farm Serial Numbers in which you have a share, adjusted for any 
reconstitution that may have occurred on or before the sales closing 
date. Eligible acreage for each FSA Farm Serial Number is determined as 
follows:
    (i) Eligible acreage will not exceed the number of acres required to 
be grown in the current crop year under a contract executed with a seed 
company prior to the acreage reporting date.
    (ii) Acreage intended to be planted under an irrigated practice will 
be limited to the number of acres for which you had adequate irrigation 
facilities prior to the insured cause of loss which prevented you from 
planting.
    (iii) Prevented planting coverage will not be provided for any 
acreage:

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    (A) That does not constitute at least 20 acres or 20 percent (20%) 
of the acreage in the unit, whichever is less (Acreage that is less than 
20 acres or 20 percent of the acreage in the unit will be presumed to 
have been intended to be planted to the insured crop planted in the 
unit, unless you can show that you had the inputs available before the 
final planting date to plant and produce another insured crop on the 
acreage);
    (B) For which the actuarial table does not designate a premium rate 
unless a written agreement designates such premium rate;
    (C) Used for conservation purposes or intended to be left unplanted 
under any program administered by the United States Department of 
Agriculture;
    (D) On which another crop is prevented from being planted, if you 
have already received a prevented planting indemnity, guarantee or 
amount of insurance for the same acreage in the same crop year, unless 
you provide adequate records of acreage and production showing that the 
acreage has a history of double-cropping in each of the last four years;
    (E) On which the insured crop is prevented from being planted, if 
any other crop is planted and fails, or is planted and harvested, hayed 
or grazed on the same acreage in the same crop year, (other than a cover 
crop as specified in paragraph (a)(3)(i) of this section, or a 
substitute crop allowed in paragraph (a)(3)(ii) of this section) unless 
you provide adequate records of acreage and production showing that the 
acreage has a history of double-cropping in each of the last four years;
    (F) When coverage is provided under the Catastrophic Risk Protection 
Endorsement if you plant another crop for harvest on any acreage you 
were prevented from planting in the same crop year, even if you have a 
history of double cropping. If you have a Catastrophic Risk Protection 
Endorsement and receive a prevented planting indemnity, guarantee, or 
amount of insurance for a crop and are prevented from planting another 
crop on the same acreage, you may only receive the prevented planting 
indemnity, guarantee, or amount of insurance for the crop on which the 
prevented planting indemnity, guarantee, or amount of insurance is 
received; or
    (G) For which planting history or conservation plans indicate that 
the acreage would have remained fallow for crop rotation purposes.
    (iv) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be reduced 
by the number of acres of the insured crop timely planted and late 
planted. For example, assume you have 100 acres eligible for prevented 
planting coverage in which you have a 100 percent (100%) share. The 
acreage is located in a single FSA Farm Serial Number which you insure 
as two separate optional units consisting of 50 acres each. If you 
planted 60 acres of the insured crop on one optional unit and 40 acres 
of the insured crop on the second optional unit, your prevented planting 
eligible acreage would be reduced to zero (i.e., 100 acres eligible for 
prevented planting coverage minus 100 acres planted equals zero).
    (5) In accordance with the provisions of section 3 (Report of 
Acreage, Share, Type and Practice), you must report by unit any 
insurable acreage that you were prevented from planting. This report 
must be submitted on or before the acreage reporting date. For the 
purpose of determining acreage eligible for a prevented planting amount 
of insurance the total amount of prevented planting and planted acres 
cannot exceed the maximum number of acres eligible for prevented 
planting coverage. Any acreage you report in excess of the number of 
acres eligible for prevented planting coverage, or that exceeds the 
number of eligible acres physically located in a unit, will be deleted 
from your acreage report.
    (6) If the amount of premium you are required to pay (gross premium 
less our subsidy) for the prevented planting acreage exceeds the 
prevented planting liability on a unit, prevented planting coverage will 
not be provided for that unit (no premium will be due and no indemnity 
will be paid for such acreage).

                          18. Meaning of Terms

    (a) Actuarial table--the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the coverage levels, premium rates, 
amounts of insurance, practices, insurable and uninsurable acreage, and 
related information regarding insurance for the crop in the county.
    (b) Amount of insurance--the number of dollars per acre that results 
from subtracting the minimum payment (in bushels) provided by the seed 
company from the selected coverage level's county yield contained in the 
Actuarial Table and multiplying the result by the selected price 
election. If the minimum payment provided by the seed company is stated 
as a dollar amount, it will be converted to a bushel equivalent by 
dividing the dollar amount by the selected price election.
    (c) Approved yield--an expected yield level for a specific variety, 
in bushels per acre, determined by us and used to establish the value of 
seed production for the purpose of determining the amount of indemnity.
    (d) ASCS--the Agricultural Stabilization and Conservation Service of 
the United States Department of Agriculture.
    (e) Commercial seed--the offspring of two individual seeds of 
different genetic character which is produced as a result of crossing. A 
portion of this resultant offspring is the

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product intended for the purpose or use on a commercial basis by an 
agricultural producer to produce a field crop type for grain or silage.
    (f) County--(1) The County shown on the application; and
    (2) Any additional land located in a local producing area bordering 
on the county, as shown by the Actuarial Table.
    (g) Crop year--the period within which the crop is normally grown 
and is designated by the calendar year in which the crop is normally 
harvested.
    (h) Days--calendar days.
    (i) Dollar value per bushel--the value determined by dividing the 
amount of insurance per acre for timely planted acreage by the result of 
multiplying the approved yield by the coverage level percentage you 
elect.
    (j) Female plant--the plants grown for the purpose of producing 
commercial seed.
    (k) Final planting date--the date contained in the Actuarial Table 
by which the insured crop must initially be planted in order to be 
insured for the full amount of insurance.
    (l) Harvest--the completion of combining, threshing, or picking of 
the crop on any acreage.
    (m) Inadequate germination--less than 80 percent (80%) of the seed 
produced from female plants germinated as determined by a warm test 
using clean seed.
    (n) Insurable acreage--the land classified as insurable by us and 
shown as such by the Actuarial Table.
    (o) Insured--the person who submitted the application accepted by 
us.
    (p) 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 amount of insurance on the irrigated crop acreage.
    (q) Late planted--acreage planted during the late planting period.
    (r) Late planting period--the period which begins the day after the 
final planting date for the insured crop and ends twenty-five (25) days 
after the final planting date.
    (s) Loss ratio--the ratio of indemnity to premium.
    (t) Male plant--the plants grown for the purpose of pollinating 
female plants.
    (u) Non-seed production--all seed with inadequate germination. 
(Designation as non-seed production under this definition may be 
production to count under section 9 through appraisal if the inadequate 
germination was due to an uninsurable cause. (See subparagraph 
9.e.(2)(a)).
    (v) Person--an individual, partnership, association, corporation, 
estate, trust, or other legal entity, and wherever applicable, a State 
or a political subdivision or agency of a State.
    (w) Prevented planting--Inability to plant the insured crop with 
proper equipment by the final planting date designated in the Special 
Provisions for the insured crop in the county or the end of the late 
planting period. You must have been unable to plant the insured crop due 
to an insured cause of loss that has prevented the majority of producers 
in the surrounding area from planting the same crop.
    (x) Sample--at least 3 pounds of shelled corn representative (field 
run) for each variety of seed corn grown on the unit.
    (y) Seed company--a company which contracts with a grower to produce 
or grow for the production of hybrid corn seed.
    (z) Seed production--all seed with a germination rate of at least 80 
percent (80%) on a warm test using clean seed.
    (aa) Service office--the office servicing your contract as shown on 
the application for insurance or such other approved office as may be 
selected by you or designated by us.
    (bb) Shelled-corn--the grain (corn) after its removal from the cob.
    (cc) Tenant--a person who rents land from another person for a share 
of the crop or a share of the proceeds therefrom.
    (dd) Timely planted--the insured crop planted by the final planting 
date, as established by the Actuarial Table, for the insured crop in the 
county to be planted for harvest in the crop year.
    (ee) Type--the crop grown: i.e., corn.
    (ff) Unit--all insurable acreage of the insured crop in the county 
on the date of planting for the crop year:
    (1) In which you have a 100 percent (100%) share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis. 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. Land which would otherwise be one 
unit may be divided according to applicable guidelines on file in your 
service office. Units will be determined when the acreage is reported.
    Errors in reporting units may be corrected by us to conform to 
applicable guidelines when adjusting a loss. We may consider any acreage 
and share thereof reported by or for your spouse or child or any member 
of your household to be your bona fide share or the bona fide share of 
any other person having an interest therein.
    (gg) Variety--the seed produced from a pair of genetically 
identifiable parents.

                        19. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

[[Page 285]]

                           20. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               21. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    22. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[51 FR 5697, Feb. 18, 1986; 51 FR 8183, Mar. 10, 1986, as amended at 51 
FR 29205, Aug. 15, 1986; 52 FR 3214, Feb. 3, 1987; 54 FR 20373, May 11, 
1989; 55 FR 35888, Sept. 4, 1990; 58 FR 67645, Dec. 22, 1993; 60 FR 
62722, 62723, Dec. 7, 1995; 62 FR 65349, Dec. 12, 1997]

                           PART 444 [RESERVED]



PART 445--PEPPER CROP INSURANCE REGULATIONS--Table of Contents




      Subpart--Regulations for the 1987 Through the 1997 Crop Years

Sec.
445.1  Availability of pepper crop insurance.
445.2  Premium rates, coverage levels, and amounts of insurance.
445.3  OMB control numbers.
445.4  Creditors.
445.5  Good faith reliance on misrepresentation.
445.6  The contract.
445.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 51 FR 11293, Apr. 2, 1986, unless otherwise noted.



      Subpart--Regulations for the 1987 Through the 1997 Crop Years



Sec. 445.1  Availability of pepper crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
peppers in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 445.2  Premium rates, coverage levels, and amounts of insurance.

    (a) The Manager shall establish premium rates, coverage levels, and 
amounts of insurance for peppers which will be included in the actuarial 
table on file in the applicable service offices for the county and which 
may be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect an amount of insurance per acre and a coverage level from 
among those levels and amounts set by the actuarial table for the crop 
year.



Sec. 445.3  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 445.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 445.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the pepper crop insurance 
contract, whenever: (a) An insured under a contract of crop insurance 
entered into under these regulations, as a result of a misrepresentation 
or other erroneous action or advice by an agent or employee of the 
Corporation: (1) Is indebted to the Corporation for additional premiums; 
or (2) has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the insured believed 
to be insured, or believed the terms of the insurance contract to have 
been complied with or waived; and (b) the Board of Directors of the 
Corporation, or the Manager in cases involving not more than $100,000.00 
finds that: (1) An agent or employee of the

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Corporation did in fact make such misrepresentation or take other 
erroneous action or give erroneous advice; (2) said insured relied 
thereon in good faith; and (3) to require the payment of the additional 
premiums or to deny such insured's entitlement to the indemnity would 
not be fair and equitable, such insured shall be granted relief the same 
as if otherwise entitled thereto. Requests for relief under this section 
must be submitted to the Corporation in writing.



Sec. 445.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the pepper crop 
as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Changes made in 
the contract shall not affect its continuity from year to year. The 
forms referred to in the contract are available at the applicable 
service offices.



Sec. 445.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation must be made by any person to cover such person's share in 
the pepper crop as landlord, owner-operator, or tenant if the person 
wishes to participate in the program. The application shall be submitted 
to the Corporation at the service office on or before the applicable 
sales closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the sales closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period. However, if adverse conditions should develop 
during such period, the Corporation will immediately discontinue the 
acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1987 and succeeding crop years, a contract in the form provided for 
under this subpart will come into effect as a continuation of a pepper 
insurance contract issued under such regulations, without the filing of 
a new application.
    (d) The application for the 1987 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 Pepper Crop Insurance Policy for 
the 1987 through 1997 crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                      Pepper--Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Excessive rain;
    (2) Frost;
    (3) Freeze;
    (4) Hail;
    (5) Fire;
    (6) Tornado;
    (7) Tropical depression; or
    (8) Failure of the irrigation water supply due to an unavoidable 
cause occurring after the beginning of planting; unless those causes are 
excepted, excluded, or limited by the actuarial table or section 
9.e.(6).
    b. We will not insure against any loss of production due to:
    (1) Disease or insect infestation;
    (2) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants, or employees;
    (3) The failure to follow recognized good pepper farming practices;

[[Page 287]]

    (4) The impoundment of water by any governmental, public, or private 
dam or reservoir project;
    (5) The failure or breakdown of irrigation equipment or facilities;
    (6) The failure to follow recognized good pepper irrigation 
practice; or
    (7) Any cause not specified in section 1.a. as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be peppers planted for harvest as fresh 
market peppers, grown on insured acreage, and for which an amount of 
insurance and premium rate are set by the actuarial table.
    b. The acreage insured for each crop year will be peppers planted on 
irrigated acreage as designated insurable by the actuarial table and in 
which you have a share, as reported by you or as determined by us, 
whichever we elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured peppers at the time of each planting period. 
However, only for the purpose of determining the amount of indemnity, 
your share will not exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any acreage of peppers grown by any person if 
the person had not previously:
    (1) Grown peppers for commercial sales; or
    (2) Participated in the management of the pepper farming operation.
    e. We do not insure any acreage:
    (1) Of peppers grown for direct consumer marketing;
    (2) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (3) Which is not irrigated;
    (4) On which peppers are not grown on plastic mulch unless provided 
for by the actuarial table;
    (5) On which tomatoes, peppers, eggplants or tobacco have been grown 
and the soil was not fumigated or otherwise properly treated before 
planting peppers;
    (6) Which was planted to peppers the preceding planting period, 
unless the pepper plants of the preceding planting period were destroyed 
less than:
    (a) 30 days after the date of planting; or
    (b) 60 days after the date of direct seeding;
    (7) Which is destroyed, it is practical to replant to peppers, and 
such acreage is not replanted (the unavailability of plants is not a 
valid reason for failing to replant);
    (8) Initially planted after the final planting date set by the 
actuarial table;
    (9) Of volunteer peppers;
    (10) Planted to a type or variety of peppers not established as 
adapted to the area or excluded by the actuarial table;
    (11) Planted for experimental purpose; or
    (12) Planted with another crop.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to planting.

                3. Report of Acreage, Share, and Practice

    You must report at the time of each planting period on our form:
    a. All the acreage of fall, winter and spring-planted peppers in the 
county in which you have a share;
    b. The practice, including the bed size; and
    c. Your share at the time of planting.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any pepper plantings in the 
county. This report must be submitted for each planting period on or 
before the reporting date established by the actuarial table for each 
planting period. All indemnities may be determined on the basis of 
information you submit on this report. If you do not submit this report 
by the reporting date, we may elect to determine, by unit, for each 
planting period, the insured acreage, share, and practice or we may deny 
liability on any unit for any planting. Any report submitted by you may 
be revised only upon our approval.

               4. Coverage Levels and Amounts of Insurance

    a. The coverage levels and amounts of insurance are contained in the 
actuarial table.
    b. Coverage level 2 will apply if you do not elect a coverage level.
    c. You may change the coverage level and amount of insurance on or 
before the sales closing date set by the actuarial table for submitting 
applications for the crop year.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time of planting. 
The amount is computed by multiplying the amount of insurance, times the 
premium rate, times the insured acreage, times your share at the time of 
each planting.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.

                          6. Deduction for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you, or from any replant payment, or from any loan or payment due you 
under any Act of Congress or program administered by the

[[Page 288]]

United States Department of Agriculture or its Agencies.

                           7. Insurance Period

    Insurance attaches when the peppers are planted in each planting 
period and ends at the earliest of:
    a. Total destruction of the peppers on the unit;
    b. Discontinuance of harvest of peppers on the unit;
    c. The date harvest should have started on the unit on any acreage 
which will not be harvested;
    d. 150 days after the date of direct seeding, transplanting or 
replanting;
    e. Final harvest; or
    f. Final adjustment of loss.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if:
    (a) You want our consent to replant peppers damaged due to any 
insured cause (see subsection 9.f.);
    (b) During the period before harvest, the peppers on any unit are 
damaged and you decide not to further care for or harvest any part of 
them;
    (c) You want our consent to put the acreage to another use; or
    (d) After consent to put acreage to another use in given, additional 
damage occurs.
    Insured acreage may not be put to another use until we have 
appraised the peppers and given written consent. We will not consent to 
another use until it is too late to replant. You must notify us when 
such acreage is replanted or put to another use.
    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (3) If probable loss is determined within 15 days prior to or during 
harvest and you are going to claim an indemnity on any unit, you must 
give us notice not later than 72 hours after the earliest of:
    (a) Total destruction of the peppers on the unit;
    (b) Discontinuance of harvest of any acreage on the unit;
    (c) The date harvest would normally start if any acreage on the unit 
is not to be harvested; or
    (d) 150 days after the direct seeding, transplanting or replanting 
of the peppers (see section 7).
    b. You may not destroy or replant any of the peppers on which a 
replanting payment will be claimed until we give written consent.
    c. You must obtain written consent from us before you destroy any of 
the peppers which are not to be harvested.
    d. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the peppers on the unit;
    (2) Discontinuance of harvesting on the unit; or
    (3) The date harvest should have started on the unit on any acreage 
which will not be harvested.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production and the value received for all 
peppers on the unit and that any loss of production or value has been 
directly caused by one or more of the insured causes during the 
insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the amount of insurance times 
the percentage for the state of production defined by the actuarial 
table;
    (2) Subtracting therefrom the total value of production to be 
counted (see subsection 9.e.); and
    (3) Multiplying this result by your share.
    d. If the information reported by you under section 3 of this policy 
results in a lower premium than the actual premium determined to be due, 
the amount of insurance on the unit will be computed on the information 
reported, but the value of all production from insurable acreage, 
whether or not reported as insurable, will count against the amount of 
insurance.
    e. The total value of production to be counted for a unit will 
include all harvested and appraised production.
    (1) The total value of harvested production will be the greater of:
    (a) The dollar amount obtained by multiplying the number of 1\1/9\ 
bushels of peppers harvested on the unit by $4.00; or
    (b) The dollar amount obtained by multiplying the number of 1\1/9\ 
bushels of peppers sold by the price received for each 1\1/9\ bushel of 
peppers minus allowable cost set by the actuarial table. However, such 
price must not be less than zero for any 1\1/9\ bushel.
    (2) The value of appraised production to be counted will include:
    (a) The value of the potential production on any peppers that have 
not been harvested the third time and the value of unharvested mature 
green and red peppers;
    (b) The value of the potential production lost due to uninsured 
causes; and
    (c) Not less than the dollar amount of insurance per acre for any 
acreage abandoned

[[Page 289]]

or put to another use without our prior written consent or which is 
damaged solely by an uninsured cause.
    The value of any appraised production will not be less than the 
dollar amount obtained by multiplying the number of 1\1/9\ bushels of 
peppers appraised by $4.00.
    (3) Unharvested peppers damaged or defective due to insurable causes 
and which cannot be marketed will not be counted as production.
    (4) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of peppers becomes general 
in the county for the planting period and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (5) The amount and value of production of any unharvested peppers 
may be determined on the basis of field appraisals conducted after the 
end of the insurance period.
    (6) If you elect to exclude hail and fire as insured causes of loss 
and the peppers are damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78-A, ``Request to Exclude Hail and Fire.''
    f. A replanting payment may be made on any insured peppers replanted 
after we have given consent and the acreage replanted is at least the 
lesser of 20 acres or 20 percent of the insured acreage as determined on 
the final planting date for the planting period. The acreage to be 
replanted must have sustained a loss in excess of 50 percent of the 
plant stand for the unit.
    (1) No replanting payment will be made on acreage on which a 
replanting payment has been made during the current planting period for 
the crop year.
    (2) The replanting payment per acre will be your actual cost per 
acre for replanting, but will not exceed the product obtained by 
multiplying $300.00 per acre by your share.
    (3) The Corporation will transfer the original liability to the 
replanted crop without reduction by the amount of the replant payment 
and without increase in the original premium charged for insurance 
coverage when the crop is replanted in accordance with the requirements 
of the original planting.
    (4) If seasonal conditions dictate replanting by broadcast method, 
and such method differs from the requirements of the original planting, 
the Corporation will transfer the original liability to the replanted 
crop reduced by the amount of the replant payment and without increase 
in the original premuim charged for insurance coverage.

If the information reported by you results in a lower premium than the 
actual premium determined to be due, the replanting payment will be 
reduced proportionately.
    g. You must not abandon any acreage to us.
    h. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    i. An indemnity will not be paid unless you comply with all policy 
provisions.
    j. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. The interest rate will be 
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. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury.
    k. If you die, disappear or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the peppers are planted for any crop year, any indemnity 
will be paid to the persons determined to be beneficially entitled 
thereto.
    l. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.
    For the purpose of this section, the amount of loss from fire will 
be the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any

[[Page 290]]

fraud relating to the contract. Such voidance will be effective as of 
the beginning of the crop year with respect to which such act or 
omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale, or other disposition of all peppers 
produced on each unit, including separate records showing the same 
information for production from any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply, 
assignment of production to units by us, or a determination that no 
indemnity is due. Any person designated by us will have access to such 
records and the farm for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due if deducted 
from:
    (1) An indemnity, will be the date you sign the claim; or
    (2) Payment under another program administered by the United States 
Department of Agriculture, will be the date both such payment and setoff 
are approved.
    d. The cancellation and termination dates are July 31.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise.
    If two or more persons having a joint interest are insured jointly, 
death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your amount of insurance at which indemnities are computed is 
no longer offered, the actuarial table will provide the amount of 
insurance which you are deemed to have elected. All contract changes 
will be available at your service office by April 30 preceding the 
cancellation date. Acceptance of changes will be conclusively presumed 
in the absence of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of pepper crop insurance:
    a. Acre means 43,560 square feet of plastic mulch or equivalent row 
area of not more than 6 foot widths (6-foot bed) on which at least 7,260 
linear feet (rows) are planted.
    b. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the amount of insurance, coverage levels, 
premium rates, practices, insurable and uninsurable acreage, and related 
information regarding pepper insurance in the county.
    c. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county, as shown by the actuarial table.
    d. Crop year means the period within which the peppers are normally 
grown beginning August 1 and continuing through the harvesting of the 
spring-planted peppers and is

[[Page 291]]

designated by the calendar year in which the spring-planted peppers are 
normally harvested.
    e. Excessive rain means more than 10 inches of rain on the pepper 
field within a 24-hour period, after the peppers have been seeded or 
transplanted.
    f. Freeze means the condition of air temperatures over a widespread 
area remaining sufficiently at or below 32 degrees Fahrenheit to cause 
crop damage.
    f. Frost means the condition of air temperature around the plant 
falling to 32 degrees Fahrenheit or below.
    h. Harvest means the final picking of marketable peppers on the 
unit.
    i. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    j. Insured means the person who submitted the application accepted 
by us.
    k. Loss ratio means the ratio of indemnity to premium.
    l. Mature green pepper means a pepper which has reached the stage of 
development that will withstand normal handling and shipping.
    m. Peppers grown for direct consumer marketing means peppers grown 
for the purpose of selling directly to the consumer and which are grown 
on acreage not subject to an agreement between producer and packer to 
pack the production (the producer-packer agreement must be executed 
before you report your acreage).
    n. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State or a political subdivision or agency of a State.
    o. Planting means transplanting the pepper plant in the field or 
direct seeding in the field.
    p. Planting period means the peppers planted within the dates set by 
the actuarial table, as fall-planted, winter-planted or spring-planted.
    q. Plant stand means the number of live plants per acre before the 
plants were damaged due to insurable causes.
    r. Potential production means the number of 1\1/9\ bushels of mature 
green peppers which the pepper plants would produce or would have 
produced, per acre, by the end of the insurance period.
    s. Replanting means performing the cultural practices necessary to 
replant insured acreage to peppers.
    t. Replant payment means that payment made to the insured in 
accordance with the provisions of subsection 9.f. of this policy which 
payment is subject to offset for premium owed.
    u. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    v. Tenant means a person who rents land from another person for a 
share of the peppers or a share of the proceeds therefrom.
    w. Tropical depression means only a large-scale, atmospheric wind-
and-pressure system characterized by low pressure at its center and 
counterclockwise circular wind motion which has been identified by the 
United States Weather Service in which the minimum sustained surface 
wind (1-minute mean) is 33 knots per hour (38 miles per hour) or more at 
the U.S. Weather Service reporting station nearest to the crop damage at 
the time of loss.
    x. Unit means all insurable acreage of peppers for each planting 
period in the county on the date of planting for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.

Land rented for cash, a fixed commodity payment, or any consideration 
other than a share in the peppers on such land will be considered as 
owned by the lessee. Land which would otherwise be one unit may be 
divided according to applicable guidelines on file in your service 
office. Units will be determined when the acreage is reported. Errors in 
reporting units may be corrected by us to conform to applicable 
guidelines when adjusting a loss. We may consider any acreage and share 
thereof reported by or for your spouse or child or any member of your 
household to be your bona fide share or the bona fide share of any other 
person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with the Appeal Regulations (7 
CFR part 400--subpart J).

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.

[[Page 292]]

    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[51 FR 11293, Apr. 2, 1986, as amended at 51 FR 29205, Aug. 15, 1986; 52 
FR 3214, Feb. 3, 1987; 52 FR 17547-17549, May 11, 1987; 55 FR 35888, 
Sept. 4, 1990; 62 FR 14789, Mar. 28, 1997]



PART 446--WALNUT CROP INSURANCE REGULATIONS--Table of Contents




      Subpart--Regulations for the 1986 Through the 1997 Crop Years

Sec.
446.1  Availability of walnut crop insurance.
446.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
446.3  OMB control numbers.
446.4  Creditors.
446.5  Good faith reliance on misrepresentation.
446.6  The contract.
446.7  The application and policy.

    Authority: Secs. 506, 516, Pub. L. 75-430, 52 Stat. 73, 77 as 
amended (7 U.S.C. 1506, 1516).

    Source: 50 FR 43687, Oct. 29, 1985, unless otherwise noted.



      Subpart--Regulations for the 1986 Through the 1997 Crop Years



Sec. 446.1  Availability of walnut crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
walnuts in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 446.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for walnuts which will be included in the actuarial table on 
file in the applicable service offices for the county and which may be 
changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 446.3  OMB control numbers.

    The OMB control numbers are contained in subpart H of part 400, 
title 7 CFR.



Sec. 446.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 446.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the walnut insurance 
contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation: (1) Is 
indebted to the Corporation for additional premiums; or (2) has suffered 
a loss to a crop which is not insured or for which the insured is not 
entitled to an indemnity because of failure to comply with the terms of 
the insurance contract, but which the insured believed to be insured, or 
believed the terms of the insurance contract to have been complied with 
or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00 finds that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice; (2) said insured 
relied thereon in good faith; and (3) to require the payment of the 
additional premiums or to deny such insured's entitlement to the 
indemnity would not be fair and equitable, such insured shall be granted 
relief the same as if otherwise entitled thereto. Application for relief 
under this section

[[Page 293]]

must be submitted to the Corporation in writing.



Sec. 446.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the walnut crop 
as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Any changes 
made in the contract shall not affect its continuity from year to year. 
The forms referred to in the contract are available at the applicable 
service offices.



Sec. 446.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the walnut crop as landlord, owner-operator, or tenant. The application 
shall be submitted to the Corporation at the service office on or before 
the applicable closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period. However, if adverse conditions should develop 
during such period, the Corporation will immediately discontinue the 
acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1986 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a walnut 
contract issued under such prior regulations, without the filing of a 
new application.
    (d) The application for the 1986 and succeeding crop years is found 
at subpart D of part 400--General Administrative Regulations and may be 
amended from time to time for subsequent crop years. The provisions of 
the Walnut Insurance Policy for the 1986 through 1997 crop years are as 
follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                      Walnut Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption;
    (6) Direct Mediterranean Fruit Fly damage; or
    (7) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after insurance attaches;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9e(3).
    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement, or wrongdoing of you, any member of 
your household, your tenants or employees;
    (2) The failure to follow recognized good walnut farming practices;
    (3) The impoundment of water by any governmental, public or private 
dam or reservoir project;
    (4) The failure to carry out a good walnut irrigation practice;
    (5) The failure or breakdown of irrigation equipment or facilities; 
or
    (6) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be English walnuts (excluding black 
walnuts) hereafter called

[[Page 294]]

``walnuts'' which are grown on insured acreage and for which a guarantee 
and premium rate are provided by the actuarial table.
    b. The acreage insured for each crop year will be walnuts grown on 
insurable acreage as designated by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured walnuts at the time insurance attaches. However, 
for the purpose of determining the amount of indemnity, your share will 
not exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any acreage:
    (1) On which the trees have not reached the ninth growing season 
after being set out, unless we agree, in writing, to insure such 
acreage; or
    (2) Planted with a crop other than walnuts.
    e. If insurance is provided for an irrigated practice you must 
report as irrigated only the acreage for which you have adequate 
facilities and water, at the time insurance attaches, to carry out a 
good walnut irrigation practice.
    f. Insurance may attach only by written agreement with us on any 
unit which consists of less than 5 acres of insurable walnut trees.
    g. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to the date insurance attaches.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of walnuts in the county in which you have a 
share;
    b. The practice; and
    c. Your share on the date insurance attaches.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any walnuts grown in the 
county. This report must be submitted annually on or before March 1. All 
indemnities may be determined on the basis of information you submit on 
this report. If you do not submit this report by March 1, we may elect 
to determine by unit the insured acreage, share, and practice or we may 
deny liability on any unit. Any report submitted by you may be revised 
only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. If the number of bearing trees (ninth growing season and older) 
is reduced more than 10 percent from the preceding calendar year as a 
result of damage occurring within that year, the production guarantee 
will be reduced 1 percent for each percent reduction in excess of 10 
percent.
    c. Coverage level 2 will apply if you do not elect a coverage level.
    d. You may change the coverage level and price election on or before 
the closing date for submitting applications for the crop year as 
established by the actuarial table.
    e. You must furnish a report of production to use for the previous 
crop year prior to the sales closing date for the subsequent crop year 
as established by the actuarial table. If you do not provide the 
required production report we will assign a yield for the crop year for 
which the report is not furnished. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the subsequent crop year. The yield 
assigned by us will be 75% of the yield assigned for the purpose of 
determining your guarantee for the present crop year. If you have filed 
a claim for the previous crop year, the yield determined in adjusting 
your indemnity claim will be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable on the date insurance 
attaches. The amount is computed by multiplying the production guarantee 
times the price election, times the premium rate, times the insured 
acreage, times your share on the date insurance attaches.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    Insurance attaches for each crop year on March 1 and ends at the 
earliest of:
    a. Total destruction of the walnuts;
    b. Harvest of the walnuts;
    c. Final adjustment of a loss; or
    d. November 15.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if, during the period before 
harvest, the walnuts on any unit are damaged and you decide not to 
further care for them.

[[Page 295]]

    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (3) If probable loss is later determined or if damage occurs during 
harvest, immediate notice must be given.
    (4) In addition to the notices required by this section, if you are 
going to claim an indemnity on any unit, we must be given notice not 
later than 10 days after the earliest of:
    (a) Total destruction of the walnuts on the unit;
    (b) Harvest of the unit; or
    (c) November 15 of the crop year.
    b. You must obtain written consent from us before you destroy any of 
the walnuts which are not to be harvested.
    c. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the walnuts on the unit;
    (2) Harvest of the unit; or
    (3) November 15 of the crop year.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of walnuts on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of walnuts to be 
counted (see section 9e);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this product by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. The total production (pounds) to be counted for a unit will 
include all harvested and appraised production.
    (1) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes and failure to follow recognized 
good walnut farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause or destroyed by you without our 
prior written consent; and
    (c) Any appraised production on unharvested acreage.
    (2) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Marketed; or
    (b) Further damaged by an insured cause and reappraised by us.
    (3) If you elect to exclude hail and fire as insured causes of loss 
and the walnuts are damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire''.
    f. You must not abandon any acreage to us.
    g. You may not sue us unless you have complied with all policy 
provisions. If a claim is denied, you may sue us in the United States 
District Court under the provisions of 7 U.S.C. 1508(c). You must bring 
suit within 12 months of the date notice of denial is received by you.
    h. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury.
    i. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after insurance attaches for any crop year, any indemnity will 
be paid to the person determined to be beneficially entitled thereto.
    j. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
form this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or

[[Page 296]]

    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance. For the purpose of this section, the 
amount of loss from fire will be the difference between the fair market 
value of the production on the unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year only on our form and with our approval. The assignee will have 
the right to submit the loss notices and forms required by the contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale or other disposition of all walnuts 
produced on each unit, including separate records showing the same 
information for production from any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply, 
assignment of production to units by us, or a determination that no 
indemnity is due. Any person designated by us will have access to such 
records and the farm for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due:
    (1) If deducted from an indemnity will be the date you sign the 
claim; or
    (2) If deducted from payment under another program administered by 
the United States Department of Agriculture will be the date both such 
other payment and setoff are approved.
    d. The cancellation and termination dates are January 31.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by October 31 preceding the 
cancellation date. Acceptance of any change will be conclusively 
presumed in the absence of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of walnut crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the

[[Page 297]]

production guarantees, coverage levels, premium rates, prices for 
computing indemnities, practices, insurable and uninsurable acreage, and 
related information regarding walnut insurance in the county.
    b. Contiguous land means land which is touching at any point, except 
that land which is separated by only a public or private right-of-way 
will be considered contiguous.
    c. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county, as shown by the actuarial table.
    d. Crop year means the period beginning with the date insurance 
attaches and extending through the normal harvest time and will be 
designated by the calendar year in which the walnuts are normally 
harvested.
    e. Direct Mediterranean Fruit Fly damage means the actual physical 
damage to the walnuts which causes such walnuts to be considered 
unmarketable and will not include unmarketability of such walnuts as a 
direct result of a quarantine, boycott or refusal to accept the walnuts 
by any entity without regard to actual physical damage to such walnuts.
    f. Harvest means removal of the walnuts from the orchard.
    g. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    h. Insured means the person who submitted the application accepted 
by us.
    i. Loss ratio means the ratio of indemnity to premium.
    j. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State, a political subdivision of a State, or any agency 
thereof.
    k. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    l. Tenant means a person who rents land from another person for a 
share of the walnuts or a share of the proceeds therefrom.
    m. Unit means all insurable acreage of walnuts in the county located 
on contiguous land on the date insurance attaches for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the walnuts on such land will be 
considered as owned by the lessee. Land which would otherwise be one 
unit may be divided according to applicable guidelines on file in your 
service office. Units will be determined when the acreage is reported. 
Errors in reporting units may be corrected by us to conform to 
applicable guidelines when adjusting a loss. We may consider any acreage 
and share thereof reported by or for your spouse or child or any member 
of your household to be your bona fide share or the bona fide share of 
any other person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[50 FR 43687, Oct. 29, 1985, as amended at 51 FR 29205-29207, Aug. 15, 
1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 52 FR 6775, 
Mar. 5, 1987; 55 FR 35888, Sept. 4, 1990; 62 FR 20091, Apr. 25, 1997]



PART 447--POPCORN CROP INSURANCE REGULATIONS FOR THE 1987 THROUGH THE 1998 CROP YEARS--Table of Contents




Sec.
447.1  Availability of popcorn crop insurance.
447.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
447.3  OMB control numbers.
447.4  Creditors.
447.5  Good faith reliance on misrepresentation.
447.6  The contract.
447.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

[[Page 298]]


    Source: 51 FR 37897, Oct. 27, 1986, unless otherwise noted.



Sec. 447.1  Availability of popcorn crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
popcorn in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 447.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for popcorn which will be included in the actuarial table on 
file in the applicable service offices for the county and which may be 
changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices set by the actuarial table 
for the crop year.



Sec. 447.3  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 447.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 447.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the popcorn insurance 
contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation: (1) Is 
indebted to the Corporation for additional premiums; or (2) has suffered 
a loss to a crop which is not insured or for which the insured is not 
entitled to an indemnity because of failure to comply with the terms of 
the insurance contract, but which the insured believed to be insured, or 
believed the terms of the insurance contract to have been complied with 
or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice; (2) said insured 
relied thereon in good faith; and (3) to require the payment of the 
additional premiums or to deny such insured's entitlement to the 
indemnity would not be fair and equitable, such insured shall be granted 
relief the same as if otherwise entitled thereto. Requests for relief 
under this section must be submitted to the Corporation in writing.



Sec. 447.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the popcorn crop 
as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Changes made in 
the contract shall not affect its continuity from year to year. The 
forms referred to in the contract are available at the applicable 
service offices.



Sec. 447.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation must be made by any person to cover such person's share in 
the popcorn crop as landlord, owner-operator, or tenant if the person 
wishes to participate in the program. The application shall be submitted 
to the Corporation at the service office on or before the applicable 
sales closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of any 
application or

[[Page 299]]

applications in any county upon its determination that the insurance 
risk is excessive. The Manager of the Corporation is authorized in any 
crop year to extend the sales closing date for submitting applications 
in any county, by placing the extended date on file in the applicable 
service offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period. However, if adverse conditions should develop 
during such period, the Corporation will immediately discontinue the 
acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in previous policies and regulations issued by FCIC, 
a contract in the form provided for in this subpart will come into 
effect as a continuation of a popcorn contract issued under such prior 
regulations, without the filing of a new application.
    (d) The application is found at subpart D of part 400, General 
Administrative Regulations (7 CFR 400.37, 400.38). The provisions of the 
Popcorn Insurance Policy for the 1987 through 1998 crop years are as 
follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                     Popcorn--Crop Insurance Policy

          (This is a continuous contract. Refer to section 15.)

    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects;
    (4) Plant disease;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or subsection 9.e.(7).
    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement, or wrongdoing by you, any member of 
your household, your tenants, or employees;
    (2) The failure to follow recognized good popcorn farming practices 
or the grower provisions of the popcorn contract;
    (3) The impoundment of water by any governmental, public, or private 
dam or reservoir project;
    (4) Damage resulting from frost or freeze after the date designated 
by the actuarial table;
    (5) The failure or breakdown of irrigation equipment or facilities;
    (6) The failure to follow recognized good popcorn irrigation 
practices; or
    (7) Any cause not specified in subsection 1.a. as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be popcorn which is planted for harvest, 
grown on insured acreage, and for which a guarantee and premium rate are 
set by the actuarial table.
    b. The acreage insured for each crop year will be popcorn planted on 
insurable acreage as designated by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured popcorn at the time of planting. However, only for 
the purpose of determining the amount of indemnity, your share will not 
exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any acreage: (1) Of popcorn not grown under a 
contract executed with a processor or excluded from the processor 
contract for, or during, the crop year. (The contract must be executed 
and effective before you report your acreage.);
    (2) Which is destroyed, it is practical to replant to popcorn, and 
such acreage is not replanted;
    (3) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates have been established;
    (4) Which is irrigated and an irrigated practice is not provided by 
the actuarial table unless you elect to insure the acreage as 
nonirrigated by reporting it as insurable under section 3;
    (5) Initially planted after the final planting date set by the 
actuarial table unless you

[[Page 300]]

agree, in writing, on our form to coverage reduction;
    (6) Of volunteer popcorn;
    (7) Planted to a type or variety of popcorn not established as 
adapted to the area or excluded by the actuarial table;
    (8) Planted with a crop other than popcorn; or
    (9) Planted for the development or production of hybrid seed or 
planted for experimental purposes.
    e. If insurance is provided for an irrigated practice, you must 
report as irrigated only the acreage for which you have adequate 
facilities and water at the time of planting to carry out a good popcorn 
irrigation practice.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to planting.
    g. An instrument in the form of a ``lease'' under which you retain 
possession of the land on which the popcorn is grown and which provides 
for delivery of the popcorn under certain conditions and at a stipulated 
price will, for the purpose of this contract, be treated as a contract 
under which you have the share in the popcorn.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of popcorn planted in the county in which you 
have a share;
    b. The practice; and
    c. Your share at the time of planting.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any popcorn planted in the 
county. This report must be submitted annually on or before the 
reporting date established by the actuarial table. All indemnities may 
be determined on the basis of information you submit on this report. If 
you do not submit this report by the reporting date, we may elect to 
determine, by unit, the insured acreage, share, and practice or we may 
deny liability on any unit. Any report submitted by you may be revised 
only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. Coverage Level 2 will apply if you do not elect a coverage level.
    c. You may change the coverage level and price election on or before 
the sales closing date set by the actuarial table for submitting 
applications for the crop year.
    d. You must report production to us for the previous crop year prior 
to the sales closing date for the subsequent crop year as established by 
the actuarial table. If you do not provide the required production 
report we will assign a yield for the crop year for which the report is 
not furnished. The production report or assigned yield will be used to 
compute your production history for the purpose of determining your 
guarantee for the subsequent crop year. The yield assigned by us will be 
75% of the yield assigned for the purpose of determining your guarantee 
for the present crop year. If you have filed a claim for the previous 
crop year, the yield determined in adjusting your indemnity claim will 
be used as your production report.

                            5. Annual Premium

    a. The annual premium is earned and payable at the time of planting. 
The amount is computed by multiplying the production guarantee times the 
price election, times the premium rate, times the insured acreage, times 
your share at the time of planting.
    b. Interest will accrue at the rate of one and one-fourth percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.

                          6. Deduction for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you, or from any replant payment, or from any loan or payment due you 
under any Act of Congress or program administered by the United States 
Department of Agriculture or its Agencies.

                           7. Insurance Period

    Insurance attaches when the popcorn is planted and ends at the 
earliest of:
    a. Total destruction of the popcorn;
    b. Harvest;
    c. Final adjustment of a loss; or
    d. December 10 of the calendar year in which the popcorn is normally 
harvested.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if: (a) You want our consent to 
replant popcorn damaged due to any insured cause (see subsection 9.f.);
    (b) During the period before harvest, the popcorn on any unit is 
damaged and you decide not to further care for it or harvest any part of 
it;
    (c) You want our consent to put the acreage to another use; or
    (d) After consent to put acreage to another use is given, additional 
damage occurs.
    (2) Insured acreage may not be put to another use until we have 
appraised the popcorn and given written consent. We will not consent to 
another use until it is too late to replant. You must notify us when 
such acreage is replanted or put to another use.

[[Page 301]]

    (3) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (4) If probable loss is determined within 15 days prior to or during 
harvest, immediate notice must be given. A representative sample of the 
unharvested popcorn (at least 10 feet wide and the entire length of the 
field) must remain unharvested for a period of 15 days from the date of 
notice, unless we give you written consent to harvest the sample.
    (5) In addition to the notices required by this section, if you are 
going to claim an indemnity or any unit, you must give us notice not 
later than 10 days after the earliest of:
    (a) Total destruction of the popcorn on the unit;
    (b) Harvest of the unit; or
    (c) December 10 of the crop year.
    b. You may not destroy or replant any of the popcorn on which a 
replanting payment will be claimed until we give written consent.
    c. You must obtain written consent from us before you destroy any of 
the popcorn which is not to be harvested.
    d. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the popcorn on the unit;
    (2) Harvest of the unit; or
    (3) December 10 of the crop year.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of the popcorn on the unit and 
that any loss of production has been directly caused by one or more of 
the insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting from this result, the total production of popcorn to 
be counted (see subsection 9.e.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. If the information reported by you under section 3 of this policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. The total production (in pounds) to be counted for a unit will 
include all harvested and appraised production.
    (1) Mature popcorn production:
    (a) Which otherwise is not eligible for quality adjustment will be 
reduced .12 percent for each .1 percentage point of moisture in excess 
of 15.0 percent; or
    (b) Which, due to insurable causes, is not of merchantable popcorn 
quality and is rejected by the processor, will be adjusted by:
    (i) dividing the value per pound of the damaged popcorn by the 
contract price per pound for undamaged popcorn; and
    (ii) Multiplying the result by the number of pounds of such popcorn.
    (2) Any production from yellow or white dent corn will be counted as 
popcorn on a weight basis.
    (3) Any ear production for which we cannot determine a shelling 
factor will be considered to have an 80 percent shelling factor.
    (4) Appraised production to be counted will include:
    (a) Unharvested production on harvested acreage and potential 
production lost due to uninsured causes;
    (b) Not less than the guarantee for any acreage which is abandoned 
or put to another use without our prior written consent or damaged 
solely by an uninsured cause; and
    (c) Any appraised production on unharvested acreage.
    (5) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of popcorn becomes general 
in the county and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (6) The amount of production of any unharvested popcorn may be 
determined on the basis of field appraisals conducted after the end of 
the insurance period.
    (7) If you elect to exclude hail and fire as insured causes of loss 
and the popcorn is damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire.''
    f. A replanting payment may be made on any insured popcorn replanted 
after we have given consent and the acreage replanted is at least the 
lesser of 20 acres or 20 percent of the insured acreage for the unit as 
determined on the final planting date.
    (1) No replanting payment will be made on acreage:
    (a) On which our appraisal exceeds 90 percent of the guarantee;
    (b) Initially planted prior to the date established by the actuarial 
table; or
    (c) On which a replanting payment has been made during the current 
crop year.

[[Page 302]]

    (2) The replanting payment per acre will be your actual cost per 
acre for replanting, but will not exceed 150 pounds multiplied by the 
price election, multiplied by your share.
    (3) If the information reported by you results in a lower premium 
than the actual premium determined to be due, the replanting payment 
will be reduced proportionately.
    (4) The Corporation will transfer the original liability to the 
replanted crop without reduction by the amount of the replant payment 
and without increase in the original premium charged for insurance 
coverage when the crop is replanted in accordance with the requirements 
of the original planting.
    (5) If seasonal conditions dictate replanting by broadcast method, 
and such method differs from the requirements of the original planting, 
the Corporation will transfer the original liability to the replanted 
crop reduced by the amount of the replant payment and without increase 
in the original premuim charged for insurance coverage.
    g. You must not abandon any acreage to us.
    h. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    i. An indemnity will not be paid unless you comply with all policy 
provisions.
    j. We have a policy of paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury.
    k. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the crop is planted for any crop year, any indemnity 
will be paid to the persons determined to be beneficially entitled 
thereto.
    l. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance. For the purpose of this subsection, 
the amount of loss from fire will be the difference between the fair 
market value of the production on the unit before the fire and after the 
fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or ommission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can do to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for 2 years after the time of loss, records of the 
harvesting, storage, shipment, sale or other disposition of all of the 
popcorn produced on each unit including separate records showing the 
same information for production from any uninsured acreage. Failure to 
keep and maintain such

[[Page 303]]

records may, at our option, result in cancellation of the contract prior 
to the crop year to which the records apply, assignment of production to 
units by us, or a determination that no indemnity is due. Any person 
designated by us will have access to such records and the farm for 
purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due if deducted 
from:
    (1) An indemnity, will be the date you sign the claim; or
    (2) Payment under another program administered by the United States 
Department of Agriculture, will be the date both such other payment and 
setoff are approved.
    d. The cancellation and termination dates are April 15.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by December 31 preceding the 
cancellation date. Acceptance of changes will be conclusively presumed 
in the absence of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of popcorn crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
popcorn insurance in the county.
    b. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county, as shown by the acturial table.
    c. Crop year means the period within which the popcorn is normally 
grown and is designated by the calender year in which the popcorn is 
normally harvested.
    d. Harvest means the completion of removing the grain from the stalk 
either by hand or machine.
    e. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    f. Insured means the person who submitted the application accepted 
by us.
    g. Loss ratio means the ratio of indemnity to premium.
    h. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State or a political subdivision or agency of a State.
    i. Replanting means performing the cultural practices necessary to 
replant insured acreage to popcorn.
    j. Replant payment that means payment made to the insured in 
accordance with the provisions of subsection 9.f. of this policy which 
payment is subject to offset for premium owed.
    k. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    l. Tenant means a person who rents land from another person for a 
share of the popcorn or a share of the proceeds therefrom.
    m. Unit means all insurable acreage of popcorn in the county on the 
date of planting for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
Land rented for cash, a fixed commodity payment, or any consideration 
other than a share in the popcorn on such land will be considered as 
owned by the lessee. Land which would otherwise be one unit may be 
divided according to applicable guidelines on file in your service 
office. Units will be determined when the acreage is reported.

[[Page 304]]

    Errors in reporting units may be corrected by us to conform to 
applicable guidelines when adjusting a loss. We may consider any acreage 
and share thereof reported by or for your spouse or child or any member 
of your household to be your bona fide share or the bona fide share of 
any other person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with the Appeal Regulations (7 
CFR Part 400--Subpart J).

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[51 FR 37897, Oct. 27, 1986, as amended at 52 FR 3214, Feb. 3, 1987; 52 
FR 17547, 17548, May 11, 1987; 55 FR 35888, Sept. 4, 1990; 63 FR 33838, 
June 22, 1998]

                        PARTS 448-449  [RESERVED]



PART 450--PRUNE CROP INSURANCE REGULATIONS FOR THE 1996 AND SUCCEEDING CROP YEARS--Table of Contents




Sec.
450.1  Availability of prune crop insurance.
450.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
450.3  OMB control numbers.
450.4  Creditors.
450.5  Good faith reliance on misrepresentation.
450.6  The contract.
450.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 50 FR 50277, Dec. 10, 1985, unless otherwise noted.



Sec. 450.1  Availability of prune crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
prunes in counties within the limits prescribed by and in accordance 
with the provisions of the Federal Crop Insurance Act, as amended. The 
counties shall be designated by the Manager of the Corporation from 
those approved by the Board of Directors of the Corporation.



Sec. 450.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for prunes which will be included in the actuarial table on 
file in the applicable service offices for the county and which may be 
changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 450.3  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 450.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 450.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the prune insurance contract, 
whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee

[[Page 305]]

of the Corporation: (1) Is indebted to the Corporation for additional 
premiums; or (2) has suffered a loss to a crop which is not insured or 
for which the insured is not entitled to an indemnity because of failure 
to comply with the terms of the insurance contract, but which the 
insured believed to be insured, or believed the terms of the insurance 
contract to have been complied with or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice; (2) said insured 
relied thereon in good faith; and (3) to require the payment of the 
additional premiums or to deny such insured's entitlement to the 
indemnity would not be fair and equitable, such insured shall be granted 
relief the same as if otherwise entitled thereto. Requests for relief 
under this section must be submitted to the Corporation in writing.



Sec. 450.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the prune crop 
as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Any changes 
made in the contract shall not affect its continuity from year to year. 
The forms referred to in the contract are available at the applicable 
service offices.



Sec. 450.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the prune crop as landlord, owner-operator, or tenant. The application 
shall be submitted to the Corporation at the service office on or before 
the applicable sales closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the sales closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period. However, if adverse conditions should develop 
during such period, the Corporation will immediately discontinue the 
acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1986 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a prune contract 
issued under such prior regulations, without the filing of a new 
application.
    (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 Prune Insurance Policy for the 
1986 through 1997 crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                      Prune--Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption;
    (6) Direct Mediterranean Fruit Fly damage; or

[[Page 306]]

    (7) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after insurance attaches;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9e(4).
    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement or wrongdoing by you, any member of 
your household, your tenants or employees;
    (2) The failure to follow recognized good prune farming practices;
    (3) The failure to follow recognized good prune irrigation practice;
    (4) The failure or breakdown of irrigation equipment or facilities;
    (5) The impoundment of water by any governmental, public or private 
dam or reservoir project; or
    (6) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be any of the varieties of prune plums 
(``prunes'') which are grown for the production of dried prunes on 
insured acreage and for which a guarantee and premium rate are provided 
by the actuarial table.
    b. The acreage insured for each crop year will be prunes grown on 
insurable acreage as designated by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured prunes at the time insurance attaches. However, 
only for the purpose of determining the amount of indemnity, your share 
will not exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any acreage:
    (1) Which is not irrigated except where provided by the actuarial 
table, or for which adequate facilities and water are not available at 
the time insurance attaches to carry out a good prune irrigation 
practice;
    (2) On which the trees have not reached the seventh growing season 
after being set out unless we agree in writing to insure such acreage;
    (3) Planted with a vine or tree crop other than prunes;
    (4) Which we inspect and consider not acceptable; or
    (5) A variety of prunes not established as adapted to the area or 
excluded by the actuarial table.
    e. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to the date insurance attaches.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of prunes in the county in which you have a 
share;
    b. The practice; and
    c. Your share at the time insurance attaches.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any prunes grown in the 
county. This report must be submitted annually on or before March 1. All 
indemnities may be determined on the basis of information you submit on 
this report. If you do not submit this report by the reporting date, we 
may elect to determine, by unit, the insured acreage, share, and 
practice or we may deny liability on any unit. Any report submitted by 
you may be revised only upon our approval. By applying for prune crop 
insurance, you authorize us to examine records maintained by the Prune 
Marketing Committee, if applicable, or prune packer for the purpose of 
determining or verifying your production and acreage.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. If the number of bearing trees (seventh growing season and older) 
is reduced more than 10 percent from the preceding calendar year as a 
result of damage occurring within that year, the production guarantee 
will be reduced 1 percent (through adjustment to your average yield) for 
each 1 percent reduction in excess of 10 percent.
    c. Coverage level 2 will apply if you do not elect a coverage level.
    d. You may change the coverage level and price election on or before 
the sales closing date as established by the actuarial table for 
submitting applications for the crop year.

                            5. Annual Premium

    a. The annual premium is earned and payable on the date insurance 
attaches. The amount is computed by multiplying the production guarantee 
times the price election, times the premium rate, times the insured 
acreage, times your share on the date insurance attaches.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under

[[Page 307]]

any Act of Congress or program administered by the United States 
Department of Agriculture or its Agencies.

                           7. Insurance Period

    Insurance attaches for each crop year on March 1 and ends at the 
earliest of:
    a. Total destruction of the prunes;
    b. The date harvest of the prunes (by variety) should have started;
    c. Harvest of the prunes;
    d. Final adjustment of a loss;
    e. October 1 in California; or
    f. October 15 in Oregon.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice of:
    (a) The dates of damage; and
    (b) The causes of damage.
    (2) You must give us written notice if during the period before 
harvest, the prunes on any unit are damaged and you decide not to 
further care for or harvest any part of them.
    (3) You must give us notice at least 15 days before the beginning of 
harvest if you anticipate a loss on any unit.
    (4) If probable loss or damage is determined within 15 days of or 
during harvest, immediate notice must be given.
    (5) If you are going to claim an indemnity on any unit, you must 
give us notice not later than 72 hours:
    (a) After total destruction of the prunes;
    (b) Discontinuance of harvest on the unit; or
    (c) Before harvest would normally start if any acreage on the unit 
is not to be harvested.
    (6) Unless notice has been given under subsection (5) above, and in 
addition to the other notices required by this section, if you are going 
to claim an indemnity on any unit, you must give us notice not later 
than 10 days after the earliest of:
    (a) Harvest of the unit;
    (b) October 1 of the crop year in California; or
    (c) October 15 of the crop year in Oregon.
    b. You must obtain written consent from us before you destroy any of 
the prunes which are not to be harvested.
    c. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the prunes on the unit;
    (2) Harvest of the unit;
    (3) October 1 of the crop year in California; or
    (4) October 15 of the crop year in Oregon.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of prunes on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period;
    (2) Authorize us in writing to examine and obtain any records 
pertaining to the production and marketing of the insured prunes under 
this contract from the prune packer Prune Marketing Committee, if 
applicable, or prune packer; and
    (3) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of prunes to be 
counted (see section 9e);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. The total production to be counted for a unit will include all 
harvested and appraised production on a natural condition prune basis 
which grades substandard or better.
    (1) Any production of substandard prunes which results from damage 
by insurable causes will be adjusted by:
    (a) Dividing the value per ton of such prunes by the market price 
per ton of standard prunes (of the same size count); and
    (b) Multiplying the result by the number of tons of such prunes.
    (2) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good prune farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause, or destroyed by you without our 
consent; and
    (c) Any unharvested production.
    (3) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Not harvested before the harvest of prunes becomes general in 
the county;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (4) If you elect to exclude hail and fire as insured causes of loss 
and the prunes are damaged by hail or fire, appraisals will be

[[Page 308]]

made in accordance with Form FCI-78, ``Request to Exclude Hail and 
Fire''.
    f. You must not abandon any acreage to us.
    g. You may not sue us unless you have complied with all policy 
provisions. If a claim is denied, you may sue us in the United States 
District Court under the provisions of 7 U.S.C. 1508(c). You must bring 
suit within 12 months of the date notice of denial is received by you.
    h. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity. 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. The 
interest rate to be paid on any indemnity will vary with the rate 
announced by the Secretary of the Treasury.
    i. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after insurance attaches for any crop year, any indemnity will 
be paid to the persons we determine to be beneficially entitled thereto.
    j. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.
    For the purpose of this section, the amount of loss from fire will 
be the difference between the fair market value for the production on 
the unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Idemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale or other disposition of all prunes 
produced on each unit, including separate records showing the same 
information for production from any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply, 
assignment of production to units by us, or a determination that no 
indemnity is due. Any person designated by us will have access to such 
records and the farm for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or

[[Page 309]]

any other contract with you is not paid on or before the termination 
date preceding such crop year for the contract on which the amount is 
due. The date of payment of the amount due if deducted from:
    (1) An indemnity claim will be the date you sign the claim; or
    (2) Payment under another program administered by the United States 
Department of Agriculture will be the date both such payment and setoff 
are approved.
    d. The cancellation and termination dates are January 31.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by October 31 preceding the 
cancellation date. Acceptance of any change will be conclusively 
presumed in the absence of notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of prune crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
prune insurance in the county.
    b. Average yield means the yield established from your production 
records, which is approved by us and shown on our form.
    c. Contiguous land means land which is touching at any point, except 
that land which is separated by only a public or private right-of-way 
will be considered contiguous.
    d. County means the county shown on the application and any 
additional land located in a local producing are bordering on the 
county, as shown by the actuarial table.
    e. Crop year means the period beginning with the date insurance 
attaches and extending through the normal harvest time and designated by 
the calendar year in which the prunes are normally harvested.
    f. Direct Mediterranean Fruit Fly damage means the actual physical 
damage to the prunes on the unit which causes such prunes to be 
unmarketable and will not include unmarketability of such prunes as a 
direct result of a quarantine, boycott, or refusal to accept the prunes 
by any entity without regard to actual physical damage to such prunes.
    g. Harvest means picking of the prunes from the trees or ground 
either by hand or machine for the purpose of removal from the orchard.
    h. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    i. Insured means the person who submitted the application accepted 
by us.
    j. Market price for standard prunes means the price per ton shown on 
the processor's settlement sheet for each size count of standard prunes.
    k. Natural condition prunes means prunes in the condition in which 
they normally come from a dry yard or dehydrator.
    l. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State, a political subdivision of a State, or any agency 
thereof.
    m. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    n. Standard prunes means any natural conditioned prunes:
    (1) Grading C or better in accordance with U.S. Standards for grades 
of dried prunes; or
    (2) Which conform to the grading specifications currently regulating 
the handling of dried prunes in States where Federal Marketing Orders 
for dried prunes are applicable.
    o. Substandard prunes mean any natural condition prunes failing to 
meet the applicable grading specifications for standard prunes.
    p. Tenant means a person who rents land from another person for a 
share of the prunes or a share of the proceeds therefrom.
    q. Unit means all insurable acreage of prunes in the county located 
on contiguous land on the data insurance attaches for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a

[[Page 310]]

share in the prunes on such land will be considered as owned by the 
lessee. Land which would otherwise be one unit may be divided according 
to applicable guidelines on files in your service office. Units will be 
determined when the acreage is reported. Errors in reporting units may 
be corrected by us to conform to applicable guidelines when adjusting a 
loss. We may consider any acreage and share thereof reported by or for 
your spouse or child or any member of your household to be your bona 
fide share or the bona fide share of any other person having an interest 
therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsiderations of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[50 FR 50277, Dec. 10, 1985, as amended at 51 FR 29205, 29207, Aug. 15, 
1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 55 FR 35888, 
Sept. 4, 1990; 62 FR 58630, Oct. 30, 1997]



PART 451--CANNING AND PROCESSING PEACH CROP INSURANCE REGULATIONS--Table of Contents




          Subpart--Regulations for the 1986 and 1987 Crop Years

Sec.
451.1  Availability of canning and processing peach crop insurance.
451.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
451.3  OMB control numbers.
451.4  Creditors.
451.5  Good faith reliance on misrepresentation.
451.6  The contract.
451.7  The application and policy.

    Authority: Secs. 506, 516, Pub. L. 75-430, 52 Stat. 73, 77, as 
amended (7 U.S.C. 1506, 1516).

    Source: 51 FR 1241, Jan. 10, 1986, unless otherwise noted.



          Subpart--Regulations for the 1986 and 1987 Crop Years



Sec. 451.1  Availability of canning and processing peach crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
canning and processing peaches in counties within the limits prescribed 
by and in accordance with the provisions of the Federal Crop Insurance 
Act, as amended. The counties shall be designated by the Manager of the 
Corporation from those approved by the Board of Directors of the 
Corporation.



Sec. 451.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for canning and processing peaches which will be included in 
the actuarial table on file in the applicable service offices for the 
county and which may be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices contained in the actuarial 
table for the crop year.



Sec. 451.3  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 451.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.

[[Page 311]]



Sec. 451.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the canning and processing 
peach insurance contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation: (1) Is 
indebted to the Corporation for additional premiums; or (2) has suffered 
a loss to a crop which is not insured or for which the insured is not 
entitled to an indemnity because of failure to comply with the terms of 
the insurance contract, but which the insured believed to be insured, or 
believed the terms of the insurance contract to have been complied with 
or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice; (2) said insured 
relied thereon in good faith; and (3) to require the payment of the 
additional premiums or to deny such insured's entitlement to the 
indemnity would not be fair and equitable, such insured shall be granted 
relief the same as if otherwise entitled thereto. Requests for relief 
under this section must be submitted to the Corporation in writing.



Sec. 451.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the canning and 
processing peach crop as provided in the policy. The contract shall 
consist of the application, the policy, and the county actuarial table. 
Any changes made in the contract shall not affect its continuity from 
year to year. The forms referred to in the contract are available at the 
applicable service offices.



Sec. 451.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the canning and processing peach crop as landlord, owner-operator, or 
tenant. The application shall be submitted to the Corporation at the 
service office on or before the applicable sales closing date on file in 
the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the sales closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period. However, if adverse conditions should develop 
during such period, the Corporation will immediately discontinue the 
acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1986 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a canning and 
processing peach contract issued under such prior regulations, without 
the filing of a new application.
    (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) and may be amended from time to time for subsequent crop 
years. The provisions of the Canning and Processing Peach Crop Insurance 
Policy for the 1986 and succeeding crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

           Canning and Processing Peach Crop Insurance Policy

    (This is a continuous contract. Refer to section 15.)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted

[[Page 312]]

Application and ``we,'' ``us'' and ``our'' refer to the Federal Crop 
Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption;
    (6) Direct Mediterranean Fruit Fly damage; or
    (7) Failure of the irrigation water supply due to an unavoidable 
cause occurring after insurance attaches;

unless those causes are excepted, excluded, or limited by the actuarial 
table or section 9e(3).
    b. We will not insure against any loss of production due to:
    (1) The neglect, mismanagement or wrongdoing by you, any member of 
your household, your tenants or employees;
    (2) The failure to follow recognized good peach farming practices;
    (3) The failure to follow recognized good peach irrigation practice;
    (4) The failure or breakdown of irrigation equipment or facilities;
    (5) The impoundment of water by any governmental, public or private 
dam or reservoir project;
    (6) Split pits regardless of cause; or
    (7) Any cause not specified in section 1a as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be any of the varieties of clingstone 
peaches (``peaches'') which are grown for the production of canning or 
processing peaches on insured acreage and for which a guarantee and 
premium rate are provided by the actuarial table.
    b. The acreage insured for each crop year will be peaches grown on 
insurable acreage as designated by the acturial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured peaches at the time insurance attaches. However, 
only for the purpose of determining the amount of indemnity, your share 
will not exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any acreage:
    (1) Which is not irrigated or for which adequate facilities and 
water are not available at the time insurance attaches to carry out a 
good peach irrigation practice;
    (2) On which the trees have not reached the fifth growing season 
after being set out unless we agree in writing to insure such acreage;
    (3) Planted with a vine or tree crop other than peaches;
    (4) Which we inspect and consider not acceptable; or
    (5) A variety of peaches not established as adapted to the area or 
excluded by the actuarial table.
    e. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to the date insurance attaches.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of peaches in the county in which you have a 
share;
    b. The practice; and
    c. Your share at the time insurance attaches.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any peaches grown in the 
county. This report must be submitted annually on or before March 1. All 
indemnities may be determined on the basis of information you submit on 
this report. If you do not submit this report by the reporting date, we 
may elect to determine, by unit, the insured acreage, share, and 
practice or we may deny liability on any unit. Any report submitted by 
you may be revised only upon our approval. By applying for peach crop 
insurance, you authorize us to examine records maintained by the Cling 
Peach Advisory Board for the purpose of determining or verifying your 
production and acreage.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. If the number of bearing trees (fifth growing season and older) 
is reduced more than 10 percent from the preceding calendar year as a 
result of damage occurring within that year, the production guarantee 
will be reduced 1 percent (through adjustment to your average yield) for 
each 1 percent reduction in excess of 10 percent.
    c. Coverage level 2 will apply if you do not elect a coverage level.
    d. You may change the coverage level and price election on or before 
the sales closing date as established by the actuarial table for 
submitting applications for the crop year.

                            5. Annual Premium

    a. The annual premium is earned and payable on the date insurance 
attaches. The amount is computed by multiplying the production guarantee 
times the price election,

[[Page 313]]

times the premium rate, times the insured acreage, times your share on 
the date insurance attaches.
    b. Interest will accrue at the rate of one and one-quarter percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the first premium billing date.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    Insurance attaches for each crop year on March 1 and ends at the 
earliest of:
    a. Total destruction of the peaches;
    b. The date harvest of the peaches (by variety) should have started;
    c. Harvest of the peaches;
    d. Final adjustment of a loss; or
    e. September 15.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice of:
    (a) The dates of damage; and
    (b) The causes of damage.
    (2) You must give us written notice if during the period before 
harvest, the peaches on any unit are damaged and you decide not to 
further care for or harvest any part of them.
    (3) You must give us notice at least 15 days before the beginning of 
harvest if you anticipate a loss on any unit.
    (4) If probable loss or damage is determined within 15 days of or 
during harvest, immediate notice must be given.
    (5) If you are going to claim an indemnity on any unit, you must 
give us notice not later than 72 hours:
    (a) After total destruction of the peaches;
    (b) Discontinuance of harvest on the unit; or
    (c) Before harvest would normally start if any acreage on the unit 
is not to be harvested.
    (6) Unless notice has been given under subsection (5) above, and in 
addition to the other notices required by this section, if you are going 
to claim an indemnity on any unit, you must give us notice not later 
than 10 days after the earliest of:
    (a) Harvest of the unit; or
    (b) September 15 of the crop year.
    b. You must obtain written consent from us before you destroy any of 
the peaches which are not to be harvested.
    c. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the peaches on the unit;
    (2) Harvest of the unit; or
    (3) September 15 of the crop year.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of peaches on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period;
    (2) Authorize us in writing to examine and obtain any records 
pertaining to the production and marketing of the insured peaches under 
this contract from the peach canner or Cling Peach Advisory Board; and
    (3) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of peaches to be 
counted (see section 9e);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. The total production to be counted for a unit will include all 
harvested and appraised production which the California State Inspection 
Service grades No. 2 or better.
    (1) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good peach farming practices;
    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause, or destroyed by you without our 
consent; and
    (c) Any unharvested production.
    (2) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Not harvested before the harvest of peaches becomes general in 
the county;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.
    (3) If your elect to exclude hail and fire as insured causes of loss 
and the peaches are damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire''.

[[Page 314]]

    f. You must not abandon any acreage to us.
    g. You may not sue us unless you have complied with all policy 
provisions. If a claim is denied, you may sue us in the United States 
District Court under the provisions of 7 U.S.C. 1508(c). You must bring 
suit within 12 months of the date notice of denial is received by you.
    h. We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity.
    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. The interest rate to be paid on any 
indemnity will vary with the rate announced by the Secretary of the 
Treasury
    i. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after insurance attaches for any crop year, any indemnity will 
be paid to the persons we determine to be beneficially entitled thereto.
    j. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.
    For the purpose of this section, the amount of loss from fire will 
be the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for two years after the time of loss, records of the 
harvesting, storage, shipment, sale or other disposition of all peaches 
produced on each unit, including separate records showing the same 
information for production from any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply, 
assignment of production to units by us, or a determination that no 
indemnity is due. Any person designated by us will have access to such 
records and the farm for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or

[[Page 315]]

before the termination date preceding such crop year for the contract on 
which the amount is due. The date of payment of the amount due if 
deducted from:
    (1) An indemnity claim will be the date you sign the claim; or
    (2) A payment under another program administered by the United 
States Department of Agriculture will be the date both such other 
payment and setoff are approved.
    d. The cancellation and termination dates are January 31.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for 3 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by October 31 preceding the 
cancellation data (November 31 for the 1988 crop year only). Acceptance 
of any changes will be conclusively presumed in the absence of any 
notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of peach crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
canning and processing peach insurance in the county.
    b. Average yield means the yield established from your production 
records, which is approved by us and shown on our form.
    c. Contiguous land means land which is touching at any point, except 
that land which is separated by only a public or private right-of-way 
will be considered contiguous.
    d. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county, as shown by the actuarial table.
    e. Crop year means the period beginning with the date insurance 
attaches and extending through the normal harvest time and designated by 
the calendar year in which the peaches are normally harvested.
    f. Direct Mediterranean Fruit Fly damage means the actual physical 
damage to the peaches on the unit which causes such peaches to be 
unmarketable and will not include unmarketability of such peaches as a 
direct result of a quarantine, boycott, or refusal to accept the peaches 
by any entity without regard to actual physical damage to such peaches.
    g. Harvest means picking of the peaches from the trees either by 
hand or machine for the purpose of removal from the orchard.
    h. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    i. Insured means the person who submitted the application accepted 
by us.
    j. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State, a political subdivision of a State, or any agency 
thereof.
    k. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    l. Tenant means a person who rents land from another person for a 
share of the proceeds therefrom.
    m. Unit means all insurable acreage of peaches in the county located 
on contiguous land on the date insurance attaches for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
    Land rented for cash, fixed commodity payment, or any consideration 
other than a share in the peaches on such land will be considered as 
owned by the lessee. Land which would otherwise be one unit may be 
divided according to applicable guidelines on file in your service 
office. Units will be determined when the acreage is reported. Errors in 
reporting units may be corrected by us to conform to applicable 
guidelines when adjusting a loss. We may consider any acreage and share 
thereof reported by or for your spouse or child or any member of your 
household to be your bona fide share or the bona fide share of any other 
person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to

[[Page 316]]

affect the construction or meaning of any of the provisions of the 
contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations.

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[51 FR 5697, Feb. 18, 1986, as amended at 51 FR 29205, 29207, Aug. 15, 
1986; 51 FR 45296, Dec. 18, 1986; 52 FR 3214, Feb. 3, 1987; 52 FR 41692, 
Oct. 30, 1987; 53 FR 46850, Nov. 21, 1988; 55 FR 35888, Sept. 4, 1990]

                        PARTS 452-453  [RESERVED]



PART 454--FRESH MARKET TOMATO (GUARANTEED PRODUCTION PLAN) CROP INSURANCE REGULATIONS FOR THE 1987 THROUGH 1997 CROP YEARS--Table of Contents




Sec.
454.1  Availability of guaranteed plan of fresh market tomato crop 
          insurance.
454.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
454.3  OMB control numbers.
454.4  Creditors.
454.5  Good faith reliance on misrepresentation.
454.6  The contract.
454.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 52 FR 4593, Feb. 13, 1987, unless otherwise noted.



Sec. 454.1  Availability of guaranteed plan of fresh market tomato crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
the insured crop in counties within the limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended (the Act). The counties shall be designated by the Manager of 
the Corporation from those approved by the Board of Directors of the 
Corporation. The insurance is offered through two methods. First, the 
Corporation offers the contract contained in this part directly to the 
insured through Agents of the Corporation. Those contracts are 
specifically identified as being offered by the Federal Crop Insurance 
Corporation. Second, companies reinsured by the Corporation offer 
contracts containing substantially the same terms and conditions as the 
contract set out in this part. No person may have in force more than one 
contract on the same crop for the crop year, whether insured by the 
Corporation or insured by a company which is reinsured by the 
Corporation. If a person has more than one contract under the Act 
outstanding on the same crop for the same crop year, all such contracts 
will be voided for that crop year but the person will still be liable 
for the premium on all contracts unless the person can show to the 
satisfaction of the Corporation that the multiple contract insurance was 
inadvertent and without the fault of the insured. If the multiple 
contract insurance is shown to be inadvertent and without the fault of 
the insured, the contract with the earliest application will be valid 
and all other contracts on that crop for that crop year will be 
cancelled. No liability for indemnity or premium will attach to the 
contracts so cancelled. The person must repay all amounts received in 
violation of this section with interest at the rate contained in the 
contract for delinquent premiums. An insured whose contract with the 
Corporation, or with a Company reinsured by the Corporation under the 
Act, has been terminated because of violation of the terms of the 
contract is not eligible to obtain multi-peril crop insurance under the 
Act with the Corporation or with a company reinsured by the Corporation 
unless the insured can show that the default in the prior contract was 
cured prior to the sales closing date of the contract applied for or 
unless the insured can show that the termination

[[Page 317]]

was improper and should not result in subsequent ineligibility. All 
applicants for insurance under the Act must advise the agent, in 
writing, at the time of application, of any previous applications for a 
Contract under the Act and the present status of the other applications 
or contracts.



Sec. 454.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for fresh market tomatoes which will be included in the 
actuarial table on file in the applicable service offices for the county 
and which may be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices set by the actuarial table 
for the crop year.



Sec. 454.3  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 454.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 454.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the fresh market tomato 
insurance contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation:
    (1) Is indebted to the Corporation for additional premiums; or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the insured person 
believed to be insured, or believed the terms of the insurance contract 
to have been complied with or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000, finds that:
    (1) An agent or employee of the Corporation did in fact make such 
misrepresentation or take other erroneous action or give erroneous 
advice;
    (2) Said insured relied thereon in good faith; and
    (3) To require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto. Requests for relief under this section must be 
submitted to the Corporation in writing.



Sec. 454.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation of a duly executed application for insurance on a form 
prescribed by the Corporation. The contract shall cover the fresh market 
tomato crop as provided in the policy. The contract shall consist of the 
application, the policy, and the county actuarial table. Changes made in 
the contract shall not affect its continuity from year to year. The 
forms referred to in the contract are available at the applicable 
service offices.



Sec. 454.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation must be made by any person to cover such person's share in 
the fresh market tomato crop as landlord, owner-operator, or tenant if 
the person wishes to participate in the program. The application shall 
be submitted to the Corporation at the service office on or before the 
applicable sales closing date on file in the service office.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive. The Manager of the Corporation is authorized in

[[Page 318]]

any crop year to extend the sales closing date for submitting 
applications in any county, by placing the extended date on file in the 
applicable service offices and publishing a notice in the Federal 
Register upon the Manager's determination that no adverse selectivity 
will result during the extended period. However, if adverse conditions 
should develop during such period, the Corporation will immediately 
discontinue the acceptance of applications.
    (c) In accordance with the provisions governing changes in the 
contract contained in policies issued under FCIC regulations for the 
1987 and succeeding crop years, a contract in the form provided for in 
this subpart will come into effect as a continuation of a fresh market 
tomato contract issued under such prior regulations, without the filing 
of a new application.
    (d) The application is found at subpart D of part 400, General 
Administrative Regulations (7 CFR 400.37, 400.38). The provisions of the 
Fresh Market Tomato (Guaranteed Production Plan) Crop Insurance 
Regulations for the 1987 through 1997 crop years are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

Guaranteed Production Plan of Fresh Market--Tomato Crop Insurance Policy

          (This is a continuous contract. Refer to section 15.)

    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption; or
    (6) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after the beginning of planting;

unless those causes are excepted, excluded, or limited by the actuarial 
table or subsection 9.e.(5).
    b. We will not insure against any loss of production due to:
    (1) Damage that occurs or becomes evident after the tomatoes have 
been harvested;
    (2) The neglect, mismanagement, or wrongdoing by you, any member of 
your household, your tenants, or employees;
    (3) The failure to follow recognized good tomato irrigation 
practices;
    (4) The failure or breakdown of irrigation equipment or facilities;
    (5) The failure to follow recognized good tomato farming practices;
    (6) The impoundment of water by any governmental, public, or private 
dam or reservoir project;
    (7) Disease or insect infestation; or
    (8) Any cause not specified in subsection 1.a. as an insured loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be transplanted tomatoes (excluding cherry-
type tomatoes) planted for harvest as fresh market tomatoes, grown on 
insurable acreage, and for which a guarantee and premium rate are set by 
the actuarial table.
    b. The acreage insured for each crop year will be tomatoes planted 
on insurable acreage as designated by the actuarial table and in which 
you have a share, as reported by you or as determined by us, whichever 
we elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured tomatoes at the time of planting. However, only 
for the purpose of determining the amount of indemnity, your insured 
share will not exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any acreage of tomatoes grown by any person if 
the person had not previously:
    (1) Grown fresh market tomatoes for commercial sales; or
    (2) Participated in the management of a fresh market tomato farming 
operation, in at least one of the three previous years.
    e. We do not insure any acreage:
    (1) Of tomatoes grown for direct consumer marketing;
    (2) If the farming practices carried out are not in accordance with 
farming practices for which premium rates have been established;
    (3) Except in Pennsylvania, on which tomatoes, peppers, eggplants, 
or tobacco have been grown within the previous two years and the soil 
was not fumigated or nematicide was not applied before planting 
tomatoes;

[[Page 319]]

    (4) Which is destroyed, it is practical to replant to tomatoes, and 
such acreage is not replanted (the unavailability of plants is not a 
valid reason for failure to replant);
    (5) Initially planted before or after the planting period set by the 
actuarial table;
    (6) Of volunteer tomatoes;
    (7) Planted to a type or variety of tomatoes not established as 
adapted to the area or excluded by the actuarial table;
    (8) Planted for experimental purposes;
    (9) Planted with another crop; or
    (10) Of tomatoes not subject to an agreement between the producer 
and the packer to pack the production (excluding insureds with their own 
packing facilities). Such agreement must be executed before reporting 
acreage.
    f. We may limit the insured acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to planting.

                3. Report of Acreage, Share, and Practice

    You must report on our form:
    a. All the acreage of tomatoes in the county in which you have a 
share;
    b. The practice, including the row width; and
    c. Your share at the time of planting.
    You must designate separately any acreage that is not insurable. You 
must report if you do not have a share in any tomato plantings in the 
county. This report must be submitted annually on or before the 
reporting date established by the actuarial table. All indemnities may 
be determined on the basis of information you submit on this report. If 
you do not submit this report by the acreage reporting date, we may 
elect to determine, by unit, the insured acreage, share, and practice or 
we may deny liability on any unit. Any report submitted by you may be 
revised only upon our approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The final stage production guarantees, coverage levels, and 
prices for computing indemnities are contained in the actuarial table.
    b. The production guarantees per acre are progressive by stages and 
increase, at specified intervals, to the final stage production 
guarantee. The stages and production guarantees are:
    (1) First Stage is from planting until qualifying for stage 2, the 
production guarantee is 50% of the final stage production guarantee.
    (2) Second Stage is from the earlier of stakes driven, one tie and 
pruning, or 30 days after planting until qualifying for stage 3, the 
production guarantee is 75% of the final stage production guarantee.
    (3) Third Stage is from 60 days after planting until qualifying for 
stage 4, the production guarantee is 90% of the final stage production 
guarantee.
    (4) Fourth Stage (Final Stage) is from the earlier of 75 days after 
planting or the beginning of harvest, the production guarantee is the 
final stage guarantee.
    c. Any acreage of tomatoes damaged to the extent that growers in the 
area generally would not further care for the tomatoes will be deemed to 
have been destroyed even though the tomatoes continue to be cared for. 
The production guarantee for such acreage will be the guarantee for the 
stage in which such damage occurs.
    d. Coverage level 2 will apply if you do not elect a coverage level.
    e. You may change the coverage level and price election on or before 
the sales closing date set by the actuarial table for submitting 
applications for the crop year.
    f. You must report production to us for the prior crop year before 
the sales closing date as established by the actuarial table. If you do 
not provide the required production report, we will assign a yield for 
the crop year for which the report is not furnished. The production 
report or assigned yield will be used to compute your production history 
for the purpose of determining your guarantee for the insured crop year. 
The yield assigned by us will not be more than 75 percent of the yield 
used by us to determine your guarantee for the prior crop year. If you 
have filed a claim for the prior crop year, the yield determined in 
adjusting your indemnity claim will be considered your production 
report.

                            5. Annual Premium

    The annual premium amount is computed by multiplying the final stage 
production guarantee times the price election, times the premium rate, 
times the insured acreage, times your share at the time of planting, 
times any applicable premium adjustment factor for which you may qualify 
as contained in the actuarial table because you did not select optional 
units.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you, or from a replanting payment, or from any loan or payment due 
you under any Act of Congress or program administered by the United 
States Department of Agriculture or its agencies.

                           7. Insurance Period

    Insurance (on a per acre basis) attaches when the tomatoes are 
planted and ends at the earliest of:
    a. Total destruction of the tomatoes;
    b. Discontinuance of harvest;
    c. The date harvest should have started on any acreage which was not 
harvested;

[[Page 320]]

    d. 120 days after the date of transplanting or replanting;
    e. Completion of harvest;
    f. Final adjustment of a loss; or
    g. November 20 of the crop year in California and September 20 in 
all other states.

                       8. Notice of Damage or Loss

    a. In case of damage or probable loss:
    (1) You must give us written notice if:
    (a) You want our consent to replant tomatoes damaged due to any 
insured cause (see subsection 9.f.);
    (b) During the period before harvest begins, the tomatoes on any 
unit are damaged and you decide not to further care for or harvest any 
part of them;
    (c) You want our consent to put the acreage to another use; or
    (d) After consent to put acreage to another use is given, additional 
damage occurs.
    Insured acreage may not be put to another use until we have 
appraised the tomatoes and given written consent. We will not consent to 
another use until it is too late to replant. You must notify us when 
such acreage is replanted or put to another use.
    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (3) If probable loss is determined within 15 days prior to or during 
harvest and you are going to claim an indemnity on any unit, you must 
give us notice not later than 72 hours after the earliest of:
    (a) Total destruction of the tomatoes on the unit;
    (b) Discontinuance of harvest of any acreage on the unit;
    (c) The date harvest would normally start if any acreage on the unit 
is not to be harvested;
    (d) 120 days after transplanting or replanting of the tomatoes; or
    (e) November 20 of the crop year in California and September 20 in 
all other states.
    b. You may not destroy or replant any of the tomatoes on which a 
replanting payment will be claimed until we give written consent.
    c. You must obtain written consent from us before you destroy any of 
the tomatoes which are not to be harvested.
    d. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the tomatoes on the unit;
    (2) Discontinuance of harvesting on the unit; or
    (3) The date harvest should have started on the unit on any acreage 
which will not be harvested.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of tomatoes on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee for 
the applicable stage;
    (2) Subtracting therefrom the total production of tomatoes to be 
counted (see subsection 9.e.);
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    d. If the information reported by you under section 3 of this policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. The total production (in 25-pound carton equivalents) to be 
counted for a unit will include all harvested and appraised production.
    (1) All tomato production marketed, and any harvested unmarketed 
production meeting the standards for grading 85% or better U.S. No. 1 
with classification size of 6 x 7 (2\8/32\ inch minimum diameter) or 
larger will be considered production to count.
    (2) Appraised production to be counted will include:
    (a) Unharvested production of mature green and ripe tomatoes with 
classification size of 6 x 7 (2\8/32\ inch minimum diameter) or larger 
remaining after the final harvest;
    (b) Potential production on unharvested acreage and potential 
production on acreage when final harvest has not been completed;
    (c) Potential production lost due to uninsured causes; and
    (d) Not less than the guarantee for any acreage abandoned or put to 
another use without prior written consent or which is damaged solely by 
an uninsured cause.
    (3) Any appraisal we have made on insured acreage for which we have 
given written consent to be put to another use will be considered 
production unless such acreage is:
    (a) Not put to another use before harvest of tomatoes becomes 
general in the county for the planting period and reappraised by us;
    (b) Further damaged by an insured cause and reappraised by us; or
    (c) Harvested.

[[Page 321]]

    (4) The amount of production of any unharvested tomatoes may be 
determined on the basis of field appraisals conducted after the end of 
the insurance period.
    (5) If you elect to exclude hail and fire as insured causes of loss 
and the tomatoes are damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire.''
    f. A replanting payment may be made on any insured tomatoes 
replanted after we have given consent and the acreage replanted is at 
least the lesser of 20 acres or 20 percent of the insured acreage as 
determined on the final planting date. The acreage to be replanted must 
have sustained a loss in excess of 50 percent of the plant stand.
    (1) No replanting payment will be made on acreage on which a 
replanting payment has been made during the current crop year.
    (2) The replanting payment per acre will be your actual cost per 
acre for replanting, but will not exceed 70 cartons multiplied by the 
price election, multiplied by your share.
    If the information reported by you results in a lower premium than 
the actual premium determined to be due, the replanting payment will be 
reduced proportionately.
    g. You must not abandon any acreage to us.
    h. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    i. An indemnity will not be paid unless you comply with all policy 
provisions.
    j. It is our policy to pay your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. However, we will pay simple 
interest on the net indemnity ultimately found to be due to you, if the 
reason for non-payment is not due to your failure to provide information 
or other material necessary for the computation or payment of the 
indemnity. Interest due will be paid from and including the 61st day 
after the date you sign, date, and submit to us the properly completed 
claim-for-indemnity form. 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. The interest rate to be 
paid on any indemnity will vary with the rate announced by the Secretary 
of the Treasury.
    k. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after the tomatoes are planted for any crop year, any 
indemnity will be paid to the persons determined to be beneficially 
entitled thereto.
    l. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.
    For the purpose of this section, the amount of loss from fire will 
be the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will, at 
our option, belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for three years after the time of loss, records of 
the harvesting, storage, shipment, sale, or other disposition of

[[Page 322]]

all tomatoes produced on each unit, including separate records showing 
the same information for production from any uninsured acreage. Failure 
to keep and maintain such records may, at our option, result in 
cancellation of the contract prior to the crop year to which the records 
apply, assignment of production to units by us, or a determination that 
no indemnity is due. Any person designated by us will have access to 
such records and the farm for purposes related to the contract.

           15. Life of Contract: Cancellation and Termination

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year. 
Thereafter, the contract will continue in force for each succeeding crop 
year unless canceled or terminated as provided in this section.
    b. This contract may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding such crop year.
    c. This contract will terminate as to any crop year if any amount 
due us on this or any other contract with you is not paid on or before 
the termination date preceding such crop year for the contract on which 
the amount is due. The date of payment of the amount due if deducted 
from:
    (1) An indemnity, will be the date you sign the claim; or
    (2) Payment under another program administered by the United States 
Department of Agriculture, will be the date both such other payment and 
setoff are approved.
    d. The cancellation and termination dates are:

------------------------------------------------------------------------
                                            Cancellation and termination
                  State                                dates
------------------------------------------------------------------------
California, Florida, Georgia, and South    February 15.
 Carolina.
All other states.........................  April 15.
------------------------------------------------------------------------

    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    f. The contract will terminate if no premium is earned for three 
consecutive years.

                          16. Contract Changes

    We may change any terms and provisions of the contract from year to 
year. If your price election at which indemnities are computed is no 
longer offered, the actuarial table will provide the price election 
which you are deemed to have elected. All contract changes will be 
available at your service office by November 30 (December 17 for the 
1998 crop year only) preceding the cancellation date for counties with a 
February 15 cancellation date, and by December 31 preceding the 
cancellation date for counties with an April 15 cancellation date. 
Acceptance of changes will be conclusively presumed in the absence of 
notice from you to cancel the contract.

                          17. Meaning of Terms

    For the purposes of tomato crop insurance:
    a. Acre means 43,560 square feet of land on which row widths do not 
exceed 6 feet or if row widths exceed 6 feet, the land area on which at 
least 7,260 linear feet of rows are planted.
    b. Actuarial table means the forms and related material for the crop 
year approved by us which are available for public inspection in your 
service office, and which show the production guarantees, coverage 
levels, premium rates, prices for computing indemnities, practices, 
insurable and uninsurable acreage, and related information regarding 
fresh market tomato insurance in the county.
    c. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county, as shown by the actuarial table.
    d. Crop year means the period within which the tomatoes are normally 
grown and is designated by the calendar year in which the tomatoes are 
normally harvested.
    e. Harvest means the picking of marketable tomatoes on the unit.
    f. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    g. Insured means the person who submitted the application accepted 
by us.
    h. Mature green tomato means a tomato which:
    (1) Has heightened gloss because of the waxy skin that cannot be 
torn by scraping;
    (2) Has well formed jelly-like substance in the locules;
    (3) Has seeds that are sufficiently hard so they are pushed aside 
and not cut by a sharp knife in slicing; and
    (4) Shows no red color.
    i. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State or a political subdivision or agency of a State.

[[Page 323]]

    j. Planting means transplanting the tomato plants into the field.
    k. Plant stand means the number of live plants per acre before the 
plants were damaged due to insurable causes.
    l. Potential production means the number of 25-pound cartons of 
mature green or ripe tomatoes with classification size of 6 x 7 (2\8/32\ 
inch minimum diameter) or larger which the tomato plants would produce 
or would have produced, per acre, by the end of the insurance period.
    m. Replanting means performng the cultural practices necessary to 
replant insured acreage to tomatoes.
    n. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    o. Tenant means a person who rents land from another person for a 
share of the tomatoes or a share of the proceeds therefrom.
    p. Tomatoes grown for direct consumer marketing means tomatoes grown 
for the purpose of selling directly to the consumer.
    q. Unit means all insurable acreage of tomatoes in the county on the 
date of planting for the crop year:
    (1) In which you have 100 percent share; or
    (2) Which is owned by one person and operated by another person on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the tomatoes on such land will be 
considered as owned by the lessee. Land which would otherwise be one 
unit may be divided according to applicable guidelines on file in your 
service office. Units will be determined when the acreage is reported. 
Errors in reporting units may be corrected by us to conform to 
applicable guidelines when adjusting a loss. We may consider any acreage 
and share thereof reported by or for your spouse or child or any member 
of your household to be your bona fide share or the bona fide share of 
any other person having an interest therein.

                        18. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           19. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with the Appeal Regulations (7 
CFR Part 400--Subpart J).

                               20. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    21. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[52 FR 4593, Feb. 13, 1987, as amended at 53 FR 46850, Nov. 21, 1988; 54 
FR 48077, Nov. 21, 1989; 55 FR 35888, Sept. 4, 1990; 62 FR 23631, May 1, 
1997; 62 FR 63633, Dec. 2, 1997]



PART 455--MACADAMIA NUT CROP INSURANCE REGULATIONS FOR THE 1988 THROUGH THE 1997 CROP YEARS--Table of Contents




Sec.
455.1  Availability of macadamia nut crop insurance.
455.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
455.3  OMB control numbers.
455.4  Creditors.
455.5  Good faith reliance on misrepresentation.
455.6  The contract.
455.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 53 FR 6569, Mar. 2, 1988, unless otherwise noted.



Sec. 455.1  Availability of macadamia nut crop insurance.

    (a) Insurance shall be offered under the provisions of this subpart 
on the insured crop in counties within the limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended, (the Act). The counties shall be designated by the Manager of 
the Corporation from those approved by the Board of Directors of the 
Corporation. The insurance is offered through two methods. First, the 
Corporation offers the contract contained in this part directly to the 
insured through Agents of the Corporation. Those contracts are 
specifically

[[Page 324]]

identified as being offered by the Federal Crop Insurance Corporation. 
Second, companies reinsured by the Corporation (hereinafter ``Reinsured 
companies'') offer contracts containing substantially the same terms and 
conditions as the contract set out in this part. No person may have in 
force more than one contract on the same crop for the crop year, whether 
insured by the Corporation or insured by a Reinsured company. If a 
person has more than one contract under the Act outstanding on the same 
crop for the same crop year, all such contracts will be voided for that 
crop year but the person will still be liable for the premium on all 
contracts unless the person can show to the satisfaction of the 
Corporation that the multiple contract insurance was inadvertent and 
without the fault of the insured. If the multiple contract insurance is 
shown to be inadvertent and without the fault of the insured, the 
contract with the earliest application will be valid and all other 
contracts on that crop for that crop year will be cancelled. No 
liability for indemnity or premium will attach to the contracts so 
cancelled. The person must repay all amounts received in violaton of 
this section with interest at the rate contained in the contract for 
delinquent premiums.
    (b) An insured whose contract with the Corporation or with a 
Reinsured company under the Act has been terminated because of violation 
of the terms of the contract is not eligible to obtain multi-peril crop 
insurance under the Act with the Corporation or with a Reinsured company 
unless the insured can show that the default in the prior contract was 
cured prior to the sales closing date of the contract applied for or 
unless the insured can show that the termination was improper and should 
not result in subsequent ineligibility. All applicants for insurance 
under the Act must advise the agent, in writing, at the time of 
application, of any previous applications for a Contract under the Act 
and the present status of the applications or contracts.



Sec. 455.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for macadamia nuts which will be included in the actuarial 
table on file in the applicable service offices for the county and which 
may be changed from year to year.
    (b) At the time of application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices set by the actuarial table 
for the crop year.



Sec. 455.3  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 455.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 455.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the macadamia nut insurance 
contract, whenever--
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation or a 
Reinsured company:
    (1) Is indebted to the Corporation or a Reinsured company for 
additional premiums; or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the

[[Page 325]]

insured believed to be insured, or believed the terms of the insurance 
contract to have been complied with or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000, or a Reinsured company finds 
that:
    (1) An agent or employee of the Corporation or a Reinsured company 
did in fact make such misrepresentation or take other erroneous action 
or give erroneous advice;
    (2) Said insured relied thereon in good faith; and
    (3) To require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto.

Request for relief under this section must be submitted to the 
Corporation or to the Reinsured Company, whichever is applicable, in 
writing.

[53 FR 6569, Mar. 2, 1988, as amended at 54 FR 30007, July 18, 1989]



Sec. 455.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation or a Reinsured company of a duly executed application 
for insurance on a form prescribed by the Corporation or a Reinsured 
company. The contract shall cover the macadamia nut crop as provided in 
the policy. The contract shall consist of the application, the policy 
and the county actuarial table. This contract is not continuous. 
Application must be made annually for the macadamia nut contract on or 
prior to the sales closing date established by the actuarial table. The 
forms referred to in the contract are available at the applicable 
service offices.



Sec. 455.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation must be made by any person to cover such person's share in 
the macadamia nut crop as landlord, owner-operator, or tenant if the 
person wishes to participate in the program. The application shall be 
submitted to the Corporation or a Reinsured company at the service 
office on or before the applicable sales closing date on file in the 
service office.
    (b) The Corporation or a Reinsured company may discontinue the 
acceptance of any application or applications in any county upon its 
determination that the insurance risk is excessive. The Manager of the 
Corporation is authorized in any crop year to extend the sales closing 
date for submitting applications in any county, by placing the extended 
date on file in the applicable service offices and publishing a notice 
in the Federal Register upon the Manager's determination that no adverse 
selectivity will result during the extended period. However, if adverse 
conditions should develop during such period, the Corporation will 
immediately discontinue the acceptance of applications.
    (c) A contract in the form provided for in this subpart will be in 
effect as a macadamia nut contract applicable for one year. A new 
application must be submitted for each subsequent crop year.
    (d) The application is found at subpart D of part 400, General 
Administrative Regulations (7 CFR 400.37, 400.38). The provisions of the 
Macadamia Nut Crop Insurance Policy for the 1988 through 1997 crop years 
are as follows:

                        DEPARTMENT OF AGRICULTURE

                   Federal Crop Insurance Corporation

                  Macadamia Nut--Crop Insurance Policy

    (This is NOT a continuous contract. Refer to Section 15)
    AGREEMENT TO INSURE: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable loss of production 
resulting from the following causes occurring within the insurance 
period:
    (1) Adverse weather conditions;
    (2) Earthquake;
    (3) Fire;
    (4) Volcanic eruption;
    (5) Wildlife; or

[[Page 326]]

    (6) If applicable, failure of the irrigation water supply due to an 
unavoidable cause occurring after insurance attaches; unless those 
causes are excepted, excluded, or limited by the actuarial table or 
subsection 9.e.(4).
    b. We will not insure against any loss of production due to:
    (1) Unmarketability as a direct result of quarantine, boycott, or 
refusal of any entity to accept production unless production has actual 
physical damage due to a cause specified in subsection 1.a.;
    (2) The neglect, mismanagement, or wrongdoing by you, any member of 
your household, your tenants, or employees;
    (3) The failure to follow recognized good macadamia nut farming 
practices;
    (4) Water contained by any governmental, public, or private dam or 
reservoir project;
    (5) Flooding on any unit subject to a flood or water flowage 
easement;
    (6) Flooding on any unit located between any body of water and a 
primary flood control structure for that body of water;
    (7) Failure or breakdown of irrigation equipment or facilities;
    (8) Failure to carry out a good macadamia nut irrigation practice; 
or
    (9) Any cause not specified in subsection 1.a. as an insured cause 
of loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be all varieties of macadamia nuts grown 
for processing on insurable acreage which has been inspected and 
accepted by us and for which a guarantee and premium rate are provided 
by the actuarial table.
    b. The acreage insured for each crop year will be macadamia nuts 
grown on insurable acreage as designated by the actuarial table, and in 
which you have a share, as reported by you or as determined by us, 
whichever we elect.
    c. The insured share is your share as landlord, owner-operator, or 
tenant in the insured macadamia nuts at the time insurance attaches. 
However, only for the purpose of determining the amount of indemnity, 
your insured share will not exceed your share on the earlier of:
    (1) The time of loss; or
    (2) The beginning of harvest.
    d. We do not insure any macadamia nuts:
    (1) If the farming practices carried out are not the same as those 
for which the guarantee and premium rate have been established;
    (2) Of a type of variety not established as adapted to the area or 
excluded by the actuarial table;
    (3) Produced by macadamia trees that have not reached the fifth 
growing season after transplanting or grafting;
    (4) If the macadamia trees have not produced an average yield of at 
least 190 pounds of wet inshell nuts per acre in a previous year;
    (5) If the trees are interplanted with a crop other than macadamia 
nuts;
    (6) If acceptable production records of at least the previous crop 
year are not available;
    (7) If there is less than a 50 percent stand of bearing trees based 
on the original planting pattern; or
    (8) Which we consider not acceptable.
    e. We may limit the insurable acreage to any acreage limitation 
established under any Act of Congress, if we advise you of the limit 
prior to the date insurance attaches.

 3. Report of Acreage, Share, Variety, Practice, and Number of Bearing 
                                  Trees

    You must report on our form by unit:
    a. All the acreage of macadamia nuts in the county in which you have 
a share;
    b. Your share at the time insurance attaches;
    c. The variety;
    d. The dates on which the trees were transplanted or grafted;
    e. The practice; and
    f. The number of bearing trees.
    You must designate separately any acreage that is not insurable. 
This report must be submitted annually prior to the time insurance 
attaches. If insurance is provided for an irrigated practice, you must 
report as irrigated only the acreage for which you have adequate 
facilities and water, at the time insurance attaches, to carry out a 
good macadamia nut irrigation practice. All indemnities may be 
determined on the basis of information you submit on this report. If you 
do not submit this report within 15 days after the time insurance 
attaches, we may elect to determine, by unit, the insured acreage, 
share, practice, and number of bearing trees, or we may deny liability 
on any unit. Any report submitted by you may be revised only upon our 
approval.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    a. The production guarantees, coverage levels, and prices for 
computing indemnities are contained in the actuarial table.
    b. If the number of bearing trees (fifth growing season after 
transplanting or grafting and older) is reduced more than 10 percent 
from the preceding calendar year as a result of damage occurring within 
that year, the production guarantee will be reduced 1 percent for each 
percent reduction in excess of 10 percent.
    c. You may change the coverage level and price election for the 
succeeding crop year on or before December 31 of the current crop year.
    d. You must report production to us for the insured crop year by 
December 31 of that

[[Page 327]]

crop year. If you do not provide the required production report, we will 
assign a yield for the insured crop year. The yield assigned by us will 
not be more than 75 percent of the yield used to determine your 
guarantee for the insured crop year. The production report or assigned 
yield will be used to compute your production history for the purpose of 
determining your guarantee for the succeeding crop year. If you have 
filed a claim for the insured crop year, the production report will be 
calculated based on the actual production used to determine the 
indemnity payment.

                            5. Annual Premium

    a. The annual premium is earned and payable on the date insurance 
attaches. The amount is computed by multiplying the production guarantee 
times the price election, times the premium rate, times the insured 
acreage, times your share on the date insurance attaches.
    b. Interest will accrue at the rate of one and one-fourth percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the premium billing date.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its agencies.

                           7. Insurance Period

    Insurance on insurable acreage attaches for each crop year on 
January 1. However, if we accept your application for insurance after 
January 1, insurance does not attach until the thirtieth (30th) day 
after you sign and submit a properly completed application. Insurance 
will not attach to any acreage inspected by us and determined to be 
unacceptable. Insurance ends on a per-acre basis at the earliest of:
    a. Total destruction of the macadamia nuts on the unit;
    b. The date harvest would normally start on the unit on any acreage 
which will not be harvested;
    c. Completion of harvest;
    d. Final adjustment of a loss; or
    e. June 30, 1998, for the 1997 crop year only.

                       8. Notice of Damage or Loss

    a. You must give us written notice:
    (1) Without delay if damage resulting in probable loss occurs at any 
time during the period before harvest; and
    (2) At least fifteen (15) days before the beginning of harvest if 
you anticipate a loss on any unit.
    b. If probable loss is determined within fifteen (15) days prior to 
or during harvest and you are going to claim an indemnity on any unit, 
you must give us notice not later than seventy-two (72) hours after the 
earliest of:
    (1) Total destruction of the macadamia nuts on the unit;
    (2) Discontinuance of harvest of any acreage on the unit;
    (3) The date harvest would normally start if any acreage on the unit 
is not to be harvested; or
    (4) June 30, 1998, for the 1997 crop year only.
    c. You must obtain written consent from us before you destroy any of 
the macadamia nuts which are not to be harvested.
    d. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than sixty (60) days after the earliest of:
    (1) Total destruction of the macadamia nuts on the unit;
    (2) Harvest of the unit; or
    (3) June 30, 1998, for the 1997 crop year only.
    b. We will not pay any indemnity unless you:
    (1) Establish the total production of macadamia nuts on the unit and 
that any loss of production has been directly caused by one or more of 
the insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of macadamia nuts to 
be counted (see subsection 9.e.);
    (3) Multiplying the remainder of the price election; and
    (4) Multiplying this product by your share.
    d. If the information reported by you under section 3 of this policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    e. The total production (wet inshell pounds) to be counted for a 
unit will include all harvested and appraised production.
    (1) Appraised production to be counted will include:
    (a) Potential production lost due to uninsured causes and failure to 
follow recognized good macadamia nut farming practices;

[[Page 328]]

    (b) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause, or destroyed by you without our 
prior written consent; and
    (c) Any production detached from trees and not removed from the 
orchard.
    (2) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (a) Further damaged by an insured cause and reappraised by us; or
    (b) Harvested.
    (3) We may determine the amount of production of any unharvested 
macadamia nuts on the basis of field appraisals conducted after the end 
of the insurance period.
    (4) If you elect to exclude hail and fire as insured causes of loss 
and the macadamia nuts are damaged by hail or fire, appraisals will be 
made in accordance with Form FCI-78, ``Request to Exclude Hail and 
Fire.''
    f. You must not abandon any acreage to us.
    g. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    h. An indemnity will not be paid unless you comply with all policy 
provisions.
    i. It is our policy to pay your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. However, we will pay simple 
interest computed on the net indemnity ultimately found to be due to 
you, if the reason for non-payment is not due to your failure to provide 
information or other material necessary for the computation or payment 
of the indemnity. Interest due will be paid from and including the 61st 
day after the date you sign, date, and submit to us the properly 
completed claim-for-indemnity form. 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.
    The interest rate to be paid on any indemnity will vary with the 
rate announced by the Secretary of the Treasury.
    j. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after insurance attaches for any crop year, any indemnity will 
be paid to the persons determined to be beneficially entitled thereto.
    k. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or payble 
under such other insurance.

For the purpose of this subsection, the amount of loss from fire will be 
the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

          11. Transfer of Right to an Indemnity--Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay for your loss, then your right of recovery will, at our 
option, belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access to Farm

    You must keep, for three years, after the time of loss, records of 
the harvesting, storage, shipment, sale or other disposition of all 
macadamia nuts produced on each unit, including separate records showing 
the same information for production from any uninsured acreage. Failure 
to keep and maintain such records may, at our option, result in: (a) 
Cancellation of the contract prior to the

[[Page 329]]

crop year to which the records apply; (b) assignment of production to 
units by us; or (c) a determination that no indemnity is due. Any person 
designated by us will have access to such records and the farm for 
purposes related to the contract.

                          15. Life of Contract

    a. This contract will be in effect for the crop year specified on 
the application and may not be canceled by you for such crop year.
    b. The term of this contract ends as shown in section 7 of this 
policy. We are under no obligation to send you any renewal notice or 
other notice that the contract term is ending and the receipt by you of 
any such notice is not a waiver of this provision.
    c. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    d. This contract will automatically terminate at the end of the 
current contract period unless we offer to renew the contract for a 
subsequent crop year and you accept.

                          16. Meaning of Terms

    For the purposes of macadamia nut crop insurance:
    a. Actuarial table means the forms and related material for the crop 
year approved by us. The Actuarial Table is available for public 
inspection in your service office and shows the production guarantees, 
coverage levels, premium rates, prices for computing indemnities, 
practices, insurable and uninsurable acreage, and related information 
regarding macadamia nut insurance in the country.
    b. County means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county, as shown by the actuarial table.
    c. Crop year means the period beginning with the date insurance 
attaches and extending through the normal harvest time and will be 
designated by the calendar year in which the macadamia nuts are normally 
harvested.
    d. Harvest means the picking of the macadamia nuts from the ground.
    e. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    f. Insured means the person who submitted the application accepted 
by us.
    g. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State or a political subdivision or agency of a State.
    h. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    i. Tenant means a person who rents land from another person for a 
share of the macadamia nuts or a share of the proceeds therefrom.
    j. Unit means all insurable acreage of macadamia nuts in the county 
on the date of planting for the crop year:
    (1) In which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the macadamia nuts on such land will 
be considered as owned by the lessee.
    Land which would otherwise be one unit may be divided according to 
applicable guidelines on file in your service office. Units will be 
determined when the acreage is reported. Errors in reporting units may 
be corrected by us to conform to applicable guidelines when adjusting a 
loss. We may consider any acreage and share thereof reported by or for 
your spouse or child or any member of your household to be your bona 
fide share or the bona fide share of any other person having an interest 
therein.
    k. Wet inshell means the weight of the macadamia nuts as they are 
removed from the orchard with the nuts meats in the shells after removal 
of the husk and prior to being dried.

                        17. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           18. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with the Appeal Regulations (7 
CFR Part 400, Subpart J).

                               19. Notices

    All notices required to be given by you must be in writing and 
received by your

[[Page 330]]

service office within the designated time unless otherwise provided by 
the notice requirement. Notices required to be given immediately may be 
by telephone or in person and confirmed in writing. Time of the notice 
will be determined by the time of our receipt of the written notice.
    20. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[53 FR 6569, Mar. 2, 1988, as amended at 55 FR 35887, Sept. 4, 1990; 62 
FR 35662, 35664, July 2, 1997]



PART 456--MACADAMIA TREE CROP INSURANCE REGULATIONS FOR THE 1988 THROUGH 1997 CROP YEARS--Table of Contents




Sec.
456.1  Availability of macadamia tree crop insurance.
456.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
456.3  OMB control numbers.
456.4  Creditors.
456.5  Good faith reliance on misrepresentation.
456.6  The contract.
456.7  The application and policy.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 53 FR 31827, Aug. 22, 1988, unless otherwise noted.



Sec. 456.1  Availability of macadamia tree crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
the insured crop in counties within the limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended (the Act). The counties shall be designated by the Manager of 
the Corporation from those approved by the Board of Directors of the 
Corporation. The insurance is offered through two methods. First, the 
Corporation offers the contract contained in this part directly to the 
insured through Agents of the Corporation. Those contracts are 
specifically identified as being offered by the Federal Crop Insurance 
Corporation. Second, companies reinsured by the Corporation offer 
contracts containing substantially the same terms and conditions as the 
contract set out in this part. No person may have in force more than one 
contract on the same crop for the crop year, whether insured by the 
Corporation or insured by a company which is reinsured by the 
Corporation. If a person has more than one contract under the Act 
outstanding on the same crop for the same crop year, all such contracts 
will be voided for that crop year but the person will still be liable 
for the premium on all contracts unless the person can show to the 
satisfaction of the Corporation that the multiple contract insurance was 
inadvertent and without the fault of the insured. If the multiple 
contract insurance is shown to be inadvertent and without the fault of 
the insured, the contract with the earliest application will be valid 
and all other contracts on that crop for that crop year will be 
cancelled. No liability for indemnity or premium will attach to the 
contracts so cancelled. The person must repay all amounts received in 
violation of this section with interest at the rate contained in the 
contract for delinquent premiums.
    An insured whose contract with the Corporation or with a Company 
reinsured by the Corporation under the Act has been terminated because 
of violation of the terms of the contract is not eligible to obtain 
multi-peril crop insurance under the Act with the Corporation or with a 
company reinsured by the Corporation unless the insured can show that 
the default in the prior contract was cured prior to the sales closing 
date of the contract applied for or unless the insured can show that the 
termination was improper and should not result in subsequent 
ineligibility. All applicants for insurance under the Act must advise 
the agent, in writing at the time of application, of any previous 
applications for a Contract under the Act and the present status of the 
applications or contracts.



Sec. 456.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for macadamia trees which will be included in

[[Page 331]]

the actuarial table on file in the applicable service offices for the 
county and which may be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect a coverage level and price at which indemnities will be 
computed from among those levels and prices set by the actuarial table 
for the crop year.



Sec. 456.3  OMB control numbers.

    OMB control numbers are contained in subpart H of part 400, title 7 
CFR.



Sec. 456.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 456.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the macadamia tree insurance 
contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation:
    (1) Is indebted to the Corporation for additional premiums; or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the insured believed 
to be insured, or believed the terms of the insurance contract to have 
been complied with or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that: (1) An agent or 
employee of the Corporation did in fact make such misrepresentation or 
take other erroneous action or give erroneous advice; (2) said insured 
relied thereon in good faith; and (3) to require the payment of the 
additional premiums or to deny such insured's entitlement to the 
indemnity would not be fair and equitable, such insured shall be granted 
relief the same as if otherwise entitled thereto. Requests for relief 
under this section must be submitted to the Corporation in writing.



Sec. 456.6  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation (or by a Company reinsured by the Corporation) of a duly 
executed application for insurance on a form prescribed by the 
Corporation. The contract shall cover the macadamia tree crop as 
provided in the policy. The contract shall consist of the application, 
the policy and the county actuarial table. This contract is not 
continuous. Application must be made annually for the macadamia tree 
contract on or prior to the sales closing date established by the 
actuarial table. The forms referred to in the contract are available at 
the applicable service offices.



Sec. 456.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation must be made by any person to cover such person's share in 
the macadamia tree crop as landlord or owner-operator if the person 
wishes to participate in the program. The application must be submitted 
to the Corporation (or the Company reinsured by the Corporation) at the 
service office on or before the applicable sales closing date on file in 
the service office.
    (b) The Corporation may discontinue the acceptance of any 
application or applications in any county upon its determination that 
the insurance risk is excessive. The Manager of the Corporation is 
authorized in any crop year to extend the sales closing date for 
submitting applications in any county, by placing the extended date on 
file in the applicable service offices and publishing a notice in the 
Federal Register upon the Manager's determination that no adverse 
selectivity will result during the extended period. However, if adverse 
conditions should develop during such period, the Corporation will 
immediately discontinue the acceptance of applications.
    (c) A contract in the form provided for in this subpart will be in 
effect as a

[[Page 332]]

macadamia tree contract applicable for one year. A new application must 
be submitted for each subsequent crop year.
    (d) The application is found at subpart D of part 400, General 
Administrative Regulations (7 CFR 400.37, 400.38). The provisions of the 
Macadamia Tree Crop Insurance Policy for the 1988 through 1997 crop 
years are as follows:

                  Macadamia Tree Crop Insurance Policy

    (This is not a continuous contract. Refer to Section 15)
    Agreement to Insure: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted application and ``we,'' ``us,'' and ``our'' refer 
to the Federal Crop Insurance Corporation.

                          Terms and Conditions

                            1. Causes of Loss

    a. The insurance provided is against unavoidable damage to macadamia 
trees resulting from the following causes occurring within the insurance 
period:
    (1) Fire;
    (2) Volcanic eruption; or
    (3) Wind;
    Unless those causes are excepted, excluded, or limited by this 
policy or the actuarial table.
    b. We will not insure against any loss due to:
    (1) Fire, where weeds and other forms of undergrowth have not been 
controlled or tree pruning debris has not been removed from the grove;
    (2) The neglect, mismanagement, or wrongdoing by you, any member of 
your household, your tenants, or employees;
    (3) The failure to follow recognized good macadamia nut orchard 
practices; or
    (4) Any cause not specified in subsection 1.a. as an insured cause 
of loss.

                   2. Crop, Acreage, and Share Insured

    a. The crop insured will be all macadamia trees grown for the 
production of macadamia nuts on insurable acreage which has been 
annually inspected and accepted by us and for which a guarantee and 
premium rate are provided by the actuarial table.
    b. The acreage insured for each crop year will be all macadamia tree 
acreage designated as insurable by the actuarial table and in which you 
have a share, as reported by you or as determined by us, whichever we 
elect.
    c. The insured share is your share as landlord or owner-operator in 
the insured macadamia trees at the time insurance attaches. However, 
only for the purpose of determining the amount of indemnity, your 
insured share will not exceed your share at the time of loss.
    d. We do not insure any macadamia trees:
    (1) If the orchard maintenance practices carried out are not the 
same as those for which the guarantee and premium rate have been 
established;
    (2) Of a type or variety not established as adapted to the area or 
excluded by the actuarial table;
    (3) Interplanted with another crop;
    (4) Which we consider not acceptable; or
    (5) That are less than one year of age when the insured period 
begins.
    e. We may limit the insurable acreage to any acreage limitation, 
established under any Act of Congress, if we advise you of the limit 
prior to the date insurance attaches.

           3. Report of Acreage, Share, Variety, and Practice

    You must report on our form by unit:
    a. all the acreage of macadamia trees in the county in which you 
have a share;
    b. your share at the time insurance attaches;
    c. the types of trees;
    d. the number of trees set out;
    e. the dates on which the trees were set out or grafted; and
    f. If more than 10 percent of the trees on any unit has been 
replaced in the previous five crop years, the date of replacement.
    You must designate separately any acreage that is not insurable. 
This report must be submitted annually prior to the time insurance 
attaches. If insurance is provided for an irrigated practice, you must 
report as irrigated only the acreage for which you have adequate 
facilities and water, at the time insurance attaches, to carry out a 
good macadamia orchard irrigation practice. All indemnities may be 
determined on the basis of information you submit on this report. If you 
do not submit this report within 15 days after the time insurance 
attaches, we may elect to determine, by unit, the insured acreage, 
share, and practice or we may deny liability on any unit. Any report 
submitted by you may be revised only upon our approval.

               4. Amounts of Insurance and Coverage Levels

    a. The amounts of insurance and coverage levels are contained in the 
actuarial table.
    b. If, at the time insurance attaches, the number of macadamia trees 
on a unit is less than 90 percent of the number of macadamia trees that 
would comprise a complete planting pattern, the amount of insurance will 
be reduced 1 percent for each percent below 90 percent.

[[Page 333]]

                            5. Annual Premium

    a. The annual premium is earned and payable on the date insurance 
attaches. The amount is computed by multiplying the amount of insurance 
per acre times the premium rate, times the insured acreage, times your 
share on the date insurance attaches.
    b. Interest will accrue at the rate of one and one-fourth percent 
(1\1/4\%) simple interest per calendar month, or any part thereof, on 
any unpaid premium balance starting on the first day of the month 
following the premium billing date.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its agenices.

                           7. Insurance Period

    Insurance attaches on insurable acreage for each crop year on 
January 1. However, if we accept your application for insurance after 
January 1, insurance does not attach until the tenth (10th) day after 
you sign and submit a properly completed application. Insurance will not 
attach to any acreage determined by us, after inspection, to be 
unacceptable. Insurance ends at the earlier of:
    a. Total destruction of the macadamia trees; or
    b. December 31 of the crop year.

                       8. Notice of Damage or Loss

    a. You must give us written notice without delay if damage resulting 
in probable loss occurs at any time during the insurance period. Such 
notice must include the dates and causes of damage.
    b. If you are going to claim an indemnity on any unit, we must be 
allowed to inspect all insured trees before any pruning or tree removal.
    c. We may reject any claim for indemnity if you fail to comply with 
any of the requirements of this section or section 9.

                         9. Claim for Indemnity

    a. Any claim for indemnity on a unit must be submitted to us on our 
form not later than sixty (60) days after the earlier of:
    (1) Total destruction of the trees on the unit; or
    (2) December 31 of the crop year.
    b. We will not pay any indemnity unless you:
    (1) Furnish all records we require concerning all trees on the unit;
    (2) Show that any damage to the trees has been directly caused by 
one or more of the insured causes during the insurance period; and
    (3) Furnish all information we require concerning the loss.
    c. The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the amount of insurance per 
acre;
    (2) Multiplying this result by the applicable percent of loss, which 
is determined for:
    (a) Coverage level 3 by subtracting 25 percent from the actual 
percent of damage and dividing the result of 75 percent.
    (b) Coverage level 2 by subtracting 35 percent from the actual 
percent of damage and dividing the result by 65 percent; or
    (c) Coverage level 1 by subtracting 50 percent from the actual 
percent of damage and dividing the result by 50 percent; and
    (3) Multiplying the result for the applicable coverage level by your 
share.
    d. If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the amount of insurance on the unit will be computed on the information 
you reported, but all of the insurable acreage planted, whether or not 
reported as insurable, will count against the amount of insurance.
    e. The total amount of indemnity will include both trees damaged and 
trees destroyed due to an insurable cause.
    (1) Any grove with over 80 percent actual damage will be determined 
to be 100 percent damaged.
    (2) Any percentage of damage by uninsured causes will not be 
included in the percent of damage.
    (3) If you elect to exclude fire as an insured cause of loss and the 
macadamia trees are damaged by fire, appraisals will be made in 
accordance with Form FCI-78-A, ``Request to Exclude Hail and Fire.''
    f. You must not abandon any acreage to us.
    g. Any suit against us for an indemnity must be brought in 
accordance with the provisions of 7 U.S.C. 1508(c). You must bring suit 
within 12 months of the date notice of denial of the claim is received 
by you.
    h. An indemnity will not be paid unless you comply with all policy 
provisions.
    i. It is our policy to pay your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. However, we will pay simple 
interest computed on the net indemnity ultimately found to be due to you 
if the reason for non-payment is not due to your failure to provide 
information or other material necessary for the computation or payment 
of the indemnity. Interest due will be paid from and including the 61st 
day after the date you sign, date, and submit to us the properly 
completed claim-for-indemnity form.

[[Page 334]]

    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. The interest rate to be paid on any 
indemnity will vary with the rate announced by the Secretary of the 
Treasury.
    j. If you die, disappear, or are judicially declared incompetent, or 
if you are an entity other than an individual and such entity is 
dissolved after insurance attaches for any crop year, any indemnity will 
be paid to the persons determined to be beneficially entitled thereto.
    k. If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.
    For the purpose of this subsection, the amount of loss from fire 
will be the difference between the fair market value of the trees on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us, if at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to an Indemnity-Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

          13. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay for your loss, then your right of recovery will, at our 
option, belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                    14. Records and Access to Orchard

    You must keep, for three years after the time of loss, records of 
the trees destroyed or damaged on each unit, including separate records 
showing the same information for any uninsured acreage. Failure to keep 
and maintain such records may, at our option, result in cancellation of 
the contract prior to the crop year to which the records apply or a 
determination that no indemnity is due. Any person designated by us will 
have access to such records and the orchard for purposes related to the 
contract.

                          15. Life of Contract

    a. This contract will be in effect for the crop year specified on 
the application.
    b. The term of this contract begins and ends as shown in Section 7 
of this policy. We are under no obligation to send you any renewal 
notice or other notice that the contract term is ending, and the receipt 
by you of any such notice is not a waiver of this provision.
    c. This contract will not be renewed for any successive contract 
term if any amount due us on this or any other contract with you is not 
paid on or before the termination date. The date of payment of the 
amount due if deducted from:
    (1) An indemnity, will be the date you sign the claim; or
    (2) Payment under another program administered by the United States 
Department of Agriculture, will be the date both such other payment and 
setoff are approved.
    d. Since the premium must be paid prior to insurance attaching, the 
termination date is the date insurance attaches.
    e. If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will terminate as of the date of death, judicial declaration, 
or dissolution. If such event occurs after insurance attaches for any 
crop year, the contract will continue in force through the crop year and 
terminate at the end thereof. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.

[[Page 335]]

    f. This contract will automatically terminate at the end of the 
current contract period.

                          16. Meaning to Terms

    For the purposes of macadamia tree crop insurance:
    a. Age means the number of years after the later of when the trees 
have been set out or grafted. Age determination will be made for the 
unit on January 1 of each crop year.
    b. Actuarial table means the forms and related materials for the 
crop year approved by us. The actuarial table is available for public 
inspection in your service office and shows the production guarantees, 
coverage levels, premium rates, prices for computing indemnities, 
practices, insurable and uninsurable acreage, and related information 
regarding macadamia tree insurance in the county.
    c. County means the county shown on the application.
    d. Crop year means the period beginning with the date insurance 
attaches and extending through December 31 of the same calendar year and 
will be designated by the calendar year in which insurance attaches.
    e. Destroyed means damage to trees to the extent that we determine 
that replacement is required.
    f. Grafting means to unite a macadamia tree shoot to an established 
macadamia tree root stock for future production of macadamia nuts.
    g. Insurable acreage means the land classified as insurable by us 
and shown as such by the actuarial table.
    h. Insured means the person who submitted the application accepted 
by us.
    i. Person means an individual, partnership, association, 
corporation, estate, trust, or other legal entity, and wherever 
applicable, a State or a political subdivision, or agency of a State.
    j. Planting pattern means the spacing oftrees on a uniform 
geometrical basis so that each tree is a uniform distance from other 
trees and resulting in a specific number of trees per acre.
    k. Service office means the office servicing your contract as shown 
on the application for insurance or such other approved office as may be 
selected by you or designated by us.
    l. Unit means all insurable acreage of macadamia trees in the county 
on the date of planting for the crop year:
    (1) In which you have a 100 percent share; or
    (2) In which you are a joint owner.
    Land which would otherwise be one unit may be divided according to 
applicable guidelines on file in your service office. Units will be 
determined when the acreage is reported. Errors in reporting units may 
be corrected by us to conform to applicable guidelines when adjusting a 
loss. We may consider any acreage and share thereof reported by or for 
your spouse or child or any member of your household to be your bona 
fide share or the bona fide share of any other person having an interest 
therein.

                        17. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           18. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of, or 
appeal those determinations in accordance with the Appeal Regulations (7 
CFR part 400, subpart J).

                               19. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.
    20. Notwithstanding the terms of the crop insurance policy and any 
contract for crop insurance under the provisions of this part, coverage 
under the terms of such crop insurance policy will be effective subject 
to the availability of appropriations.

[53 FR 31827, Aug. 22, 1988, as amended at 55 FR 1786, Jan. 19, 1990; 55 
FR 35887, Sept. 4, 1990; 62 FR 35668, July 2, 1997]



PART 457--COMMON CROP INSURANCE REGULATIONS--Table of Contents




Sec.
457.1  Applicability.
457.2  Availability of Federal crop insurance.
457.3  Premium rates, production guarantees or amounts of insurance, 
          coverage levels, and prices at which indemnities shall be 
          computed.
457.4  OMB control numbers.
457.5  Creditors.
457.6  Good faith reliance on misrepresentation.
457.7  The contract.
457.8  The application and policy.
457.9  Appropriation contingency.
457.10-457.100  [Reserved]
457.101  Small grains crop insurance.
457.102  Wheat crop insurance winter coverage endorsement.
457.103  Malting barley option.
457.104  Cotton crop insurance provisions.

[[Page 336]]

457.105  Extra long staple cotton crop insurance provisions.
457.106  Texas citrus tree crop insurance provisions.
457.107  Florida citrus fruit crop insurance provisions.
457.108  Sunflower seed crop insurance provisions.
457.109  Sugar beet crop insurance provisions.
457.110  Fig crop insurance provisions.
457.111  Pear crop insurance provisions.
457.112  Hybrid sorghum seed crop insurance provisions.
457.113  Coarse grains crop insurance provisions.
457.114  Nursery crop insurance provisions.
457.115  Nursery frost, freeze, and cold damage exclusion option.
457.116  Sugarcane crop insurance provisions.
457.117  Forage production crop insurance regulations.
457.118  Malting barley crop insurance.
457.119  Texas citrus fruit crop insurance provisions.
457.120  [Reserved]
457.121  Arizona-California citrus crop insurance provisions.
457.122  Walnut crop insurance provisions.
457.123  Almond crop insurance provisions.
457.124  Raisin crop insurance provisions.
457.125  Safflower crop insurance provisions.
457.126  Popcorn crop insurance provisions.
457.127  Forage Production Winter Coverage Endorsement.
457.128  Guaranteed production plan of fresh market tomato crop 
          insurance provisions.
457.129  Fresh market sweet corn crop insurance provisions.
457.130  Madacamia tree crop insurance provisions.
457.131  Macadamia nut crop insurance provisions.
457.132  Cranberry crop insurance provisions.
457.133  Prune crop insurance provisions.
457.134  Peanut crop insurance provisions.
457.135  Onion crop insurance provisions.
457.136  Guaranteed tobacco crop insurance provisions.
457.137  Green pea crop insurance provisions.
457.138  Grape crop insurance provisions.
457.139  Fresh market tomato (dollar plan) crop insurance provisions.
457.140  Dry pea crop insurance provisions.
457.141  Rice crop insurance provisions.
457.142  Northern potato crop insurance provisions.
457.143  Northern potato crop insurance--quality endorsement.
457.144  Northern potato crop insurance--processing quality endorsement.
457.145  Potato crop insurance --certified seed endorsement.
457.146  Northern potato crop insurance--storage coverage endorsement.
457.147  Central and Southern potato crop insurance provisions.
457.148  Fresh market pepper crop insurance provisions.
457.149  Table grape crop insurance provisions.
457.150  Dry bean crop insurance provisions.
457.151  Forage seeding crop insurance provisions.
457.152  Hybrid seed corn crop insurance provisions.
457.153  Peach crop insurance provisions.
457.154  Processing sweet corn crop insurance provisions.
457.155  Processing bean crop insurance provisions.
457.156  Quota tobacco crop insurance provisions.
457.157  Plum crop insurance provisions.
457.158  Apple crop insurance provisions.
457.159  Stonefruit crop insurance provisions.
457.160  Processing tomato crop insurance provisions.
457.161  Canola and rapeseed crop insurance provisions.
457.162  Nursery crop insurance provisions.
457.163  Nursery peak inventory endorsement.

    Authority: 7 U.S.C. 1506(l), 1506(p).

    Source: 56 FR 1351, Jan. 14, 1991, unless otherwise noted.



Sec. 457.1  Applicability.

    The provisions of this part are applicable only to crops for which a 
crop provision is published as a section to 7 CFR part 457 and then only 
for the crops and crop year designated by the application section.



Sec. 457.2  Availability of Federal crop insurance.

    (a) Insurance shall be offered under the provisions of this section 
on the insured crop in counties within the limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended (the Act). The crops and counties shall be designated by the 
Manager of the Corporation from those approved by the Board of Directors 
of the Corporation.
    (b) The insurance is offered through companies reinsured by the 
Federal Crop Insurance Corporation (FCIC) that offer contracts 
containing the same terms and conditions as the contract set out in this 
part. These contracts are clearly identified as being reinsured by FCIC. 
FCIC may offer the contract for the catastrophic level of

[[Page 337]]

coverage contained in this part and part 402 directly to the insured 
through local offices of the Department of Agriculture only if the 
Secretary determines that the availability of local agents is not 
adequate. Those contracts are specifically identified as being offered 
by FCIC.
    (c) Except as specified in the Crop Provisions, the Catastrophic 
Risk Protection Endorsement (part 402 of this chapter) and part 400, 
subpart T of this chapter, no person may have in force more than one 
contract on the same crop for the same crop year in the same county.
    (d) Except as specified in paragraph (c) of this section, if a 
person has more than one contract under the Act that provides coverage 
for the same loss on the same crop for the same crop year in the same 
county, all such contracts shall be voided for that crop year and the 
person will be liable for the premium on all contracts, unless the 
person can show to the satisfaction of the Corporation that the multiple 
contracts of insurance were inadvertent and without the fault of the 
person. If the multiple contracts of insurance are shown to be 
inadvertent and without the fault of the person, the contract with the 
earliest signature date on the application will be valid and all other 
contracts on that crop in the county for that crop year will be 
canceled. No liability for indemnity or premium will attach to the 
contracts so canceled.
    (e) The person must repay all amounts received in violation of this 
section with interest at the rate contained in the contract (see 
Sec. 457.8, paragraph 24).
    (f) An insured whose contract with the Corporation or with a company 
reinsured by the Corporation under the Act has been terminated because 
of violation of the terms of the contract is not eligible to obtain 
multiple peril crop insurance under the Act with the Corporation or with 
a company reinsured by the Corporation unless the insured can show that 
the default in the prior contract was cured prior to the sales closing 
date of the contract applied for or unless the insured can show that the 
termination was improper and should not result in subsequent 
ineligibility.
    (g) All applicants for insurance under the Act must advise the 
agent, in writing, at the time of application, of any previous 
applications for insurance or policies of insurance under the Act and 
the present status of any such applications or insurance.

[56 FR 1351, Jan. 14, 1991, as amended at 58 FR 58262, Nov. 1, 1993; 62 
FR 65154, Dec. 10, 1997; 63 FR 66712, Dec. 3, 1998]



Sec. 457.3  Premium rates, production guarantees or amounts of insurance, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production guarantees 
or amounts of insurance, coverage levels, and prices at which 
indemnities shall be computed for the insured crop which will be 
included in the actuarial table on file in the applicable agents' office 
for the county and which may be changed from year to year.
    (b) At the time the application for insurance is made, the applicant 
will elect an amount of insurance or a coverage level and price from 
among those contained in the actuarial table for the crop year.



Sec. 457.4  OMB control numbers.

    The information collection requirements contained in these 
regulations have been approved by the Office of Management and Budget 
(OMB) under the provisions of 44 U.S.C. chapter 35 and have been 
assigned OMB number 0563-0053.

[62 FR 65154, Dec. 10, 1997]



Sec. 457.5  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.



Sec. 457.6  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the crop insurance contract, 
whenever:

[[Page 338]]

    (a) A person entering into a contract of crop insurance under these 
regulations who, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation:
    (1) Is indebted to the Corporation for additional premiums; or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the insured believed 
to be insured, or believed the terms of the insurance contract to have 
been complied with or waived; and
    (b) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that:
    (1) An agent or employee of the Corporation did in fact make such 
misrepresentation or take other erroneous action or give erroneous 
advice;
    (2) Said insured relied thereon in good faith; and
    (3) To require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto. Requests for relief under this section must be 
submitted to the Corporation in writing. The Corporation reviewing 
officers must, upon application by the person claiming relief under this 
section, refer such application to the appropriate official of the 
Corporation for determination as to whether to grant relief under this 
section. Corporation reviewing officers do not have authority to grant 
relief under this section.
    (c) The reinsured companies may use arbitration panels established 
under contracts for reinsurance issued by them under the FCIC Act to 
grant relief under the same terms and conditions as contained in 
paragraphs (a) and (b) of this section or, may establish procedures to 
administratively handle relief in accordance with such terms and 
conditions.

[56 FR 1351, Jan. 14, 1991, as amended at 58 FR 58262, Nov. 1, 1993]



Sec. 457.7  The contract.

    The insurance contract shall become effective upon the acceptance by 
the Corporation or the reinsured company of a duly executed application 
for insurance on a form prescribed by the Corporation. The contract 
shall consist of the accepted Application, the Basic Provisions, the 
Crop Provisions, the Special Provisions, the county Actuarial Table, and 
any amendments or options thereto. Changes made in the contract shall 
not affect its continuity from year to year. No indemnity shall be paid 
unless the insured complies with all terms and conditions of the 
contract. The forms referred to in the contract are available at the 
offices of the crop insurance agent.



Sec. 457.8  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation, or approved by the Corporation, must be made by any person 
who wishes to participate in the program, to cover such person's share 
in the insured crop as landlord, owner-operator, crop ownership 
interest, or tenant. No other person's interest in the crop may be 
insured under an application unless that person's interest is clearly 
shown on the application and unless that other person's interest is 
insured in accordance with the procedures of the Corporation. The 
application must be submitted to the Corporation or the reinsured 
company through the crop insurance agent and must be submitted on or 
before the applicable sales closing date on file.
    (b) FCIC or the reinsured company may reject or discontinue the 
acceptance of applications in any country or of any individual 
application upon FCIC's determination that the insurance risk is 
excessive.

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                        DEPARTMENT OF AGRICULTURE

                   FEDERAL CROP INSURANCE CORPORATION

                    [OR POLICY ISSUING COMPANY NAME]

                      Common Crop Insurance Policy

           (This is a continuous policy. Refer to section 2.)

                              FCIC Policies

    This is an insurance policy issued by the Federal Crop Insurance 
Corporation (FCIC), a United States government agency. The provisions of 
the policy are published in the Federal Register and in chapter IV of 
title 7 of the Code of Federal Regulations (CFR) under the Federal 
Register Act (44 U.S.C. 1501 et seq.), and may not be waived or varied 
in any way by the crop insurance agent or any other agent or employee of 
FCIC.
    Throughout this policy, ``you'' and ``your'' refer to the named 
insured shown on the accepted application and ``we,'' ``us,'' and 
``our'' refer to the Federal Crop Insurance Corporation. Unless the 
context indicates otherwise, use of the plural form of a word includes 
the singular and use of the singular form of the word includes the 
plural.

                           Reinsured Policies

    This insurance policy is reinsured by the Federal Crop Insurance 
Corporation (FCIC) under the provisions of the Federal Crop Insurance 
Act, as amended (7 U.S.C. 1501 et seq.) (Act). All provisions of the 
policy and rights and responsibilities of the parties are specifically 
subject to the Act. The provisions of the policy are published in the 
Federal Register and codified in chapter IV of title 7 of the Code of 
Federal Regulations (CFR) under the Federal Register Act (44 U.S.C. 1501 
et seq.), and may not be waived or varied in any way by the crop 
insurance agent or any other agent or employee of FCIC or the company. 
In the event we cannot pay your loss, your claim will be settled in 
accordance with the provisions of this policy and paid by FCIC. No state 
guarantee fund will be liable for your loss.
    Throughout this policy, ``you'' and ``your'' refer to the named 
insured shown on the accepted application and ``we,'' ``us,'' and 
``our'' refer to the insurance company providing insurance. Unless the 
context indicates otherwise, use of the plural form of a word includes 
the singular and use of the singular form of the word includes the 
plural.
    Agreement to insure. In return for the payment of the premium, and 
subject to all of the provisions of this policy, we agree with you to 
provide the insurance as stated in this policy. If a conflict exists 
among the policy provisions, the order of priority is as follows: (1) 
The Catastrophic Risk Protection Endorsement, as applicable; (2) the 
Special Provisions; (3) the Crop Provisions; and (4) these Basic 
Provisions (Sec. 457.8), with (1) controlling (2), etc.

                          Terms and Conditions

                            Basic Provisions

                             1. Definitions

    Abandon. Failure to continue to care for the crop, providing care so 
insignificant as to provide no benefit to the crop, or failure to 
harvest in a timely manner, unless an insured cause of loss prevents you 
from properly caring for or harvesting the crop or causes damage to it 
to the extent that most producers of the crop on acreage with similar 
characteristics in the area would not normally further care for or 
harvest it.
    Acreage report. A report required by paragraph 6 of these Basic 
Provisions that contains, in addition to other required information, 
your report of your share of all acreage of an insured crop in the 
county, whether insurable or not insurable.
    Acreage reporting date. The date contained in the Special Provisions 
or as provided in section 6 by which you are required to submit your 
acreage report.
    Act. The Federal Crop Insurance Act (7 U.S.C. 1501 et seq.).
    Actuarial documents. The material for the crop year which is 
available for public inspection in your agent's office, and which shows 
the amounts of insurance or production guarantees, coverage levels, 
premium rates, practices, insurable acreage, and other related 
information regarding crop insurance in the county.
    Additional coverage. Plans of crop insurance providing a level of 
coverage equal to or greater than 65 percent of the approved yield 
indemnified at 100 percent of the expected market price, or a comparable 
coverage as established by FCIC.
    Administrative fee. An amount the producer must pay for catastrophic 
risk protection, limited, and additional coverage for each crop year as 
specified in section 7 and the Catastrophic Risk Protection Endorsement.
    Agricultural commodity. All insurable crops and other fruit, 
vegetable or nut crops produced for human or animal consumption.

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    Another use, notice of. The written notice required when you wish to 
put acreage to another use (see section 14).
    Application. The form required to be completed by you and accepted 
by us before insurance coverage will commence. This form must be 
completed and filed in your agent's office not later than the sales 
closing date of the initial insurance year for each crop for which 
insurance coverage is requested. If cancellation or termination of 
insurance coverage occurs for any reason, including but not limited to 
indebtedness, suspension, debarment, disqualification, cancellation by 
you or us or violation of the controlled substance provisions of the 
Food Security Act of 1985, a new application must be filed for the crop. 
Insurance coverage will not be provided if you are ineligible under the 
contract or under any Federal statute or regulation.
    Approved yield. The yield determined in accordance with 7 CFR part 
400, subpart (G).
    Assignment of indemnity. A transfer of policy rights, made on our 
form, and effective when approved by us. It is the arrangement whereby 
you assign your right to an indemnity payment to any party of your 
choice for the crop year.
    Basic unit. All insurable acreage of the insured crop in the county 
on the date coverage begins for the crop year:
    (1) In which you have 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 you own, you rent 
land from five landlords, three on a crop share basis and two on a cash 
basis, you would be entitled to four units; one for each crop share 
lease and one that combines the two cash leases and the land you own.) 
Land which would otherwise be one unit may, in certain instances, be 
divided according to guidelines contained in section 34 of these Basic 
Provisions and in the applicable Crop Provisions.
    Cancellation date. The calendar date specified in the Crop 
Provisions on which coverage for the crop will automatically renew 
unless canceled in writing by either you or us or terminated in 
accordance with the policy terms.
    Catastrophic risk protection. The minimum level of coverage offered 
by FCIC that is required before a person may qualify for certain other 
USDA program benefits unless the producer executes a waiver of any 
eligibility for emergency crop loss assistance in connection with the 
crop.
    Catastrophic Risk Protection Endorsement. The part of the crop 
insurance policy that contains provisions of insurance that are specific 
to catastrophic risk protection.
    Claim for indemnity. A claim made on our form by you for damage or 
loss to an insured crop and submitted to us not later than 60 days after 
the end of the insurance period (see section 14).
    Consent. Approval in writing by us allowing you to take a specific 
action.
    Contract. (See ``policy'').
    Contract change date. The calendar date by which we make any policy 
changes available for inspection in the agent's office (see section 4).
    County. Any county, parish, or other political subdivision of a 
state shown on your accepted application, including acreage in a field 
that extends into an adjoining county if the county boundary is not 
readily discernible.
    Coverage. The insurance provided by this policy, against insured 
loss of production or value, by unit as shown on your summary of 
coverage.
    Coverage begins, date. The calendar date insurance begins on the 
insured crop, as contained in the Crop Provisions, or the date planting 
begins on the unit (see section 11 of these Basic Provisions for 
specific provisions relating to prevented planting).
    Crop Provisions. The part of the policy that contains the specific 
provisions of insurance for each insured crop.
    Crop year. The period within which the insured crop is normally 
grown, regardless of whether or not it is actually grown, and designated 
by the calendar year in which the insured crop is normally harvested.
    Damage. Injury, deterioration, or loss of production of the insured 
crop due to insured or uninsured causes.
    Damage, notice of. A written notice required to be filed in your 
agent's office whenever you initially discover the insured crop has been 
damaged to the extent that a loss is probable (see section 14).
    Days. Calendar days.
    Deductible. The amount determined by subtracting the coverage level 
percentage you choose from 100 percent. For example, if you elected a 65 
percent coverage level, your deductible would be 35 percent (100%-65% = 
35%).
    Delinquent account. Any account you have with us in which premiums 
and interest on those premiums is not paid by the termination date 
specified in the Crop Provisions, or any other amounts due us, such as 
indemnities found not to have been earned, which are not paid within 30 
days of our mailing or other delivery of notification to you of the 
amount due.
    Earliest planting date. The earliest date established for planting 
the insured crop (see Special Provisions and section 13).
    End of insurance period, date of. The date upon which your crop 
insurance coverage ceases for the crop year (see Crop Provisions and 
section 11).
    Enterprise unit. All insurable acreage of the insured crop in the 
county in which you have a share on the date coverage begins for the

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crop year. An enterprise unit must consist of:
    (1) Two or more basic units of the same insured crop that are 
located in two or more separate sections, section equivalents, or FSA 
farm serial numbers; or
    (2) Two or more optional units of the same insured crop established 
by separate sections, section equivalents, or FSA farm serial numbers.
    Field. All acreage of tillable land within a natural or artificial 
boundary (e.g., roads, waterways, fences, etc.).
    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 or amount of 
insurance per acre.
    FSA. The Farm Service Agency, an agency of the USDA, or a successor 
agency.
    FSA farm serial number. The number assigned to the farm by the local 
FSA office.
    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 or 
amount of insurance, and are those recognized by the Cooperative State 
Research, Education, and Extension Service as compatible with agronomic 
and weather conditions in the county.
    Insured. The named person as shown on the application accepted by 
us. This term does not extend to any other person having a share or 
interest in the crop (for example, a partnership, landlord, or any other 
person) unless specifically indicated on the accepted application.
    Insured crop. The crop for which coverage is available under these 
Basic Provisions and the applicable Crop Provisions as shown on the 
application accepted by us.
    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 or amount of insurance on the irrigated 
acreage planted to the insured crop.
    Late planted. Acreage initially planted to the insured crop after 
the final planting date.
    Late planting period. The period that begins the day after the final 
planting date for the insured crop and ends 25 days after the final 
planting date, unless otherwise specified in the Crop Provisions or 
Special Provisions.
    Limited coverage. Plans of insurance offering coverage that is equal 
to or greater than 50 percent of the approved yield indemnified at 100 
percent of the expected market price, or a comparable coverage as 
established by FCIC, but less than 65 percent of the approved yield 
indemnified at 100 percent of the expected market price, or a comparable 
coverage as established by FCIC.
    Limited resource farmer. A producer or operator of a farm, with an 
annual gross income of $20,000 or less derived from all sources, 
including income from a spouse or other members of the household, for 
each of the prior two years. Notwithstanding the previous sentence, a 
producer on a farm or farms of less than 25 acres aggregated for all 
crops, where a majority of the producer's gross income is derived from 
such farm or farms, but the producer's gross income from farming 
operations does not exceed $20,000, will be considered a limited 
resource farmer.
    Loss, notice of. The notice required to be given by you not later 
than 72 hours after certain occurrences or 15 days after the end of the 
insurance period, whichever is earlier (see section 14).
    Negligence. The failure to use such care as a reasonably prudent and 
careful person would use under similar circumstances.
    Non-contiguous. Any two or more tracts of land whose boundaries do 
not touch at any point, except that land separated only by a public or 
private right-of-way, waterway, or an irrigation canal will be 
considered as contiguous.
    Person. An individual, partnership, association, corporation, 
estate, trust, or other legal entity, and wherever applicable, a State 
or a political subdivision or agency of a State. ``Person'' does not 
include the United States Government or any agency thereof.
    Planted acreage. Land in which seed, plants, or trees have been 
placed, 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.
    Policy. The agreement between you and us consisting of the accepted 
application, these Basic Provisions, the Crop Provisions, the Special 
Provisions, other applicable endorsements or options, the actuarial 
documents for the insured crop, the Catastrophic Risk Protection 
Endorsement, if applicable, and the applicable regulations published in 
7 CFR chapter IV.
    Practical to replant. Our determination, after loss or damage to the 
insured crop, based on all factors, including, but not limited to 
moisture availability, marketing window, condition of the field, 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, or the final planting date if no 
late planting period is applicable, unless

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replanting is generally occurring in the area. Unavailability of seed or 
plants will not be considered a valid reason for failure to replant.
    Premium billing date. The earliest date upon which you will be 
billed for insurance coverage based on your acreage report. The premium 
billing date is contained in the Special Provisions.
    Prevented planting. Failure to plant the insured crop with proper 
equipment by the final planting date designated in the Special 
Provisions for the insured crop in the county. You may also be eligible 
for a prevented planting payment if you failed to plant the insured crop 
with the proper equipment within the late planting period. You must have 
been prevented from planting the insured crop due to an insured cause of 
loss that is general in the surrounding area and that prevents other 
producers from planting acreage with similar characteristics.
    Price election. The amounts contained in the Special Provisions or 
an addendum thereto, to be used for computing the value per pound, 
bushel, ton, carton, or other applicable unit of measure for the 
purposes of determining premium and indemnity under the policy.
    Production guarantee (per acre). The number of pounds, bushels, 
tons, cartons, or other applicable units of measure determined by 
multiplying the approved yield per acre by the coverage level percentage 
you elect.
    Production report. A written record showing your annual production 
and used by us to determine your yield for insurance purposes (see 
section 3). The report contains yield information for previous years, 
including planted acreage and harvested production. This report must be 
supported by written verifiable records from a warehouseman or buyer of 
the insured crop or by measurement of farm-stored production, or by 
other records of production approved by us on an individual case basis.
    Replanting. Performing the cultural practices necessary to prepare 
the land to replace the seed or plants of the damaged or destroyed 
insured crop and then replacing the seed or plants of the same crop in 
the insured acreage with the expectation of producing at least the yield 
used to determine the production guarantee.
    Representative sample. Portions of the insured crop that must remain 
in the field for examination and review by our loss adjuster when making 
a crop appraisal, as specified in the Crop Provisions. In certain 
instances we may allow you to harvest the crop and require only that 
samples of the crop residue be left in the field.
    Sales closing date. A date contained in the Special Provisions by 
which an application must be filed. The last date by which you may 
change your crop insurance coverage for a crop year.
    Section. (for the purposes of unit structure) A unit of measure 
under a rectangular survey system describing a tract of land usually one 
mile square and usually containing approximately 640 acres.
    Share. Your percentage of interest in the insured crop as an owner, 
operator, or tenant at the time insurance attaches. However, only for 
the purpose of determining the amount of indemnity, your share will not 
exceed your share at the earlier of the time of loss or the beginning of 
harvest.
    Special Provisions. The part of the policy that contains specific 
provisions of insurance for each insured crop that may vary by 
geographic area.
    State. The state shown on your accepted application.
    Substantial beneficial interest. An interest held by any person of 
at least 10 percent in the applicant or insured.
    Summary of coverage. Our statement to you, based upon your acreage 
report, specifying the insured crop and the guarantee or amount of 
insurance coverage provided by unit.
    Tenant. A person who rents land from another person for a share of 
the crop or a share of the proceeds of the crop (see the definition of 
``share'' above).
    Termination date. The calendar date contained in the Crop Provisions 
upon which your insurance ceases to be in effect because of nonpayment 
of any amount due us under the policy, including premium.
    Timely planted. Planted on or before the final planting date 
designated in the Special Provisions for the insured crop in the county.
    USDA. United States Department of Agriculture.
    Void. When the policy is considered not to have existed for a crop 
year as a result of concealment, fraud or misrepresentation (see section 
27).
    Whole farm unit. All insurable acreage of the insured crops in the 
county in which you have a share on the date coverage begins for each 
crop for the crop year.
    Written agreement. A document that alters designated terms of a 
policy as authorized under these Basic Provisions, the Crop Provisions, 
or the Special Provisions for the insured crop (see section 18).

            2. Life of Policy, Cancellation, and Termination

    (a) This is a continuous policy and will remain in effect for each 
crop year following the acceptance of the original application until 
canceled by you in accordance with the terms of the policy or terminated 
by operation of the terms of the policy or by us.
    (b) Your application for insurance must contain all the information 
required by us to insure the crop. Applications that do not

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contain all social security numbers and employer identification numbers, 
as applicable, (except as stated herein) coverage level, price election, 
crop, type, variety, or class, plan of insurance, and any other material 
information required to insure the crop, are not acceptable. If a person 
with a substantial beneficial interest in the insured crop refuses to 
provide a social security number or employer identification number and 
that person is:
    (1) Not on the non-standard classification system list, the amount 
of coverage available under the policy will be reduced proportionately 
by that person's share of the crop; or
    (2) On the non-standard classification system list, the insurance 
will not be available to that person and any entity in which the person 
has a substantial beneficial interest.
    (c) After acceptance of the application, you may not cancel this 
policy for the initial crop year. Thereafter, the policy will continue 
in force for each succeeding crop year unless canceled or terminated as 
provided below.
    (d) Either you or we may cancel this policy after the initial crop 
year by providing written notice to the other on or before the 
cancellation date shown in the Crop Provisions.
    (e) If any amount due, including administrative fees or premium, is 
not paid or an acceptable arrangement for payment is not made on or 
before the termination date for the crop on which the amount is due, you 
will be determined to be ineligible to participate in any crop insurance 
program authorized under the Act in accordance with 7 CFR part 400, 
subpart U.
    (1) For a policy with unpaid administrative fees or premium, the 
policy will terminate effective on the termination date immediately 
subsequent to the billing date for the crop year;
    (2) For a policy with other amounts due, the policy will terminate 
effective on the termination date immediately after the account becomes 
delinquent;
    (3) Ineligibility will be effective as of the date that the policy 
was terminated for the crop for which you failed to pay an amount owed 
and for all other insured crops with coincidental termination dates;
    (4) All other policies that are issued by us under the authority of 
the Act will also terminate as of the next termination date contained in 
the applicable policy;
    (5) If you are ineligible, you may not obtain any crop insurance 
under the Act until payment is made, you execute an agreement to repay 
the debt and make the payments in accordance with the agreement, or you 
file a petition to have your debts discharged in bankruptcy;
    (6) If you execute an agreement to repay the debt and fail to timely 
make any scheduled payment, you will be ineligible for crop insurance 
effective on the date the payment was due until the debt is paid in full 
or you file a petition to discharge the debt in bankruptcy and 
subsequently obtain discharge of the amounts due. Dismissal of the 
bankruptcy petition before discharge will void all policies in effect 
retroactive to the date you were originally determined ineligible to 
participate;
    (7) Once the policy is terminated, the policy cannot be reinstated 
for the current crop year unless the termination was in error;
    (8) After you again become eligible for crop insurance, if you want 
to obtain coverage for your crops, you must reapply on or before the 
sales closing date for the crop (Since applications for crop insurance 
cannot be accepted after the sales closing date, if you make any payment 
after the sales closing date, you cannot apply for insurance until the 
next crop year); and
    (9) If we deduct the amount due us from an indemnity, the date of 
payment for the purpose of this section will be the date you sign the 
properly executed claim for indemnity.
    (10) For example, if crop A, with a termination date of October 31, 
1997, and crop B, with a termination date of March 15, 1998, are insured 
and you do not pay the premium for crop A by the termination date, you 
are ineligible for crop insurance as of October 31, 1997, and crop A's 
policy is terminated on that date. Crop B's policy is terminated as of 
March 15, 1998. If you enter an agreement to repay the debt on April 25, 
1998, you can apply for insurance for crop A by the October 31, 1998, 
sales closing date and crop B by the March 15, 1999, sales closing date. 
If you fail to make a scheduled payment on November 1, 1998, you will be 
ineligible for crop insurance effective on November 1, 1998, and you 
will not be eligible unless the debt is paid in full or you file a 
petition to have the debt discharged in bankruptcy and subsequently 
receive discharge.
    (f) If you die, disappear, or are judicially declared incompetent, 
or if you are an entity other than an individual and such entity is 
dissolved, the policy will terminate as of the date of death, judicial 
declaration, or dissolution. If such event occurs after coverage begins 
for any crop year, the policy will continue in force through the crop 
year and terminate at the end of the insurance period and any indemnity 
will be paid to the person or persons determined to be beneficially 
entitled to the indemnity. The premium will be deducted from the 
indemnity or collected from the estate. Death of a partner in a 
partnership will dissolve the partnership unless the partnership 
agreement provides otherwise. If two or more persons having a joint 
interest are insured jointly, death of one of the persons will dissolve 
the joint entity.
    (g) We may terminate your policy if no premium is earned for 3 
consecutive years.

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    (h) The cancellation and termination dates are contained in the Crop 
Provisions.
    (i) When obtaining catastrophic, limited, or additional coverage, a 
producer must provide information regarding crop insurance coverage on 
any crop previously obtained at any other local FSA office or from an 
approved insurance provider, including the date such insurance was 
obtained and the amount of the administrative fee.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    (a) For each crop year, the production guarantee or amount of 
insurance, coverage level, and price at which an indemnity will be 
determined for each unit will be those used to calculate your summary of 
coverage. The information necessary to determine those factors will be 
contained in the Special Provisions or in the actuarial documents.
    (b) You may select only one coverage level from among those offered 
by us for each insured crop. You may change the coverage level, price 
election, or amount of insurance for the following crop year by giving 
written notice to us not later than the sales closing date for the 
insured crop. Since the price election or amount of insurance may change 
each year, if you do not select a new price election or amount of 
insurance on or before the sales closing date, we will assign a price 
election or amount of insurance which bears the same relationship to the 
price election schedule as the price election or amount of insurance 
that was in effect for the preceding year. (For example: If you selected 
100 percent of the market price for the previous crop year and you do 
not select a new price election for the current crop year, we will 
assign 100 percent of the market price for the current crop year.)
    (c) You must report production to us for the previous crop year by 
the earlier of the acreage reporting date or 45 days after the 
cancellation date unless otherwise stated in the Special Provisions:
    (1) If you do not provide the required production report, we will 
assign a yield for the previous crop year. The yield assigned by us will 
not be more than 75 percent of the yield used by us to determine your 
coverage for the previous crop year. The production report or assigned 
yield will be used to compute your approved yield for the purpose of 
determining your coverage for the current crop year.
    (2) If you have filed a claim for any crop year, the documents 
signed by you which state the amount of production used to complete the 
claim for indemnity will be the production report for that year unless 
otherwise specified by FCIC.
    (3) Production and acreage for the prior crop year must be reported 
for each proposed optional unit by the production reporting date. If you 
do not provide the information stated above, the optional units will be 
combined into the basic unit.
    (d) We may revise your production guarantee for any unit, and revise 
any indemnity paid based on that production guarantee, if we find that 
your production report under paragraph (c) of this section:
    (1) Is not supported by written verifiable records in accordance 
with the definition of production report; or
    (2) Fails to accurately report actual production, acreage, or other 
material information.
    (e) In addition to the price election or amount of insurance 
available on the contract change date, we may provide an additional 
price election or amount of insurance no later than 15 days prior to the 
sales closing date. You must select the additional price election or 
amount of insurance on or before the sales closing date for the insured 
crop. These additional price elections or amounts of insurance will not 
be less than those available on the contract change date. If you elect 
the additional price election or amount of insurance any claim 
settlement and amount of premium will be based on this amount.
    (f) The producer must obtain the same level of coverage 
(catastrophic risk protection, limited or additional) for all acreage of 
the crop in the county unless one of the following applies:
    (1) The applicable crop policy allows the producer the option to 
separately insure individual crop types or varieties. In this case, each 
individual type or variety insured by the producer will be subject to 
separate administrative fees. For example, if two grape varieties in 
California are insured under the Catastrophic Risk Protection 
Endorsement and two varieties are insured under a limited coverage 
policy, a separate administrative fee will be charged for each of the 
four varieties. Although insurance may be elected by type or variety in 
these instances, failure to insure a type or variety that is of economic 
significance may result in the denial of other farm program benefits 
unless the producer executes a waiver of any eligibility for emergency 
crop loss assistance in connection with the crop.
    (2) The producer with limited or additional coverage for the crop in 
the county has acreage that has been designated as ``high risk'' by 
FCIC. Such producers will be able to obtain a High Risk Land Exclusion 
Option for the high risk land under the limited or additional coverage 
policies and insure the high risk acreage under a separate Catastrophic 
Risk Protection Endorsement, provided that the Catastrophic Risk 
Protection Endorsement is obtained from the same insurance provider from 
which the limited or additional coverage was obtained.

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    (g) Hail and fire coverage may be excluded from the covered causes 
of loss for a crop policy only if additional coverage is selected.
    (h) Any person may sign any document relative to crop insurance 
coverage on behalf of any other person covered by such a policy, 
provided that the person has a properly executed power of attorney or 
such other legally sufficient document authorizing such person to sign.

                           4. Contract Changes

    (a) We may change the terms of your coverage under this policy from 
year to year.
    (b) Any changes in policy provisions, price elections, amounts of 
insurance, premium rates, and program dates will be provided by us to 
your crop insurance agent not later than the contract change date 
contained in the Crop Provisions, except that price elections may be 
offered after the contract change date in accordance with section 3. You 
may view the documents or request copies from your crop insurance agent.
    (c) You will be notified, in writing, of changes to the Basic 
Provisions, Crop Provisions, and Special Provisions not later than 30 
days prior to the cancellation date for the insured crop. Acceptance of 
changes will be conclusively presumed in the absence of notice from you 
to change or cancel your insurance coverage.

                            5. Liberalization

    If we adopt any revision that broadens the coverage under this 
policy subsequent to the contract change date without additional 
premium, the broadened coverage will apply.

                          6. Report of Acreage

    (a) An annual acreage report must be submitted to us on our form for 
each insured crop in the county on or before the acreage reporting date 
contained in the Special Provisions, except as follows:
    (1) If you insure multiple crops with us that have final planting 
dates on or after August 15 but before December 31, you must submit an 
acreage report for all such crops on or before the latest applicable 
acreage reporting date for such crops; and
    (2) If you insure multiple crops with us that have final planting 
dates on or after December 31 but before August 15, you must submit an 
acreage report for all such crops on or before the latest applicable 
acreage reporting date for such crops.
    (3) Notwithstanding the provisions in sections 6(a) (1) and (2):
    (i) If the Special Provisions designate separate planting periods 
for a crop, you must submit an acreage report for each planting period 
on or before the acreage reporting date contained in the Special 
Provisions for the planting period; and
    (ii) If planting of the insured crop continues after the final 
planting date or you are prevented from planting during the late 
planting period, the acreage reporting date will be the later of:
    (A) The acreage reporting date contained in the Special Provisions;
    (B) The date determined in accordance with sections (a)(1) or (2); 
or
    (C) Five (5) days after the end of the late planting period for the 
insured crop, if applicable.
    (b) If you do not have a share in an insured crop in the county for 
the crop year, you must submit an acreage report, on or before the 
acreage reporting date, so indicating.
    (c) Your acreage report must include the following information, if 
applicable:
    (1) All acreage of the crop in the county (insurable and not 
insurable) in which you have a share;
    (2) Your share at the time coverage begins;
    (3) The practice;
    (4) The type; and
    (5) The date the insured crop was planted.
    (d) Because incorrect reporting on the acreage report may have the 
effect of changing your premium and any indemnity that may be due, you 
may not revise this report after the acreage reporting date without our 
consent.
    (e) We may elect to determine all premiums and indemnities based on 
the information you submit on the acreage report or upon the factual 
circumstances we determine to have existed, subject to the provisions 
contained in section 6(g).
    (f) If you do not submit an acreage report by the acreage reporting 
date, or if you fail to report all units, we may elect to determine by 
unit the insurable crop acreage, share, type and practice, or to deny 
liability on such units. If we deny liability for the unreported units, 
your share of any production from the unreported units will be 
allocated, for loss purposes only, as production to count to the 
reported units in proportion to the liability on each reported unit. 
However, such production will not be allocated to prevented planting 
acreage or otherwise affect any prevented planting payment.
    (g) If the information reported by you on the acreage report for 
share, acreage, practice, type or other material information is 
inconsistent with the information that is determined to actually exist 
for a unit and results in:
    (1) A lower liability than the actual liability determined, the 
production guarantee or amount of insurance on the unit will be reduced 
to an amount that is consistent with the reported information. In the 
event that insurable acreage is under-reported for any unit, all 
production or value from insurable acreage in that unit will be 
considered production or value to count in determining the indemnity; 
and

[[Page 346]]

    (2) A higher liability than the actual liability determined, the 
information contained in the acreage report will be revised to be 
consistent with the correct information. If we discover that you have 
incorrectly reported any information on the acreage report for any crop 
year, you may be required to provide documentation in subsequent crop 
years that substantiates your report of acreage for those crop years, 
including, but not limited to, an acreage measurement service at your 
own expense.
    (h) Errors in reporting units may be corrected by us at the time of 
adjusting a loss to reduce our liability and to conform to applicable 
unit division guidelines.

                7. Annual Premium and Administrative Fees

    (a) The annual premium is earned and payable at the time coverage 
begins. You will be billed for premium due not earlier than the premium 
billing date specified in the Special Provisions. The premium due, plus 
any accrued interest, will be considered delinquent if it is not paid on 
or before the termination date specified in the Crop Provisions.
    (b) Any amount you owe us related to any crop insured with us under 
the authority of the Act will be deducted from any prevented planting 
payment or indemnity due you for any crop insured with us under the 
authority of the Act.
    (c) The annual premium amount is determined, as applicable, by 
either:
    (1) Multiplying the production guarantee per acre times the price 
election, times the premium rate, times the insured acreage, times your 
share at the time coverage begins, and times any premium adjustment 
percentages that may apply; or
    (2) Multiplying the amount of insurance per acre times the premium 
rate, times the insured acreage, times your share at the time coverage 
begins, and times any premium adjustment percentages that may apply.
    (d) The premium will be computed using the price election or amount 
of insurance you elect or that we assign in accordance with section 
3(b).
    (e) In addition to the premium charged:
    (1) If you elect limited coverage, you must pay an administrative 
fee each crop year of $50 per crop per county, not to exceed $200 per 
county, or $600 for all counties in which the producer has elected to 
obtain limited coverage.
    (2) If you elect additional coverage, you must pay an administrative 
fee of $20 per crop for each crop year in which crop insurance coverage 
remains in effect.
    (3) The administrative fee must be paid no later than the time that 
premium is due.
    (4) Payment of an administrative fee will not be required if the 
insured files a bona fide zero acreage report on or before the acreage 
reporting date for the crop. Any producer who falsely files a zero 
acreage report may be subject to criminal and administrative sanctions.
    (5) The administrative fee for limited coverage will be waived if 
you qualify as a limited resource farmer.
    (6) The administrative fee for additional coverage is not 
refundable, is not subject to any limits, and may not be waived.
    (7) Failure to pay the administrative fees when due may make you 
ineligible for certain other USDA benefits.

                             8. Insured Crop

    (a) The insured crop will be that shown on your accepted application 
and as specified in the Crop Provisions or Special Provisions and must 
be grown on insurable acreage.
    (b) A crop which will NOT be insured will include, but will not be 
limited to, any crop:
    (1) If the farming practices carried out are not in accordance with 
the farming practices for which the premium rates, production guarantees 
or amounts of insurance have been established, unless insurance is 
allowed by a written agreement;
    (2) Of a type, class or variety established as not adapted to the 
area or excluded by the policy provisions;
    (3) That is a volunteer crop;
    (4) That is a second crop following the same crop (insured or not 
insured) harvested in the same crop year unless specifically permitted 
by the Crop Provisions or the Special Provisions;
    (5) That is planted for the development or production of hybrid seed 
or for experimental purposes, unless permitted by the Crop Provisions or 
by written agreement to insure such crop; or
    (6) That is used solely for wildlife protection or management. If 
the lease states that specific acreage must remain unharvested, only 
that acreage is uninsurable. If the lease specifies that a percentage of 
the crop must be left unharvested, your share will be reduced by such 
percentage.

                          9. Insurable Acreage

    (a) Acreage planted to the insured crop in which you have a share is 
insurable except acreage:
    (1) That has not been planted and harvested within one of the 3 
previous crop years, unless:
    (i) Such acreage was not planted:
    (A) To comply with any other USDA program;
    (B) Because of crop rotation, (e.g., corn, soybean, alfalfa; and the 
alfalfa remained for 4 years before the acreage was planted to corn 
again);
    (C) Due to an insurable cause of loss that prevented planting; or
    (D) Because a perennial tree, vine, or bush crop was grown on the 
acreage;

[[Page 347]]

    (ii) Such acreage was planted but was not harvested due to an 
insurable cause of loss; or
    (iii) The Crop Provisions or a written agreement specifically allow 
insurance for such acreage;
    (2) That has been strip-mined, unless otherwise approved by written 
agreement, or unless an agricultural commodity other than a cover, hay, 
or forage crop (except corn silage), has been harvested from the acreage 
for at least five crop years after the strip-mined land was reclaimed;
    (3) On which the insured crop is damaged and it is practical to 
replant the insured crop, but the insured crop is not replanted;
    (4) That is interplanted, unless allowed by the Crop Provisions;
    (5) That is otherwise restricted by the Crop Provisions or Special 
Provisions; or
    (6) That is planted in any manner other than as specified in the 
policy provisions for the crop unless a written agreement to such 
planting exists.
    (b) If insurance is provided for an irrigated practice, you must 
report as irrigated only that acreage for which you have adequate 
facilities and adequate water, or the reasonable expectation of 
receiving adequate water at the time coverage begins, to carry out a 
good irrigation practice. If you knew or had reason to know that your 
water may be reduced before coverage begins, no reasonable expectation 
exists.
    (c) Notwithstanding the provisions in section 8(b)(1), if acreage is 
irrigated and we do not provide a premium rate for an irrigated 
practice, you may either report and insure the irrigated acreage as 
``non-irrigated,'' or report the irrigated acreage as not insured.
    (d) We may restrict the amount of acreage that we will insure to the 
amount allowed under any acreage limitation program established by the 
United States Department of Agriculture if we notify you of that 
restriction prior to the sales closing date.

                           10. Share Insured.

    (a) Insurance will attach only to the share of the person completing 
the application and will not extend to any other person having a share 
in the crop unless the application clearly states that:
    (1) The insurance is requested for an entity such as a partnership 
or a joint venture; or
    (2) You as landlord will insure your tenant's share, or you as 
tenant will insure your landlord's share. In this event, you must 
provide evidence of the other party's approval (lease, power of 
attorney, etc.). Such evidence will be retained by us. You also must 
clearly set forth the percentage shares of each person on the acreage 
report.
    (b) We may consider any acreage or interest reported by or for your 
spouse, child or any member of your household to be included in your 
share.
    (c) Acreage rented for a percentage of the crop, or a lease 
containing provisions for both a minimum payment (such as a specified 
amount of cash, bushels, pounds, etc.,) and a crop share will be 
considered a crop share lease.
    (d) Acreage rented for cash, or a lease containing provisions for 
either a minimum payment or a crop share (such as a 50/50 share or 
$100.00 per acre, whichever is greater) will be considered a cash lease.

                          11. Insurance Period

    (a) Except for prevented planting coverage (see section 17), 
coverage begins on each unit or part of a unit at the later of:
    (1) The date we accept your application (For the purposes of this 
paragraph, the date of acceptance is the date that you submit a properly 
executed application in accordance with section 2);
    (2) The date the insured crop is planted; or
    (3) The calendar date contained in the Crop Provisions for the 
beginning of the insurance period.
    (b) Coverage ends at the earliest of:
    (1) Total destruction of the insured crop on the unit;
    (2) Harvest of the unit;
    (3) Final adjustment of a loss on a unit;
    (4) The calendar date contained in the Crop Provisions for the end 
of the insurance period;
    (5) Abandonment of the crop on the unit; or
    (6) As otherwise specified in the Crop Provisions.

                           12. Causes of Loss.

    The insurance provided is against only unavoidable loss of 
production directly caused by specific causes of loss contained in the 
Crop Provisions. All other causes of loss, including but not limited to 
the following, are NOT covered:
    (a) Negligence, mismanagement, or wrongdoing by you, any member of 
your family or household, your tenants, or employees;
    (b) Failure to follow recognized good farming practices for the 
insured crop;
    (c) Water contained by any governmental, public, or private dam or 
reservoir project;
    (d) Failure or breakdown of irrigation equipment or facilities; or
    (e) Failure to carry out a good irrigation practice for the insured 
crop, if applicable.

                         13. Replanting Payment.

    (a) If allowed by the Crop Provisions, a replanting payment may be 
made on an insured crop replanted after we have given consent and the 
acreage replanted is at least the lesser of 20 acres or 20 percent of 
the insured planted acreage for the unit (as determined on the final 
planting date or within the late planting period if a late planting 
period is applicable).

[[Page 348]]

    (b) No replanting payment will be made on acreage:
    (1) On which our appraisal establishes that production will exceed 
the level set by the Crop Provisions;
    (2) Initially planted prior to the earliest planting date 
established by the Special Provisions; or
    (3) On which one replanting payment has already been allowed for the 
crop year.
    (c) The replanting payment per acre will be your actual cost for 
replanting, but will not exceed the amount determined in accordance with 
the Crop Provisions.
    (d) No replanting payment will be paid if we determine it is not 
practical to replant.

                14. Duties in the Event of Damage or Loss

                              Your Duties--

    (a) In case of damage to any insured crop you must:
    (1) Protect the crop from further damage by providing sufficient 
care;
    (2) Give us notice within 72 hours of your initial discovery of 
damage (but not later than 15 days after the end of the insurance 
period), by unit, for each insured crop (we may accept a notice of loss 
provided later than 72 hours after your initial discovery if we still 
have the ability to accurately adjust the loss);
    (3) Leave representative samples intact for each field of the 
damaged unit as may be required by the Crop Provisions; and
    (4) Cooperate with us in the investigation or settlement of the 
claim, and, as often as we reasonably require:
    (i) Show us the damaged crop;
    (ii) Allow us to remove samples of the insured crop; and
    (iii) Provide us with records and documents we request and permit us 
to make copies.
    (b) You must obtain consent from us before, and notify us after you:
    (1) Destroy any of the insured crop that is not harvested;
    (2) Put the insured crop to an alternative use;
    (3) Put the acreage to another use; or
    (4) Abandon any portion of the insured crop. We will not give 
consent for any of the actions in sections 14(b) (1) through (4) if it 
is practical to replant the crop or until we have made an appraisal of 
the potential production of the crop.
    (c) In addition to complying with all other notice requirements, you 
must submit a claim for indemnity declaring the amount of your loss not 
later than 60 days after the end of the insurance period. This claim 
must include all the information we require to settle the claim.
    (d) Upon our request, you must:
    (1) Provide a complete harvesting and marketing record of each 
insured crop by unit including separate records showing the same 
information for production from any acreage not insured; and
    (2) Submit to examination under oath.
    (e) You must establish the total production or value received for 
the insured crop on the unit, that any loss of production or value 
occurred during the insurance period, and that the loss of production or 
value was directly caused by one or more of the insured causes specified 
in the Crop Provisions.
    (f) All notices required in this section that must be received by us 
within 72 hours may be made by telephone or in person to your crop 
insurance agent but must be confirmed in writing within 15 days.

                              Our Duties--

    (a) If you have complied with all the policy provisions, we will pay 
your loss within 30 days after:
    (1) We reach agreement with you;
    (2) Completion of arbitration or appeal proceedings; or
    (3) The entry of a final judgment by a court of competent 
jurisdiction.
    (b) In the event we are unable to pay your loss within 30 days, we 
will give you notice of our intentions within the 30-day period.
    (c) We may defer the adjustment of a loss until the amount of loss 
can be accurately determined. We will not pay for additional damage 
resulting from your failure to provide sufficient care for the crop 
during the deferral period.
    (d) We recognize and apply the loss adjustment procedures 
established or approved by the Federal Crop Insurance Corporation.

           15. Production Included in Determining Indemnities.

    (a) The total production to be counted for a unit will include all 
production determined in accordance with the policy.
    (b) The amount of production of any unharvested insured crop may be 
determined on the basis of our field appraisals conducted after the end 
of the insurance period.
    (c) If you elect to exclude hail and fire as insured causes of loss 
and the insured crop is damaged by hail or fire, appraisals will be made 
as described in the applicable Form FCI-78 ``Request To Exclude Hail and 
Fire'' or a form containing the same terms approved by the Federal Crop 
Insurance Corporation.
    (d) The amount of an indemnity that may be determined under the 
applicable provisions of your crop policy may be reduced by an amount, 
determined in accordance with the Crop Provisions or Special Provisions, 
to reflect out-of-pocket expenses that were not incurred by the producer 
as a result of not planting, caring for, or harvesting the crop. 
Indemnities paid for acreage prevented from

[[Page 349]]

planting will be based on a reduced guarantee as provided for in the 
crop policy and will not be further reduced to reflect expenses not 
incurred.
    (e) Appraised production will be used to calculate your claim if you 
will not be harvesting the acreage. To determine your indemnity based on 
appraised production, you must agree to notify us if you harvest the 
crop and advise us of the production. If the acreage will be harvested, 
harvested production will be used to determine any indemnity due, unless 
otherwise specified in the policy.

                            16. Late Planting

    Unless limited by the Crop Provisions, insurance will be provided 
for acreage planted to the insured crop after the final planting date in 
accordance with the following:
    (a) The production guarantee or amount of insurance for each acre 
planted to the insured crop during the late planting period will be 
reduced by 1 percent per day for each day planted after the final 
planting date.
    (b) Acreage planted after the late planting period (or after the 
final planting date for crops that do not have a late planting period) 
may be insured as follows:
    (1) The production guarantee or amount of insurance for each acre 
planted as specified in this subsection will be determined by 
multiplying the production guarantee or amount of insurance that is 
provided for acreage of the insured crop that is timely planted by the 
prevented planting coverage level percentage you elected, or that is 
contained in the Crop Provisions if you did not elect a prevented 
planting coverage level percentage;
    (2) Planting on such acreage must have been prevented by the final 
planting date (or during the late planting period, if applicable) by an 
insurable cause occurring within the insurance period for prevented 
planting coverage; and
    (3) All production from acreage as specified in this section will be 
included as production to count for the unit.
    (c) The premium amount for insurable acreage specified in this 
section will be the same as that for timely planted acreage. If the 
amount of premium you are required to pay (gross premium less our 
subsidy) for such acreage exceeds the liability, coverage for those 
acres will not be provided (no premium will be due and no indemnity will 
be paid).
    (d) Any acreage on which an insured cause of loss is a material 
factor in preventing completion of planting, as specified in the 
definition of ``planted acreage'' (e.g., seed is broadcast on the soil 
surface but cannot be incorporated) will be considered as acreage 
planted after the final planting date and the production guarantee will 
be calculated in accordance with section 16(b)(1).

                         17. Prevented Planting

    (a) Unless limited by the policy provisions, a prevented planting 
payment may be made to you for eligible acreage if:
    (1) You were prevented from planting the insured crop by an insured 
cause that occurs:
    (i) On or after the sales closing date contained in the Special 
Provisions for the insured crop in the county for the crop year the 
application for insurance is accepted; or
    (ii) For any subsequent crop year, on or after the sales closing 
date for the previous crop year for the insured crop in the county, 
provided insurance has been in force continuously since that date. 
Cancellation for the purpose of transferring the policy to a different 
insurance provider for the subsequent crop year will not be considered a 
break in continuity for the purpose of the preceding sentence;
    (2) You include any acreage of the insured crop that was prevented 
from being planted on your acreage report; and
    (3) You did not plant the insured crop during or after the late 
planting period. If such acreage was planted to the insured crop during 
or after the late planting period, it is covered under the late planting 
provisions.
    (b) The actuarial documents may contain additional levels of 
prevented planting coverage that you may purchase for the insured crop:
    (1) Such purchase must be made on or before the sales closing date.
    (2) If you do not purchase one of those additional levels by the 
sales closing date, you will receive the prevented planting coverage 
specified in the Crop Provisions.
    (3) If you have a Catastrophic Risk Protection Endorsement for any 
crop, the additional levels of prevented planting coverage will not be 
available for that crop.
    (4) You may not increase your elected or assigned prevented planting 
coverage level for any crop year if a cause of loss that will or could 
prevent planting is evident prior to the time you wish to change your 
prevented planting coverage level.
    (c) The premium amount for acreage that is prevented from being 
planted will be the same as that for timely planted acreage. If the 
amount of premium you are required to pay (gross premium less our 
subsidy) for acreage that is prevented from being planted exceeds the 
liability on such acreage, coverage for those acres will not be provided 
(no premium will be due and no indemnity will be paid for such acreage).
    (d) Drought or failure of the irrigation water supply will be 
considered to be an insurable cause of loss for the purposes of 
prevented planting only if on the final planting date (or within the 
late planting period if you elect to try to plant the crop):

[[Page 350]]

    (1) For non-irrigated acreage, the area that is prevented from being 
planted has insufficient soil moisture for germination of seed and 
progress toward crop maturity due to a prolonged period of dry weather. 
Prolonged precipitation deficiencies must be verifiable using 
information collected by sources whose business it is to record and 
study the weather, including, but not limited to, local weather 
reporting stations of the National Weather Service; or
    (2) For irrigated acreage, there is not a reasonable probability of 
having adequate water to carry out an irrigated practice.
    (e) The maximum number of acres that may be eligible for a prevented 
planting payment for any crop will be determined as follows:
    (1) The total number of acres eligible for prevented planting 
coverage for all crops cannot exceed the number of acres of cropland in 
your farming operation for the crop year, unless you are eligible for 
prevented planting coverage on double cropped acreage in accordance with 
section 17(f) (4) or (5). The eligible acres for each insured crop will 
be determined in accordance with the following table.

------------------------------------------------------------------------
                                                     Eligible acres if,
                               Eligible acres if,   in any of the 4 most
                              in any of the 4 most   recent crop years,
                               recent crop years,   you have not planted
                              you have planted any     any crop in the
                               crop in the county     county for which
        Type of crop           for which prevented   prevented planting
                               planting insurance       insurance was
                                was available or      available or have
                                 have received a       not received a
                               prevented planting    prevented planting
                               insurance guarantee   insurance guarantee
------------------------------------------------------------------------
(i) The crop is not required  (A) The maximum       (B) The number of
 to be contracted with a       number of acres       acres specified on
 processor to be insured.      certified for APH     your intended
                               purposes or           acreage report
                               reported for          which is submitted
                               insurance for the     to us by the sales
                               crop in any one of    closing date for
                               the 4 most recent     all crops you
                               crop years (not       insure for the crop
                               including reported    year and that is
                               prevented planting    accepted by us. The
                               acreage that was      total number of
                               planted to a          acres listed may
                               substitute crop       not exceed the
                               other than an         number of acres of
                               approved cover        cropland in your
                               crop). The number     farming operation
                               of acres determined   at the time you
                               above for a crop      submit the intended
                               may be increased by   acreage report. The
                               multiplying it by     number of acres
                               the ratio of the      determined above
                               total cropland        for a crop may only
                               acres that you are    be increased by
                               farming this year     multiplying it by
                               (if greater) to the   the ratio of the
                               total cropland        total cropland
                               acres that you        acres that you are
                               farmed in the         farming this year
                               previous year,        (if greater) to the
                               provided that you     number of acres
                               submit proof to us    listed on your
                               that for the          intended acreage
                               current crop year     report, if you meet
                               you have purchased    the conditions
                               or leased             stated in section
                               additional land or    17(e)(1)(i)(A).
                               that acreage will
                               be released from
                               any USDA program
                               which prohibits
                               harvest of a crop.
                               Such acreage must
                               have been
                               purchased, leased,
                               or released from
                               the USDA program,
                               in time to plant it
                               for the current
                               crop year using
                               good farming
                               practices. No cause
                               of loss that will
                               or could prevent
                               planting may be
                               evident at the time
                               the acreage is
                               purchased, leased,
                               or released from
                               the USDA program.
(ii)The crop must be          (A) The number of     (B) The number of
 contracted with a processor   acres of the crop     acres of the crop
 to be insured.                specified in the      as determined in
                               processor contract,   section
                               if the contract       17(e)(1)(ii)(A).
                               specifies a number
                               of acres contracted
                               for the crop year;
                               or the result of
                               dividing the
                               quantity of
                               production stated
                               in the processor
                               contract by your
                               approved yield, if
                               the processor
                               contract specifies
                               a quantity of
                               production that
                               will be accepted.
                               (For the purposes
                               of establishing the
                               number of prevented
                               planting acres, any
                               reductions applied
                               to the transitional
                               yield for failure
                               to certify acreage
                               and production for
                               four prior years
                               will not be used.).
------------------------------------------------------------------------

    (2) Any eligible acreage determined in accordance with the table 
contained in section 17(e)(1) will be reduced by subtracting the number 
of acres of the crop (insured and uninsured) that are timely and late 
planted, including acreage specified in section 16(b).
    (f) Regardless of the number of eligible acres determined in section 
17(e), prevented planting coverage will not be provided for any acreage:
    (1) That does not constitute at least 20 acres or 20 percent of the 
insurable crop acreage in the unit, whichever is less. Any prevented 
planting acreage within a field that contains planted acreage will be 
considered to be acreage of the same crop, type, and practice that is 
planted in the field unless the acreage that was prevented from being 
planted constitutes at least 20 acres or 20 percent of the total 
insurable acreage in the field and you produced both crops, crop types, 
or followed both practices in the same field in the same crop year 
within any of the 4 most recent crop years;

[[Page 351]]

    (2) For which the actuarial documents do not designate a premium 
rate unless a written agreement designates such premium rate;
    (3) Used for conservation purposes or intended to be left unplanted 
under any program administered by the USDA;
    (4) On which the insured crop is prevented from being planted, if 
you or any other person receives a prevented planting payment for any 
crop for the same acreage in the same crop year (excluding share 
arrangements), unless you have coverage greater than the Catastrophic 
Risk Protection Plan of Insurance and have records of acreage and 
production that are used to determine your approved yield that show the 
acreage was double-cropped in each of the last 4 years in which the 
insured crop was grown on the acreage;
    (5) On which the insured crop is prevented from being planted, if 
any crop from which any benefit is derived under any program 
administered by the USDA is planted and fails, or if any crop is 
harvested, hayed or grazed on the same acreage in the same crop year 
(other than a cover crop which may be hayed or grazed after the final 
planting date for the insured crop), unless you have coverage greater 
than that applicable to the Catastrophic Risk Protection Plan of 
Insurance and have records of acreage and production that are used to 
determine your approved yield that show the acreage was double-cropped 
in each of the last 4 years in which the insured crop was grown on the 
acreage (If one of the crops being double-cropped is not insurable, 
other verifiable records of it being planted may be used);
    (6) Of a crop that is prevented from being planted if a cash lease 
payment is also received for use of the same acreage in the same crop 
year (not applicable if acreage is leased for haying or grazing only) 
(If you state that you will not be cash renting the acreage and claim a 
prevented planting payment on the acreage, you could be subject to civil 
and criminal sanctions if you cash rent the acreage and do not return 
the prevented planting payment for it);
    (7) For which planting history or conservation plans indicate that 
the acreage would have remained fallow for crop rotation purposes;
    (8) That exceeds the number of acres eligible for a prevented 
planting payment;
    (9) That exceeds the number of eligible acres physically available 
for planting;
    (10) For which you cannot provide proof that you had the inputs 
available to plant and produce a crop with the expectation of at least 
producing the yield used to determine the production guarantee or amount 
of insurance (Evidence that you have previously planted the crop on the 
unit will be considered adequate proof unless your planting practices or 
rotational requirements show that the acreage would have remained fallow 
or been planted to another crop);
    (11) Based on an irrigated practice production guarantee or amount 
of insurance unless adequate irrigation facilities were in place to 
carry out an irrigated practice on the acreage prior to the insured 
cause of loss that prevented you from planting. Acreage with an 
irrigated practice production guarantee will be limited to the number of 
acres allowed for that practice under sections 17(e) and (f); or
    (12) Based on a crop type that you did not plant, or did not receive 
a prevented planting insurance guarantee for, in at least one of the 
four most recent crop years. Types for which separate price elections, 
amounts of insurance, or production guarantees are available must be 
included in your APH database in at least one of the four most recent 
crop years, or crops that do not require yield certification (crops for 
which the insurance guarantee is not based on APH) must be reported on 
your acreage report in at least one of the four most recent crop years 
except as allowed in section 17(e)(1)(i)(B). We will limit prevented 
planting payments based on a specific crop type to the number of acres 
allowed for that crop type as specified in sections 17(e) and (f).
    (g) If you purchased a limited or additional coverage policy for a 
crop, and you executed a High Risk Land Exclusion Option that separately 
insures acreage which has been designated as ``high-risk'' land by FCIC 
under a Catastrophic Risk Protection Endorsement for that crop, the 
maximum number of acres eligible for a prevented planting payment will 
be limited for each policy as specified in sections 17(e) and (f).
    (h) If you are prevented from planting a crop for which you do not 
have an adequate base of eligible prevented planting acreage, as 
determined in accordance with section 17(e)(1), your prevented planting 
production guarantee or amount of insurance, premium, and prevented 
planting payment will be based on the crops insured for the current crop 
year, for which you have remaining eligible prevented planting acreage. 
The crops used for this purpose will be those that result in a prevented 
planting payment most similar to the prevented planting payment that 
would have been made for the crop that was prevented from being planted.
    (1) For example, assume you were prevented from planting 200 acres 
of corn and have 100 acres eligible for a corn prevented planting 
guarantee that would result in a payment of $40 per acre. You also had 
50 acres of potato eligibility that would result in a $100 per acre 
payment, 90 acres of grain sorghum eligibility that would result in a 
$30 per acre payment, and 100 acres of soybean eligibility that would 
result in a $25 per acre payment. Your prevented planting coverage for 
the 200 acres would be based on 100 acres

[[Page 352]]

of corn ($40 per acre), 90 acres of grain sorghum ($30 per acre), and 10 
acres of soybeans ($25 per acre).
    (2) Prevented planting coverage will be allowed as specified in this 
section (17(h)) only if the crop that was prevented from being planted 
meets all policy provisions, except for having an adequate base of 
eligible prevented planting acreage. Payment may be made based on crops 
other than those that were prevented from being planted even though 
other policy provisions, including but not limited to, processor 
contract and rotation requirements, have not been met for the crop on 
which payment is being based.
    (i) The prevented planting payment for any eligible acreage within a 
unit will be determined by:
    (1) Multiplying the liability per acre for timely planted acreage of 
the insured crop (the amount of insurance per acre or the production 
guarantee per acre multiplied by the price election for the crop, or 
type if applicable) by the prevented planting coverage level percentage 
you elected, or that is contained in the Crop Provisions if you did not 
elect a prevented planting coverage level percentage;
    (2) Multiplying the result of section 17(i)(1) by the number of 
eligible prevented planting acres in the unit; and
    (3) Multiplying the result of section 17(i)(2) by your share.

                         18. Written Agreements

    Terms of this policy which are specifically designated for the use 
of written agreements 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 18(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 crop year (If 
a 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 you demonstrate your physical inability 
to apply prior to the sales closing date, or it is submitted in 
accordance with any regulation which may be promulgated under 7 CFR part 
400, and after inspection of the acreage by us, if required, it is 
determined that no loss has occurred and the crop is insurable in 
accordance with the policy and written agreement provisions.

                          19. Crops as Payment

    You must not abandon any crop to us. We will not accept any crop as 
compensation for payments due us.

                            For FCIC policies

                               20. Appeals

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with appeal provisions 
published at 7 CFR part 11.

                         For reinsured policies

                             20. Arbitration

    (a) If you and we fail to agree on any factual determination, the 
disagreement will be resolved in accordance with the rules of the 
American Arbitration Association. Failure to agree with any factual 
determination made by FCIC must be resolved through the FCIC appeal 
provisions published at 7 CFR part 11.
    (b) No award determined by arbitration or appeal can exceed the 
amount of liability established or which should have been established 
under the policy.

      21. Access to Insured Crop and Records, and Record Retention

    (a) We reserve the right to examine the insured crop as often as we 
reasonably require.
    (b) For three years after the end of the crop year, you must retain, 
and provide upon our request, complete records of the harvesting, 
storage, shipment, sale, or other disposition of all the insured crop 
produced on each unit. This requirement also applies to the records used 
to establish the basis for the production report for each unit. You must 
also provide upon our request, separate records showing the same 
information for production from any acreage not insured. We may extend 
the record retention period beyond three years by notifying you of such 
extension in writing. Your failure to keep and maintain such records 
will, at our option, result in:
    (1) Cancellation of the policy;
    (2) Assignment of production to the units by us;
    (3) Combination of the optional units; or
    (4) A determination that no indemnity is due.
    (c) Any person designated by us will, at any time during the record 
retention period, have access:

[[Page 353]]

    (1) To any records relating to this insurance at any location where 
such records may be found or maintained; and
    (2) To the farm.
    (d) By applying for insurance under the authority of the Act or by 
continuing insurance for which you previously applied, you authorize us, 
or any person acting for us, to obtain records relating to the insured 
crop from any person who may have custody of those records including, 
but not limited to, FSA offices, banks, warehouses, gins, cooperatives, 
marketing associations, and accountants. You must assist us in obtaining 
all records which we request from third parties.

                           22. Other Insurance

    (a) Other Like Insurance. You must not obtain any other crop 
insurance issued under the authority of the Act on your share of the 
insured crop. If we determine that more than one policy on your share is 
intentional, you may be subject to the sanctions authorized under this 
policy, the Act, or any other applicable statute. If we determine that 
the violation was not intentional, the policy with the earliest date of 
application will be in force and all other policies will be void. 
Nothing in this paragraph prevents you from obtaining other insurance 
not issued under the Act.
    (b) Other Insurance Against Fire. If you have other insurance, 
whether valid or not, against damage to the insured crop by fire during 
the insurance period, and you have not excluded coverage for fire from 
this policy, we will be liable for loss due to fire only for the smaller 
of:
    (1) The amount of indemnity determined pursuant to this policy 
without regard to such other insurance; or
    (2) The amount by which the loss from fire is determined to exceed 
the indemnity paid or payable under such other insurance.
    (c) For the purpose of subsection (b) of this section the amount of 
loss from fire will be the difference between the fair market value of 
the production of the insured crop on the unit involved before the fire 
and after the fire, as determined from appraisals made by us.

                   23. Conformity to Food Security Act

    Although your violation of a number of federal statutes, including 
the Act, may cause cancellation, termination, or voidance of your 
insurance contract, you should be specifically aware that your policy 
will be canceled if you are determined to be ineligible to receive 
benefits under the Act due to violation of the controlled substance 
provisions (title XVII) of the Food Security Act of 1985 (Pub. L. 99-
198) and the regulations promulgated under the Act by USDA. Your 
insurance policy will be canceled if you are determined, by the 
appropriate Agency, to be in violation of these provisions. We will 
recover any and all monies paid to you or received by you during your 
period of ineligibility, and your premium will be refunded, less a 
reasonable amount for expenses and handling not to exceed 20 percent of 
the premium paid or to be paid by you.

                            For FCIC policies

                           24. Amounts Due Us

    (a) Any amount illegally or erroneously paid to you or that is owed 
to us but is delinquent may be recovered by us through offset by 
deducting it from any loan or payment due you under any Act of Congress 
or program administered by any United States Government Agency, or by 
other collection action.
    (b) Interest will accrue at the rate of 1.25 percent simple interest 
per calendar month, or any part thereof, on any unpaid premium amount 
due us. With respect to any premiums owed, interest will start to accrue 
on the first day of the month following the premium billing date 
specified in the Special Provisions.
    (c) For the purpose of any other amounts due us, such as repayment 
of indemnities found not to have been earned:
    (1) Interest will start on the date that notice is issued to you for 
the collection of the unearned amount;
    (2) Amounts found due under this paragraph will not be charged 
interest if payment is made within 30 days of issuance of the notice by 
us;
    (3) The amount will be considered delinquent if not paid within 30 
days of the date the notice is issued by us;
    (4) Penalties and interest will be charged in accordance with 31 
U.S.C. 3717 and 4 CFR part 102; and
    (5) The penalty for accounts more than 90 days delinquent is an 
additional 6 percent per annum.
    (d) Interest on any amount due us found to have been received by you 
because of fraud, misrepresentation or presentation by you of a false 
claim will start on the date you received the amount with the additional 
6 percent penalty beginning on the 31st day after the notice of amount 
due is issued to you. This interest is in addition to any other amount 
found to be due under any other federal criminal or civil statute.
    If we determine that it is necessary to contract with a collection 
agency, refer the debt to government collection centers, the Department 
of Treasury Offset Program, or to employ an attorney to assist in 
collection, you agree to pay all the expenses of collection.
    (f) All amounts paid will be applied first to expenses of collection 
if any, second to the reduction of any penalties which may have

[[Page 354]]

been assessed, then to reduction of accrued interest, and finally to 
reduction of the principal balance.

                         For reinsured policies

                           24. Amounts Due Us

    (a) Interest will accrue at the rate of 1.25 percent simple interest 
per calendar month, or any portion thereof, on any unpaid amount due us. 
For the purpose of premium amounts due us, the interest will start to 
accrue on the first day of the month following the premium billing date 
specified in the Special Provisions.
    (b) For the purpose of any other amounts due us, such as repayment 
of indemnities found not to have been earned, interest will start to 
accrue on the date that notice is issued to you for the collection of 
the unearned amount. Amounts found due under this paragraph will not be 
charged interest if payment is made within 30 days of issuance of the 
notice by us. The amount will be considered delinquent if not paid 
within 30 days of the date the notice is issued by us.
    (c) All amounts paid will be applied first to expenses of collection 
(see subsection (d) of this section) if any, second to the reduction of 
accrued interest, and then to the reduction of the principal balance.
    (d) If we determine that it is necessary to contract with a 
collection agency or to employ an attorney to assist in collection, you 
agree to pay all of the expenses of collection.
    (e) Amounts owed to us by you may be collected in part through 
administrative offset from payments you receive from United States 
government agencies in accordance with 31 U.S.C. chapter 37.

                       25. Legal Action Against Us

    (a) You may not bring legal action against us unless you have 
complied with all of the policy provisions.
    (b) If you do take legal action against us, you must do so within 12 
months of the date of denial of the claim. Suit must be brought in 
accordance with the provisions of 7 U.S.C. 1508(j).
    (c) Your right to recover damages (compensatory, punitive, or 
other), attorney's fees, or other charges is limited or excluded by this 
contract or by Federal Regulations.

                  26. Payment and Interest Limitations

    (a) Under no circumstances will we be liable for the payment of 
damages (compensatory, punitive, or other), attorney's fees, or other 
charges in connection with any claim for indemnity, whether we approve 
or disapprove such claim.
    (b) We will pay simple interest computed on the net indemnity 
ultimately found to be due by us or by a final judgment of a court of 
competent jurisdiction, from and including the 61st day after the date 
you sign, date, and submit to us the properly completed claim on our 
form. Interest will be paid only if the reason for our failure to timely 
pay is NOT due to your failure to provide information or other material 
necessary for the computation or payment of the indemnity. 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.

               27. Concealment, Misrepresentation or Fraud

    (a) If you have falsely or fraudulently concealed the fact that you 
are ineligible to receive benefits under the Act or if you or anyone 
assisting you has intentionally concealed or misrepresented any material 
fact relating to this policy:
    (1) This policy will be voided; and
    (2) You may be subject to remedial sanctions in accordance with 7 
CFR part 400, subpart R.
    (b) Even though the policy is void, you may still be required to pay 
20 percent of the premium due under the policy to offset costs incurred 
by us in the service of this policy. If previously paid, the balance of 
the premium will be returned.
    (c) Voidance of this policy will result in you having to reimburse 
all indemnities paid for the crop year in which the voidance was 
effective.
    (d) Voidance will be effective on the first day of the insurance 
period for the crop year in which the act occurred and will not affect 
the policy for subsequent crop years unless a violation of this section 
also occurred in such crop years.

             28. Transfer of Coverage and Right to Indemnity

    If you transfer any part of your share during the crop year, you may 
transfer your coverage rights, if the transferee is eligible for crop 
insurance. We will not be liable for any more than the liability 
determined in accordance with your policy that existed before the 
transfer occurred. The transfer of coverage rights must be on our form 
and will not be effective until approved by us in writing. Both you and 
the transferee are jointly and severally liable for the payment of the 
premium and administrative fees. The transferee has all rights and 
responsibilities under this policy consistent with the transferee's 
interest.

                       29. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year. The assignment must be on our form and will not be effective 
until approved in writing by us.

[[Page 355]]

The assignee will have the right to submit all loss notices and forms as 
required by the policy. If you have suffered a loss from an insurable 
cause and fail to file a claim for indemnity within 60 days after the 
end of the insurance period, the assignee may submit the claim for 
indemnity not later than 15 days after the 60-day period has expired. We 
will honor the terms of the assignment only if we can accurately 
determine the amount of the claim. However, no action will lie against 
us for failure to do so.

          30. Subrogation (Recovery of Loss From a Third Party)

    Since you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve this right. 
If we pay you for your loss, your right to recovery will, at our option, 
belong to us. If we recover more than we paid you plus our expenses, the 
excess will be paid to you.

              31. Applicability of State and Local Statutes

    If the provisions of this policy conflict with statutes of the State 
or locality in which this policy is issued, the policy provisions will 
prevail. State and local laws and regulations in conflict with federal 
statutes, this policy, and the applicable regulations do not apply to 
this policy.

                        32. Descriptive Headings

    The descriptive headings of the various policy provisions are 
formulated for convenience only and are not intended to affect the 
construction or meaning of any of the policy provisions.

                               33. Notices

    (a) All notices required to be given by you must be in writing and 
received by your crop insurance agent within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice. If the date by which you are required to 
submit a report or notice falls on Saturday, Sunday, or a Federal 
holiday, or if your agent's office is, for any reason, not open for 
business on the date you are required to submit such notice or report, 
such notice or report must be submitted on the next business day.
    (b) All notices and communications required to be sent by us to you 
will be mailed to the address contained in your records located with 
your crop insurance agent. Notice sent to such address will be 
conclusively presumed to have been received by you. You should advise us 
immediately of any change of address.

                            34. Unit Division

    (a) You may elect an enterprise unit or a whole farm unit if the 
Special Provisions allow such unit structure, subject to the following:
    (1) You must make such election on or before the earliest sales 
closing date for the insured crops and report such unit structure to us 
in writing. Your unit selection will remain in effect from year to year 
unless you notify us in writing by the earliest sales closing date for 
the crop year for which you wish to change this election. These units 
may not be further divided except as specified herein;
    (2) For enterprise units:
    (i) You must report the acreage for each optional or basic unit on 
your acreage report that comprises the enterprise unit;
    (ii) These basic units or optional units that comprise the 
enterprise unit must each have insurable acreage of the same crop in the 
crop year insured;
    (iii) You must comply with all reporting requirements for the 
enterprise unit (You must maintain any required production records on a 
basic or optional unit basis if you wish to change your unit structure 
for any subsequent crop year);
    (iv) The qualifying basic units or optional units may not be 
combined into an enterprise unit on any basis other than as described 
herein;
    (v) If you do not comply with the reporting provisions for the 
enterprise unit, your yield for the enterprise unit will be determined 
in accordance with section 3(c)(1); and
    (vi) If you do not qualify for an enterprise unit when the acreage 
is reported, we will assign the basic unit structure.
    (3) For a whole farm unit:
    (i) You must report on your acreage report the acreage for each 
optional or basic unit for each crop produced in the county that 
comprises the whole farm unit; and
    (ii) Although you may insure all of your crops under a whole farm 
unit, you will be required to pay separate applicable administrative 
fees for each crop included in the whole farm unit.
    (b) Unless limited by the Crop Provisions or Special Provisions, a 
basic unit as defined in section 1 of the Basic Provisions may be 
divided into optional units if, for each optional unit, you meet the 
following:
    (1) You must plant the crop in a manner that results in a clear and 
discernible break in the planting pattern at the boundaries of each 
optional unit;
    (2) All optional units you select for the crop year are identified 
on the acreage report for that crop year (Units will be determined when 
the acreage is reported but may be adjusted or combined to reflect the 
actual

[[Page 356]]

unit structure when adjusting a loss. No further unit division may be 
made after the acreage reporting date for any reason);
    (3) You have records, that are acceptable to us, of planted acreage 
and the production from each optional unit for at least the last crop 
year used to determine your production guarantee;
    (4) You have records of marketed or 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 optional 
unit is kept separate until loss adjustment is completed by us; and
    (c) Each optional unit must meet one or more of the following, 
unless otherwise specified in the Crop Provisions or allowed by written 
agreement:
    (1) Optional units may be established if each optional unit is 
located in a separate section. In the absence of sections, we may 
consider parcels of land legally identified by other methods of measure 
such as Spanish grants, as the equivalents of sections for unit 
purposes. In areas which have not been surveyed using sections, section 
equivalents or in areas where boundaries are not readily discernible, 
each optional unit must be located in a separate FSA farm serial number; 
and
    (2) 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 and non-irrigated acreage. 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 may be 
considered as irrigated acreage 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. In this case, production from both practices 
will be used to determine your approved yield.
    (d) Optional units are not available for crops insured under a 
Catastrophic Risk Protection Endorsement.
    (e) If you do not comply fully with the provisions in this section, 
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 by us 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 for the units combined.
    35. Multiple Benefits
    (a) If you are eligible to receive an indemnity under a limited or 
additional coverage plan of insurance and are also eligible to receive 
benefits for the same loss under any other USDA program, you may receive 
benefits under both programs, unless specifically limited by the crop 
insurance contract or by law.
    (b) The total amount received from all such sources may not exceed 
the amount of your actual loss. The total amount of the actual loss is 
the difference between the fair market value of the insured commodity 
before and after the loss, based on your production records and the 
highest price election or amount of insurance available for the crop.
    (c) FSA will determine and pay the additional amount due you for any 
applicable USDA program after first considering the amount of any crop 
insurance indemnity.
    (d) Farm ownership and operating loans may be obtained from USDA in 
addition to crop insurance indemnities.

[56 FR 1351, Jan. 14, 1991, as amended at 58 FR 58262, 58263, Nov. 1, 
1993; 59 FR 42751, Aug. 19, 1994; 62 FR 65154, Dec. 10, 1997; 63 FR 
40634, July 30, 1998; 63 FR 66712, Dec. 3, 1998]



Sec. 457.9  Appropriation contingency.

    Notwithstanding the cancellation date stated in the policy, if there 
are insufficient funds appropriated by the Congress to deliver the crop 
insurance program, the policy will automatically terminate without 
liability.

[59 FR 45972, Sept. 6, 1994]



Sec. 457.10-457.100  [Reserved]



Sec. 457.101  Small grains crop insurance.

    The small grains crop insurance provisions for the 1998 and 
succeeding crop years in counties with a contract change date of 
December 31, and for the 1999 and succeeding crop years in counties with 
a contract change date of June 30, are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                      Small Grains Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

[[Page 357]]

                             1. Definitions

    Adequate stand--A population of live plants per unit of acreage 
which will produce at least the yield used to establish your production 
guarantee.
    Harvest--Combining or threshing the insured crop for grain or 
cutting for hay or silage on any acreage. A crop which is swathed prior 
to combining is not considered harvested.
    Initially planted--The first occurrence of planting the insured crop 
on insurable acreage for the crop year.
    Latest final planting date--
    (1) The final planting date for spring-planted acreage in all 
counties for which the Special Provisions designate a final planting 
date for spring-planted acreage only;
    (2) The final planting date for fall-planted acreage in all counties 
for which the Special Provisions designate a final planting date for 
fall-planted acreage only; or
    (3) The final planting date for spring-planted acreage in all 
counties for which the Special Provisions designate final planting dates 
for both spring-planted and fall-planted acreage.
    Local market price--The cash grain price per bushel for the U.S. No. 
2 grade of the insured crop offered by buyers in the area in which you 
normally market the insured crop. The local market price will reflect 
the maximum limits of quality deficiencies allowable for the U.S. No. 2 
grade of the insured crop. Factors not associated with grading under the 
Official United States Standards for Grain, including but not limited to 
protein, oil or moisture content, or milling quality will not be 
considered.
    Nurse crop (companion crop)--A crop planted into the same acreage as 
another crop, that is intended to be harvested separately, and which is 
planted to improve growing conditions for the crop with which it is 
grown.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, except for flax, land on which seed is initially 
spread onto the soil surface by any method and subsequently is 
mechanically incorporated into the soil in a timely manner and at the 
proper depth will be considered planted. Flax seed must initially be 
planted in rows to be considered planted, unless otherwise provided by 
the Special Provisions, actuarial documents, or by written agreement.
    Prevented planting--In lieu of the definition contained in the Basic 
Provisions, failure to plant the insured crop with proper equipment by 
the latest final planting date designated in the Special Provisions for 
the insured crop in the county or by the end of the late planting 
period. You must have been prevented from planting the insured crop due 
to an insured cause of loss that also prevented most producers from 
planting on acreage with similar characteristics in the surrounding 
area.
    Sales closing date--In lieu of the definition contained in the Basic 
Provisions, a date contained in the Special Provisions by which an 
application must be filed and by which you may change your crop 
insurance coverage for a crop year. If the Special Provisions provide a 
sales closing date for both winter and spring types of the insured crop 
and you plant any insurable acreage of the winter type, you may not 
change your crop insurance coverage after the sales closing date for the 
winter type.
    Small grains-- Wheat, barley, oats, rye, and flax.
    Swathed-- Severance of the stem and grain head from the ground 
without removal of the seed from the head and placing into a windrow.

                            2. Unit Division

    In addition to the requirements of section 34(b) of the Basic 
Provisions, for wheat only, in addition to, or instead of, establishing 
optional units by section, section equivalent or FSA farm serial number 
and by irrigated and non-irrigated practices, optional units may be 
established if each optional unit contains only initially planted winter 
wheat or only initially planted spring wheat. Optional units may be 
established in this manner only in counties having both winter and 
spring type final planting dates as designated in the Special 
Provisions.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements under 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 each crop insured under this policy in the county.

                           4. Contract Changes

    The contract change date is December 31 preceding the cancellation 
date for counties with an April 15 cancellation date and June 30 
preceding the cancellation date for all other counties (see the 
provisions under section 4. (Contract changes) in the Basic Provisions 
Sec. 457.8).

                  5. Cancellation and Termination Dates

    The cancellation and termination dates are:

[[Page 358]]



------------------------------------------------------------------------
   Crop, state and county       Cancellation date     Termination date
------------------------------------------------------------------------
Wheat:
    All Colorado counties     September 30          September 30.
     except Alamosa,
     Archuleta, Conejos,
     Costilla, Custer,
     Delta, Dolores, Eagle,
     Garfield, Grand, La
     Plata, Mesa, Moffat,
     Montezuma, Montrose,
     Ouray, Pitkin, Rio
     Blanco, Rio Grande,
     Routt, Saguache, and
     San Miguel Counties;
     all Iowa Counties
     except Plymouth,
     Cherokee, Buena Vista,
     Pocahontas, Humbolt,
     Wright, Franklin,
     Butler, Black Hawk,
     Buchanan, Delaware, and
     Dubuque Counties and
     all Iowa counties north
     thereof; all Wisconsin
     Counties except
     Trempealeau, Jackson,
     Wood, Portage, Waupaca,
     Outagamie, Brown, and
     Kewaunee Counties and
     all Wisconsin counties
     north and west thereof;
     and all other states
     except Alaska, Arizona,
     California,
     Connecticut, Idaho,
     Maine, Massachusetts,
     Minnesota, Montana,
     Nevada, New Hampshire,
     New York, North Dakota,
     Oregon, Rhode Island,
     South Dakota, Utah,
     Vermont, Washington,
     and Wyoming.
    Archuleta, Custer,        September 30          November 30.
     Delta, Dolores, Eagle,
     Garfield, Grand, La
     Plata, Mesa, Moffat,
     Montezuma, Montrose,
     Ouray, Pitkin, Rio
     Blanco, Routt, and San
     Miguel Counties,
     Colorado; Connecticut;
     Idaho; Plymouth,
     Cherokee, Buena Vista,
     Pocahontas, Humboldt,
     Wright, Franklin,
     Butler, Black Hawk,
     Buchanan, Delaware, and
     Dubuque Counties, Iowa,
     and all Iowa counties
     north thereof;
     Massachusetts; all
     Montana counties except
     Daniels, Roosevelt,
     Sheridan, and Valley
     Counties; New York;
     Oregon; Rhode Island;
     all South Dakota
     counties except
     Harding, Perkins,
     Corson, Walworth,
     Edmonds, Faulk, Spink,
     Beadle, Jerauld,
     Aurora, Douglas, and
     Bon Homme Counties and
     all South Dakota
     counties north and east
     thereof; Washington;
     and all Wyoming
     counties except Big
     Horn, Fremont, Hot
     Springs, Park, and
     Washakie Counties.
    Matanuska-Susitna         October 31            November 30.
     County, Alaska;
     Arizona; California;
     Nevada; and Utah.
    All Alaska Counties       April 15              April 15.
     except Matanuska-
     Susitna County;
     Alamosa, Conejos,
     Costilla, Rio Grande,
     and Saguache Counties,
     Colorado; Maine;
     Minnesota; Daniels,
     Roosevelt, Sheridan,
     and Valley Counties,
     Montana; New Hampshire;
     North Dakota; Harding,
     Perkins, Corson,
     Walworth, Edmunds,
     Faulk, Spink, Beadle,
     Jerauld, Aurora,
     Douglas, and Bon Homme
     Counties, South Dakota,
     and all South Dakota
     counties north and east
     thereof; Vermont;
     Trempealeau, Jackson,
     Wood, Portage, Waupaca,
     Outagamie, Brown, and
     Kewaunee Counties,
     Wisconsin, and all
     Wisconsin counties
     north and west thereof;
     Big Horn, Fremont, Hot
     Springs, Park, and
     Washakie Counties,
     Wyoming.
Barley:
    All New Mexico counties   September 30          September 30.
     except Taos County;
     Oklahoma, Missouri,
     Illinois, Indiana,
     Ohio, Pennsylvania, New
     Jersey, and all states
     south and east thereof.
    Kit Carson, Lincoln,      September 30          November 30.
     Elbert, El Paso,
     Pueblo, Las Animas
     Counties, Colorado and
     all Colorado Counties
     south and east thereof;
     Connecticut; Kansas;
     Massachusetts; and New
     York.
    Arizona; California; and  October 31            November 30.
     Clark and Nye Counties,
     Nevada.
    All Colorado counties     April 15              April 15.
     except Kit Carson,
     Lincoln, Elbert, El
     Paso, Pueblo, and Las
     Animas Counties and all
     Colorado counties south
     and east thereof; all
     Nevada counties except
     Clark and Nye Counties;
     Taos County, New
     Mexico; and all other
     states except: Arizona,
     California,
     Connecticut, Kansas,
     Massachusetts, New
     York; and (except)
     Oklahoma, Missouri,
     Illinois, Indiana,
     Ohio, Pennsylvania, and
     New Jersey and all
     states south and east
     thereof.
Oats:
    Alabama; Arkansas;        September 30          September 30.
     Florida; Georgia;
     Louisiana; Mississippi;
     All New Mexico counties
     except Taos County;
     North Carolina;
     Oklahoma; South
     Carolina; Tennessee;
     Texas; and Patrick,
     Franklin, Pittsylvania,
     Campbell, Appomattox,
     Fluvanna, Buckingham,
     Louisa, Spotsylvania,
     Caroline, Essex, and
     Westmoreland Counties,
     Virginia, and all
     Virginia counties east
     thereof.
    Arizona; All California   October 31            October 31.
     counties except Del
     Norte, Humboldt,
     Lassen, Modoc, Plumas,
     Shasta, Siskiyou and
     Trinity Counties.
    Del Norte, Humbolt,       April 15              April 15.
     Lassen, Modoc, Plumas,
     Shasta, Siskiyou, and
     Trinity Counties,
     California; Taos
     County, New Mexico; all
     Virginia counties
     except Patrick,
     Franklin, Pittsylvania,
     Campbell, Attomattox,
     Fluvanna, Buckingham,
     Louisa, Spotsylvania,
     Caroline, Essex, and
     Westmoreland Counties
     and all Virginia
     counties east thereof;
     and all other except
     Alabama, Arizona,
     Arkansas, Florida,
     Georgia, Louisiana,
     Mississippi, North
     Carolina, Oklahoma,
     South Carolina,
     Tennessee, and Texas.
Rye:
    All states..............  September 30          September 30.
Flax:
    All states..............  April 15              April 15.
------------------------------------------------------------------------


[[Page 359]]

                             6. Insured Crop

    (a) The crop insured will be each small grain you elect to insure, 
that is grown in the county on insurable acreage, and for which premium 
rates are provided by the actuarial documents:
    (1) In which you have a share;
    (2) That is planted for harvest as grain (a grain mixture in which 
barley or oats is the predominate grain may also be insured if allowed 
by the Barley or Oat Special Provisions, or if we agree in writing to 
insure such mixture. The crop insured will be the grain which is 
predominate in the mixture. The production from such mixture will be 
considered as the predominate grain on a weight basis);
    (3) That is not:
    (i) Interplanted with another crop except as allowed in paragraph 
6.(a)(2);
    (ii) Planted into an established grass or legume; or
    (iii) Planted as a nurse crop, unless planted as a nurse crop for 
new forage seeding, but only if seeded at a normal rate and intended for 
harvest as grain.
    (4) We may agree, in writing, to insure a crop prohibited under 
paragraph 6.(a)(3) if you so request. Your request to insure such crop 
must be in writing, and submitted to your agent not later than 15 days 
after the acreage reporting date.
    (b) If you anticipate destroying any acreage prior to harvest you:
    (1) May report all planted acreage when you report your acreage for 
the crop year and specify any acreage to be destroyed as uninsurable 
acreage. (By doing so, no coverage will be considered to have attached 
on the specified acreage and no premium will be due for such acreage. If 
you do not destroy such acreage, you will be subject to the under-
reporting provisions contained in section 6 of the Basic Provisions); or
    (2) If the actuarial documents provide a reduced premium rate for 
acreage destroyed by a date designated in the Special Provisions, you 
may report all planted acreage as insurable when you report your acreage 
for the crop year. Premium will be due on all the acreage. Your premium 
amount will be reduced by the amount shown on the Actuarial Documents 
for any acreage you destroy prior to a date designated in the Special 
Provisions if you do not claim an indemnity on such acreage. In 
accordance with subsection 14.(b) of the Basic Provisions (Sec. 457.8), 
you must obtain our consent before and give us notice after you destroy 
any of the insured crop so your acreage report can be revised to make 
you eligible for this reduction in premium.
    (c) In counties for which the Wheat Special Provisions designate 
both fall and spring final planting dates, you may elect a winter 
coverage endorsement for wheat. This endorsement provides two options 
for alternative coverage for wheat that is damaged between the fall 
final planting date and the spring final planting date. Coverage under 
the endorsement will be effective only if you designate the coverage 
option you elect by executing the endorsement by the sales closing date 
for winter wheat in the county.

                           7. Insurance Period

    In lieu of the requirements under section 11 (Insurance Period) of 
the Basic Provisions (Sec. 457.8), and subject to any provisions 
provided by the Wheat crop insurance winter coverage endorsement 
(Sec. 457.102) if you have elected such endorsement, the insurance 
period is as follows:
    (a) Insurance attaches on each unit or part thereof on the later of 
the date we accept your application or the date the insured crop is 
planted.
    (1) For oats, rye and flax, the following limitations apply:
    (i) The acreage must be planted on or before the final planting date 
designated in the Special Provisions for the insured crop except as 
allowed in section 12 of these Crop Provisions and section 16 of the 
Basic Provisions.
    (ii) Any acreage of the insured crop damaged before the final 
planting date, to the extent that producers in the surrounding area 
would not normally further care for the crop, must be replanted unless 
we agree that it is not practical to replant.
    (2) For barley and wheat, the following limitations apply:
    (i) The acreage must be planted on or before the final planting date 
designated in the Special Provisions for the type (winter or spring) 
except as allowed in section 12 of these Crop Provisions and section 16 
of the Basic Provisions.
    (ii) Whenever the Special Provisions designate only a fall final 
planting date, any acreage of winter barley or wheat damaged before such 
final planting date, to the extent that growers in the area would 
normally not further care for the crop, must be replanted to a winter 
type of the insured crop unless we agree that replanting is not 
practical.
    (iii) Whenever the Special Provisions designate both fall and spring 
final planting dates, winter barley or wheat planted on or before the 
final planting date which is damaged:
    (A) Before the fall planting final planting date, to the extent that 
growers in the area would normally not further care for the crop, must 
be replanted to a winter type of the insured crop unless we agree that 
replanting is not practical.
    (B) On or after the fall final planting date, but before the spring 
final planting date, to the extent that growers in the area would 
normally not further care for the crop, must be replanted to an 
appropriate variety of the

[[Page 360]]

insured crop unless we agree that replanting is not practical.
    If you have elected coverage under one of the available wheat winter 
coverage options available in the county, the insurance period for wheat 
will be in accordance with the selected options.
    (iv) Whenever the Special Provisions designate a spring final 
planting date, any acreage of spring barley or wheat damaged before such 
final planting date, to the extent that growers in the area would 
normally not further care for the crop, must be replanted to a spring 
type of the insured crop unless we agree that replanting is not 
practical.
    (v) Whenever the Special Provisions designate only a spring final 
planting date, any acreage of fall planted barley or wheat is not 
insured unless you request such coverage and we agree in writing that 
the acreage has an adequate stand in the spring to produce the yield 
used to determine your production guarantee. Insurance will then attach 
to acreage having an adequate stand on the earlier of the spring final 
planting date or the date we agree to accept the acreage for insurance. 
If such fall planted acreage is not to be insured it must be recorded on 
the acreage report as an uninsured fall planted crop.
    (b) Insurance ends on each unit at the earliest of:
    (1) Total destruction of the insured crop on the unit;
    (2) Harvest of the unit;
    (3) Final adjustment of a loss on the unit;
    (4) September 25 following planting in Alaska, or October 31 of the 
calendar year in which the crop is normally harvested in all other 
states; or
    (5) Abandonment of the crop on the unit.

                            8. Causes of Loss

    In addition to the provisions under section 12 (Causes of Loss) of 
the Basic Provisions, any loss covered by this policy must occur within 
the insurance period.
    The specific causes of loss for small grains are:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage allowed because of insufficient or 
improper application of pest control measures;
    (d) Plant disease, but not damage allowed because of insufficient or 
improper application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply.

                         9. Replanting Payments

    (a) A replant payment for wheat only is allowed as follows:
    (1) You comply with all requirements regarding replanting payments 
contained under section 13 (Replanting Payment) of the Basic Provisions 
and in any winter coverage endorsement for which you are eligible and 
which you have elected;
    (2) The wheat must be damaged by an insurable cause of loss to the 
extent that the remaining stand will not produce at least 90 percent of 
the production guarantee for the acreage;
    (3) The acreage must have been initially planted to spring wheat in 
those counties with only a spring final planting date;
    (4) The damage must occur after the fall final planting date in 
those counties where both a fall and spring final planting date are 
designated;
    (5) Replanting must take place not later than 25 days after the 
spring final planting date; and
    (6) The replant wheat must be seeded at a rate that is normal for 
initially planted wheat (if new seed is planted at a reduced seeding 
rate into a partially damaged stand of wheat, the acreage will not be 
eligible for a replanting payment).
    (b) No replanting payment will be made for acreage initially planted 
to winter wheat in any county for which the Special Provisions contain 
only a fall final planting date.
    (c) In accordance with subsection 13.(c) of the Basic Provisions 
(Sec. 457.8), the maximum amount of the replanting payment per acre will 
be the lesser of 20 percent (20%) of the production guarantee or 3 
bushels, multiplied by your price election multiplied by your share.
    (d) When wheat is replanted using a practice that is uninsurable for 
an original planting, the liability for the unit will be reduced by the 
amount of the replanting payment. The premium amount will not be 
reduced.

                10. Duties in the Event of Damage or Loss

    In addition to your duties under section 14 of the Basic Provisions 
(Sec. 457.8), if you initially discover damage to any insured crop 
within 15 days of, or during harvest, you must leave representative 
samples of the unharvested crop for our inspection. The samples must be 
at least 10 feet wide and the entire length of each field in the unit, 
and 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.

                         11. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide records of production that are acceptable to us 
for any:
    (1) Optional unit, we will combine all optional units for which 
acceptable records of production were not provided; or for any

[[Page 361]]

    (2) Basic unit, we will allocate any commingled production to such 
units in proportion to our liability on the harvested acreage for each 
unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting from this the total production to count;
    (3) Multiplying the remainder by your price election; and
    (4) Multiplying this result by your share.
    (c) The total production (bushels) to count from all insurable 
acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) Which is abandoned;
    (B) Put to another use without our consent;
    (C) Damaged solely by uninsured causes; or
    (D) For which you fail to provide records of production that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies and excess moisture in accordance with 
subsection 11.(d));
    (iv) Potential production on insured acreage you want to put to 
another use or you wish to 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 you put the acreage to 
another use or abandon the crop. If:
    (A) Agreement on the appraised amount of production is not reached, 
you may elect to continue to care for the crop, or we will 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 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 you 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.
    (B) You elect to continue to care for the crop, we will determine 
the amount of production to count for the acreage using the harvested 
production, or our reappraisal if additional damage occurs and the crop 
is not harvested.
    (2) All harvested production from the insurable acreage.
    (d) Mature wheat, barley, oat, and rye production may be adjusted 
for excess moisture and quality deficiencies. Flax production may be 
adjusted for quality deficiencies only.
    (1) Production will be reduced by .12 percent for each .1 percentage 
point of moisture in excess of:
    (i) 13.5 percent for wheat;
    (ii) 14.5 percent for barley;
    (iii) 14.0 percent for oats; and
    (iv) 16.0 for rye.
    We may obtain samples of the production to determine the moisture 
content.
    (2) Production will be eligible for quality adjustment if:
    (i) Deficiencies in quality, in accordance with the Official United 
States Standards for Grain, result in:
    (A) Wheat not meeting the grade requirements for U.S. No. 4 (grades 
U.S. No. 5 or worse) because of test weight, total damaged kernels 
(excluding heat damage), shrunken or broken kernels, or defects 
(excluding foreign material and heat damage), or grading garlicky, light 
smutty, smutty or ergoty;
    (B) Barley not meeting the grade requirements for U.S. No. 4 (grades 
U.S. No. 5 or worse) because of test weight, percentage of sound barley, 
damaged kernels, thin barley, or black barley, or grading smutty, 
garlicky, or ergoty;
    (C) Oats not meeting the grade requirements for U.S. No. 4 (grade 
U.S. sample grade) because of test weight or percentage of sound oats, 
or grading smutty, garlicky, or ergoty;
    (D) Rye not meeting the grade requirements for U.S. No. 3 (grades 
U.S. No. 4 or worse) because of test weight, percent damaged kernels or 
thin rye, or grading smutty, garlicky, or ergoty;
    (E) Flaxseed not meeting the grade requirements for U.S. No. 2 
(grades U.S. sample grade) due to damaged kernels; or
    (ii) Substances or conditions are present, including mycotoxins, 
that are identified by the Food and Drug Administration or other public 
health organizations of the United States as being injurious to human or 
animal health.
    (3) Quality will be a factor in determining your loss only if:
    (i) The deficiencies, substances, or conditions resulted from a 
cause of loss against which insurance is provided under these crop 
provisions;
    (ii) The deficiencies, substances, or conditions result in a net 
price for the damaged grain that is less than the local market price of 
U.S. No. 2 production;
    (iii) All determinations of these deficiencies, substances, or 
conditions are made using samples of the production obtained by us or by 
a disinterested third party approved by us; and
    (iv) The samples are analyzed by a grain grader licensed under the 
authority of the United States Grain Standards Act or the United States 
Warehouse Act with regard to

[[Page 362]]

deficiencies in quality, or by a laboratory approved by us with regard 
to substances or conditions injurious to human or animal health. Test 
weight for quality adjustment purposes may be determined by one loss 
adjustor.
    (4) Production of small grains that is eligible for quality 
adjustment, as specified in paragraphs 11.(d) (2) and (3), will be 
reduced as follows:
    (i) The market price of the qualifying damaged production and the 
local market price will be the prices on the earlier of the date such 
quality adjusted production is sold or the date of final inspection for 
the unit. The price for the qualifying damaged production will be the 
market price for the local area to the extent feasible. Discounts used 
to establish the net price of the damaged production will be limited to 
those which are usual, customary, and reasonable. Any reduction in price 
due to the following factors will not be accepted:
    (A) Moisture content;
    (B) Damage due to uninsured causes; or
    (C) Drying, handling, processing, or any other costs associated with 
normal harvesting, handling, and marketing of the grain; except, if the 
price of the damaged production can be increased by conditioning, we may 
reduce the price of the production after it has been conditioned by the 
cost of conditioning but not lower than the value of the production 
before conditioning. We may obtain prices from any buyer of our choice. 
If we obtain prices from one or more buyers located outside your local 
market area, we will reduce such prices by the additional costs required 
to deliver the production to those buyers.
    (ii) The value of the damaged or conditioned production will be 
divided by the local market price to determine the quality adjustment 
factor.
    (iii) The number of bushels remaining after any reduction due to 
excessive moisture (the moisture-adjusted gross bushels (if 
appropriate)) of the damaged or conditioned production will then be 
multiplied by the quality adjustment factor to determine the net 
production to count.
    (e) Any production harvested from plants growing in the insured crop 
may be counted as production of the insured crop on a weight basis.

                            12. Late Planting

    A late planting period is not applicable to fall-planted wheat. Any 
winter wheat that is planted after the fall final planting date in 
counties for which the Special Provisions also contain a final planting 
date for spring wheat will not be insured. Any winter wheat that is 
planted after the fall final planting date in counties for which the 
Special Provisions contain only a fall final planting date will not be 
insured unless you were prevented from planting the winter wheat by the 
fall final planting date. Such acreage will be insurable, and the 
production guarantee and premium for the acreage will be determined in 
accordance with sections 16 (b) and (c) of the Basic Provisions.

                         13. Prevented Planting

    (a) In addition to the provisions contained in section 17 of the 
Basic Provisions, in counties for which the Special Provisions designate 
a spring final planting date, your prevented planting production 
guarantee will be based on your approved yield for spring-planted 
acreage of the insured crop.
    (b) Your prevented planting coverage will be 60 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to a level specified in the actuarial documents.

[59 FR 9391, Feb. 28, 1994, as amended at 60 FR 62723, Dec. 7, 1995; 62 
FR 65164, Dec. 10, 1997]



Sec. 457.102  Wheat crop insurance winter coverage endorsement.

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

            Wheat Crop Insurance Winter Coverage Endorsement

                   (This is a Continuous Endorsement)

    (a) In return for payment of the additional premium designated in 
the Actuarial Table, this endorsement is attached to and made part of 
your Small Grains Crop Provisions subject to the terms and conditions 
described herein.
    (b) This endorsement is available only in counties for which the 
Special Provisions designate both a fall final planting date and a 
spring final planting date.
    (c) This endorsement modifies the provisions of sections 7 and 11 of 
the Small Grains Crop Insurance policy (Sec. 457.101).
    (1) You must have a Small Grains Crop Insurance policy in force and 
elect to insure wheat under that policy.
    (2) You may select either Option A or Option B. Failure to select 
either Option A or Option B means that you have rejected both Options 
and this endorsement would be void.
    (3) Insurance Period. Coverage under this endorsement begins on the 
later of the date we accept your application for coverage or on the fall 
final planting date designated in the Special Provisions. Coverage ends 
on the spring final planting date designated in the Special Provisions.

[[Page 363]]

    (4) The provisions under section 14 of the Common Crop Insurance 
Policy (Sec. 457.8) are amended to require that all notices of damage 
must be provided to us by the spring final planting date designated in 
the Special Provisions.

           Option A (30 Percent Coverage and Acreage Release)

    Whenever any winter wheat is damaged during the insurance period 
(see section 3, above), and at least 20 acres or 20 percent of the 
acreage in the unit, whichever is less, does not have an adequate stand 
to produce at least 90 percent of the production guarantee for the 
acreage, you may take any one of the following actions:
    (a) Destroy the remaining crop on such acreage. By doing so, you 
agree to accept an amount of production to count against the unit 
production guarantee equal to 70 percent of the production guarantee for 
the damaged acreage, or an appraisal determined in accordance with 
paragraph 11.(c)(1) of the Small Grains Crop Insurance Provisions 
(Sec. 457.101) if such an appraisal results in a greater amount of 
production. This amount will be considered production to count in 
determining any final indemnity on the unit and will be used to settle 
your claim as described in the provisions under section 11. (Settlement 
of Claim) of the Small Grains Crop Insurance Provisions (Sec. 457.101). 
You may use such acreage for any purpose, including planting and 
separately insuring any other crop. If you elect to utilize such acreage 
for the production of spring wheat, you must:
    (1) Plant the spring wheat in a manner which results in a clear and 
discernible break in the planting pattern at the boundary between it and 
any remaining winter wheat; and
    (2) Store or market the production from such acreage in a manner 
which permits us to verify the amount of spring wheat production 
separately from any winter wheat production.
    In the event you are unable to provide records of production that 
are acceptable to us, the spring wheat acreage will be considered to be 
a part of the original winter wheat unit. If you elected to insure the 
spring wheat acreage as a separate optional unit, any premium amount for 
such acreage will be considered earned and payable to us.
    (b) Continue to care for the damaged crop. By doing so, coverage 
will continue under the terms of the Common Crop Insurance Policy 
(Sec. 457.8), the Small Grains Crop Insurance Provisions (Sec. 457.101), 
and this Option.
    (c) Replant the acreage to an appropriate variety of wheat, if it is 
practical, and receive a replanting payment in accordance with the terms 
of section 9. (Replanting Payments) of the Small Grains Crop Provisions 
(Sec. 457.101). By doing so, coverage will continue under the terms of 
the Common Crop Insurance Policy (Sec. 457.8), the Small Grains Crop 
Insurance Provisions (Sec. 457.101), and this Option, and the production 
guarantee for winter wheat will remain in effect.

               Option B (With Full Winter Damage Coverage)

    Whenever any winter wheat is damaged during the insurance period and 
at least 20 acres or 20 percent of the acreage in the unit, whichever is 
less, does not have an adequate stand to produce at least 90 percent of 
the production guarantee for the acreage, you may, at your option, take 
one of the following actions:
    (a) Continue to care for the damaged crop. By doing so, coverage 
will continue under the terms of the Common Crop Insurance Policy 
(Sec. 457.8), the Small Grains Crop Insurance Provisions (Sec. 457.101), 
and this Option.
    (b) Replant the acreage to an appropriate variety of wheat, if it is 
practical, and receive a replanting payment in accordance with the terms 
of section 9. (Replanting Payments) of the Small Grains Crop Provisions 
(Sec. 457.101). By doing so, coverage will continue under the terms of 
the Common Crop Insurance Policy (Sec. 457.8), the Small Grains Crop 
Insurance Provisions (Sec. 457.101), and this Option, and the production 
guarantee for winter wheat will remain in effect.
    (c) Accept our appraisal of the crop on the damaged acreage as 
production to count against the production guarantee for the damaged 
acreage, destroy the remaining crop on such acreage, and be eligible for 
any indemnity due under the terms of the Common Crop Insurance Policy 
(Sec. 457.8) and the Small Grains Crop Provisions (Sec. 457.101). The 
appraisal will be considered production to count in determining any 
final indemnity on the unit and will be used to settle your claim as 
described in the provisions of section 11. (Settlement of Claim) of the 
Small Grains Crop Insurance Provisions (Sec. 457.101). You may use such 
acreage for any purpose, including planting and separately insuring any 
other crop. If you elect to utilize such acreage for the production of 
spring wheat, you must:
    (1) Plant the spring wheat in a manner which results in a clear and 
discernable break in the planting pattern at the boundary between it and 
any remaining winter wheat; and
    (2) Store or market the production from such acreage in a manner 
which permits us to verify the amount of spring wheat production 
separately from any winter wheat production.
    In the event you are unable to provide records of production that 
are acceptable to us, the spring wheat acreage will be considered to be 
a part of the original winter wheat unit. If you elected to insure the 
spring wheat acreage as a separate optional unit,

[[Page 364]]

any premium amount for such acreage will be considered earned and 
payable to us.

[59 FR 9397, Feb. 28, 1994]



Sec. 457.103  Malting barley option.

    The Malting Barley Option Provisions for the 1995 and succeeding 
crop years are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

         Small Grains Crop Insurance Malting Barley Endorsement

(This is a continuous Endorsement. Refer to section 2 of the Common Crop 
                            Insurance Policy)

    In return for payment of the additional premium designated in the 
actuarial table, it is hereby agreed that the Common Crop Insurance 
Policy (Sec. 457.8) and Small Grains Crop Provisions (Sec. 457.101) are 
amended to incorporate the following terms and conditions:
    (a) This Endorsement must be submitted to us on or before the final 
date for accepting applications for the initial crop year in which you 
wish to insure your malting barley acreage under this Option.
    (b) You must have a Common Crop Insurance Policy (Sec. 457.8) and a 
Small Grains Crop Insurance policy (Sec. 457.101) in force and elect to 
insure barley under those policies.
    (c) You must provide:
    (1) Acceptable records of the sale of malting barley for malting 
purposes for three of the previous five crop years by the production 
reporting date; and
    (2) Before the acreage reporting date, written contract with a 
brewery or business that makes or sells malt or processed mash to a 
brewery, which states the quantity contracted and purchase price or 
method for determining such price by the acreage reporting date. Our 
liability under this Option will be limited to the lesser of the number 
of contracted bushels or your production guarantee.
    (d) All barley acreage in the county planted to an approved malting 
variety in which you have a share will be insured under this 
Endorsement. All barley acreage of any non-malting variety will be 
insured under the terms of the Small Grains Endorsement. Malting barley 
and basic barley acreage will be separate basic units. Further unit 
division may be allowed in accordance with the Common Crop Insurance 
Policy.
    (e) Your price election will be provided by the actuarial table.
    (f) In lieu of subparagraphs 11.(d)(2)(i)(B) and 11.(d)(1)(ii) of 
the Small Grains Crop Provisions:
    (1) Mature malting barley production will be reduced .12 percent for 
each one tenth (.1) percentage point of moisture in excess of 13.0 
percent; and
    (2) Mature malting barley production, which due to insurable causes, 
is not accepted by a buyer of malting barley and will not meet the 
applicable standards for two-rowed or six-rowed malting barley will be 
adjusted by:
    (i) Dividing the value per bushel for the insured malting barley by 
the price election for malting barley; and
    (ii) Multiplying the result not to exceed one (1.0) by the number of 
bushels of such barley.
    (3) All grade determination must be made by a grader licensed to 
inspect barley under the United States Grain Standards Act using samples 
obtained by a licensed sampler or our loss adjuster. Any production 
which is not sampled and graded as provided by this section will be 
considered as malting barley meeting the applicable standards.
    (g) As used in the Endorsement:
    (1) Applicable standards--For two-rowed and six-rowed malting barley 
are defined in the Official United States Standards for barley.
    (2) Approved malting variety--The varieties specified in the Special 
Provisions.
    (3) Brewery--A facility where malt liquors are commercially produced 
for human consumption.
    (4) Value per bushel means:
    (i) The local market price of U.S. No. 2 barley (basic barley) if 
the insure mature malting barley production, due to insurable causes, 
grades U.S. No. 4 or better and does not grade smutty, garlicky, or 
ergoty; or
    (ii) The local market price of basic barley of the same quality as 
the insured malting barley, if the malting barley does not grade better 
than U.S. No. 5.
    The prices used for this adjustment will be the prices on the 
earlier of the date such quality-adjusted barley is sold or the date of 
final inspection for the unit.

[59 FR 9397, Feb. 28, 1994]



Sec. 457.104  Cotton crop insurance provisions.

    The cotton crop insurance provisions for the 1998 and succeeding 
crop years are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                         Cotton Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1)

[[Page 365]]

The Catastrophic Risk Protection Endorsement, if applicable (2) the 
Special Provisions; (3) these Crop Provisions; and (4) the Basic 
Provisions with (1) controlling (2), etc.

                             1. Definitions

    Cotton--Varieties identified as American Upland Cotton.
    Growth area--A geographic area designated by the Secretary of 
Agriculture for the purpose of reporting cotton prices.
    Harvest--The removal of the seed cotton from the open cotton boll, 
or the severance of the open cotton boll from the stalk by either manual 
or mechanical means.
    Mature cotton--Cotton that can be harvested either manually or 
mechanically.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, cotton must be planted in rows, unless otherwise 
provided by the Special Provisions, actuarial documents, or by written 
agreement. The yield conversion factor normally applied to non-irrigated 
skip-row cotton acreage will not be used if the land between the rows of 
cotton is planted to any other spring planted crop.
    Production guarantee--The number of pounds determined by multiplying 
the approved yield per acre by any applicable yield conversion factor 
for non-irrigated skip-row planting patterns, and multiplying the result 
by the coverage level percentage you elect.
    Skip-row--A planting pattern that:
    (1) Consists of alternating rows of cotton and fallow land or land 
planted to another crop the previous fall; and
    (2) Qualifies as a skip-row planting pattern as defined by the Farm 
Service Agency (FSA) or a successor agency.

  2. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    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 
cotton in the county insured under this policy.

                           3. Contract Changes

    The contract change date is November 30 (December 17 for the 1998 
crop year only) preceding the cancellation date (see the provisions of 
section 4 (Contract Changes) of the Basic Provisions).

                  4. 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:

------------------------------------------------------------------------
                                                    Cancellation and
               State and county                     termination dates
------------------------------------------------------------------------
Val Verde, Edwards, Kerr, Kendall, Bexar,       January 15.
 Wilson, Karnes, Goliad, Victoria, and Jackson
 Counties, Texas, and all Texas counties lying
 south thereof.
Alabama; Arizona; Arkansas; California;         February 28.
 Florida; Georgia; Louisiana; Mississippi;
 Nevada; North Carolina; South Carolina; El
 Paso, Hudspeth, Culberson, Reeves, Loving,
 Winkler, Ector, Upton, Reagon, Sterling,
 Coke, Tom Green, Concho, McCulloch, San Saba,
 Mills, Hamilton, Bosque, Johnson, Tarrant,
 Wise, and Cooke Counties, Texas, and all
 Texas counties lying south and east thereof
 to and including Terrell, Crocket, Sutton,
 Kimble, Gillespie, Blanco, Comal, Guadalupe,
 Gonzales, De Witt, Lavaca, Colorado, Wharton,
 Matagorda Counties, Texas..
All other Texas counties and all other States.  March 15.
------------------------------------------------------------------------

                             5. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the cotton lint, in the 
county for which premium rates are provided by the actuarial documents:
    (a) In which you have a share; and
    (b) That is not (unless allowed by the Special Provisions or by 
written agreement):
    (1) Colored cotton lint;
    (2) Planted into an established grass or legume;
    (3) Interplanted with another spring planted crop;
    (4) Grown on acreage from which a hay crop was harvested in the same 
calendar year unless the acreage is irrigated; or
    (5) Grown on acreage on which a small grain crop reached the heading 
stage in the same calendar year unless the acreage is irrigated or 
adequate measures are taken to terminate the small grain crop prior to 
heading and less than fifty percent (50%) of the small grain plants 
reach the heading stage.

                          6. Insurable Acreage

    In addition to the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8):
    (a) The acreage insured will be only the land occupied by the rows 
of cotton when a skip row planting pattern is utilized; and
    (b) Any acreage of the insured crop damaged before the final 
planting date, to the extent that a majority of the producers in the 
area would not normally further care for the crop, must be replanted 
unless we agree that it is not practical to replant.

[[Page 366]]

                           7. Insurance Period

    (a) In lieu of section 11(b)(2) of the Basic Provisions, insurance 
will end upon the removal of the cotton from the field.
    (b) In accordance with the provisions under 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:
    (1) September 30 in Val Verde, Edwards, Kerr, Kendall, Bexar, 
Wilson, Karnes, Goliad, Victoria, and Jackson Counties, Texas, and all 
Texas counties lying south thereof;
    (2) January 31 in Arizona, California, New Mexico, Oklahoma, and all 
other Texas counties; and
    (3) December 31 in all other states.

                            8. Causes of Loss

    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:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control meaures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if applicable, due to an 
unavoidable cause of loss occurring within the insurance period.

                9. Duties in the Event of Damage or Loss

    (a) In addition to your duties under section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), in the event of 
damage or loss:
    (1) The cotton stalks must remain intact for our inspection; and
    (2) If you initially discover damage to the insured crop within 15 
days of harvest, or during harvest, you must leave representative 
samples of the unharvested crop in the field for our inspection. The 
samples must be at least 10 feet wide and extend the entire length of 
each field in the unit.
    (b) The stalks must not be destroyed, and required samples must not 
be harvested, until the earlier of our inspection or 15 days after 
harvest of the balance of the unit is completed and written notice of 
probable loss given to us.

                         10. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide records of production:
    (1) For any optional unit, we will combine all optional units for 
which acceptable records of production were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim on any unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting from this the total production to count;
    (3) Multiplying the remainder by your price election; and
    (4) Multiplying this result by your share.
    (c) The total production (pounds) to count from all insurable 
acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage;
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) Damaged solely by uninsured causes;
    (D) For which you fail to provide records of production that are 
acceptable to us; or
    (E) On which the cotton stalks are destroyed, in violation of 
section 9;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production of white 
cotton may be adjusted for quality deficiencies in accordance with 
subsection 10(d)); and
    (iv) Potential production on insured acreage you want to put to 
another use or you wish to abandon or 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 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 amount of production to count 
for such acreage will be based on the harvested production of appraisals 
from the samples at the time harvest should have occurred. If you do not 
leave the required samples intact, or you 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

[[Page 367]]

    (2) All harvested production from the insurable acreage, including 
any mature cotton retrieved from the ground.
    (d) Mature white cotton may be adjusted for quality when production 
has been damaged by insured causes. Such production to count will be 
reduced if the price quotation for cotton of like quality (price 
quotation ``A'') for the applicable growth area is less than seventy-
five percent (75%) of price quotation ``B.'' Price quotation ``B'' is 
defined as the price quotation for the applicable growth area for cotton 
of the color and leaf grade, staple length, and micronaire reading 
designated in the Special Provisions for this purpose. Price quotations 
``A'' and ``B'' will be the price quotations contained in the Daily Spot 
Cotton Quotations published by the USDA Agricultural Marketing Service 
on the date the last bale from the unit is classed. If the date the last 
bale classed is not available, the price quotations will be determined 
on the date the last bale from the unit is delivered to the warehouse, 
as shown on the producer's account summary obtained from the gin. If 
eligible for adjustment, the amount of production to be counted will be 
determined by multiplying the number of pounds of such production by the 
factor derived from dividing price quotation ``A'' by seventy-five 
percent (75%) of price quotation ``B.''
    (e) Colored cotton lint will not be eligible for quality adjustment.

                         11. Prevented Planting

    (a) In addition to the provisions contained in section 17 of the 
Basic Provisions, your prevented planting production guarantee will be 
based on your approved yield without adjustment for skip-row planting 
patterns.
    (b) Your prevented planting coverage will be 50 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to a level specified in the actuarial documents.

[59 FR 49154, Sept. 27, 1994, as amended at 60 FR 62725, Dec. 7, 1995; 
62 FR 7134, Feb. 18, 1997; 62 FR 63633, Dec. 2, 1997; 62 FR 65164, Dec. 
10, 1997; 63 FR 55497, Oct. 16, 1998; 63 FR 66717, Dec. 3, 1998]



Sec. 457.105  Extra long staple cotton crop insurance provisions.

    The extra long staple cotton crop insurance provisions for the 1998 
and succeeding crop years are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                       ELS Cotton Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement; (2) the Special Provisions; (3) these Crop Provisions; (4) 
the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Cotton--Varieties identified as Extra Long Staple (ELS) cotton and 
American Upland (AUP) cotton if ELS cotton is destroyed by an insured 
cause and acreage is replanted to AUP cotton.
    ELS cotton--Extra Long Staple cotton (also called Pima cotton, 
American-Egyptian cotton, and American Pima cotton).
    Harvest--The removal of the seed cotton from the open cotton boll, 
or the severance of the open cotton boll from the stalk by either manual 
or mechanical means.
    Mature ELS cotton--ELS cotton that can be harvested either manually 
or mechanically.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, cotton must be planted in rows, unless otherwise 
provided by the Special Provisions, actuarial documents, or by written 
agreement. The yield conversion factor normally applied to non-irrigated 
skip-row cotton acreage will not be used if the land between the rows of 
cotton is planted to any other spring planted crop.
    Production guarantee-- The number of pounds determined by 
multiplying the approved yield per acre by any applicable yield 
conversion factor for non-irrigated skip-row planting patterns, and 
multiplying the result by the coverage level percentage you elect.
    Replanting-- Performing the cultural practices necessary to replace 
the ELS cotton seed, and replacing the seed with either ELS or AUP 
cotton seed in the insured acreage with the expectation of growing a 
successful crop.
    Skip-row-- A planting pattern that:
    (1) Consists of alternating rows of cotton and fallow land or land 
planted to another crop the previous fall; and
    (2) Qualifies as a skip-row planting pattern as defined by the Farm 
Service Agency (FSA) or a successor agency.

  2. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    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 cotton in the county insured under this policy.

[[Page 368]]

                           3. Contract Changes

    The contract change date is November 30 (December 17 for the 1998 
crop year only) preceding the cancellation date (see the provisions of 
section 4 (Contract Changes) of the Basic Provisions).

                  4. 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:

------------------------------------------------------------------------
                                            Cancellation and termination
                  States                                dates
------------------------------------------------------------------------
New Mexico................................  March 15.
All other States..........................  Feb. 28.
------------------------------------------------------------------------

                             5. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the cotton lint in the county 
for which premium rates are provided by the actuarial documents:
    (a) In which you have a share; and
    (b) That is not (unless allowed by the Special Provisions or by a 
written agreement):
    (1) Planted into an established grass or legume;
    (2) Interplanted with another spring planted crop;
    (3) Grown on acreage from which a hay crop was harvested in the same 
calendar year unless the acreage is irrigated; or
    (4) Grown on acreage on which a small grain crop reached the heading 
stage in the same calendar year unless the acreage is irrigated or 
adequate measures are taken to terminate the small grain crop prior to 
heading and less than fifty percent (50%) of the small grain plants 
reach the heading stage.

                          6. Insurable Acreage

    In addition to the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8):
    (a) The acreage insured will be only the land occupied by the rows 
of cotton when a skip row planting pattern is utilized; and
    (b) Any acreage of the insured crop damaged before the final 
planting date, to the extent that a majority of producers in the area 
would not be replanted unless we agree that it is not practical to 
replant.

                           7. Insurance Period

    (a) In lieu of section 11(b)(b)(2) of the Basic Provisions, 
insurance will end upon the removal of the cotton from the field.
    (b) 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 January 31 immediately following 
planting.

                            8. Causes of Loss

    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:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of irrigation water supply, if applicable, due to an 
unavoidable cause of loss occurring within the insurance period.

                9. Duties in the Event of Damage or Loss

    (a) In addition to your duties under section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), in the event of 
damage or loss:
    (1) You must give us notice if you intend to replant any acreage 
originally planted to ELS cotton to AUP cotton;
    (2) The cotton stalks must remain intact for our inspection; and
    (3) If you initially discover damage to any insured crop within 15 
days of harvest, or during harvest, you must leave representative 
samples of the unharvested crop for our inspection. The samples must be 
at least 10 feet wide and extend the entire length of the field in the 
unit.
    (b) The stalks must not be destroyed, and required samples must not 
be harvested, until the earlier of our inspection or 15 days after 
harvest of the balance of the unit is completed and written notice of 
probable loss is given to us.

                         10. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide records of production:
    (1) For any optional unit, we will combine all optional units for 
which acceptable records of production were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim on any unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting from this the total production to count;
    (3) Multiplying the remainder by your price election; and
    (4) Multiplying this result by your share.

[[Page 369]]

    (c) The total production (pounds) to count from all insurable 
acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) Damaged solely by uninsured causes;
    (D) For which you fail to provide records of production that are 
acceptable to us; or
    (E) On which the cotton stalks are destroyed in violation of section 
9;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies in accordance with subsection:
    (A) 10(d) and (e) if it is mature ELS cotton; or
    (B) 10(f) if it is AUP cotton insured under these crop provisions); 
and
    (iv) Potential production on insured acreage you want to put to 
another use or you wish to abandon or 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 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 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 you fail to provided 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, including 
any mature cotton retrieved from the ground.
    (d) Mature ELS cotton production may be adjusted for quality when 
production has been damaged by insured causes. Such production to count 
will be reduced if the price quotation for ELS cotton of like quality 
(price quotation ``A'') for the applicable growth area is less than 75 
percent of price quotation ``B.'' Price quotation ``B'' is defined as 
the price quotation for the applicable growth area for ELS cotton of the 
grade, staple length, and micronaire reading designated in the Special 
Provisions for this purpose. Price quotations ``A'' and ``B'' will be 
the price quotations contained in the Daily Spot Cotton Quotations 
published by the USDA Agricultural Marketing Service on the date the 
last bale from the unit is classed. If the date the last bale is classed 
is not available, the price quotations will be determined when the last 
bale from the unit is delivered to the warehouse, as shown on the 
producers account summary obtained from the gin. If eligible for quality 
adjustment, the amount of production to be counted will be determined by 
multiplying the number of pounds of such production by the factor 
derived from dividing price quotation ``A'' by 75 percent of price 
quotation ``B.''
    (e) For ELS cotton to be eligible for quality adjustment as shown in 
subsection 10(d), ginning must have been completed at a gin using roller 
equipment.
    (f) Any AUP cotton harvested or appraised from the acreage 
originally planted to ELS cotton in the same growing season will be 
reduced by the factor obtained by dividing the price per pound of the 
AUP cotton by the price quotation for the ELS cotton of the grade, 
staple length, and micronaire reading designated in the Special 
Provisions for this purpose. The prices used for the AUP and ELS cotton 
will be the price quotations contained in the Daily Spot Cotton 
Quotations published by the USDA Agricultural Marketing Service on the 
date the last bale from the unit is classed. If the date the last bale 
is classed is not available, the price quotations will be determined 
when the last bale from the unit is delivered to the warehouse, as shown 
on the producer's account summary obtained from the gin. If either price 
quotation is unavailable for the dates stated above, the price 
quotations for the nearest prior date for which price quotations for 
both the AUP and ELS cotton are available will be used. If prices are 
not yet available for the insured crop year, the previous season's 
average prices will be used.

                            11. Late Planting

    A late planting period is not applicable to ELS cotton. Any ELS 
cotton that is planted after the final planting date will not be insured 
unless you were prevented from planting it by the final planting date. 
Such acreage will be insurable, and the production guarantee and premium 
for the acreage will be determined in accordance with section 16 of the 
Basic Provisions.

                         12. Prevented Planting

    (a) In addition to the provisions contained in section 17 of the 
Basic Provisions, your prevented planting production guarantee will be 
based on your approved yield without adjustment for skip-row planting 
patterns.

[[Page 370]]

    (b) Your prevented planting coverage will be 50 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to a level specified in the actuarial documents.

[59 FR 49169, Sept. 27, 1994, as amended at 60 FR 62726, Dec. 7, 1995; 
62 FR 6704, Feb. 13, 1997; 62 FR 63633, Dec. 2, 1997; 62 FR 65165, Dec. 
10, 1997; 63 FR 55497, Oct. 16, 1998; 63 FR 66717, Dec. 3, 1998]



Sec. 457.106  Texas citrus tree crop insurance provisions.

    The Texas Citrus Tree Crop Insurance Provisions for the 1999 and 
succeeding crop years are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured policies

(Appropriate title for insurance provider)
    Both FCIC and Reinsured Policies

                    Texas Citrus Tree Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Bud union--The location on the tree trunk where a bud from one tree 
variety is grafted onto root stock of another variety.
    Crop--Specific groups of citrus fruit trees as listed in the Special 
Provisions.
    Crop year--For the 1998 crop year only, a period of time that begins 
on June 1, 1997, and ends on November 20, 1998. For all other crop 
years, a period of time that begins on November 21 of the calendar year 
prior to the year the trees normally bloom, and ends on November 20 of 
the following calendar year. The crop year is designated by the year in 
which the insurance period ends.
    Dehorning--Cutting all scaffold limbs to a length not longer than 
\1/4\ the height of the tree before such cutting.
    Destroyed--Trees damaged to the extent that removal is necessary.
    Excess precipitation--An amount of precipitation sufficient to 
directly damage the tree.
    Excess wind--A natural movement of air that has sustained speeds in 
excess of 58 miles per hour recorded at the U.S. Weather Service 
reporting station nearest to the crop at the time of crop damage.
    Freeze--The formation of ice in the cells of the trees caused by low 
air temperatures.
    Good farming practices--The cultural practices generally in use in 
the county for the trees to have normal growth and vigor and recognized 
by the Cooperative State Research, Education, and Extension Service as 
compatible with agronomic and weather conditions in the county.
    Interplanted--Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Irrigated practice--A method by which the normal growth and vigor of 
the insured trees is maintained by artificially applying adequate 
quantities of water during the growing season using the appropriate 
irrigation systems at the proper times.
    Root stock--A root or a piece of a root of one tree variety onto 
which a bud from another tree variety is grafted.
    Scaffold limbs--Major limbs attached directly to the trunk.
    Set out--Transplanting the tree into the grove.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will be divided into additional basic units by each citrus crop 
designated in the Special Provisions.
    (b) Sections 34(a) (1), (3), and (4) of the Basic Provisions are not 
applicable.
    (c) Provisions in the Basic Provisions that allow optional units by 
irrigated and non-irrigated practices are not applicable.
    (d)Instead of establishing optional units by section, section 
equivalent, or FSA farm serial number optional units may be established 
if each optional unit is located on non-contiguous land.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    (a) In lieu of the requirement of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8), that prohibits you from selecting more than one 
coverage level for each insured crop, you may select a different 
coverage level for each crop designated in the Special Provisions that 
you elect to insure.
    (b) In addition to the requirements of section 3 (Insurance 
Guarantees, Coverage Levels, and Prices for Determining Indemnities) of 
the Basic Provisions (Sec. 457.8):
    (1) If you insure trees within a crop which are either of a 
different variety or are planted at a different population density, the 
per acre amount of insurance for each variety or population density for 
the crop must bear the same relationship to the maximum amount of 
insurance available for each variety and population density of the crop 
as

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specified in the Actuarial documents. For example, if you elect 100 
percent of the maximum amount of insurance for a variety within a 
population density for the crop, you must select 100 percent of the 
maximum amount of insurance for that variety for all population 
densities for the crop. The amount of insurance for each variety and 
population density must be multiplied by any applicable factor contained 
in section 3(b)(2).
    (2) The amount of insurance per acre will be the product obtained by 
multiplying the reference maximum dollar amount of insurance that is 
shown in the actuarial documents for the applicable population density 
by the percentage for the level of coverage you select and by:
    (i) Thirty-three percent (0.33) for the year of set out, the year 
following dehorning, or the year following grafting of a set out tree. 
(Insurance will be limited to this amount until trees that are set out 
are one year of age or older on the first day of the crop year);
    (ii) Sixty percent (0.60) for the first growing season after being 
set out, the second year following dehorning, or the second year 
following grafting of a set out tree;
    (iii) Eighty percent (0.80) for the second growing season after 
being set out, the third year following dehorning, or the third year 
following grafting of a set out tree; or
    (iv) Ninety percent (0.90) for the third growing season after being 
set out, the fourth year following dehorning, or the fourth year 
following grafting of a set out tree.
    (3) The amount of insurance per acre for each population density, or 
factor as appropriate, will be multiplied by the applicable number of 
insured acres. These results will then be added together to determine 
the amount of insurance for the unit.
    (4) The amount of insurance will be reduced proportionately for any 
unit on which the stand is less than 90 percent, based on the original 
planting pattern. For example, if the amount of insurance you selected 
is $2,000 and the remaining stand is 85 percent of the original stand, 
the amount of insurance on which the premium and any indemnity will be 
based is $1,700 ($2,000 multiplied by 0.85).
    (5) If any insurable acreage of trees is set out after the first day 
of the crop year, and you elect to insure such acreage during that crop 
year, you must report the acreage, practice, crop, number of trees, date 
set out is completed, and your share to us within 72 hours after set out 
is completed for the unit.
    (6) Production reporting requirements contained in section 3 
(Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities) of the Basic Provisions (Sec. 457.8), are not applicable.
    (7) You must report, by the sales closing date contained in the 
Special Provisions, by type if applicable:
    (i) Any damage, removal of trees, change in practices, or any other 
circumstance that may reduce the amount of insurance, and the number of 
affected acres;
    (ii) The number of trees on insurable and uninsurable acreage;
    (iii) The date of original set out and the planting pattern;
    (iv) The date of replacement or dehorning, if more than 10 percent 
of the trees on any unit have been replaced or dehorned in the previous 
5 years; and
    (v) For the first year of insurance for acreage interplanted with 
another perennial crop, and anytime the planting pattern of such acreage 
is changed:
    (A) The age of the interplanted crop, and type if applicable;
    (B) The planting pattern; and
    (C) Any other information that we request in order to establish your 
amount of insurance.
    We will reduce the amount of insurance as necessary, based on our 
estimate of the effect of interplanting a perennial crop; removal of 
trees; damage; change in practices and any other circumstance on the 
potential of the insured crop. If you fail to notify us of any 
circumstance that may reduce the potential for the insured crop, we will 
reduce your amount of insurance as necessary at any time we become aware 
of the circumstance.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is August 31 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 November 20.

                            6. Annual Premium

    In addition to the provisions of section 5 (Annual Premium) of the 
Basic Provisions (Sec. 457.8), for the 1998 crop year, the premium 
amount otherwise payable for the 1998 crop year will be increased by 46 
percent as a result of the additional six months of coverage for that 
crop year.

                             7. Insured Crop

    (a) In accordance with section 8 (Insured Crop) of the Basic 
Provisions (Sec. 457.8), the crop insured will be all of each citrus 
tree crop designated in the Special Provisions in the county for which a 
premium rate is provided by the actuarial documents and that you elect 
to insure:

[[Page 372]]

    (1) In which you have an ownership share;
    (2) That is adapted to the area;
    (3) That is set out for the purpose of growing fruit to be harvested 
for the commercial production of fresh fruit or for juice;
    (4) That is irrigated; and
    (5) That have the potential to produce at least 70 percent of the 
county average yield for the crop and age, unless a written agreement is 
approved to insure the trees with lesser potential.
    (b) In addition to section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), we do not insure any citrus trees:
    (1) During the crop year the application for insurance is filed, 
unless we inspect the acreage and consider it acceptable; or
    (2) That have been grafted onto existing root stock or nursery stock 
within the one-year period prior to the date insurance attaches.
    (c) We may exclude from insurance or limit the amount of insurance 
on any acreage that was not insured the previous year.

                          8. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a 
crop planted with another crop, citrus trees interplanted with another 
perennial crop are insurable, unless we inspect the acreage and 
determine that it does not meet the requirements contained in your 
policy.

                           9. Insurance Period

    In lieu of the provisions of section 11 (Insurance Period) of the 
Basic Provisions (Sec. 457.8):
    (a) The insurance period is as follows:
    (1) For the 1998 crop year only, coverage will begin on June 1, 
1997, and will end on November 20, 1998.
    (2) For all subsequent crop years, coverage begins on November 21 of 
the calendar year prior to the year the insured crop normally blooms, 
except that for the year of application, if your application is received 
after November 11 but prior to November 21, insurance will attach on the 
10th day after your properly completed application is received in our 
local office, unless we inspect the acreage during the 10 day period and 
determine that it does not meet the requirements for insurability 
contained in your policy. You must provide any information that we 
require for the crop or to determine the condition of the grove.
    (3) The calendar date for the end of the insurance period for each 
crop year is November 20.
    (b) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (c) If you relinquish your insurable share on any insurable acreage 
of citrus trees on or before the acreage reporting date for the crop 
year, insurance will not be considered to have attached to and no 
premium or indemnity will be due for such acreage for that crop year 
unless:
    (1) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (2) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (3) The transferee is eligible for crop insurance.

                           10. Causes of Loss

    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:
    (a) Excess precipitation;
    (b) Excess wind;
    (c) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the grove;
    (d) Freeze;
    (e) Hail;
    (f) Tornado; or
    (g) Failure of the irrigation water supply if caused by an insured 
peril or drought that occurs during the insurance period.

                11. Duties In The Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), in case of 
damage or probable loss, if you intend to claim an indemnity on any 
unit, you must allow us to inspect all insured acreage before pruning, 
dehorning, or removal of any damaged trees.

                         12. Settlement of Claim

    (a) In the event of damage covered by this policy, we will settle 
your claim on a unit basis by:
    (1) Determining the actual percent of damage for the unit in 
accordance with sections 12 (b), (c), and (d);
    (2) Subtracting your deductible from the percent of damage for the 
unit (this result must be greater than zero to receive an indemnity);
    (3) Dividing the result of section 12(a)(2) by your coverage level 
percentage;
    (4) Multiplying the result of section 12(a)(3) by the amount of 
insurance per acre determined in accordance with section 3(b)(2);
    (5) Multiplying the result of section 12(a)(4) by the number of 
insured acres; and

[[Page 373]]

    (6) Multiplying the result of section 12(a)(5) by your share.
    (b) The percent of damage for any tree will be determined as 
follows:
    (1) For damage occurring during the year of set out (trees that have 
not been set out for at least one year at the time insurance attaches):
    (i) One-hundred percent (100%) whenever there is no live wood above 
the bud union;
    (ii) Ninety percent (90%) whenever there is less than 12 inches of 
live wood above the bud union; or
    (iii) The tree will be considered undamaged whenever there is more 
than 12 inches of live wood above the bud union; or
    (2) For damage occurring in any year following the year of set out:
    (i) The percentage of damage will be determined by dividing the 
number of scaffold limbs damaged in an area from the trunk to a length 
equal to one-fourth (\1/4\) the height of the tree, by the total number 
of scaffold limbs before damage occurred. Whenever this percentage 
exceeds 80 percent, the tree will be considered as 100 percent damaged.
    (ii) The percent of damage for the unit will be determined by 
computing the average of the determinations made for the individual 
trees. If this percent of damage exceeds 80 percent, the unit will be 
considered 100 percent damaged.
    (c) The percent of damage on the unit will be reduced by the 
percentage of damage due to uninsured causes.

                     13. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 4117, Jan. 29, 1997, as amended at 62 FR 65166, Dec. 10, 1997; 63 
FR 55779, Oct. 19, 1998]



Sec. 457.107  Florida citrus fruit crop insurance provisions.

    The Florida citrus fruit crop insurance provisions for the 1999 and 
succeeding crop years are as follows:

                        Department of Agriculture

                   Federal Crop Insurance Corporation

                  Florida Citrus Fruit Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Amount of insurance (acre). The dollar amount determined by 
multiplying the Reference Maximum Dollar Amount shown on the actuarial 
documents for the citrus fruit times the coverage level you elect, times 
your share.
    Box. A standard field box as prescribed in the State of Florida 
Citrus Fruit Laws.
    Citrus fruit type. Any of the following:
    (1) Type I--Early and mid-season oranges;
    (2) Type II--Late oranges juice;
    (3) Type III--Grapefruit for which freeze damage will be adjusted on 
a juice basis;
    (4) Type IV--Navel Oranges, Tangelos and Tangerines;
    (5) Type V--Murcott Honey Oranges (also known as Honey Tangerines) 
and Temple Oranges;
    (6) Type VI--Lemons and Limes; and
    (7) Type VII--Grapefruit for which freeze damage will be adjusted on 
a fresh fruit basis, and late oranges fresh.
    Freeze. The formation of ice in the cells of the fruit caused by low 
air temperatures.
    Good farming practices. The cultural practices generally in use in 
the county for the crop to make normal progress toward maturity and 
produce the expected yield for the type and age of citrus fruit, and are 
those recognized by the Cooperative State Research, Education, and 
Extension Service as compatible with agronomic and weather conditions in 
the county.
    Harvest. The severance of mature citrus fruit from the tree by 
pulling, picking, or any other means, or collecting the marketable fruit 
from the ground.
    Hurricane. A windstorm classified by the U.S. Weather Service as a 
hurricane.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Potential production. Citrus fruit that would have been produced had 
damage not occurred, including citrus fruit that:
    (1) Was harvested before damage occurred;
    (2) Remained on the tree after damage occurred; and
    (3) Was lost from either an insured or uninsured cause;
    But not including citrus fruit that:
    (1) Was lost before insurance attached for any crop year;
    (2) Was lost by normal dropping; or
    (3) Any tangerines that normally would not meet the 210 pack size (2 
and 4/16 inch minimum diameter) under United States Standards by the end 
of the insurance period for tangerines.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will be divided into additional basic units by each citrus crop 
designated in the Special Provisions.
    (b) Provisions in the Basic Provisions that allow optional units by 
irrigated and non-irrigated practices are not applicable.

[[Page 374]]

    (c)Instead of establishing optional units by section, section 
equivalent, or FSA farm serial number, optional units may be established 
if each optional unit is located on non-contiguous land.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one coverage level for each Florida citrus 
fruit type shown in section 1 of these crop provisions or designated in 
the Special Provisions, that you elect to insure. If different amounts 
of insurance are available for citrus fruit within a type, you must 
select the same coverage level for each citrus fruit. For example, if 
you choose the 75 percent coverage level for a specific citrus fruit 
within a type, you must also choose the 75 percent coverage level for 
all other citrus fruit within that type.
    (b) In lieu of the production reporting date contained in section 3 
(Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities) of the Basic Provisions (Sec. 457.8), potential production 
for each unit will be determined during loss adjustment.
    (c) By the sales closing date contained in the Special Provisions, 
for the first year of insurance for acreage interplanted with another 
citrus fruit crop, and anytime the planting pattern of such acreage is 
changed, you must report the following:
    (1) The age of the interplanted trees and type if applicable;
    (2) The planting pattern; and
    (3) Any other information we request in order to establish your 
amount of insurance.
    (d) We will reduce acreage or the amount of insurance or both, as 
necessary, based on our estimate of the effect of the interplanted 
citrus fruit trees on the insured citrus fruit crop. If you fail to 
notify us of any circumstance that may reduce the acreage or amount of 
insurance, we will reduce the acreage or amount of insurance or both as 
necessary any time we become aware of the circumstance.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is March 15 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 date 
is April 30 preceding the crop year. The termination date is April 30 of 
the crop year.

                             6. Insured Crop

    (a) In accordance with section 8 (Insured Crop) of the Basic 
Provisions (Sec. 457.8), the crop insured will be all acreage of each 
citrus fruit type that you elect to insure, in which you have a share, 
that is grown in the county shown on the application, and for which a 
premium rate is quoted in the actuarial documents.
    (b) In addition to the citrus fruit not insurable in section 8 
(Insured Crop) of the Basic Provisions (Sec. 457.8), we do not insure 
any citrus fruit:
    (1) That cannot be expected to mature each crop year within the 
normal maturity period for the type;
    (2) Produced by trees that have not reached the fifth growing season 
after being set out, unless otherwise provided in the Special Provisions 
or by a written agreement to insure such citrus fruit;
    (3) Of ``Meyer Lemons'' and oranges commonly known as ``Sour 
Oranges'' or ``Clementines''; or
    (4) Of the Robinson tangerine variety, for any crop year in which 
you have elected to exclude such tangerines from insurance. (You must 
elect this exclusion prior to the crop year for which the exclusion is 
to be effective, except that for the first crop year you must elect this 
exclusion by the later of April 30 or the time you submit the 
application for insurance.)
    (c) Upon our approval, prior to the date insurance attaches, you may 
elect to insure or exclude from insurance any insurable acreage that has 
a potential production of less than 100 boxes per acre. If you:
    (1) Elect to insure such acreage, we will consider the potential 
production to be 100 boxes per acre when determining the amount of loss; 
or
    (2) Elect to exclude such acreage, we will disregard the acreage for 
all purposes related to this contract.
    (d) In addition to the provisions in section 6 (Report of Acreage) 
of the Basic Provisions (Sec. 457.8), if you fail to notify us of your 
election to insure or exclude acreage, and the potential production from 
such acreage is 100 or more boxes per acre, we will determine the 
percent of damage on all of the insurable acreage for the unit, but will 
not allow the percent of damage for the unit to be increased by 
including such acreage.

                          7. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a 
crop planted with another crop, citrus fruit interplanted with another 
citrus fruit crop is insurable unless we inspect the acreage and 
determine that it does not meet the requirements contained in your 
policy.

[[Page 375]]

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on May 1 of each crop year, except that for the 
year of application if your application is received by us after April 
21, but prior to May 1, insurance will attach on the 10th day after your 
properly completed application, acreage, and production reports are 
received in our local office, unless we inspect the acreage during the 
10 day period and determine that it does not meet the requirements for 
insurability contained in your policy. You must provide any information 
that we require for the crop to determine the condition of the grove to 
be insured.
    (2) The calendar date for the end of the insurance period for each 
crop year is:
    (i) January 31 for tangerines and navel oranges;
    (ii) April 30 for lemons, limes, tangelos, early and mid-season 
oranges; and
    (iii) June 30 for late oranges, grapefruit, Temple, and Murcott 
Honey Oranges.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins, but on or before the acreage reporting date of any crop 
year, and if after inspection we consider the acreage acceptable, then 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable share on any insurable acreage 
of citrus fruit on or before the acreage reporting date of any crop 
year, insurance will not be considered to have attached to, no premium 
will be due and no indemnity paid for, such acreage for that crop year 
unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            9. 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) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the grove;
    (2) Freeze;
    (3) Hail;
    (4) Hurricane; or
    (5) Tornado.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to:
    (1) Any damage to the blossoms or trees; or
    (2) Inability to market the citrus fruit for any reason other than 
actual physical damage from an insurable cause specified in this 
section. For example, we will not pay you an indemnity if you are unable 
to market due to quarantine, boycott, or refusal of any person to accept 
production.

                         10. 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 such 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) Calculating the amount of insurance for the unit by multiplying 
the number of acres by the respective dollar amount of insurance per 
acre for the citrus fruit and multiplying that result by your share;
    (2) Calculating the average percent of damage to the respective 
citrus fruit, rounded to the nearest tenth of a percent (0.1%). The 
percent of damage will be the ratio of the number of boxes of citrus 
fruit considered damaged from an insured cause divided by the undamaged 
potential production. Citrus fruit will be considered undamaged 
potential production if it is:
    (i) Marketed or could be marketed as fresh fruit;
    (ii) Harvested prior to inspection by us; or
    (iii) Harvested within 7 days after a freeze;
    (3) Subtracting the coverage level percentage from 100 percent;
    (i) Subtracting this result from the result of section (10)(b)(2); 
and
    (ii) If the result section (10)(b)(3)(i) is positive, dividing this 
result by the coverage level percentage;
    (4) Multiplying the result of section (10)(b)(3)(ii) by the amount 
of insurance for the unit for the respective citrus fruit.
    (For example, if the average percent of damage is 70 percent and the 
coverage level is 75 percent (the deductible is 25 percent), the amount 
payable is 60 percent times the amount of insurance (70% damage - 25 % 
level deductible)=45% (45%  75%) 60% adjusted damage times the 
amount of insurance); and
    (5) Totaling all such results of section (10)(b)(4) to determine the 
amount payable for the unit.

[[Page 376]]

    (c) Citrus fruit of Types IV, V, and VII that are seriously damaged 
by freeze, as determined by a fresh-fruit cut of a representative sample 
of fruit in the unit in accordance with the applicable provisions of the 
State of Florida Citrus Fruit laws, and that are not or could not be 
marketed as fresh fruit, will be considered damaged to the following 
extent:
    (1) If less than 16 percent of the fruit in a sample shows serious 
freeze damage, the fruit will be considered undamaged; or
    (2) If 16 percent or more of the fruit in a sample shows serious 
freeze damage, the fruit will be considered 50 percent damaged, except 
that:
    (i) For tangerines of Type IV, damage in excess of 50 percent will 
be the actual percent of damaged fruit; and
    (ii) Citrus of Types IV (except tangerines), V, and VII, if it is 
determined that the juice loss in the fruit exceeds 50 percent, such 
percent will be considered the percent of damage.
    (d) Notwithstanding the provisions of section 10(c) of these crop 
provisions as to citrus fruit of Types IV, V, and VII, in any unit that 
is mechanically separated using the specific-gravity (floatation) method 
into undamaged and freeze-damaged fruit, the amount of damage will be 
the actual percent of freeze-damaged fruit not to exceed 50 percent and 
will not be affected by subsequent fresh-fruit marketing. However, the 
50 percent limitation on mechanically-separated, freeze-damaged fruit 
will not apply to tangerines of citrus fruit Type IV.
    (e) Any citrus fruit of Types I, II, III, and VI damaged by freeze, 
but that can be processed into products for human consumption, will be 
considered as marketable for juice. The percent of damage will be 
determined by relating the juice content of the damaged fruit to:
    (1) The average juice content of the fruit produced on the unit for 
the three previous crop years based on your records, if they are 
acceptable to us; or
    (2) The following juice content, if acceptable records are not 
furnished:

(i) Type I--52 pounds of juice per box
(ii) Type II--54 pounds of juice per box
(iii) Type III--45 pounds of juice per box
(iv) Type VI--43 pounds of juice per box

    (f) Any citrus fruit on the ground that is not collected and 
marketed will be considered as 100 percent damaged if the damage was due 
to an insured cause.
    (g) Any citrus fruit that is unmarketable either as fresh fruit or 
as juice because it is immature, unwholesome, decomposed, adulterated, 
or otherwise unfit for human consumption due to an insured cause will be 
considered as 100 percent damaged.
    (h) Citrus fruit of Types IV, V, and VII that are unmarketable as 
fresh fruit due to serious damage from hail as defined in the applicable 
United States Standards for Grades of Florida fruit will be considered 
totally lost.

                     11. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[61 FR 69002, Dec. 31, 1996, as amended at 62 FR 65166, Dec. 10, 1997]



Sec. 457.108  Sunflower seed crop insurance provisions.

    The sunflower seed crop insurance provisions for the 1998 and 
succeeding crop years are as follows:

                        Department of Agriculture

                   Federal Crop Insurance Corporation

                     Sunflower Seed Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Harvest--Combining or threshing the sunflowers for seed.
     Local market price--The cash seed price per pound for oil type 
sunflower seed grading U.S. No. 2, or non-oil type sunflower seed with a 
test weight of at least 22 pounds per bushel and less than five percent 
(5%) kernel damage, offered by buyers in the area in which you normally 
market the sunflower seed. The local market price for oil type sunflower 
seed will reflect the maximum limits of quality deficiencies allowable 
for the U.S. No. 2 grade of sunflower seed. Factors not associated with 
grading of sunflower seed under the Official United States Standards for 
Grain including, but not limited to, oil or moisture content will not be 
considered.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, sunflower seed must initially be planted ini rows far 
enough apart to permit mechanical cultivation, unless otherwise provided 
by the Special Provisions, actuarial documents, or by written agreement.

  2. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    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 sunflower seed in the county insured under this policy. 
Notwithstanding the preceding sentence, if the Special Provisions 
provide different price elections by type, you may select one price

[[Page 377]]

election for each sunflower seed type designated in the Special 
Provisions.

                           3. Contract Changes

    The contract change date is November 30 (December 17 for the 1998 
crop year only) preceding the cancellation date (see the provisions of 
Section 4 (Contract Changes) of the Basic Provisions).

                  4. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions (Sec. 457.8), 
the cancellation and termination dates are March 15.

                             5. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the oil and non-oil type 
sunflower seed in the county for which a premium rate is provided by the 
actuarial documents:
    (a) In which you have a share;
    (b) That is planted for harvest as sunflower seed; and
    (c) That is not (unless a written agreement allows otherwise):
    (1) Interplanted with another crop; or
    (2) Planted into an established grass or legume.

                          6. Insurable Acreage

    In addition to the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8):
    (a) We will not insure any acreage which does not meet the rotation 
requirements shown in the Special Provisions; and
    (b) Any acreage of the insured crop damaged before the final 
planting date, to the extent that a majority of producers in the area 
would not normally further care for the crop, must be replanted unless 
we agree that it is not practical to replant.

                           7. 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 November 30, immediately following planting.

                            8. Causes of Loss

    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:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) If applicable, failure of the irrigation water supply due to an 
unavoidable cause of loss occurring after the beginning of planting.

                         9. Replanting Payments

    (a) In accordance with section 13 of the Basic Provisions, a 
replanting payment for sunflower seed is allowed if the sunflowers are 
damaged by an insurable cause of loss to the extent that the remaining 
stand will not produce at least ninety percent of the production 
guarantee for the acreage and it is practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of twenty percent (20%) of the production guarantee or 175 
(pounds of seed), multiplied by your price election, multiplied by your 
insured share or the share determined in accordance with section 9(c), 
if applicable.
    (c) When more than one person insures the same crop on a share 
basis, a replanting payment based on the total shares insured by us may 
be made to the insured person who incurs the total cost of replanting. 
Payment will be made in this manner only if an agreement exists between 
the insured persons which:
    (1) Requires one person to incur the entire cost of replanting; or
    (2) Gives the right to all replanting payments to one person.
    (d) When sunflower seed is replanted using a practice that is 
uninsurable as an original planting, the liability for the unit will be 
reduced by the amount of the replanting payment which is attributable to 
your share. The premium amount will not be reduced.

                10. Duties in the Event of Damage or Loss

    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.

                         11. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide records of production:
    (1) For any optional unit, we will combine all optional units for 
which acceptable records of production were not provided; or

[[Page 378]]

    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim on any unit by:
    (1) Multiplying the insured acreage of each type of sunflower seed 
by the production guarantee for the applicable type;
    (2) Multiplying each result by the price election for the applicable 
type;
    (3) Adding these values;
    (4) Multiplying the production to count of each type of sunflower 
seed by the price election for that type;
    (5) Adding these dollar values;
    (6) Subtracting the result of step (5) from the result of step (3); 
and
    (7) Multiplying the result by your share.
    (c) The total production (pounds) to count from all insurable 
acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) Damaged solely by uninsured causes; or
    (D) For which you fail to provide records of production that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies and excess moisture in accordance with 
subsection 11(d)); and
    (iv) Potential production on insured acreage you want to put to 
another use or you wish to 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 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 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 you 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.
    (d) Mature sunflower seed production may be adjusted for excess 
moisture and quality deficiencies. If moisture adjustment is applicable, 
it will be made prior to any adjustment for quality.
    (1) Production will be reduced by 0.12 percent for each 0.1 
percentage point of moisture in excess of ten percent (10%). We may 
obtain samples of the production to determine the moisture content.
    (2) Production will be eligible for quality adjustment if:
    (i) Deficiencies in quality result in:
    (A) Oil type sunflower seed not meeting the grade requirements for 
U.S. No. 2 (grades U.S. sample grade) because of test weight, kernel 
damage (excluding heat damage), or a musty, sour or commercially 
objectionable foreign odor; or
    (B) Non-oil type sunflower seed having a test weight below 22 pounds 
per bushel or kernel damage (excluding heat damage) in excess of five 
percent (5%) or a musty, sour or commercially objectionable foreign 
odor; or
    (ii) Substances or conditions are present that are identified by the 
Food and Drug Administration or other public health organizations of the 
United States as being injurious to human or animal health.
    (3) Quality will be a factor in determining your loss only if:
    (i) The deficiencies, substances, or conditions, resulted from a 
cause of loss against which insurance is provided under these crop 
provisions and within the insurance period ;
    (ii) All determinations of these deficiencies, substances, or 
conditions are made using samples of the production obtained by us or by 
a disinterested third party approved by us; and
    (iii) The samples are analyzed by a grader licensed to grade 
sunflower seed under the authority of the United States Grain Standards 
Act or the United States Warehouse Act with regard to deficiencies in 
quality, or by a laboratory approved by us with regard to substances or 
conditions injurious to human or animal health. (Test weight for quality 
adjustment purposes may also be determined by our loss adjuster.)
    (4) Sunflower seed production that is eligible for quality 
adjustment, as specified in paragraphs 11(d) (2) and (3), will be 
reduced:
    (i) In accordance with quality adjustment factor provisions 
contained in the Special Provisions; or
    (ii) As follows, if quality adjustment factor provisions are not 
contained in the Special Provisions:
    (A) The market price of the qualifying damaged production and the 
local market price will be determined on the earlier of the

[[Page 379]]

date such quality adjusted production is sold or the date of final 
inspection for the unit. The price for the qualifying damaged production 
will be the market price for the local area to the extent feasible. 
Discounts used to establish the net price of the damaged production will 
be limited to those which are usual, customary, and reasonable. The 
price will not be reduced for:
    (1) Moisture content;
    (2) Damage due to uninsured causes; or
    (3) Drying, handling, processing, or any other costs associated with 
normal harvesting, handling, and marketing of the sunflower seed; 
except, if the price of the damaged production can be increased by 
conditioning, we may reduce the price of the production after it has 
been conditioned by the cost of conditioning but not lower than the 
value of the production before conditioning. (We may obtain prices from 
any buyer of our choice. If we obtain prices from one or more buyers 
located outside your local market area, we will reduce such prices by 
the additional costs required to deliver the sunflower seed to those 
buyers.);
    (B) The value of the damaged or conditioned production will be 
divided by the local market price to determine the quality adjustment 
factor; and
    (C) The number of pounds remaining after any reduction due to 
excessive moisture (the moisture-adjusted gross pounds (if appropriate)) 
of the damaged or conditioned production will then be multiplied by the 
quality adjustment factor to determine the net production to count.
    (e) Any production harvested from plants growing in the insured crop 
may be counted as production of the insured crop on a weight basis.

                         12. Prevented Planting

    Your prevented planting coverage will be 60 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase you prevented 
planting coverage to a level specified in the actuarial documents.

[59 FR 67136, Dec. 29, 1994, as amended at 60 FR 62727, Dec. 7, 1995; 62 
FR 63633, Dec. 2, 1997; 62 FR 65166, Dec. 10, 1997]



Sec. 457.109  Sugar Beet Crop Insurance Provisions.

    The Sugar Beet Crop Insurance Provisions for the 1998 and succeeding 
crop years in countries with a contract change date of November 30, and 
for the 1999 and succeeding crop years in countries with a contract 
change date of April 30, are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured policies

(Appropriate title for insurance provider)
    Both FCIC and Reinsured Policies

                       Sugar Beet Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Crop year. In Imperial, Lassen, Modoc, Shasta and Siskiyou counties, 
California and all other States, the period within which the sugar beets 
are normally grown, which is designated by the calendar year in which 
the sugar beets are normally harvested. In all other California 
counties, the period from planting until the applicable date for the end 
of the insurance period which is designated by:
    (a) The calendar year in which planted if planted on or before July 
15; or
    (b) The following calendar year if planted after July 15.
    Harvest. Topping and lifting of sugar beets in the field.
    Initially planted. The first occurrence that land is considered as 
planted acreage for the crop year.
    Local market price. The price per pound for raw sugar offered by 
buyers in the area in which you normally market the sugar beets.
    Planted acreage.--In addition to the definition contained in the 
Basic Provisions, sugar beets must initially be planted in rows, unless 
otherwise provided by the Special Provisions, actuarial documents, 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, time to crop maturity, 
and marketing window, 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 if 
production from the replanted acreage cannot be delivered under the 
terms of the processor contract, or 30 days after the initial planting 
date for all counties where a late planting period is not applicable, 
unless replanting is generally occurring in the area.
    Processor. Any business enterprise regularly engaged in processing 
sugar beets for

[[Page 380]]

sugar that possesses all licenses and permits for processing sugar beets 
required by the State in which it operates, and that possesses 
facilities, or has contractual access to such facilities, with enough 
equipment to accept and process the contracted sugar beets within a 
reasonable amount of time after harvest.
    Production guarantee (per acre):
    (a) First stage production guarantee--The final stage production 
guarantee multiplied by 60 percent.
    (b) Final stage production guarantee--The number of tons determined 
by multiplying the approved yield per acre by the coverage level 
percentage you elect.
    Raw sugar. Sugar that has not been extracted from the sugar beet.
    Standardized ton. A ton of sugar beets containing the percentage of 
raw sugar specified in the Special Provisions.
    Sugar beet processor contract. A written contract between the 
producer and the processor, containing at a minimum:
    (1) The producer's commitment to plant and grow sugar beets, and to 
deliver the sugar beet production to the processor;
    (2) The processor's commitment to purchase the production stated in 
the contract; and
    (3) A price or formula for a price based on third party data that 
will be paid to the producer for the production stated in the contract.
    Thinning. The process of removing, either by machine or hand, a 
portion of the sugar beet plants to attain a desired plant population.
    Ton. Two thousand (2,000) pounds avoirdupois.

                            2. Unit Division

    In addition to the requirements of section 34 of the Basic 
Provisions, basic units may be divided into optional units only if you 
have a sugar beet processor contract that requires the processor to 
accept all production from a number of acres specified in the sugar beet 
processor contract. Acreage insured to fulfil a a sugar beet contract 
which provides that the processor will accept a designated amount of 
production or a combination of acreage and production will not be 
eligible for optional units.

  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 sugar beets in the county insured under this 
policy.
    (b) The production guarantees are progressive by stages, and 
increase at specified intervals to the final stage. The stages are:
    (1) First stage, with a guarantee of 60 percent (60%) of the final 
stage production guarantee, extends from planting until:
    (i) July 1 in Lassen, Modoc, Shasta and Siskiyou counties, 
California and all other States except Arizona; and
    (ii) The earlier of thinning or 90 days after planting in Arizona 
and all other California counties.
    (2) Final stage, with a guarantee of 100 percent (100%) of the final 
stage production guarantee, applies to all insured sugar beets that 
complete the first stage.
    (c) The production guarantee will be expressed in standardized tons.
    (d) Any acreage of sugar beets damaged in the first stage to the 
extent that growers in the area would not normally further care for the 
sugar beets will be deemed to have been destroyed, even though you may 
continue to care for it. The production guarantee for such acreage will 
not exceed the first stage production guarantee.

                           4. Contract Changes

    In accordance with the provisions of section 4 (Contract Changes) of 
the Basic Provisions, the contract change date is April 30 preceding the 
cancellation date for counties with a July 15 or August 31 cancellation 
date and November 30 (December 17 for the 1998 crop year only) preceding 
the cancellation date for all other counties.

                  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          Cancellation date    Termination date
------------------------------------------------------------------------
Arizona; and Imperial County,    August 31..........  August 31.
 California.
All California counties, except  July 15............  November 30.
 Imperial, Lassen, Modoc,
 Shasta and Siskiyou.
All Other States, and Lassen,    March 15...........  March 15.
 Modoc, Shasta and Siskiyou
 Counties, California.
------------------------------------------------------------------------

                            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 final stage production 
guarantee by the price election, the premium rate, the insured acreage, 
your share at the time of

[[Page 381]]

planting, and any applicable premium adjustment factors contained in the 
Actuarial Table.

                             7. Insured Crop

    (a) In accordance with section 8 (Insured Crop) of the Basic 
Provisions (Sec. 457.8), the crop insured will be all the sugar beets in 
the county for which a premium rate is provided by the actuarial 
documents:
    (1) In which you have a share;
    (2) That are planted for harvest as sugar beets;
    (3) That are grown under a sugar beet processor contract executed 
before the acreage reporting date and are not excluded from the 
processor contract at any time during the crop year; and
    (4) That are not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Interplanted with another crop;
    (ii) Planted into an established grass or legume; or
    (iii) Planted prior to submitting a properly completed application.
    (b) Sugar beet growers who are also processors may establish an 
insurable interest if they meet the following requirements:
    (1) The processor must meet the definition of a ``processor'' in 
section 1 of these crop provisions and have a valid insurable interest 
in the sugar beet crop;
    (2) The Board of Directors or officers of the processor must have 
duly promulgated a resolution that sets forth essentially the same terms 
as a sugar beet processor contract. Such resolution will be considered a 
sugar beet processing contract under the terms of the sugar beet crop 
insurance policy;
    (3) The sales records of the processor showing the amount of sugar 
produced the previous year must be supplied to us to confirm the 
processor has produced and sold sugar in the past; and
    (4) Our inspection of the processing facilities determines that they 
conform to the definition of processor contained in section 1 of these 
crop provisions.

                          8. Insurable Acreage

    In addition to the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8):
    (a) We will not insure any acreage planted to sugar beets:
    (1) The preceding crop year, unless otherwise specified in the 
Special Provisions for the county;
    (2) In any crop year following the discovery of rhizomania on the 
acreage, unless allowed by the Special Provisions or by written 
agreement; or
    (3) That does not meet the rotation requirements shown in the 
Special Provisions;
    (b) Any acreage of the insured crop damaged before the final 
planting date, (or within 30 days of initial planting for those counties 
without a final planting date) to the extent that growers in the area 
would normally not further care for the crop, must be replanted unless 
we agree that replanting is not practical.

                           9. Insurance Period

    (a) 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:
    (1) July 15 in Arizona and in Imperial County, California;
    (2) The last day of the 12th month after the insured crop was 
initially planted in all California counties except Imperial, Lassen, 
Modoc, Shasta and Siskiyou;
    (3) October 31 in Lassen, Modoc, Shasta and Siskiyou Counties, 
California, and in Klamath County, Oregon;
    (4) November 25 in Ohio;
    (5) December 31 in New Mexico and Texas; and
    (6) November 15 in all other States and counties.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8), regarding the end of the insurance 
period, the insurance period ends for all units when the production 
delivered to the processor equals the amount of production stated in the 
sugar beet processor contract.

                           10. Causes of Loss

    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:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.

                         11. Replanting Payments

    (a) In accordance with section 13 (Replanting Payment) of the Basic 
Provisions (Sec. 457.8), a replanting payment is allowed if the crop is 
damaged by an insurable cause of loss to the extent that the remaining 
stand will not produce at least 90 percent (90%) of the final stage 
production guarantee for the acreage and it is practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of 10

[[Page 382]]

percent (10%) of the final stage production guarantee or one ton, 
multiplied by your price election, multiplied by your insured share.
    (c) When sugar beets are replanted using a practice that is 
uninsurable for an original planting, our liability on the unit will be 
reduced by the amount of the replanting payment. The premium amount will 
not be reduced.

                12. Duties In The Event of Damage or Loss

    In accordance with the requirements of section 14 (Duties in the 
Event of Damage or Loss) of the Basic Provisions (Sec. 457.8):
    (a) 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; and
    (b) You must provide a copy of your sugar beet processor contract or 
corporate resolution if you are the processor.

                         13. 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 unit, we will combine all optional units for 
which acceptable production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim on any unit by:
    (1) Multiplying the insured acreage by its respective production 
guarantee;
    (2) Subtracting the total production to count from the result in 
paragraph (b)(1);
    (3) Multiplying the result of paragraph (b)(2) by your price 
election; and
    (4) Multiplying the result of paragraph (b)(3) by your share.
    (c) The total production to count (in standardized tons) from all 
insurable acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records that 
are acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (unharvested production that is 
appraised prior to the earliest delivery date that the processor accepts 
harvested production will not be eligible for a conversion to 
standardized tons in accordance with section 13 (d) and (e));
    (iv) Only appraised production in excess of the difference between 
the first and final stage production guarantee for acreage that does not 
qualify for the final stage guarantee will be counted, except that all 
production from acreage subject to section 13(c)(1) (i) and (ii) will be 
counted; 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 if 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 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 you 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.
    (d) Harvested production or unharvested production that is appraised 
after the earliest delivery date that the processor accepts harvested 
production and that meets the minimum acceptable standards contained in 
the sugar beet processor contract or corporate resolution will be 
converted to standardized tons by:
    (1) Dividing the average percentage of raw sugar in such sugar beets 
by the raw sugar content percentage shown in the Special Provisions; and
    (2) Multiplying the result (rounded to three places) by the number 
of tons of such sugar beets.
    The average percentage of raw sugar will be determined from tests 
performed by the processor at the time of delivery. If individual tests 
of raw sugar content are not made at the time of delivery, the average 
percent of raw sugar may be based on the results of previous tests 
performed by the processor during the crop year if it is determined that 
such results are representative of the total

[[Page 383]]

production. If not representative, the average percent of raw sugar will 
equal the raw sugar content percent shown in the Special Provisions.
    (e) Harvested production or unharvested production that is appraised 
after the earliest delivery date that the processor accepts harvested 
production and that does not meet the minimum acceptable standards 
contained in the sugar beet processor contract due to an insured peril 
will be converted to standardized tons by:
    (1) Dividing the gross dollar value of all of the damaged sugar 
beets on the unit (including the value of cooperative stock, patronage 
refunds, etc.) by the local market price per pound on the earlier of the 
date such production is sold or the date of final inspection for the 
unit;
    (2) Dividing that result by 2,000; and
    (3) Dividing that result by the county average raw sugar factor 
contained in the Special Provisions for this purpose.
    For example, assume that the total dollar value of the damaged sugar 
beets is $6,000.00; the local market price is $0.10; and the county 
average raw sugar factor is 0.15. The amount of production to count 
would be calculated as follows: 
(($6,000.00$0.10)2,000)0.15=200 tons.

                     14. Late and Prevented Planting

    The late planting provisions contained in section 16 of the Basic 
Provisions are not applicable in California counties with a July 15, 
cancellation date.

                         15. Prevented Planting

    (a) The prevented planting provision contained in sectino 17 of the 
Basic Provisions are not applicable in Califronia counties with a July 
15, cancellation date.
    (b) Except in those counties indicated in section 15(a), your 
prevented planting coverage will be 45 percent of your production 
guarantee for timely planted acreage. If you have limited or additional 
levels of coverage, as specified in 7 CFR part 400, subpart T, and pay 
an additional premium, you may increase your prevented planting coverage 
to a level specified in the actuarial documents.

[61 FR 58775, Nov. 19, 1996, as amended at 62 FR 63633, Dec. 2, 1997; 62 
FR 65167, Dec. 10, 1997]



Sec. 457.110  Fig crop insurance provisions.

    The Fig Crop Insurance Provisions for the 1999 and succeeding crop 
years are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Fig Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Harvest--The picking of the figs from the trees or ground by hand or 
machine for the purpose of removal from the orchard.
    Manufacturing grade production-- Production that meets the minimum 
grade standards and is defined as ``manufacturing grade'' by the 
Marketing Order for Dried Figs, as amended, which is in effect on the 
date insurance attaches.
    Marketable figs-- Figs that grade manufacturing grade or better in 
accordance with the Marketing Order for Dried Figs, as amended, which is 
in effect on the date insurance attaches.
    Substandard production-- Production that does not meet minimum grade 
standards and is defined as ``substandard'' by the Marketing Order for 
Dried Figs, as amended, which is in effect on the date insurance 
attaches.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will be divided into additional basic units by each fig type designated 
in the Special Provisions.
    (b) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Optional units may be 
established only if each optional unit is located on non-contiguous 
land, unless otherwise allowed by written agreement.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements under 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 each fig type designated in the Special Provisions, and 
insured in the county under this policy.

                           4. Contract Changes

    The contract change date is October 31 preceding the cancellation 
date (see the provisions under section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8)).

                  5. Cancellation and Termination Dates

    The cancellation and termination dates are February 28.

[[Page 384]]

                          6. Report of Acreage

    By applying for fig crop insurance, you authorize us to have access 
to and to determine or verify your production and acreage from records 
maintained by the California Fig Advisory Board and the fig packer.

                             7. Insured Crop

    The crop insured will be all the commercially grown dried figs that 
are grown in the county on insurable acreage, and for which a premium 
rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are grown for harvest as dried figs;
    (c) That are irrigated;
    (d) That have reached the seventh growing season after being set 
out; and
    (e) For which acceptable production records for at least the 
previous crop year are provided;
    (f) That are not figs:
    (1) Grown on acreage with less than 90 percent of a stand based on 
the original planting pattern unless we agree, in writing, to insure 
such figs;
    (2) Which we inspect and consider not acceptable;
    (3) Grown for the crop year the application is filed unless 
inspected and accepted by us; or
    (4) Grown on acreage acquired for the crop year unless such acreage 
has been inspected and accepted by us.

                           8. Insurance Period

    In lieu of the provisions of section 11 (Insurance Period) of the 
Basic Provisions (Sec. 457.8), insurance attaches on each unit the later 
of the date you submit your application or March 1 of the crop year and 
ends at the earliest of:
    (a) Total destruction of the fig crop;
    (b) The date harvest of the figs (by type) should have started on 
any acreage that will not be harvested;
    (c) Harvest of the figs;
    (d) Final adjustment of a loss;
    (e) Abandonment of the crop; or
    (f) October 31 of the crop year.

                            9. Causes of Loss

    (a) In addition to the provisions under section 12 (Causes of Loss) 
of the Basic Provisions (Sec. 457.8), any loss covered by this policy 
must occur within the insurance period. The specific causes of loss for 
figs are:
    (1) Adverse weather conditions;
    (2) Earthquake;
    (3) Fire;
    (4) Volcanic eruption;
    (5) Wildlife; or
    (6) Failure of the irrigation water supply.
    (b) In addition to the causes of loss not insured against contained 
in section 12 (Causes of Loss) of the Basic Provisions (Sec. 457.8), we 
will not insure against:
    (1) Any loss of production due to fire, where weeds and other forms 
of undergrowth have not been controlled or tree pruning debris has not 
been removed from the grove; or
    (2) The inability to market the fruit as a direct result of 
quarantine, boycott, or refusal of any entity to accept production.

                         10. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide records of production that are acceptable to us 
for any:
    (1) Optional unit, we will combine all optional units for which 
acceptable records of production were not provided; or
    (2) Basic unit, we will allocate any commingled production to such 
units in proportion to our liability on the harvested acreage for each 
unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting from this the total production to count;
    (3) Multiplying the remainder by your price election; and
    (4) Multiplying this result by your share.
    (c) The total production (pounds) to count from all insurable 
acreage on the unit will include all harvested and appraised marketable 
figs.
    (1) Figs, which due to insurable causes, grade manufacturing grade 
will be adjusted by:
    (i) Dividing the value per pound of the manufacturing grade 
production by the highest price election available for the insured type; 
and
    (ii) Multiplying the result (not to exceed 1) by the number of 
pounds of such manufacturing grade production.
    (2) Figs, which due to insurable causes, grade substandard and are 
delivered to the substandard pool will not be considered production to 
count, provided all the insured's substandard production is inspected by 
us and we give written consent to such delivery prior to delivery. If we 
do not give written consent prior to the delivery to the substandard 
pool, all production will be counted as undamaged marketable production. 
Substandard production for which we give written consent to you prior to 
delivery to the substandard pool, which is not delivered to the 
substandard pool, and is sold by you, will be considered production to 
count and adjusted as follows:
    (i) Dividing the value per pound received for such substandard 
production by the highest price election available for the insured type; 
and

[[Page 385]]

    (ii) Multiplying the result (not to exceed 1) by the number of 
pounds of such substandard production.
    (3) Appraised production to be counted will include:
    (i) Potential production lost due to uninsured causes and failure to 
follow recognized good fig farming practices;
    (ii) Not less than the production guarantee for the figs on any 
acreage:
    (A) That is abandoned without our consent;
    (B) Damaged solely by uninsured causes;
    (c) If the figs are destroyed by you without our consent; or
    (D) For which you fail to provide records of production that are 
acceptable to us;
    (iii) Unharvested production which would be marketable if harvested; 
and
    (iv) Potential production on insured acreage that you want to 
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 you abandon the crop. If agreement on the appraised 
amount of production is not reached:
    (A) We may require you to continue to care for the crop so that a 
subsequent appraisal may be made or the crop harvested to determine 
actual production. You must notify us within three days of the date 
harvest should have started if the crop is not harvested; or
    (B) You may elect to continue to care for the crop. We will 
determine the amount of production to count for the acreage using the 
harvested production or our reappraisal if the crop is not harvested.

                     11. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[59 FR 9615, Mar. 1, 1994, as amended at 62 FR 65167, Dec. 10, 1997]



Sec. 457.111  Pear crop insurance provisions.

    The pear crop insurance provisions for the 1999 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

                          Pear Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Direct marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper, or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    Harvest. The picking of mature pears from the trees or the 
collecting of marketable pears from the ground.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Marketable. Pear production acceptable for processing or other human 
consumption even if failing to meet any U.S. or applicable state grading 
standard.
    Ton. Two thousand (2,000) pounds avoirdupois.
    Varietal group. Types of pears with similar characteristics that are 
grouped for insurance purposes as specified in the Special Provisions.

                            2. Unit Division

    (a) Provisions in the Basic Provision that allow optional units by 
irrigated and non-irrigated practices are not applicable.
    (b) Instead of establishing optional units by section, section 
equivalents, or FSA farm serial number optional units may be established 
if each optional unit is located on non-contiguous.
    (c) In addition to, or instead of, establishing optional units by 
section, section equivalents, FSA farm serial number, or on non-
contiguous land, optional units may be established by varietal group 
when provided for in the Special Provisions. The requirements of section 
34(a)(1) of the Basic Provisions are not applicable for this method of 
unit division.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one price election for all the pears in the 
county insured under this policy unless the Special Provisions provide 
different price elections by varietal group, in which case you may 
select one price election for each varietal group designated in the 
Special Provisions. The price elections you choose for each varietal 
group must have the same percentage relationship to the maximum price 
offered by us for each varietal group. For example, if you choose

[[Page 386]]

one hundred percent (100%) of the maximum price election for one 
varietal group, you must also choose one hundred percent (100%) of the 
maximum price election for all other varietal groups.
    (b) You must report, by the production reporting date designated in 
section 3 (Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities) of the Basic Provisions (Sec. 457.8), by 
varietal group:
    (1) Any damage, removal of trees, change in practices or any other 
circumstance that may reduce the expected yield below the yield upon 
which the insurance guarantee is based, and the number of affected 
acres;
    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and any time the planting pattern of such 
acreage is changed:
    (i) The age of the interplanted crop, and type if applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield. We will reduce the yield used to establish your 
production guarantee as necessary, based on our estimate of the effect 
of the following: interplanted perennial crop; removal of trees; damage; 
change in practices or any other circumstance on the yield potential of 
the insured crop. If you fail to notify us of any circumstance that may 
reduce your yields from previous levels, we will reduce your production 
guarantee as necessary at any time that we become aware of the 
circumstance.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is October 31 
preceding the cancellation date for states with a January 31 
cancellation date and August 31 preceding the cancellation date for all 
other states.

                  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:

------------------------------------------------------------------------
                                           Cancellation and termination
                 States                               dates
------------------------------------------------------------------------
California.............................  January 31.
All other states.......................  November 20.
------------------------------------------------------------------------

                             6. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the pears in the county for 
which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are of varieties adapted to the area;
    (c) That are grown on trees that have produced an average of at 
least five (5) tons of pears per acre in at least one of the four 
previous crop years unless the Special Provisions or a written agreement 
establishes a lower production level; and
    (d) That are grown in an orchard that, if inspected, is considered 
acceptable by us.

                          7. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a 
crop planted with another crop, pears interplanted with another 
perennial crop are insurable unless we inspect the acreage and determine 
that it does not meet the requirements contained in your policy.

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins:
    (i) In California, on February 1 of each crop year, except that for 
the year of application, if your application is received after January 
22 but prior to February 1, insurance will attach on the 10th day after 
your properly completed application is received in our local office, 
unless we inspect the acreage during the 10 day period and determine 
that it does not meet insurability requirements. You must provide any 
information that we require for the crop or to determine the condition 
of the orchard; or
    (ii) In all other states, on November 21 of each crop year, except 
that for the year of application, if your application is received after 
November 11 but prior to November 21, insurance will attach on the 10th 
day after your properly completed application is received in our local 
office, unless we inspect the acreage during the 10 day period and 
determine that it does not meet insurability requirements. You must 
provide any information that we require for the crop or to determine the 
condition of the orchard.
    (2) The calendar date for the end of the insurance period for each 
crop year is:
    (i) September 15 for Bartlett (green and red) and Star Crimson 
(Crimson Red) varietal groups; or
    (ii) October 15 for all other varietal groups.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we

[[Page 387]]

consider the acreage acceptable, insurance will be considered to have 
attached to such acreage on the calendar date for the beginning of the 
insurance period.
    (2) If you relinquish your insurable interest on any insurable 
acreage of pears on or before the acreage reporting date of any crop 
year, insurance will not be considered to have attached to, and no 
premium will be due, and no indemnity paid, for such acreage for that 
crop year unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            9. 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, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the orchard;
    (3) Earthquake;
    (4) Volcanic eruption; or
    (5) Failure of the irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to:
    (1) Disease or insect infestation, unless adverse weather:
    (i) Prevents the proper application of control measures or causes 
properly applied control measures to be ineffective; or
    (ii) Causes disease or insect infestation for which no effective 
control mechanism is available.
    (2) Failure of the fruit to color properly; or
    (3) Inability to market the pears for any reason other than actual 
physical damage from an insurable cause specified in this section. For 
example, we will not pay you an indemnity if you are unable to market 
due to quarantine, boycott, or refusal of any person to accept 
production.

                10. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), the following 
will apply:
    (a) You must notify us within 3 days of the date harvest should have 
started if the crop will not be harvested.
    (b) You must notify us at least 15 days before any production from 
any unit will be sold by direct marketing. We will conduct an appraisal 
that will be used to determine your production to count for production 
that is sold by direct marketing. If damage occurs after this appraisal, 
we will conduct an additional appraisal. These appraisals, and any 
acceptable records provided by you, will be used to determine your 
production to count. Failure to give timely notice that production will 
be sold by direct marketing will result in an appraised amount of 
production to count of not less than the production guarantee per acre 
if such failure results in our inability to make the required appraisal.
    (c) If you intend to claim an indemnity on any unit, you must notify 
us at least 15 days prior to the beginning of harvest if you previously 
gave notice in accordance with section 14 of the Basic Provisions 
(Sec. 457.8), so that we may inspect the damaged production. You must 
not sell or dispose of the damaged crop until after we have given you 
written consent to do so. If you fail to meet the requirements of this 
section, and such failure results in our inability to inspect the 
damaged production, all such production will be considered undamaged and 
included as production to count.

                         11. 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 unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage for each varietal group if 
applicable, by its respective production guarantee;
    (2) Multiplying the results of section 11(b)(1) by the respective 
price election for each varietal group, if applicable;
    (3) Totaling the results of section 11(b)(2);
    (4) Multiplying the total production to be counted of each varietal 
group, if applicable, by the respective price election;
    (5) Totaling the results of section 11(b)(4);
    (6) Subtracting this result of section 11(b)(5) from the result of 
section 11(b)(3); and
    (7) Multiplying the result of section 11(b)(6) by your share.
    (c) The total production to count (in tons) 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;

[[Page 388]]

    (B) That is sold by direct marketing if you fail to meet the 
requirements contained in section 10;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide production records that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production; and
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we may defer 
the claim only if you agree to continue to care for the crop. We will 
then make another appraisal when you notify us of further damage or that 
harvest is general in the area unless you harvested the crop, in which 
case we will use the harvested production. If you do not continue to 
care for the crop, our appraisal made prior to deferring the claim will 
be used to determine the production to count; and
    (2) For all states except California, all harvested and appraised 
marketable pear production from the insurable acreage.
    (3) For California, all harvested and appraised production that:
    (i) Meets the standards for first grade canning as defined by the 
California Pear Advisory Board or for U.S. Number 1 as defined by the 
United States Standards for Grades of Summer and Fall Pears, or Pears 
for Processing, or for U.S. Extra Number 1 or U.S. Number 1 as defined 
by the United States Standards for Grades of Winter Pears;
    (ii) Is accepted by a processor for canning or packing; or
    (iii) Is marketable for any purpose. However, if the pears are 
damaged by an insured cause, the production to count will be reduced by 
the greater of the following amounts:
    (A) The excess over ten percent (10%) of pears that are size 180 or 
smaller for varieties other than Forelle, Seckel or Winter Nelis; or
    (B) The result of dividing the value per ton of such pears by the 
highest price election for the insured varietal group, subtracting this 
result from 1.000, and multiplying this difference (if positive) by the 
number of tons of such pears.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

                 13. Pear Quality Adjustment Endorsement

    (a) This endorsement applies to any crop year: Provided,
    (1) The insured pears are located in a State other than California 
and the actuarial documents designate a premium rate for this 
endorsement;
    (2) You have not elected to insure your pears under the Catastrophic 
Risk Protection (CAT) Endorsement;
    (3) You elected it on your application or other form approved by us, 
and did so on or before the sales closing date for the initial crop year 
for which you wish it to be effective. By doing so, you agreed to pay 
the additional premium designated in the actuarial documents for this 
optional coverage; and
    (4) You or we did not cancel it in writing on or before the 
cancellation date. Your election of CAT coverage for any crop year after 
this endorsement is effective will be considered as notice of 
cancellation by you.
    (b) If the pear production is damaged by hail and if eleven percent 
(11%) or more of the harvested and appraised production does not grade 
at least U.S. No. 2 in accordance with applicable United States 
Standards for Grades of Summer and Fall Pears, United States Standards 
for Grades of Winter Pears, or United States Standards for Grades of 
Pears for Processing, as applicable, due solely to hail, the amount of 
production to count will be reduced as follows:
    (1) By two percent (2%) for each full one percent (1%) in excess of 
ten percent (10%), when eleven percent (11%) through sixty percent (60%) 
of the pears fail the grade standard; or
    (2) By one hundred percent (100%) when more than sixty percent (60%) 
of the pears fail the grade standard.
    The difference between the reduced production determined in section 
13(b) and the total production will be considered as cull production.
    (c) Pears that are knocked to the ground by wind or that are frozen 
and cannot be packed or marketed as fresh pears will be considered one 
hundred percent (100%) cull production.
    (d) Marketable production that grades less than U.S. No. 2 due to 
causes not covered by this endorsement will not be reduced.
    (e) Fifteen percent (15%) of all production considered as cull 
production in accordance with section 13 (b) and (c) will be production 
to count.

[61 FR 57580, Nov. 7, 1996; 62 FR 2007, Jan. 15, 1997; 62 FR 65167, Dec. 
10, 1997]



Sec. 457.112  Hybrid sorghum seed crop insurance provisions.

    The Hybrid Sorghum Seed Crop Insurance Provisions for the 1998 and 
succeeding crop years are as follows:
    FCIC policies:


[[Page 389]]



                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and Reinsured Policies

                   Hybrid Sorghum Seed Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows:
    (1) The Catastrophic Risk Protection Endorsement, if applicable; (2) 
the Special Provisions; (3) these Crop Provisions; and (4) the Basic 
Provisions, (Sec. 457.8) with (1) controlling (2), etc.

                             1. Definitions

    Adjusted yield. An amount determined by multiplying the county yield 
by the coverage level factor.
    Amount of insurance per acre. A dollar amount determined by 
multiplying the adjusted yield by the price election you select and 
subtracting any minimum guaranteed payment, not to exceed the total 
compensation specified in the hybrid sorghum seed processor contract. If 
your hybrid sorghum seed processor contract contains a minimum 
guaranteed payment that is stated in bushels, we will convert that value 
to dollars by multiplying it by the price election you selected.

    Approved yield. In lieu of the definition contained in the Basic 
Provisions, an amount FCIC determines to be representative of the yield 
that the female parent plants are expected to produce when grown under a 
specific production practice. FCIC will establish the approved yield 
based upon records provided by the seed company and other information it 
deems appropriate.
    Bushel. Fifty-six pounds avoirdupois of the insured crop.
    Certified seed test. A warm germination test performed on clean seed 
according to specifications of the ``Rules for Testing Seeds'' of the 
Association of Official Seed Analysts.
    Commercial hybrid sorghum seed. The offspring produced by crossing a 
male and female parent plant, each having a different genetic character. 
This offspring is the product intended for use by an agricultural 
producer to produce a commercial field sorghum crop for grain or forage.
    County yield. An amount contained in the actuarial documents that is 
established by FCIC to represent the yield that a producer of hybrid 
sorghum seed would be expected to produce if the acreage had been 
planted to commercial field sorghum.
    Coverage level factor. A factor contained in the Special Provisions 
to adjust the county yield for commercial field sorghum to reflect the 
higher value of hybrid sorghum seed.
    Dollar value per bushel. An amount that determines the value of any 
seed production to count. It is determined by dividing the amount of 
insurance per acre by the result of multiplying the approved yield by 
the coverage level percentage, expressed as a decimal.
    Female parent plants. Sorghum plants that are grown for the purpose 
of producing commercial hybrid sorghum seed and are male sterile.
    Field run. Commercial hybrid sorghum seed production before it has 
been processed or screened.
    Good farming practices. In addition to the definition contained in 
the Basic Provisions, good farming practices include those practices 
required by the hybrid sorghum seed processor contract.
    Harvest. Combining, threshing or picking of the female parent plants 
to obtain commercial hybrid sorghum seed.
    Hybrid sorghum seed processor contract. An agreement executed in 
writing between the hybrid sorghum seed crop producer and a seed company 
containing, at a minimum:
    (a) The producer's promise to plant and grow male and female parent 
plants, and to deliver all commercial hybrid sorghum seed produced from 
such plants to the seed company;
    (b) The seed company's promise to purchase the commercial hybrid 
sorghum seed produced by the producer; and
    (c) Either a fixed price per unit of measure (bushels, 
hundredweight, etc.) of the commercial hybrid sorghum seed or a formula 
to determine the value of such seed. Any formula for establishing the 
value must be based on data provided by a public third party that 
establishes or provides pricing information to the general public, based 
on prices paid in the open market (e.g., commodity futures exchanges), 
to be acceptable for the purpose of this policy.
    Inadequate germination. Germination of less than 80 percent of the 
commercial hybrid sorghum seed as determined by using a certified seed 
test.
    Insurable interest. Your share of the financial loss that occurs in 
the event seed production is damaged by a cause of loss specified in 
section 10.
    Local market price. The cash price offered by buyers for any 
production from the female parent plants that is not considered 
commercial hybrid sorghum seed under the terms of this policy.
    Male parent plants. Sorghum plants grown for the purpose of 
pollinating female parent plants.
    Minimum guaranteed payment. A minimum amount (usually stated in 
dollars or bushels) specified in your hybrid sorghum seed processor 
contract that will be paid or credited to you by the seed company 
regardless of the quantity of seed produced.

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    Non-seed production. Production that does not qualify as seed 
production because of inadequate germination.
    Planted acreage. In addition to the definition contained in the 
Basic Provisions, the insured crop must be planted in rows wide enough 
to permit mechanical cultivation, unless provided by the Special 
Provisions or by written agreement.
    Planting pattern. The arrangement of the rows of the male and female 
parent plants in a field. An example of a planting pattern is four 
consecutive rows of female parent plants followed by two consecutive 
rows of male parent plants.
    Practical to replant. In addition to the definition contained in the 
Basic Provisions, practical to replant applies to either the female or 
male parent plant. It will not be considered practical to replant unless 
production from the replanted acreage can be delivered under the terms 
of the hybrid sorghum seed processor contract, or the seed company 
agrees that it will accept the production from the replanted acreage.
    Prevented planting. In addition to the definition contained in the 
Basic Provisions, prevented planting applies to the female and male 
parent plants. The male parent plants must be planted in accordance with 
the requirements of the hybrid sorghum seed processor contract to be 
considered planted.
    Sample. For the purpose of the certified seed test, at least 3 
pounds of randomly selected field run sorghum seed for each type or 
variety of commercial hybrid sorghum seed grown on the unit.
    Seed company. A business enterprise that possesses all licenses for 
marketing commercial hybrid sorghum seed required by the state in which 
it is domiciled or operates, and which possesses facilities with enough 
storage and drying capacity to accept and process the insured crop 
within a reasonable amount of time after harvest. If the seed company is 
the insured, it must also be a corporation.
    Seed production. All seed produced by female parent plants with a 
germination rate of at least 80 percent as determined by a certified 
seed test.
    Type. Grain sorghum, forage sorghum, or sorghum sudan parent plants.
    Variety. The name, number or code assigned to a specific genetic 
cross by the seed company or the Special Provisions for the insured crop 
in the county.

                            2. Unit Division

    (a) For any processor contract that stipulates the amount of 
production to be delivered:
    (1) In lieu of the definition of ``basic unit'' contained in the 
Basic Provisions, a basic unit will consist of all acreage planted to 
the insured crop in the county that will be used to fulfill a hybrid 
sorghum seed processor contract;
    (2) There will be no more than one basic unit for all production 
contracted with each processor contract;
    (3) In accordance with section 12, all production from any basic 
unit in excess of the amount under contract will be included as 
production to count if such production is applied to any other basic 
unit for which the contracted amount has not been fulfilled; and
    (4) Optional units will not be established.
    (b) For any processor contract that stipulates a number of acres to 
be planted, the provisions in the Basic Provisions that allow optional 
units by irrigated and non-irrigated practices are not applicable.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    (a) In addition to the requirements of section 3 of the Basic 
Provisions, you may select only one price election for all the hybrid 
sorghum seed in the county insured under this policy unless the Special 
Provisions provide different price elections by type or variety, in 
which case you may elect one price election for each hybrid sorghum seed 
type or variety designated in the Special Provisions. The price election 
you choose for each type or variety must have the same percentage 
relationship to the maximum price offered by us for each type or 
variety. For example, if you choose 100 percent of the maximum price 
election for one specific type or variety, you must also choose 100 
percent of the maximum price election for all other types or varieties.
    (b) The production reporting requirements contained in section 3 of 
the Basic Provisions are not applicable to this contract.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are March 15.

                          6. Report of Acreage

    In addition to the requirements of section 6 of the Basic 
Provisions, you must:
    (a) Report by type and variety, the location and insurable acreage 
of the insured crop;
    (b) Report any acreage that is uninsured, including that portion of 
the total acreage occupied by male parent plants; and
    (c) Certify that you have a hybrid sorghum seed processor contract 
and report the amount, if any, of any minimum guaranteed payment.

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                             7. Insured Crop

    (a) In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the female parent plants in the county for which a 
premium rate is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That are grown under a hybrid sorghum seed processor contract 
executed before the acreage reporting date;
    (3) That are planted for harvest as commercial hybrid sorghum seed 
in accordance with the requirements of the hybrid sorghum seed processor 
contract and the production management practices of the seed company; 
and
    (4) That are not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Planted with a mixture of female and male parent seed in the 
same row;
    (ii) Planted for any purpose other than for commercial hybrid 
sorghum seed;
    (iii) Interplanted with another crop; or
    (iv) Planted into an established grass or legume.
    (b) An instrument in the form of a ``lease'' under which you retain 
control of the acreage on which the insured crop is grown and that 
provides for delivery of the crop under substantially the same terms as 
a hybrid sorghum seed processor contract will be treated as a contract 
under which you have an insurable interest in the crop.
    (c) A commercial hybrid sorghum seed producer who is also a 
commercial hybrid sorghum seed company may be able to insure the hybrid 
sorghum seed crop if the following requirements are met:
    (1) The seed company has an insurable interest in the hybrid sorghum 
seed crop;
    (2) Prior to the sales closing date, the Board of Directors of the 
seed company has executed and adopted a corporate resolution containing 
the same terms as an acceptable hybrid sorghum seed processor contract. 
This corporate resolution will be considered a contract under the terms 
of this policy;
    (3) Sales records for at least the previous years' seed production 
must be provided to confirm that the seed company has produced and sold 
seed. If such records are not available, the crop may be insured under 
the Coarse Grains Crop Provisions with a written agreement; and
    (4) Our inspection reveals that the storage and drying facilities 
satisfy the definition of a seed company.
    (d) Any of the insured crop that is under contract with different 
seed companies may be insured under separate policies with different 
insurance providers provided all acreage of the insured crop in the 
county is insured. If you elect to insure the insured crop with 
different insurance providers, you agree to pay separate administrative 
fees for each insurance policy.

                          8. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions, 
we will not insure any acreage of the insured crop:
    (a) Planted and occupied exclusively by male parent plants;
    (b) Not in compliance with the rotation requirements contained in 
the Special Provisions or, if applicable, required by the hybrid sorghum 
seed processor contract; or
    (c) If either the female or male parent plants are damaged before 
the final planting date and we determine that insured crop is practical 
to replant but it is not replanted.

                           9. Insurance Period

    (a) In addition to the provisions of section 11 of the Basic 
Provisions, insurance attaches upon completion of planting of:
    (1) The female parent plant seed on or before the final planting 
date designated in the Special Provisions, except as allowed in section 
16 of the Basic Provisions; and
    (2) The male parent plant seed.
    (b) In accordance with the provisions of section 11 of the Basic 
Provisions, the calendar date for the end of the insurance period is the 
November 30 immediately following planting.

                           10. Causes of Loss

    (a) In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss that occur during 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 due to a cause of 
loss contained in section 10(a) (1) through (7) that occurs during the 
insurance period.
    (b) In addition to the causes of loss excluded by section 12 of the 
Basic Provisions, we will not insure against any loss of production due 
to:
    (1) The use of unadapted, incompatible, or genetically deficient 
male or female parent plant seed;
    (2) Frost or freeze after the date set by the Special Provisions;
    (3) Failure to follow the requirements stated in the hybrid sorghum 
seed processor contract and production management practices of the seed 
company;
    (4) Inadequate germination, even if resulting from an insured cause 
of loss, unless you

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have provided adequate notice as required by section 11(b)(1); or
    (5) Failure to plant the male parent plant seed at a time or in a 
manner sufficient to assure adequate pollination of the female parent 
plants, unless you are prevented from planting the male parent plant 
seed by an insured cause of loss.

                11. Duties In The Event of Damage or Loss

    (a) In accordance with the requirements of section 14 of the Basic 
Provisions, you must leave representative samples of at least one 
complete planting pattern of the male and female parent plant rows that 
extend the entire length of each field in the unit. If you are going to 
destroy any acreage of the insured crop that will not be harvested, the 
samples must not be destroyed until after our inspection.
    (b) In addition to the requirements of section 14 of the Basic 
Provisions:
    (1) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate inadequate germination on any 
unit; and
    (2) You must provide a completed copy of your hybrid sorghum seed 
processor contract unless we have determined it has already been 
provided by the seed company, and the seed company certifies that such 
contract is used for all its producers without any waivers or 
amendments.

                         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 such 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) You will not receive an indemnity payment on a unit if the seed 
company refuses to provide us with records we require to determine the 
dollar value per bushel of production for each variety.
    (c) In the event of loss or damage covered by this policy, we will 
settle your claim on any unit by:
    (1) Multiplying the insured acreage by its respective amount of 
insurance per acre, by type and variety if applicable;
    (2) Totaling the results of section 12(c)(1) if there are more than 
one type or variety;
    (3) Multiplying the total seed production to count (see section 
12(d)) for each type and variety of commercial hybrid sorghum seed by 
the applicable dollar value per bushel for that type or variety;
    (4) Multiplying the total non-seed production to count (see section 
12(e)) for each type and variety by the applicable local market price 
determined on the earlier of the date the non-seed production is sold or 
the date of final inspection;
    (5) Totaling the results of sections 12(c)(3) and 12(c)(4) by type 
and variety;
    (6) Subtracting the result of section 12(c)(5) from the result of 
section 12(c)(1) if there is only one type or variety, or subtracting 
the result of 12(c)(5) from the result of section 12(c)(2) if there are 
more than one type or variety; and
    (7) Multiplying the result of section 12(c)(6) by your share.
For example:
    You have a 100 percent share in 50 acres insured for the development 
of type ``A'' hybrid sorghum seed in the unit, with an amount of 
insurance per acre guarantee of $361 (county yield of 170 bushels times 
a coverage level factor of .867 for the 65 percent coverage level, times 
a price election of $2.45 per bushel, minus the minimum guaranteed 
payment of zero). Your seed production was 1,400 bushels and the dollar 
value per bushel was $3.47. Your non-seed production was 100 bushels 
with a local market value of $2.00 per bushel. Your indemnity would be 
calculated as follows:
    (1) 50 acres x $361=$18,050 amount of insurance guarantee;
    (3) 1,400 bushels x $3.47=$4,858 value of seed production;
    (4) 100 bushels of non-seed x $2.00=$200 of non-seed production;
    (5) $4,858+$200=$5,058;
    (6) $18,050-$5,058=$12,992; and
    (7) $12,992 x 100 percent share=$12,992 indemnity payment.
    You also have a 100 percent share in 50 acres insured for the 
development of type ``B'' hybrid sorghum seed in the unit, with an 
amount of insurance per acre guarantee of $340 (county yield of 160 
bushels times a coverage level factor of .867 for the 65 percent 
coverage level, times a price election of $2.45 per bushel, minus the 
minimum guaranteed payment of zero). You harvested 1,200 bushels and the 
dollar value per bushel for the harvested amount was $4.63. You also 
harvested 200 bushels of non-seed with a market value of $2.00 per 
bushel. Your indemnity would be calculated as follows:
    (1) 50 acres x $361=$18,050 amount of insurance guarantee for type 
``A'' and 50 acres x $340=$17,000 amount of insurance guarantee for type 
``B'';
    (2) $18,050+$17,000=$35,050 amount of insurance guarantee;
    (3) 1,400 bushels x $3.47=$4,858 value of seed production for type 
``A'' and 1,200 bushels x $4.63=$5,556 value of seed production for type 
``B'';
    (4) 100 bushels of non-seed x $2.00=$200 of non-seed production for 
type ``A'' and 200 bushels of non-seed x $2.00=$400 of non-seed 
production for type ``B''

[[Page 393]]

    (5) $4,858+$200+$5,556+$400=$11,014 value of production to count;
    (6) $35,050-$11,014=$24,036; and
    (7) $24,036 x 100 percent share=$24,036 indemnity payment.
    (d) Production to be counted as seed production will include:
    (1) All appraised production as follows:
    (i) Not less than the amount of insurance per acre for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Mature unharvested production with a germination rate of at 
least 80 percent of the commercial hybrid sorghum seed as determined by 
a certified seed test. Any such production may be adjusted in accordance 
with section 12(f);
    (iv) Immature appraised production;
    (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 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) Harvested production that you deliver as commercial hybrid 
sorghum seed to the seed company stated in your hybrid sorghum seed 
processor contract, regardless of quality, unless the production has 
inadequate germination.
    (e) Production to be counted as non-seed production will include all 
harvested or mature appraised production that does not qualify as seed 
production to count as specified in section 12(d). Any such production 
may be adjusted in accordance with section 12(f).
    (f) For the purpose of determining the quantity of mature 
production:
    (1) Commercial hybrid sorghum seed production will be:
    (i) Increased 0.12 percent for each 0.1 percentage point of moisture 
below 13.0 percent; or
    (ii) Decreased 0.12 percent for each 0.1 percentage point of 
moisture in excess of 13.0 percent.
    (2) When records of commercial hybrid sorghum seed production 
provided by the seed company have been adjusted to a basis of 13.0 
percent moisture and 56 pound avoirdupois bushels, section 12(f)(1) 
above will not apply to harvested production. In such cases, records of 
the seed company will be used to determine the amount of production to 
count, provided that the moisture and weight of such production are 
calculated on the same basis as that used to determine the approved 
yield.

                         13. Prevented Planting

    Your prevented planting coverage will be 60 percent of your amount 
of insurance for timely planted acreage. If you have limited or 
additional levels of coverage as specified in 7 CFR part 400, subpart T, 
and pay an additional premium, you may increase your prevented planting 
coverage to a level specified in the actuarial documents.

[62 FR 65318, Dec. 12, 1997]



Sec. 457.113  Coarse grains crop insurance provisions.

    The coarse grains crop insurance provisions for the 1998 and 
succeeding crop year are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                      Coarse Grains Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Coarse grains-- Corn, grain sorghum, and soybeans.
    Grain sorghum-- The crop defined as sorghum under the United States 
Grain Standards Act.
    Harvest-- Combining, threshing, or picking the insured crop for 
grain, or cutting for hay, silage, or fodder.
    Local market price-- The cash grain price per bushel for the U.S. 
No. 2 yellow corn,

[[Page 394]]

U.S. No. 2 grain sorghum, or U.S. No. 1 soybeans, offered by buyers in 
the area in which you normally market the insured crop. The local market 
price will reflect the maximum limits of quality deficiencies allowable 
for the U.S. No. 2 grade for yellow corn and grain sorghum, or U.S. No. 
1 grade for soybeans. Factors not associated with grading under the 
Official United States Standards for Grain, including but not limited to 
protein and oil, will not be considered.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, coarse grains must initially be planted in rows (corn 
must be planted in rows far enough apart to permit mechanical 
cultivation), unless otherwise provided by the Special Provisions, 
actuarial documents, or by written agreement.
    Production guarantee(per acre)--In lieu of the definition contained 
in the Basic Provisions, the number of bushels (tons for corn insured a 
silage) determined by multiplying the approved actual production history 
(APH) yield per acre, calculated in accordance with 7 CFR part 400, 
subpart G, by the coverage level percentage you elect.
    Silage-- A product that results from severing the plant from the 
land and chopping it for the purpose of livestock feed.
    Ton-- Two thousand (2000) pounds avoirdupois.

  2. 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:
    (1) For grain sorghum and soybeans, only one price election for each 
crop in the county insured under this policy; and
    (2) For corn, only one price election for all the corn in the county 
insured as grain under this policy, and only one price election for all 
the corn in the county insured as silage under this policy. The price 
elections you choose for grain and silage must have the same percentage 
relationship to the maximum price election offered by us for grain and 
silage. For example, if you choose one hundred percent (100%) of the 
maximum grain price election and you also insure corn on a silage basis, 
you must choose one hundred percent (100%) of the maximum silage price 
election.
    (b) For corn only, if you harvest the crop in a manner other than 
the manner you reported (for example, you reported grain but harvested 
as silage) and you did not select a price election for the type 
harvested, we will assign a price election for the type harvested that 
bears the same percentage relationship to the maximum price election you 
selected for the type reported (for example, if you selected a grain 
price election in the amount of eighty percent (80%) of the maximum 
price election for grain and you did not select a silage price election, 
we will assign a silage price election in the amount of eighty percent 
(80%) of the maximum price election for silage specified in the Special 
Provisions if you harvest for silage). This assigned price election will 
be used only to determine the dollar value of production to count for 
indemnity purposes and will not be used to determine the amount of 
insurance or premium.

                           3. Contract Changes

    The contract change date is November 30 (December 17 for the 1998 
crop year only) preceding the cancellation date (see the provisions of 
Section 4 (Contract Changes) of the Basic Provisions).

                  4. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions (Sec. 457.8), 
the cancellation and termination dates are:

------------------------------------------------------------------------
                                                    Cancellation and
               State and county                     termination dates
------------------------------------------------------------------------
(a) For corn and grain sorghum:
  Val Verde, Edwards, Kerr, Kendall, Bexar,     January 15.
   Wilson, Karnes, Goliad, Victoria, and
   Jackson Counties, Texas, and all Texas
   counties lying south thereof.
  El Paso, Hudspeth, Culberson, Reeves,         February 15.
   Loving, Winkler, Ector, Upton, Reagan,
   Sterling, Coke, Tom Green, Concho,
   McCulloch, San Saba, Mills, Hamilton,
   Bosque, Johnson, Tarrant, Wise, Cooke
   Counties, Texas, and all Texas counties
   lying south and east thereof to and
   including Terrell, Crockett, Sutton,
   Kimble, Gillespie, Blanco, Comal,
   Guadalupe, Gonzales, De Witt, Lavaca,
   Colorado, Wharton, and Matagorda Counties,
   Texas.
  Alabama; Arizona; Arkansas; California;       February 28.
   Florida; Georgia; Louisiana; Mississippi;
   Nevada; North Carolina; and South Carolina.
  All other Texas counties and all other        March 15.
   states.
(b) For soybeans:
  Jackson, Victoria, Goliad, Bee, Live Oak,     February 15.
   McMullen, LaSalle, and Dimmit Counties,
   Texas and all Texas counties lying south
   thereof.

[[Page 395]]

 
  Alabama; Arizona; Arkansas; California;       February 28.
   Florida; Georgia; Louisiana; Mississippi;
   Nevada; North Carolina; and South Carolina;
   and El Paso, Hudspeth, Culberson, Reeves,
   Loving, Winkler, Ector, Upton, Reagan,
   Sterling, Coke, Tom Green, Concho,
   McCulloch, San Saba, Mills, Hamilton,
   Bosque, Johnson, Tarrant, Wise, Cooke
   Counties, Texas, and all Texas counties
   lying south and east thereof to and
   including Maverick, Zavala, Frio, Atascosa,
   Karnes, De Witt, Lavaca, Colorado, Wharton,
   and Matagorda Counties, Texas.
  All other Texas counties and all other        March 15.
   states.
------------------------------------------------------------------------

                             5. Insured Crop

    (a) In accordance with section 8 (Insured Crop) of the Basic 
Provisions (Sec. 457.8), the crop insured will be each coarse grain crop 
you elect to insure for which premium rates are provided by the 
actuarial documents:
    (1) In which you have a share;
    (2) That is adapted to the area based on days to maturity and is 
compatible with agronomic and weather conditions in the area; and
    (3) That is not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Interplanted with another crop except as allowed in paragraph 
5(b)(1); or
    (ii) Planted into an established grass or legume.
    (b) For corn only, in addition to the provisions of subsection 5(a), 
the corn crop insured will be all corn that is:
    (1) Planted for harvest either as grain or as silage (see subsection 
5(c)). A mixture of corn and sorghum (grain or forage-type) will be 
insured as corn silage if the sorghum does not constitute more than 
twenty percent (20%) of the plants;
    (2) Yellow dent or white corn, including mixed yellow and white, 
waxy or high-lysine corn, and excluding:
    (i) High-amylose, high-oil, high-protein, flint, flour, Indian, or 
blue corn, or a variety genetically adapted to provide forage for 
wildlife or any other open pollinated corn, unless a written agreement 
allows insurance of such excluded crops.
    (ii) A variety of corn adapted for silage use only when the corn is 
reported for insurance as grain.
    (c) For corn only, if the actuarial documents for the county provide 
a premium rate for:
    (1) Both grain and silage, all insurable acreage will be insured as 
the type or types reported by you on or before the acreage reporting 
date;
    (2) Grain but not silage, all insurable acreage will be insured as 
grain unless a written agreement allows insurance on all or a portion of 
the insurable acreage as silage; or
    (3) Silage but not grain, all insurable corn acreage will be insured 
as silage unless a written agreement allows insurance on all or a 
portion of the insurable acreage as grain.
    (d) For grain sorghum only, in addition to the provisions of 
subsection 5(a), the grain sorghum crop insured will be all of the grain 
sorghum in the county:
    (1) That is planted for harvest as grain;
    (2) That is a combine-type hybrid grain sorghum (grown from hybrid 
seed); and
    (3) That is not a dual-purpose type of grain sorghum (a type used 
for both grain and forage), unless a written agreement allows insurance 
of such grain sorghum.
    (e) For soybeans only, in addition to the provisions of subsection 
5(a), the soybean crop insured will be all of the soybeans in the county 
that are planted for harvest as beans.

                          6. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions, 
any acreage of the insured crop damaged before the final planting date, 
to the extent that a majority of producers in the area would not 
normally further care for the crop, must be replanted unless we agreee 
that it is not practical to replant.

                           7. Insurance Period

    In accordance with the provisions under 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:

(a) For corn insured as grain:
  (1) Val Verde, Edwards, Kerr, Kendall,        September 30.
   Bexar, Wilson, Karnes, Goliad, Victoria,
   and Jackson Counties, Texas, and all Texas
   counties lying south thereof.
  (2) Clark, Cowlitz, Grays Harbor, Island,     October 31.
   Jefferson, King, Kitsap, Lewis, Pierce,
   Skagit, Snohomish, Thurston, Wahkiakum, and
   Whatcom Counties, Washington.
  (3) All other counties and states...........  December 10.
(b) For corn insured as silage:
  All states..................................  September 30.

[[Page 396]]

 
(c) For grain sorghum:
  (1) Val Verde, Edwards, Kerr, Kendall,        September 30.
   Bexar, Wilson, Karnes, Goliad, Victoria,
   and Jackson Counties, Texas, and all Texas
   counties lying south thereof.
  (2) All other Texas counties and all other    December 10.
   states.
(d) For soybeans: All states..................  December 10.
 

                            8. Causes of Loss

    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:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if applicable, due to an 
unavoidable cause of loss occurring within the insurance period.

                         9. Replanting Payments

    (a) In accordance with section 13 of the Basic Provisions, 
replanting payments for coarse grains are allowed if the coarse grains 
are damaged by an insurable cause of loss to the extent that the 
remaining stand will not produce at least 90 percent of the production 
guarantee for the acreage and it is practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of twenty percent (20%) of the production guarantee or the 
number of bushels (tons for corn insured as silage) set out herein, 
multiplied by your price election multiplied by your insured share or 
the share determined under 9(c), if applicable. The number of bushels or 
tons are 8 bushels for corn grain; 1 ton for corn silage; 7 bushels for 
grain sorghum; and 3 bushels for soybeans.
    (c) When more than one person insures the same crop on a share 
basis, a replanting payment based on the total shares insured by us may 
be made to the insured person who incurs the total cost of replanting. 
Payment will be made in this manner only if an agreement exists between 
the insured persons which:
    (1) Requires one person to incur the entire cost of replanting; or
    (2) Gives the right to all replanting payments to one person.
    (d) When the insured crop is replanted using a practice that is 
uninsurable as an original planting, the liability for the unit will be 
reduced by the amount of the replanting payment which is attributable to 
your share. The premium amount will not be reduced.

                10. 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), if you 
initially discover damage to any insured crop within 15 days of or 
during harvest, you must leave representative samples of the unharvested 
crop for our inspection. The samples must be at least 10 feet wide and 
extend the entire length of each field in the unit, and 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) For any corn unit that has separate dates for the end of the 
insurance period (grain and silage):
    (1) In lieu of paragraph 14.(a)(2) of the Basic Provisions 
(Sec. 457.8), if damage occurs:
    (i) Before the earliest end of insurance period date (grain or 
silage), you must give us notice within 72 hours of your initial 
discovery of damage (but not later than 15 days after that earliest end 
of insurance period date); or
    (ii) If damage does not occur before the earliest end of insurance 
period date (grain or silage), but occurs before the latest end of 
insurance period date (grain or silage), you must give notice within 72 
hours of your initial discovery of damage (but not later than 15 days 
after that latest end of insurance period date).
    (2) In lieu of subsection 14.(c) of the Basic Provisions 
(Sec. 457.8), in addition to complying with all other notice 
requirements, you must submit a claim for indemnity declaring the amount 
of your loss not later than 60 days after the latest date for the end of 
insurance period for the unit. This claim must include all the 
information we require to settle the claim.

                         11. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide records of production:
    (1) For any optional unit, we will combine all optional units for 
which acceptable records of production were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.

[[Page 397]]

    (b) In the event of loss or damage covered by this policy, we will 
settle your claim on any unit:
    (1) For grain sorghum and soybeans by:
    (i) Multiplying the insured acreage by the production guarantee;
    (ii) Subtracting from this the total production to count;
    (iii) Multiplying the remainder by your price election; and
    (iv) Multiplying this result by your share.
    (2) For corn by:
    (i) Multiplying the insured acreage of each type (grain/silage) by 
the production guarantee for the applicable type;
    (ii) Multiplying each result by the price election for the 
applicable type;
    (iii) Adding these values;
    (iv) Multiplying the production to count of each type (see 
subsection 11(d)) by the price election for that type (see the 
provisions under section 2 (Insurance Guarantees, Coverage Levels, and 
Prices for Determining Indemnities));
    (v) Adding these dollar values;
    (vi) Subtracting the result of step (v) from the result of step 
(iii); and
    (vii) Multiplying the result by your share.
    (c) The total production in bushels (tons for corn silage) (see 
subsection 11(d)) to count from all insurable acreage on the unit will 
include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) Damaged solely by uninsured causes; or
    (D) For which you fail to provide records of production that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies and excess moisture in accordance with 
subsection 11(e)); and
    (iv) Potential production on insured acreage you want to put to 
another use or you wish to 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 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 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 you 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.
    (d) The production to count for corn will be in bushels for grain 
and in tons for silage as follows:
    (1) For harvested acreage, according to the method of harvest; and
    (2) For unharvested acreage, according to the information contained 
on your acreage report;

except as otherwise provided in paragraph 11(c)(1).
    (e) Mature coarse grain production (excluding corn insured or 
harvested as silage) may be adjusted for excess moisture and quality 
deficiencies. If moisture adjustment is applicable it will be made prior 
to any adjustment for quality. Corn insured or harvested as silage will 
be adjusted for excess moisture and quality only as specified in 
subsection 11(f).
    (1) Production will be reduced by 0.12 percent for each 0.1 
percentage point of moisture in excess of:
    (i) Fifteen percent (15%) for corn (If moisture exceeds 30 percent 
(30%), production will be reduced 0.2 percent for each 0.1 percentage 
point above 30 percent (30%));
    (ii) Fourteen percent (14%) for grain sorghum; and
    (iii) Thirteen percent (13%) for soybeans.
    We may obtain samples of the production to determine the moisture 
content.
    (2) Production will be eligible for quality adjustment if:
    (i) Deficiencies in quality, in accordance with the Official United 
States Standards for Grain, result in:
    (A) Corn not meeting the grade requirements for U.S. No. 4 (grades 
U.S. No. 5 or worse) because of test weight or kernel damage (excluding 
heat damage) or having a musty, sour, or commercially objectionable 
foreign odor;
    (B) Grain sorghum not meeting the grade requirements for U.S. No. 4 
(grades U.S. Sample grade) because of test weight or kernel damage 
(excluding heat damage) or having a musty, sour, or commercially 
objectionable foreign odor (except smut odor), or meets the special 
grade requirements for smutty grain sorghum; or
    (C) Soybeans not meeting the grade requirements for U.S. No. 4 
(grades U.S. Sample grade) because of test weight or kernel damage 
(excluding heat damage) or having a musty, sour, or commercially 
objectionable foreign odor (except garlic odor), or which

[[Page 398]]

meet the special grade requirements for garlicky soybeans; or
    (ii) Substances or conditions are present that are identified by the 
Food and Drug Administration or other public health organizations of the 
United States as being injurious to human or animal health.
    (3) Quality will be a factor in determining your loss only if:
    (i) The deficiencies, substances, or conditions resulted from a 
cause of loss against which insurance is provided under these crop 
provisions;
    (ii) All determinations of these deficiencies, substances, or 
conditions are made using samples of the production obtained by us or by 
a disinterested third party approved by us; and
    (iii) The samples are analyzed by a grader licensed under the 
authority of the United States Grain Standards Act or the United States 
Warehouse Act with regard to deficiencies in quality, or by a laboratory 
approved by us with regard to substances or conditions injurious to 
human or animal health. (Test weight for quality adjustment purposes may 
be determined by our loss adjuster.)
    (4) Coarse grain production that is eligible for quality adjustment, 
as specified in paragraphs 11.(e) (2) and (3), will be reduced by the 
quality adjustment factor contained in the Special Provisions.
    (f) For corn insured or harvested as silage:
    (1) Whenever our appraisal of grain content is less than 4.5 bushels 
of grain per ton of silage, the silage production will be reduced by 1 
percentage point for each 0.1(1/10) of a bushel less than 4.5 bushels 
per ton (If we cannot make a grain appraisal before harvest and you do 
not leave a representative unharvested sample, in accordance with the 
policy no reduction for grain-deficient silage will be made.); and
    (2) If the normal silage harvesting period has ended, or for any 
acreage harvested as silage or appraised as silage after September 30 of 
the crop year we may increase the silage production to count to 65 
percent (65%) moisture equivalent to reflect the normal moisture content 
of silage harvested during the normal silage harvesting period.
    (g) Any production harvested from plants growing in the insured crop 
may be counted as production of the insured crop on a weight basis.

                         12. Prevented Planting

    Your prevented planting coverage will be 60 percent of your 
production guarantee for timely planted aceage. if you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to a level specified in the actuarial documents.

[59 FR 49161, Sept. 27, 1994; 59 FR 60063, Nov. 22, 1994, as amended at 
60 FR 62728, 62729, Dec. 7, 1995; 62 FR 63633, Dec. 2, 1997; 62 FR 
65168, Dec. 10, 1997]



Sec. 457.114  Nursery crop insurance provisions.

    The Nursery Crop Insurance Provisions for the 1999 crop year only 
are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                         Nursery Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Amount of insurance-- The result of multiplying the highest monthly 
market value reported on the nursery plant inventory summary (including 
inventory reported by you and accepted by us on a revised nursery plant 
inventory summary) by .9, multiplied by the percentage for the coverage 
level you elect.
    Brownout-- A reduction in electric power that affects the unit.
    Crop year-- The 12 month period beginning October 1 and extending 
through September 30 of the next calendar year, designated by the year 
in which it ends. (The 1996 crop year begins October 1, 1995, and ends 
September 30, 1996).
    Crop year loss deductible--The value calculated by multiplying the 
highest monthly market value reported on the nursery plant inventory 
summary by .9 and subtracting from this product the amount of insurance.
    Field market value A--Ninety percent (90%) of the wholesale market 
value for the insured plants in the unit immediately prior to the 
occurrence of the loss.
    Field market value B--Ninety percent (90%) of the wholesale market 
value remaining for the insurable plants in the unit immediately 
following the occurrence of the loss as determined by our appraisal 
conducted as soon as reasonably possible after the loss is reported.
    Irrigated practice--In lieu of the definition contained in the Basic 
Provisions, 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 quanity of water 
needed to maintain the amount of insurance on the nursery plant 
inventory.

[[Page 399]]

    Largest dimension--The distance measured at the top of the standard 
nursery container from one side directly across to the opposite at the 
widest point.
    Monthly loss deductible--The smaller of: (1) The highest monthly 
market value reported on the nursery plant inventory summary multiplied 
by .9; or (2) field market value A; multiplied by the number derived by 
subtracting the coverage level percent from one hundred percent (100%), 
not to exceed the crop year loss deductible.
    Monthly market value--The dollar amount determined by multiplying 
the quantity of each insurable plant by its wholesale market value for 
that month, less the maximum discount (stated in dollar terms) granted 
to any buyer, and totalling the resulting values for all insurable 
plants in the unit.
    Nursery--A business enterprise that produces ornamental plants in 
standard nursery containers for the wholesale market.
    Nursery eligible plant listing--A listing contained in the Actuarial 
Table that specifies the plants eligible for insurance and any mandatory 
or recommended storage required for such plants in each hardiness zone 
defined by the United States Department of Agriculture.
    Nursery plant inventory summary--A report that specifies the 
numbers, growing locations, and wholesale prices of plants included in 
the nursery inventory.
    Standard nursery containers--Rigid containers not less than three 
(3) inches across the largest dimension at the top of the container, and 
which are appropriate in size and with proper drainage holes for the 
plant contained. Grow bags, trays, cellpacks, and burlap are not 
standard nursery containers under these crop provisions.
    Stock plants--Plants used for reproduction, for growing cuttings, 
for air layering or for propagating.
    Wholesale market value--The total dollar valuation of the insurable 
plants actually contained within the unit at any time. The values used 
will be based on your wholesale price list if properly supported by your 
records, less the maximum discount (stated in dollar terms) granted to 
any buyer.

                            2. Unit Division

    In lieu of the definition of ``basic unit'' and section 34 of the 
Basic Provisions, a unit consists of all growing locations in the county 
within a five mile radius of the named insured locations designated on 
your nursery plant inventory summary. Any growing location more than 
five miles from any other growing location, but within the county, may 
be designated as a separate basic unit or be included in the closest 
unit listed on your nursery plant inventory summary.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    The production reporting requirements contained in section 3 
(Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities) of the Basic Provisions (Sec. 457.8) are not applicable to 
the Nursery Crop Provisions.

                           4. Contract Changes

    The contract change date is June 30 preceding the crop year (see the 
provisions of section 4 (Contract Changes) of the Basic Provisions 
(Sec. 457.8)).

                  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 September 30 preceding the crop year.

                   6. Nursery Plant Inventory Summary

    (a) Section 6 (Report of Acreage) of the Basic Provisions 
(Sec. 457.8) is not applicable to the Nursery Crop Provisions.
    (b) You must submit a nursery plant inventory summary to us on or 
before September 30 preceding the crop year.
    (c) The nursery plant inventory summary is a projection of the 
expected inventory for the following 12 months. This summary must 
include, by unit and by month for each type of plant in the inventory, 
the:
    (1) Container sizes, as measured at the largest dimension at the top 
of the container;
    (2) Number of plants;
    (3) Wholesale price for each month of the crop year; and
    (4) Your share.
    If your inventory usually changes within a specific month, report 
the largest inventory that you expect to have for that month.
    (d) Your annual nursery plant inventory summary will be used to 
determine your premium and the amount of insurance for each unit. If you 
do not submit the summary by the reporting date, we may elect to 
determine the nursery plant inventory for each unit or we may deny 
liability on any unit. Errors in reporting units may be corrected by us 
at the time of loss adjustment.
    (e) Your wholesale price list may be examined to determine whether 
the prices listed are reasonable. If the prices are determined to be 
unreasonable, the previous acceptable wholesale price list will be used 
or we may establish the wholesale price for each type of plant.
    (f) With our consent, you may revise your reported nursery plant 
inventory summary to correct or change the value of the insurable 
inventory if the amount of the revision is at least ten percent (10%) of 
the highest

[[Page 400]]

monthly market value reported on the nursery plant inventory summary or 
$25,000, whichever is smaller, or if a new plant species is being added 
that was not originally reported on your nursery plant inventory summary 
or was approved by written agreement. If you wish to revise the nursery 
plant inventory summary, you must notify us in writing at least 14 days 
before a change in inventory value. We must inspect and accept the 
nursery before insurance attaches on any proposed increase in inventory 
if:
    (1) The storage facilities have changed in any way since our 
previous inspection; or
    (2) The revision includes plants that have specific over-wintering 
storage requirements and that were not previously reported on your 
nursery plant inventory summary.
    (g) You may not revise your nursery plant inventory summary after 
the sales closing date to add plants not listed on the Nursery Eligible 
Plant Listing unless a request for a written agreement to add such 
plants has been submitted by the sales closing date.
    (h) Insurable plants that are not reported on your nursery plant 
inventory summary will not be insured, but the value of such plants 
after a loss will be included as production to count. Such unreported 
inventory may reduce the amount of any indemnity payable to you.
    (i) You must designate separately any plant inventory that is not 
insurable.

                            7. Annual Premium

    We will determine your premium as follows:
    (a) The annual premium for each unit will be calculated by:
    (1) Determing the total value of each plant type and container size 
designated on your nursery plant inventory summary for each month by 
multiplying the number of plants by the price for that type and 
container size shown on your accepted wholesale price list for that 
month, less the maximum discount (stated in dollar terms) granted to any 
buyer, and totalling the resulting values for each separate 
classification shown on the actuarial table;
    (2) Adding the total values of all plant types and container sizes 
(determined in (1) above) for each month separately to determine the 
monthly market values. Then compare the resulting twelve (12) monthly 
market values to determine the highest monthly market value for the crop 
year;
    (3) Taking the total value of each plant type and container size 
obtained in (1) above for the month having the highest monthly market 
value for the crop year (determined in (2) above) for each 
classification specified in the actuarial table and multiplying these 
values by .9, then multiplying the results by the percentage coverage 
level you have elected;
    (4) Multiplying each product obtained in (3) above by the 
appropriate premium rate listed on the actuarial table;
    (5) Adding the products obtained in (4) above; and
    (6) Multiplying the total obtained in (5) above by your share.
    (b) The annual premium will be earned in full when insurance 
attaches. It is due and payable as follows:
    (1) Forty percent (40%) on the later of September 30 preceding each 
crop year or the date we accept the inventory for insurance;
    (2) Thirty percent (30%) on January 1 of the crop year; and
    (3) Thirty percent (30%) on April 1 of the crop year.
    (c) Additional premium earned from an increase in the nursery plant 
inventory summary is due and payable when the revised nursery plant 
inventory summary is approved by us.
    (d) Premium will not be reduced due to a decrease in the nursery 
plant inventory summary, unless such decrease results from the deletion 
of uninsurable inventory from the summary that was erroneously reported 
as insurable.

                            8. Insured Plants

    In lieu of the provisions of section 8 (Insured Crop) and section 9 
(Insurable Acreage) of the Basic Provisions (Sec. 457.8), the insured 
nursery plant inventory will be all nursery plants in the county 
reported by you or determined by us for which an application is 
accepted, a premium rate is provided by the actuarial documents, and 
that:
    (a) Are grown under an irrigated practice for which you have 
adequate facilities and water at the time coverage begins in order to 
carry out a good irrigation practice;
    (b) Are classified as woody, herbaceous, or foliage landscape 
plants;
    (c) Do not include plants that produce edible berries, fruits, or 
nuts;
    (d) Are grown in standard nursery containers;
    (e) Are grown in an appropriate growing medium;
    (f) Are inspected by us and determined to be acceptable;
    (g) Are listed on the Nursery Eligible Plant Listing unless a 
written agreement provides otherwise;
    (h) Are not stock plants;
    (i) Are grown in accordance with the production practices for which 
premium rates have been established; and
    (j) Meet the ``mandatory'' or ``recommended'' storage requirements, 
unless you have applied for and received the Frost/ Freeze, and Cold 
Damage Exclusion Option for those nursery plants.

[[Page 401]]

                           9. Insurance Period

    In lieu of the provisions of section 11 (Insurance Period) of the 
Basic Provisions (Sec. 457.8), coverage begins on each unit or part of a 
unit the later of October 1 or the date we accept the inventory for 
insurance, provided you have complied with the terms of paragraph 
7.(b)(1). Coverage will not attach for plant inventory added due to a 
revised nursery plant inventory summary until any additional premium is 
paid in full. Insurance ends for each unit at the earliest of:
    (a) The date all plant inventory within the unit is sold or 
otherwise removed unless that inventory is replaced and additional 
earned premium is paid (If a portion of the plants are sold or otherwise 
removed from inventory, and are not replaced, insurance only ends on 
that part of the unit.);
    (b) The date of final adjustment of a loss on the unit when the 
total indemnities paid for the unit equal the amount of insurance for 
that unit; or
    (c) September 30 of the crop year.

                           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 for 
unavoidable damage caused only by the following causes of loss which 
occur within the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, except as specified in (b)(4);
    (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;
    (8) Failure of the irrigation water supply, due to an unavoidable 
cause of loss occurring within the insurance period; or
    (9) Frost or freeze if there is a failure or breakdown of frost/
freeze protection equipment or facilities and the failure or breakdown 
is directly caused by an insurable cause of loss, provided the insured 
nursery plants are damaged by freezing temperatures within 72 hours 
after the failure of such equipment or facilities and you establish that 
repair or replacement was not possible between the time of failure or 
breakdown and the time the freezing temperatures occurred.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we do not insure against 
any loss caused by:
    (1) Brownout;
    (2) Failure of the power supply unless such failure is due to an 
insurable cause of loss;
    (3) The inability to market the nursery plants as a direct result of 
quarantine, boycott, or refusal of a buyer to accept production;
    (4) Fire, where weeds and other forms of undergrowth in the vicinity 
of the building and on your property have not been controlled; or
    (5) Collapse or failure of buildings or structures.

                11. Duties in the Event of Damage or Loss

    In addition to your duties contained under section 14 (Duties in the 
Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), you must:
    (a) Obtain our written consent prior to:
    (1) Destroying, selling or otherwise disposing of any plant 
inventory that is damaged; or
    (2) Changing or discontinuing your normal growing practices with 
respect to care and maintenance of the insured plant inventory.
    (b) Upon our request, provide complete copies of your nursery plant 
inventory wholesale price list for the 12 month period immediately 
preceding the loss and your marketing records including plant shipping 
invoices for the same period.
    (c) Submit a claim for indemnity to us on our form, not later than 
60 days after the earliest of:
    (1) The date of your loss; or
    (2) The end of the insurance period.

                         12. Settlement of Claim

    (a) The indemnity will be the amount calculated by us for each unit 
as follows:
    (1) Subtracting field market value B from the lesser of:
    (i) Field market value A; or
    (ii) The highest monthly market value for the unit reported on the 
nursery plant inventory summary multiplied by .9;
    (2) Subtracting the monthly loss deductible (not to exceed the 
remaining crop year loss deductible) from the product obtained in (1) 
above; and
    (3) Multiplying the result by your share.
    (b) Individual insured losses occurring on the same unit during the 
crop year may be accumulated if each loss is reported and valued by us 
to satisfy the crop year loss deductible. Paragraph 12.(a)(2) will not 
apply to any subsequent individual loss determinations when the total 
amount of accumulated monthly loss deductibles is equal to or greater 
than the crop year loss deductible. Total indemnities for a unit will 
not exceed the amount of insurance for the unit.
    (c) The value of any insured plant inventory may be determined on 
the basis of our appraisals conducted after the end of the insurance 
period.

[[Page 402]]

                     13. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[60 FR 31378, June 15, 1995, as amended at 62 FR 65169, Dec. 10, 1997; 
63 FR 50975, Sept. 24, 1998]



Sec. 457.115  Nursery frost, freeze, and cold damage exclusion option.

    This is not a continuous option. Application for this option must be 
made on or before the sales closing date for each crop year this Option 
is to be in effect (see exception in item 2 below).

Insured's Name__________________________________________________________

Address_________________________________________________________________

Contract Number_________________________________________________________

Identification Number___________________________________________________

SSN/EIN_________________________________________________________________

Tax I.D.________________________________________________________________

Crop Year_______________________________________________________________

Unit Number_____________________________________________________________

Hardiness Zone__________________________________________________________

    For the crop year designated above, the Nursery Crop Provisions 
(Sec. 457.114) are amended in accordance with the following terms and 
conditions:
    1. You must have the Common Crop Insurance Policy Basic Provisions 
and Nursery Crop Provisions in force.
    2. This option must be submitted to us on or before the final date 
for accepting applications for the crop year in which you wish to insure 
your nursery plant inventory under this option. If the provisions of 
paragraph 6.(f)(2) of the Nursery Crop Provisions apply, we may accept 
this option after the sales closing date, or we may allow additional 
plants to be added to this option after such date.
    3. Executing this option does not reduce the premium rate for 
nursery crop insurance.
    4. All provisions of the Basic Provisions (Sec. 457.8) and Nursery 
Crop Provisions (Sec. 457.114) not in conflict with this option are 
applicable.
    5. Upon execution of this option, the following plant varieties will 
not have frost, freeze, or cold damage coverage on this unit because the 
mandatory (Risk Group A) or recommended (Risk Group B) over-wintering 
requirements will not be met.

------------------------------------------------------------------------
                                                        Over-wintering
          Scientific name              Common name    requirements to be
                                                           excluded
------------------------------------------------------------------------
                                     ...............  ..................
                                     ...............  ..................
                                     ...............  ..................
                                     ...............  ..................
                                     ...............  ..................
------------------------------------------------------------------------

Insured's Signature

_______________________________________________________________________

Date____________________________________________________________________

Insurance Company Representative's Signature and Code Number

_______________________________________________________________________

Date____________________________________________________________________


[60 FR 31380, June 15, 1995]



Sec. 457.116  Sugarcane crop insurance provisions.

    The sugarcane crop insurance provisions for the 1999 and succeeding 
crop years are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                        Sugarcane Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Crop year--The period within which the insured sugarcane is normally 
grown and designated by the calendar year in which the harvest of 
sugarcane normally begins in the county.
    Harvest--Cutting and removing the mature sugarcane from the field.
    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 price--The price per pound for raw sugar offered by 
buyers in the area in which you normally market the sugarcane.
    Plant cane--The insured crop which grows from seed planted for the 
crop year.
    Stubble cane--The insured crop which grows from the stubble of 
sugarcane that was harvested the previous crop year.
    Sugarcane--means either plant cane or stubble cane.

  2. 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 sugarcane in the county insured under this policy.

[[Page 403]]

    (b) Instead of reporting your sugarcane production for the previous 
crop year as required by subsection 3.(c) of the Basic Provisions 
(Sec. 457.8), there is a lag period of one year and you are required to 
report production from two crop years previously, e.g., 1994 crop year 
production must be reported by the required date for the 1996 crop year.

                           3. Contract Changes

    The contract change date is June 30 preceding the cancellation date 
(see the provisions of section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8)).

                  4. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions (Sec. 457.8), 
the cancellation and termination dates are September 30.

                             5. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the sugarcane in the county 
for which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That is grown for processing for sugar or for seed; and
    (c) That is not interplanted with another crop, unless a written 
agreement allows otherwise.

                          6. Insurable Acreage

    Paragraph 9.(a)(3) of the Basic Provisions (Sec. 457.8) is not 
applicable to the Sugarcane Crop Provisions.

                           7. Insurance Period

    (a) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8), insurance attaches:
    (1) At the time of planting for plant cane unless we agree in 
writing to a later date;
    (2) On the first day following harvest of the previous crop for 
stubble cane except as set out in paragraph 7(a)(3);
    (3) On the later of April 15 or 30 days following harvest of the 
previous crop for stubble cane:
    (i) Damaged during the previous crop year in all states (includes 
Louisiana); and
    (ii) In Louisiana, after the second harvest from stubble cane.
    (b) 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:
    (1) January 31 in Louisiana; and
    (2) April 30 in all other states.

                            8. Causes of Loss

    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:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if applicable, due to an 
unavoidable cause of loss occurring within the insurance period.

 9. Duties in the Event of Damage or Loss or Cutting the Sugarcane for 
                                  Seed

    (a) In addition to your duties under section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), in the event of 
damage or loss:
    (1) All sugarcane stubble must remain intact for our inspection; and
    (2) You must give us notice at least 15 days before you begin 
cutting any sugarcane for seed. Your notice must include the unit number 
and the number of acres you intend to harvest as seed. After we receive 
such notice we will appraise the sugarcane for its sugar potential. If 
you do not give us this notice, the production to count for such acreage 
will be your approved yield.
    (b) In accordance with the requirements of section 14 (Duties in the 
Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), if you 
initially discover damage to any insured crop within 15 days of, or 
during harvest, you must leave representative samples of the unharvested 
crop for our inspection. 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 stubble must not be destroyed and the required 
samples must not be harvested until the earlier of our inspection or 15 
days after harvest of the balance of the unit is completed.

                         10. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide records of production:
    (1) For any optional unit, we will combine all optional units for 
which acceptable records of production were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim on any unit by:
    (1) Multiplying the insured acreage by the production guarantee;

[[Page 404]]

    (2) Subtracting from this the total production to count;
    (3) Multiplying the remainder by your price election; and
    (4) Multiplying this result by your share.
    (c) The total production (pounds of sugar) to count from all 
insurable acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) Damaged solely by uninsured causes;
    (D) For which you fail to provide records of production that are 
acceptable to us; or
    (E) On which the sugarcane stubble is destroyed within 15 days after 
harvest is completed without our consent;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production;
    (iv) The difference between the production guarantee and the 
appraised production for acreage that has an inadequate stand. An 
appraisal for an inadequate stand will be made if the product of the 
number of stalks per acre multiplied by two and further multiplied by 
the percentage of sugar contained in the Special Provisions for this 
purpose does not equal the per-acre production guarantee; and
    (v) Potential production on insured acreage harvested for seed (see 
paragraph 9(a)(2));
    (vi) Potential production on insured acreage you want to put to 
another use or you wish to 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 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 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 you 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 insurable acreage. Final records 
of sugar production will be used to determine the amount of production 
to count. Preliminary mill estimates will not be used.
    (d) Harvested sugarcane may be adjusted for low quality if it is 
damaged by one or more freezes occurring within the insurance period to 
the extent that it cannot be processed for sugar by the boiling house 
operation. The amount of production to count for such sugarcane will be 
determined by dividing the dollar value of the damaged production by the 
local market price per pound for raw sugar. The prices used for this 
adjustment will be determined on the earlier of the date such quality-
adjusted production is sold or the date of final inspection for the 
unit.

                     11. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[60 FR 25602, May 12, 1995, as amended at 62 FR 65169, Dec. 10, 1997]



Sec. 457.117  Forage production crop insurance regulations.

    The forage production crop insurance provisions for the 1999 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

               Forage Production Crop Insurance Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Adequate stand--A population of live forage plants that equals or 
exceeds the minimum required number of plants per square foot as shown 
in the Special Provisions.
    Air-dry forage--Forage that has dried in windrows by natural means 
to less than 13 percent moisture before being put into stacks or bales.
    Crop year--The period from the date insurance attaches until harvest 
is normally completed, which is designated by the calendar year in which 
the majority of the forage is normally harvested.
    Cutting--Severance of the forage plant from the land for the purpose 
of livestock feed.

[[Page 405]]

    Fall planted--A forage crop planted after June 30.
    Forage--Planted perennial alfalfa, perennial red clover, perennial 
grasses, or a mixture thereof, or other species as shown in the 
Actuarial Documents.
    Harvest--Removal of forage from the windrow or field. Grazing will 
not be considered harvested.
    Spring planted--A forage crop planted before July 1.
    Ton--Two thousand (2,000) pounds avoirdupois.
    Year of establishment--The period between seeding and when the 
forage crop has developed an adequate stand. Insurance during the year 
of establishment may be available under the forage seeding policy. 
Insurance under this policy does not attach until after the year of 
establishment. The year of establishment is determined by the date of 
seeding. The year of establishment for spring planted forage is 
designated by the calendar year in which seeding occurred. The year of 
establishment for fall planted forage is designated by the calendar year 
after the year in which the crop was planted.

                            2. Unit Division

    The optional unit provisions in section 34 of the Basic Provisions 
are not applicable. Optional units are not allowed.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
         overage Levels, and Prices for Determining Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may only select one price election for all the forage 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 forage 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 a specific type, you must also choose 100 percent of the 
maximum price election for all other types.
    (b) You must report the total production harvested from insurable 
acreage for all cuttings for each unit by the production reporting date.
    (c) Separate guarantees will be determined by forage type, as 
applicable.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is June 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 September 30.

                          6. Report of Acreage

    In addition to section 6 of the Basic Provisions (Sec. 457.8), you 
must submit separate acreage reports for acreage insured under the 
Forage Production Winter Coverage Endorsement and for all other 
insurable forage acreage.

                             7. Insured Crop

    (a) In accordance with section 8 (Insured Crop) of the Basic 
Provisions (Sec. 457.8), the crop insured will be all the forage in the 
county for which a premium rate is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That is planted for harvest as livestock feed; and
    (3) That is grown after the year of establishment.
    (b) In addition to the crop listed as not insured in section 8 
(Insured Crop) of the Basic Provisions (Sec. 457.8), we will not insure 
any forage that:
    (1) Does not have an adequate stand at the beginning of the 
insurance period;
    (2) Is grown with a non-forage crop; or
    (3) Exceeds the age limitations for forage stands contained in the 
Special Provisions.

                           8. Insurance Period

    In lieu of the provisions of section 11 (Insurance Period) of the 
Basic Provisions (Sec. 457.8):
    (a) Insurance attaches on acreage with an adequate stand on the 
later of the date we accept your application or the applicable calendar 
dates listed below:
    (1) For the first and subsequent calendar years following the year 
of establishment, for acreage not insured under the Forage Production 
Winter Coverage Endorsement for:
    (i) California--February 1;
    (ii) Colorado, Idaho, Nebraska, Nevada, Oregon, Utah, and 
Washington--April 15;
    (iii) Iowa, Minnesota, Montana, New Hampshire, New York, North 
Dakota, Pennsylvania, Wisconsin, Wyoming, and all other states--May 22;
    (2) The calendar date specified in the Forage Production Winter 
Coverage Endorsement for acreage insured under such endorsement.
    (b) Insurance ends at the earliest of:
    (1) Total destruction of the forage crop;
    (2) Removal from the windrow or the field for each cutting;
    (3) Final adjustment of a loss;
    (4) The date grazing commences on the forage crop;

[[Page 406]]

    (5) Abandonment of the forage crop; or
    (6) The following dates of the crop year:
    (i) All states except California--October 15;
    (ii) California--December 31.
    (c) In order to obtain year-round coverage for a calendar year, you 
must purchase the Forage Production Winter Coverage Endorsement 
(Sec. 457.127).

                            9. 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 during 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 that occurs during the insurance period.
    (b) In addition to the causes of loss not covered in section 12 
(Causes of Loss) of the Basic Provisions (Sec. 457.8), we will not 
insure against damage that occurs after removal from the windrow.

                10. Duties in the Event of Damage or Loss

    In addition to your duties contained in section 14 (Duties in the 
Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), if you 
discover any insured forage is damaged, or if you intend to claim an 
indemnity on any unit, you must give notice:
    (a) Of probable loss at least 15 days before the beginning of any 
cutting or immediately if probable loss is discovered after cutting has 
begun; and
    (b) At least 5 days before grazing of insured forage begins. Such 
notice must include the number of acres harvested and tons produced from 
each unit.

                         11. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide production records for any unit, we will allocate 
any commingled production to such units in proportion to our liability 
on the harvested acreage for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage for each type, by its respective 
production guarantee;
    (2) Multiplying each result in section 11(b)(1) by the respective 
price election you selected;
    (3) Totaling the results of each crop type in section 11(b)(2);
    (4) Multiplying the total production to be counted of each type, if 
applicable, (see section 11(c)) by the respective price election you 
selected;
    (5) Totaling the results of each crop type in section 11(b)(4);
    (6) Subtracting the result in section 11(b)(5) from the result in 
section 11(b)(3); and
    (7) Multiplying the result in section 11(b)(6) by your share.
    (c) The total production to count (in tons) 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) Put to another use without our consent;
    (C) Damaged solely by uninsured causes; or
    (D) For which you fail to provide production records that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production;
    (iv) 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 
and:
    (A) 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 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) 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.
    (d) When forage is harvested as other than air-dry forage, the 
production to count will be adjusted to the equivalent of air-dry 
forage.
    (e) Any harvested production from plants growing in the forage will 
be counted as forage on a weight basis.

[[Page 407]]

    (f) In addition to the provisions of section 15 (Production Included 
in Determining Indemnities) of the Basic Provisions (Sec. 457.8), we may 
determine the amount of production of any unharvested forage on the 
basis of our field appraisals conducted after the normal time for each 
cutting for the area.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 14285, Mar. 26, 1997, as amended at 62 FR 65169, Dec. 10, 1997]



Sec. 457.118  Malting barley crop insurance.

    The malting barley crop insurance provisions for the 1996 and 
succeeding crop years are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

Small Grains Crop Insurance Malting Barley Price and Quality Endorsement

(This is a continuous endorsement. Refer to section 2 of the Common Crop 
Insurance Policy.)
    In return for your payment of premium for the coverage contained 
herein, this endorsement will be attached to and made part of the Common 
Crop Insurance Policy (Sec. 457.8) and Small Grains Crop Provisions 
(Sec. 457.101), subject to the terms and conditions described herein.
    1. You must have the Common Crop Insurance Policy (Sec. 457.8) and 
the Small Grains Crop Insurance Provisions (Sec. 457.101) in force to 
elect to insure malting barley under this endorsement.
    2. You must select either Option A or Option B on or before the 
sales closing date. Failure to select either Option A or Option B, or if 
you elect Option B but fail to have a malting barley contract in effect 
by the acreage reporting date, will result in no coverage under this 
endorsement for the applicable crop year. If you elect coverage under 
Option A, and subsequently enter into a malting barley contract, your 
coverage will continue under the terms of Option A. Your selection 
(Option A or B) will continue from year to year unless you cancel or 
change your selection on or before the sales closing date.
    3. You must select either an additional value price election or a 
percentage of the maximum additional value price election on or before 
the sales closing date. The percentage of the maximum additional value 
price election you select does not have to be the same as that selected 
under the Small Grains Crop Provisions for feed barley. In the event 
that you choose a percentage of the maximum additional value price 
election, we will multiply that percentage by the maximum additional 
value price election specified in Option A or B to determine the 
additional value price election that pertains to your contract.
    4. The additional premium amount for this coverage will be 
determined by multiplying your malting barley production guarantee per 
acre by your selected additional value price election, times the premium 
rate stated in the Actuarial Table, times the acreage planted to 
approved malting barley varieties, times your share at the time coverage 
begins.
    5. In addition to the reporting requirements contained in section 6 
of the Common Crop Insurance Policy (Sec. 457.8), you must provide the 
information required by the Option you select.
    6. In lieu of the provisions regarding units and unit division in 
the Common Crop Insurance Policy (Sec. 457.8) and the Small Grains Crop 
Provisions (Sec. 457.101), all barley acreage in the county that is 
planted to malting varieties that is insurable under the Small Grains 
Crop Provisions for feed barley and your selected Option must be insured 
under this endorsement and will be considered as one unit regardless of 
whether such acreage is owned, rented for cash, or rented for a share of 
the crop. The producer's shares in the malting barley acreage to be 
insured under this endorsement must be designated on the acreage report.
    7. In lieu of the provisions in the Common Crop Insurance Policy 
(Sec. 457.8) that requires us to pay your loss within 30 days after we 
reach agreement with you, whenever any production fails one or more of 
the quality criteria specified herein, the claim may not be settled 
until the earlier of:
    (a) The date you sell, feed, donate, or otherwise utilize such 
production for any purpose; or
    (b) May 31 of the calendar year immediately following the calendar 
year in which the insured malting barley is normally harvested.
    If the production meets all quality criteria contained herein or 
grades U.S. No. 4 or lower in accordance with the grades and grade 
requirements for the subclasses Six-rowed and Two-rowed barley, and for 
the class Barley in accordance with the Official United States Standards 
for Grain, the claim will be settled within 30 days in accordance with 
the Common Crop Insurance Policy (Sec. 457.8).
    8. This endorsement does not provide additional prevented planting 
coverage. Such coverage is only provided in accordance with the 
provisions of the Small Grain Crop Provisions for feed barley.
    9. Production from all acreage insured under this endorsement and 
any production

[[Page 408]]

of feed barley varieties must not be commingled prior to our making all 
determinations necessary for the purposes of this insurance. Failure to 
keep production separate may result in denial of your claim for 
indemnity.
    10. Definitions:
    (a) APH. Actual production history as determined in accordance with 
7 CFR part 400, subpart G.
    (b) Approved malting variety. A variety of barley specified as such 
in the Special Provisions.
    (c) Brewery. A facility where malt beverages are commercially 
produced for human consumption.
    (d) Contracted production. A quantity of barley the producer agrees 
to grow and deliver, and the buyer agrees to accept, under the terms of 
the malting barley contract.
    (e) Licensed grain grader. A person authorized by the U.S. 
Department of Agriculture to inspect and grade barley under the U.S. 
Standards for malt barley.
    (f) Malting barley contract. An agreement in writing between the 
producer and a brewery or a business enterprise that produces or sells 
malt or processed mash to a brewery, or a business enterprise owned by 
such brewery or business, that contains the amount of contracted 
production, the purchase price, or a method to determine such price, and 
other such terms that establish the obligations of each party to the 
agreement.
    (g) Objective test. A determination made by a qualified person using 
standardized equipment that is widely used in the malting industry, and 
following a procedure approved by the American Society of Brewing 
Chemists when determining percent germination or protein content; 
grading performed by following a procedure approved by the Federal Grain 
Inspection Service when determining quality factors other than percent 
germination or protein content; or by the Food and Drug Administration 
when determining concentrations of mycotoxins or other substances or 
conditions that are identified as being injurious to human or animal 
health.
    (h) Subjective test. A determination made by a person using 
olfactory, visual, touch or feel, masticatory, or other senses unless 
performed by a licensed grain grader; or that uses non-standardized 
equipment; or that does not follow a procedure approved by the American 
Society of Brewing Chemists, the Federal Grain Inspection Service, or 
the Food and Drug Administration.
    (i) Unit. All insurable acreage of approved malting varieties in the 
county on the date coverage begins for the crop year.

 Option A--(Available for Producers of Production Contracted After the 
   Sales Closing Date, Non-Contracted Production, or a Combination of 
                Contracted and Non-Contracted Production)

    This option provides coverage for malting barley production and 
quality losses at a price per bushel greater than that offered under the 
Small Grains Crop Provisions.
    1. To be eligible for coverage under this option, you must provide 
us acceptable records of your sales of malting barley and the number of 
acres planted to malting varieties for at least the four crop years in 
your APH database prior to the crop year immediately preceding the 
current crop year. For example, to determine your production guarantee 
for the 1996 crop year, records must be provided for the 1991 through 
the 1994 crop years, if malting barley varieties were planted in each of 
those crop years. Failure to provide acceptable records or reports as 
required herein will make you ineligible for coverage under this 
endorsement. You must provide these records to us no later than the 
production reporting date specified in the Common Crop Insurance Policy 
(Sec. 457.8).
    2. Your malting barley production guarantee per acre will be the 
lesser of:
    (a) The production guarantee for feed barley for acreage planted to 
approved malting varieties calculated in accordance with the Small 
Grains Crop Provisions and APH regulations; or
    (b) A production guarantee calculated in accordance with APH 
procedures using the malting barley sales and acreage records provided 
by you.
    3. The additional value price per bushel elected cannot exceed the 
maximum price designated in the Special Provisions.
    4. The amount of production to count against your malting barley 
production guarantee will be determined as follows:
    (a) Production to count will include all:
    (1) Appraised production determined in accordance with sections 
11(c)(1) (i) and (ii) of the Small Grains Crop Provisions;
    (2) Harvested production and potential unharvested production that 
meets, or would meet if properly handled;
    (i) Tolerances established by the Food and Drug Administration or 
other public health organization of the United States for substances or 
conditions, including mycotoxins, that are identified as being injurious 
to human health; and
    (ii) The following quality standards, as applicable:

------------------------------------------------------------------------
                                   Six-rowed malting   Two-rowed malting
                                   barley (percent)    barley (percent)
------------------------------------------------------------------------
Protein (dry basis).............  14.0 maximum......  14.0 maximum

[[Page 409]]

 
Plump kernels...................  65.0 minimum......  75.0 minimum
Thin kernels....................  10.0 maximum......  10.0 maximum
Germination.....................  95.0 minimum......  95.0 minimum
Blight damaged..................  4.0 maximum.......  4.0 maximum
Injured by mold.................  5.0 maximum.......  5.0 maximum
Mold damaged....................  0.4 maximum.......  0.4 maximum
Sprout damaged..................  1.0 maximum.......  1.0 maximum
Injured by frost................  5.0 maximum.......  5.0 maximum
Frost damaged...................  0.4 maximum.......  0.4 maximum
------------------------------------------------------------------------

    (3) Harvested production that does not meet the quality standards 
contained in section 4(a)(2) of this Option, but is accepted by a buyer 
for malting purposes. For such production, the production to count may 
be reduced or the price used to settle the claim may be adjusted in 
accordance with sections 4 (b), (c), and (d) of this Option.
    (b) The quantity of production that initially fails any quality 
standard contained in section 4(a)(2), but is sold as malting barley 
(except production included in section 4(c)), may be reduced as 
described in this subsection, provided the failure of such production to 
meet these standards is due to insurable causes. The production to count 
of production sold under section 4(a)(3) will be determined by:
    (1) Adding the maximum barley price election under the Small Grains 
Crop Provisions and the maximum additional value price;
    (2) Dividing the price per bushel received for the damaged 
production by the result of paragraph (1); and
    (3) Multiplying the result of paragraph (2) (not to exceed 1.000) by 
the number of bushels of damaged production.
    (c) The production to count for production that initially fails any 
quality standard contained in section 4 (a)(2), sold as malting barley, 
but is conditioned before the sale will not be reduced under section 
4(b). Such production will be considered separately from all other 
production to count. (See section 5(d).)
    (d) The additional value price election per bushel used to determine 
the value of the production to count for production that initially fails 
any quality standard contained in section 4(a)(2), but is sold as 
malting barley, may be reduced by the cost incurred for any conditioning 
required to improve the quality of production so that it is marketable 
as malting barley, provided the failure of such production to meet these 
standards is due to insurable causes.
    (e) No reduction in the production to count or the additional value 
price election will be allowed for moisture content, damage due to 
uninsured causes; costs or reduced value associated with drying, 
handling, processing, or quality factors other than those contained in 
section 4(a)(2) of this Option; or any other costs associated with 
normal handling and marketing of malting barely.
    (f) All grade and quality determinations must be based on the 
results of objective tests. No indemnity will be paid for any loss 
established by subjective tests. We may obtain one or more samples of 
the insured crop and have tests performed at an official grain 
inspection location established under the U.S. Grain Standards Act or 
laboratory of our choice to verify the results of any test. In the event 
of a conflict in the test results, our results will determine the amount 
of production to count.
    5. In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (a) Multiplying the insured acreage times your malting barley 
production guarantee per acre;
    (b) Multiplying the result in subsection (a) of this section times 
your additional value price election per bushel;
    (c) Multiplying the number of bushels of production to count 
determined in accordance with sections 4(a) and (b) of this Option times 
your elected additional value price per bushel;
    (d) Multiplying the production to count determined under section 
4(c) of this Option times the additional value price per bushel 
determined in section 4(d) of the Option;
    (e) Adding the results of subsections (c) and (d) of this section;
    (f) Subtracting the result of subsection (e) of this section from 
the result in subsection (b); and
    (g) Multiplying the result of subsection (f) of this section times 
your share.
    6. For example, assume you insure two units of barley under the 
Small Grains Crop Provisions in which you have a 100% share and that are 
planted to approved malting varieties. Assume the following:
    (a) Each unit contains 40 acres;
    (b) You have sold an average of 20 bushels per acre of malting 
barley for each of the last 6 years;
    (c) You have selected the 70 percent coverage level;
    (d) Your production guarantee under the Small Grains Crop Provisions 
and the APH regulations for feed barley is 30 bushels per acre;
    (e) Your total production from all units under the Small Grains Crop 
Provisions is 1,000 bushels, all of which fails to meet the quality 
standards specified by this Option. Two hundred bushels are sold for 
malting purposes after conditioning. Conditioning costs are $0.05 per 
bushel; and
    (f) Your additional value price election is $0.40 per bushel.
    Your malting barley production guarantee is 1120.0 bushels (the 
lesser of 20 or 30 x 70 percent coverage level  x 80 acres). The value 
of your production guarantee is $448.00 (1120 bushels  x $0.40 per 
bushel). Your production to count is 200 bushels. The value of your 
production to count is $70.00 (200 bushels

[[Page 410]]

 x $0.35 ($0.40--$0.05)). Your indemnity for the malting barley unit is 
$378.00 (($448.00--$70.00)  x 100 percent share). Any remaining loss is 
paid under the Small Grains Crop Provisions for feed barley.

    Option B--(Available for Producers of Contracted Production Only)

    This option provides coverage for malting barley production and 
quality losses at a price per bushel greater than that offered under the 
Small Grains Crop Provisions provided you have a malting barley 
contract.
    1. If you elect this option you must provide us a copy of your 
malting barley contract on or before the acreage reporting date. All 
terms and conditions of the contract, including the contract price or 
futures contract premium price, must be specified in the contract and be 
effective on or before the acreage reporting date. If you fail to timely 
provide the contract, or any terms are omitted, we may elect to 
determine the relevant information necessary for insurance under this 
Option (B), or deny liability. Only contracted production or acreage is 
covered by this Option (B).
    2. Your malting barley guarantee per acre will be the lesser of:
    (a) The production guarantee for feed barley for acreage planted to 
approved malting barley varieties calculated in accordance with the 
Small Grains Crop Provisions and APH regulations; or
    (b) The number of bushels obtained by:
    (1) Dividing the number of bushels of contracted production by the 
number of acres planted to approved malting varieties in the current 
crop year; and
    (2) Multiplying the result by the percentage for the coverage level 
you elected under the Small Grains Crop Provisions.
    3. The additional value price election per bushel will be the lesser 
of, as applicable:
    (a) The guaranteed sale price per bushel established in the malting 
barley contract (without regard to discounts or incentives that may 
apply) minus the maximum price election for feed barley; or
    (b) The premium price per bushel (without regard to discounts or 
incentives) if the sale price is based on a future market price as 
specified in the malting barley contract.
    Under no circumstances will the additional value price election per 
bushel exceed $2.00 per bushel.
    4. The amount of production to count against your malting barley 
production guarantee will be determined as follows:
    (a) Production to count will include all:
    (1) Appraised production determined in accordance with sections 
11(c)(1) (i) and (ii) of the Small Grains Crop Provisions;
    (2) Harvested production and potential unharvested production that 
meets, or would meet if properly handled, the minimum acceptance 
standards contained in the malting barley contract for protein, plump 
kernels, thin kernels, germination, blight damage, mold injury or 
damage, sprout damage, frost injury or damage, and mycotoxins or other 
substances or conditions identified by the Food and Drug Administration 
or other public health organization of the United States as being 
injurious to human health, or the following quality standards as 
applicable:

------------------------------------------------------------------------
                                   Six-rowed malting   Two-rowed malting
                                        barley              barley
                                 ---------------------------------------
                                       (percent)           (percent)
------------------------------------------------------------------------
Protein (dry basis).............  14.0 maximum......  14.0 maximum
Plump kernels...................  65.0 minimum......  75.0 minimum
Thin kernels....................  10.0 maximum......  10.0 maximum
Germination.....................  95.0 minimum......  95.0 minimum
Blight damaged..................  4.0 maximum.......  4.0 maximum
Injured by mold.................  5.0 maximum.......  5.0 maximum
Mold damaged....................  0.4 maximum.......  0.4 maximum
Sprout damaged..................  1.0 maximum.......  1.0 maximum
Injured by frost................  5.0 maximum.......  5.0 maximum
Frost damaged...................  0.4 maximum.......  0.4 maximum
------------------------------------------------------------------------

    (3) Harvested production that does not meet the quality standards 
contained in section 4(a)(2) of this Option, but is accepted by a buyer 
for malting purposes. For such production, the production to count may 
be reduced or the price used to settle the claim may be adjusted in 
accordance with sections 4 (b), (c), and (d) of this Option.
    (b) The quantity of production that initially fails any quality 
standard contained in section 4(a)(2), but is sold as malting barley 
(except production included in section 4(c)), may be reduced as 
described in this subsection, provided the failure of such production to 
meet these standards is due to insurable causes. The production to count 
of production sold under section 4(a)(3) will be determined by:
    (1) Adding the maximum barley price election under the Small Grains 
Crop Provisions and the maximum additional value price;
    (2) Dividing the price per bushel received for the damaged 
production by the result of paragraph (1); and
    (3i) Multiplying the result of paragraph (2) (not to exceed 1.000) 
by the number of bushels of damaged production.
    (c) The production to count for production that initially fails any 
quality standard contained in section 4(a)(2), sold as malting barley, 
but is conditioned before the sale will not be reduced under section 
4(b). Such production will be considered separately from all other 
production to count. (See section 5(d).)
    (d) The additional value price election per bushel used to determine 
the value of the production to count for production that initially fails 
any quality standard contained in section 4(a)(2), but is sold as 
malting barley, may be reduced by the cost incurred for any conditioning 
required to improve the quality of production so that it is marketable 
as

[[Page 411]]

malting barley, provided the failure of such production to meet these 
standards is due to insurable causes.
    (e) No reduction in the production to count or the additional value 
price election will be allowed for moisture content, damage due to 
uninsured causes; costs or reduced value associated with drying, 
handling, processing, or quality factors other than those contained in 
section 4(a)(2) of this Option; or any other costs associated with 
normal handling and marketing of malting barely.
    (f) All grade and quality determinations must be based on the 
results of objective tests. No indemnity will be paid for any loss 
established by subjective tests. We may obtain one or more samples of 
the insured crop and have tests performed at an official grain 
inspection location established under the U.S. Grain Standards Act or 
laboratory of our choice to verify the results of any test. In the event 
of a conflict in the test results, our results will determine the amount 
of production to count.
    5. In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (a) Multiplying the insured acreage times your malting barley 
production guarantee per acre;
    (b) Multiplying the result in subsection (a) of this section times 
your additional value price election per bushel;
    (c) Multiplying the number of bushels of production to count 
determined in accordance with sections 4 (a) and (b) of this Option 
times your elected additional value price per bushel;
    (d) Multiplying the production to count determined under section 
4(c) of this Option times the additional value price per bushel 
determined in section 4(d) of the Option;
    (e) Adding the results of subsections (c) and (d) of this section;
    (f) Subtracting the result of subsection (e) of this section from 
the result in subsection (b); and
    (g) Multiplying the result of subsection (f) of this section times 
your share.
    6. For example, assume you insure two units of barley under the 
Small Grains Crop Provisions in which you have a 100% share and that are 
planted to approved malting varieties. Assume the following:
    (a) Each unit contains 40 acres;
    (b) You have a contract for the sale of 2500 bushels of malting 
barley;
    (c) You have selected the 70 percent coverage level;
    (d) Your production guarantee under the Small Grains Crop Provisions 
and the APH regulations for feed barley is 35 bushels per acre;
    (e) Your total production from all units under the Small Grains Crop 
Provisions is 1,000 bushels, all of which fails to meet the quality 
standards specified by this Option. Two hundred bushels are sold for 
malting purposes after conditioning. Conditioning cost $0.05 per bushel; 
and
    (f) Your additional value price election is $0.60 per bushel.
    Your malting barley production guarantee is 1750.0 bushels (the 
lesser of 35 or 21.875 (2500 contracted bushels 80 acres x 70 
percent coverage) x 80 acres). The value of your production guarantee is 
$1050.00 (1750 bushels x $0.60 per bushel). Your production to count is 
200 bushels. The value of your production to count is $110.00 (200 
bushels x $0.55 ($0.60--$0.05)). Your indemnity for the malting barley 
unit is $940.00 (($1050.00--$110.00) x 100 percent share). Any remaining 
loss is paid under the Small Grains Crop Provisions for feed barley.

[61 FR 8855, Mar. 6, 1996; 61 FR 27245, May 31, 1996]



Sec. 457.119  Texas citrus fruit crop insurance provisions.

    The Texas citrus fruit crop insurance provisions for the 2000 and 
succeeding crop years are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                   Texas Citrus Fruit Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Crop. Specific groups of citrus fruit as listed in the Special 
Provisions.
    Crop year. The period beginning with the date insurance attaches to 
the citrus crop and extending through the normal harvest time. It is 
designated by the calendar year following the year in which the bloom is 
normally set.
    Direct marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper, or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    Excess rain. An amount of precipitation that damages the crop.
    Excess wind. A natural movement of air that has sustained speeds 
exceeding 58 miles per hour recorded at the U. S. Weather Service 
reporting station operating nearest to the grove at the time of damage.

[[Page 412]]

    Freeze. The formation of ice in the cells of the tree, its blossoms, 
or its fruit caused by low air temperatures.
    Harvest. The severance of mature citrus fruit from the tree by 
pulling, picking, or any other means, or by collecting marketable fruit 
from the ground.
    Hedged. A process of trimming the sides of the citrus trees for 
better or more fruitful growth of the citrus fruit.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Local market price. The applicable citrus price per ton offered by 
buyers in the area in which you normally market the insured crop.
    Production guarantee (per acre):
    (a) First stage production guarantee. The second stage production 
guarantee multiplied by forty percent (40%).
    (b) Second stage production guarantee. The quantity of citrus (in 
tons) determined by multiplying the yield determined in accordance with 
section 3 by the coverage level percentage you elect.
    Ton. Two thousand (2,000) pounds avoirdupois.
    Topped. A process of trimming the uppermost portion of the citrus 
trees for better and more fruitful growth of the citrus fruit.
    Varieties. Subclasses of crops as listed in the Special Provisions.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will be divided into additional basic units by each citrus crop 
designated in the Special Provisions.
    (b) Provisions in the Basic Provisions that allow optional units by 
irrigated and non-irrigated practices are not applicable.
    (c) Instead of establishing optional units by section, section 
equivalent, or FSA farm serial number, optional unit is located on non-
contiguous land.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one price election and coverage level for 
each citrus fruit crop designated in the Special Provisions that you 
elect to insure. The price election you choose for each crop need not 
bear the same percentage relationship to the maximum price offered by us 
for each crop. For example, if you choose one hundred percent (100%) of 
the maximum price election for early oranges, you may choose seventy-
five percent (75%) of the maximum price election for late oranges. 
However, if separate price elections are available by variety within 
each crop, the price elections you choose within the crop must have the 
same percentage relationship to the maximum price offered by us for each 
variety within the crop.
    (b) The production guarantee per acre is progressive by stage and 
increases at specific intervals to the final stage production guarantee. 
The stages and production guarantees per acre are:
    (1) The first stage extends from the date insurance attaches through 
April 30 of the calendar year of normal bloom. The production guarantee 
will be forty percent (40%) of the yield calculated in section 3(e) 
multiplied by your coverage level.
    (2) The second or final stage extends from May 1 of the calendar 
year of normal bloom until the end of the insurance period. The 
production guarantee will be the yield calculated in section 3(e) 
multiplied by your coverage level.
    (c) Any acreage of citrus damaged in the first stage to the extent 
that the majority of producers in the area would not further maintain it 
will be limited to the first stage production guarantee even though you 
may continue to maintain it.
    (d) In addition to the reported production, each crop year you must 
report by type:
    (1) The number of trees damaged, topped, hedged, pruned or removed; 
any change in practices or any other circumstance that may reduce the 
expected yield below the yield upon which the insurance guarantee is 
based; and the number of affected acres;
    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and anytime the planting pattern of such acreage 
is changed:
    (i) The age of the interplanted crop, and type if applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield.
    We will reduce the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of the following: 
interplanted perennial crop; removal, topping, hedging, or pruning of 
trees; damage; change in practices and any other circumstance on the 
yield potential of the insured crop. If you fail to notify us of any 
circumstance that may reduce your yields from previous levels, we will 
reduce your production guarantee as necessary at any time we become 
aware of the circumstance.
    (e) The yield used to compute your production guarantee will be 
determined in accordance with Actual Production History (APH) 
regulations, 7 CFR part 400, subpart G, and applicable policy provisions 
unless damage or changes to the grove or trees, require establishment of 
the yield by another method.

[[Page 413]]

In the event of such damage or changes, the yield will be based on our 
appraisal of the potential of the insured acreage for the crop year.
    (f) Instead of reporting your citrus production for the previous 
crop year, as required by section 3 of the Basic Provisions 
(Sec. 457.8), there is a one year lag period. Each crop year you must 
report your production from two crop years ago, e.g., on the 1998 crop 
year production report, you will provide your 1996 crop year production.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is August 31 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 November 20.

                            6. Annual Premium

    In lieu of the premium computation method in section 7 (Annual 
Premium) of the Basic Provisions (Sec. 457.8), the annual premium amount 
is computed by multiplying the second stage production guarantee per 
acre by the price election, the premium rate, the insured acreage, your 
share at the time coverage begins, and by any applicable premium 
adjustment percentages contained in the Special Provisions.

                             7. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the acreage in the county of 
each citrus crop designated in the Special Provisions that you elect to 
insure and for which a premium rate is provided by the actuarial 
documents:
    (a) In which you have a share;
    (b) That are adapted to the area;
    (c) That are irrigated;
    (d) That has produced an average yield of at least three tons per 
acre the previous year, or we have appraised the yield potential of at 
least three tons per acre;
    (e) That is grown in a grove that, if inspected, is considered 
acceptable by us; and
    (f) That is not sold by direct marketing, unless allowed by the 
Special Provisions or by written agreement.

                          8. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a 
crop planted with another crop, citrus interplanted with another 
perennial crop is insurable unless we inspect the acreage and determine 
it does not meet the requirements contained in your policy.

                           9. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on November 21 of each crop year, except that 
for the year of application, if your application is received after 
November 11 but prior to November 21, insurance will attach on the 10th 
day after your properly completed application is received in our local 
office, unless we inspect the acreage during the 10 day period and 
determine that it does not meet insurability requirements. You must 
provide any information that we require for the crop or to determine the 
condition of the grove.
    (2) The calendar date for the end of the insurance period for each 
crop year is the second May 31st of the crop year.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins, but on or before the acreage reporting date for the 
crop year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable share on any insurable acreage 
of citrus on or before the acreage reporting date for the crop year, 
insurance will not be considered to have attached to, and no premium 
will be due, and no indemnity paid for such acreage for that crop year 
unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                           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) Excess rain;
    (2) Excess wind;
    (3) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the grove;
    (4) Freeze;
    (5) Hail;
    (6) Tornado;
    (7) Wildlife; or

[[Page 414]]

    (8) Failure of the irrigation water supply if caused by an insured 
peril or drought that occurs during the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to:
    (1) Disease or insect infestation, unless a cause of loss specified 
in section 10(a):
    (i) Prevents the proper application of control measures or causes 
properly applied control measures to be ineffective; or
    (ii) Causes disease or insect infestation for which no effective 
control mechanism is available;
    (2) Inability to market the citrus for any reason other than actual 
physical damage from an insurable cause specified in this section. For 
example, we will not pay you an indemnity if you are unable to market 
due to quarantine, boycott, or refusal of any person to accept 
production.

                11. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), the following 
will apply:
    (a) If the Special Provisions permit or a written agreement 
authorizing direct marketing exists, you must notify us at least 15 days 
before any production from any unit will be sold by direct marketing. We 
will conduct an appraisal that will be used to determine your production 
to count for production that is sold by direct marketing. If damage 
occurs after this appraisal, we will conduct an additional appraisal. 
These appraisals, and any acceptable records provided by you, will be 
used to determine your production to count. Failure to give timely 
notice that production will be sold by direct marketing will result in 
an appraised amount of production to count of not less than the 
production guarantee per acre if such failure results in our inability 
to make the required appraisal.
    (b) If you intend to claim an indemnity on any unit, you must notify 
us before beginning to harvest any damaged production so we may have an 
opportunity to inspect it. You must not sell or dispose of the damaged 
crop until after we have given you written consent to do so. If you fail 
to meet the requirements of this section all such production will be 
considered undamaged and included as production to count.

                         12. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide acceptable production records:
    (1) For any optional unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim on a unit basis by:
    (1) Multiplying the insured acreage for each crop, or variety if 
applicable, by its respective production guarantee (see sections 1 and 
3);
    (2) Multiplying the results of section 12(b)(1) by the respective 
price election for each crop or variety, if applicable;
    (3) Totaling the results of section 12(b)(2);
    (4) Multiplying the total production to count of each variety, if 
applicable (see section 12(c)) by the respective price election;
    (5) Totaling the results of section 12(b)(4);
    (6) Subtracting this result of section 12(b)(5) from the result of 
section 12(b)(3); and
    (7) Multiplying the result of section 12(b)(6) by your share.
    (c) The total production to count (in tons) 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) For which you fail to provide acceptable production records;
    (C) That is damaged solely by uninsured causes; or
    (D) From which production is sold by direct marketing, if direct 
marketing is specifically permitted by the Special Provisions or a 
written agreement, and you fail to meet the requirements contained in 
section 11;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production; and
    (iv) Potential production on insured acreage you intend to abandon 
or 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 you do not agree with our appraisal, we may defer the claim 
only if you agree to continue to care for the crop. We will then make 
another appraisal when you notify us of further damage or that harvest 
is general in the area unless you harvested the crop, in which case we 
will use the harvested production. If you do not continue to care for 
the crop, our appraisal made prior to deferring the claim will be used 
to determine the production to count; and
    (2) All harvested production from the insurable acreage.
    (d) Any citrus fruit that is not marketed as fresh fruit and, due to 
insurable causes, does not contain 120 or more gallons of juice per ton, 
will be adjusted by:
    (1) Dividing the gallons of juice per ton obtained from the damaged 
citrus by 120; and

[[Page 415]]

    (2) Multiplying the result by the number of tons of such citrus.
    If individual records of juice content are not available, an average 
juice content from the nearest juice plant will be used, if available. 
If not available, a field appraisal will be made to determine the 
average juice content.
    (e) Where the actuarial documents provide, and you elect, the fresh 
fruit option, citrus fruit that is not marketable as fresh fruit due to 
insurable causes will be adjusted by:
    (1) Dividing the value per ton of the damaged citrus by the price of 
undamaged citrus fruit; and
    (2) Multiplying the result by the number of tons of such citrus 
fruit. The applicable price for undamaged citrus fruit will be the local 
market price the week before damage occurred.
    (f) Any production will be considered marketed or marketable as 
fresh fruit unless, due solely to insured causes, such production was 
not marketed as fresh fruit.
    (g) In the absence of acceptable records of disposition of harvested 
citrus fruit, the disposition and amount of production to count for the 
unit will be the guarantee on the unit.
    (h) Any citrus fruit on the ground that is not harvested will be 
considered totally lost if damaged by an insured cause.

                     13. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[61 FR 41300, Aug. 8, 1996; 61 FR 57583, Nov. 7, 1996, as amended at 62 
FR 65169, Dec. 10, 1997]



Sec. 457.120  [Reserved]



Sec. 457.121  Arizona-California citrus crop insurance provisions.

    The Arizona-California citrus crop insurance provisions for the 2000 
and succeeding crop years are as follows:

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                Arizona-California Citrus Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Carton. The standard container for marketing the fresh packed citrus 
fruit crop as shown below. In the absence of marketing records on a 
carton basis, production will be converted to cartons on the basis of 
the following average net pounds of packed fruit in a standard packed 
carton.

------------------------------------------------------------------------
            Container size                    Fruit crop         Pounds
------------------------------------------------------------------------
Container #58........................  Navel oranges, Valencia        38
                                        oranges & Sweet
                                        oranges.
Container #58........................  Lemons.................        40
Container #59........................  Grapefruit.............        32
Container #63........................  Tangerines (including          25
                                        Tangelos) & Mandarin
                                        oranges.
------------------------------------------------------------------------

    Crop. Citrus fruit as listed in the Special Provisions.
    Crop year. The period beginning with the date insurance attaches to 
the citrus crop and extending through normal harvest time. It is 
designated by the calendar year following the year in which the bloom is 
normally set.
    Dehorning. Cutting of any scaffold limb to a length that is not 
greater than one-fourth (\1/4\) the height of the tree before cutting.
    Direct marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    Harvest. The severance of mature citrus from the tree by pulling, 
picking, or any other means, or by collecting marketable fruit from the 
ground.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Scaffold limb. A major limb attached directly to the trunk.
    Set out. Transplanting a tree into the grove.
    Variety. Subclass of crop as listed in the Special Provisions.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will also be divided into additional basic units by each citrus crop 
designated in the Special Provisions.
    (b) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Optional units may be 
established only if each optional unit is located on non-contiguous 
land, unless otherwise allowed by written agreement.

  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)

[[Page 416]]

of the Basic Provisions (Sec. 457.8), you may select only one price 
election and coverage level for each citrus fruit crop designated in the 
Special Provisions that you elect to insure. The price election you 
choose for each crop need not bear the same percentage relationship to 
the maximum price offered by us for each crop. For example, if you 
choose one hundred percent (100%) of the maximum price election for 
sweet oranges, you may choose seventy-five percent (75%) of the maximum 
price election for grapefruit. However, if separate price elections are 
available by variety within each crop, the price elections you choose 
for each variety must have the same percentage relationship to the 
maximum price offered by us for each variety within the crop.
    (b) In lieu of reporting your citrus production of marketable fresh 
fruit for the previous crop year, as required by section 3 of the Basic 
Provisions (Sec. 457.8), there is a lag period of one year. Each crop 
year, you must report your production from two crop years ago, e.g., on 
the 1998 crop year production report, you will provide your 1996 crop 
year production.
    (c) In addition, you must report, by the production reporting date 
designated in section 3 (Insurance Guarantees, Coverage Levels, and 
Prices for Determining Indemnities) of the Basic Provisions 
(Sec. 457.8), by type, if applicable:
    (1) The number of trees damaged, dehorned or removed; any change in 
practices or any other circumstance that may reduce the expected yield 
below the yield upon which the insurance guarantee is based; and the 
number of affected acres;
    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and anytime the planting pattern of such acreage 
is changed:
    (i) The age of the interplanted crop, and type, if applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield.
    We will reduce the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of the following: 
interplanted perennial crop; damage; dehorning; removal of trees; change 
in practices and any other circumstance on the yield potential of the 
insured crop. If you fail to notify us of any circumstance that may 
reduce your yields from previous levels, we will reduce your production 
guarantee as necessary at any time we become aware of the circumstance.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is August 31 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 November 20.

                             6. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the acreage in the county of 
each citrus crop designated in the Special Provisions that you elect to 
insure and for which a premium rate is provided by the actuarial 
documents:
    (a) In which you have a share;
    (b) That is adapted to the area;
    (c) That is irrigated;
    (d) That is grown in a grove that, if inspected, is considered 
acceptable by us;
    (e) That is not sold by direct marketing, unless allowed by the 
Special Provisions or by written agreement; and
    (f) That has reached at least the sixth growing season after being 
set out. However, we may agree to insure acreage that has not reached 
this age if we inspect and approve a written agreement to insure such 
acreage.

                          7. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a 
crop planted with another crop, citrus interplanted with another 
perennial crop is insurable unless we inspect the acreage and determine 
it does not meet the requirements contained in your policy.

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on November 21 of each crop year, except that 
for the year of application, if your application is received after 
November 11 but prior to November 21, insurance will attach on the 10th 
day after your properly completed application is received in our local 
office unless we inspect the acreage during the 10 day period and 
determine that it does not meet insurability requirements. You must 
provide any information that we require for the crop or to determine the 
condition of the grove.
    (2) The calendar date for the end of the insurance period for each 
crop year is:
    (i) August 31 for Navel oranges and Southern California lemons;
    (ii) November 20 for Valencia oranges; and

[[Page 417]]

    (iii) July 31 for all other citrus crops.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins, but on or before the acreage reporting date for the 
crop year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable share on any insurable acreage 
of citrus on or before the acreage reporting date for the crop year, 
insurance will not be considered to have attached to and no premium will 
be due, and no indemnity paid, for such acreage for that crop year 
unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            9. 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 during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the grove;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption; or
    (6) Failure of irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to:
    (1) Disease or insect infestation, unless adverse weather 
conditions:
    (i) Prevents the proper application of control measures or causes 
properly applied control measures to be ineffective; or
    (ii) Causes disease or insect infestation for which no effective 
control mechanism is available;
    (2) Inability to market the citrus for any reason other than actual 
physical damage from an insurable cause specified in this section. For 
example, we will not pay you an indemnity if you are unable to market 
due to quarantine, boycott, or refusal of any person to accept 
production.

                10. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), the following 
will apply:
    (a) If the Special Provisions permit or a written agreement 
authorizing direct marketing exists, you must notify us at least 15 days 
before any production from any unit will be sold by direct marketing. We 
will conduct an appraisal that will be used to determine your production 
to count for production that is sold by direct marketing. If damage 
occurs after this appraisal, we will conduct an additional appraisal. 
These appraisals, and any acceptable records provided by you, will be 
used to determine your production to count. Failure to give timely 
notice that production will be sold by direct marketing will result in 
an appraised amount of production to count of not less than the 
production guarantee per acre if such failure results in our inability 
to make the required appraisal.
    (b) If you intend to claim an indemnity on any unit, you must notify 
us before beginning to harvest any damaged production so that we may 
have an opportunity to inspect it. You must not sell or dispose of the 
damaged crop until after we have given you written consent to do so. If 
you fail to meet the requirements of this section, all such production 
will be considered undamaged and included as production to count.

                         11. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide acceptable production records:
    (1) For any optional unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage for each crop, or variety if 
applicable, by its respective production guarantee;
    (2) Multiplying the results of section 11(b)(1) by the respective 
price election for each crop, or variety, if applicable;
    (3) Totaling the results of section 11(b)(2);
    (4) Multiplying the total production to be counted of each variety, 
if applicable (see section 11(c)), by the respective price election;
    (5) Totaling the results of section 11(b)(4);
    (6) Subtracting this result of section 11(b)(5) from the result of 
section 11(b)(3); and
    (7) Multiplying the result of section 11(b)(6) by your share;

[[Page 418]]

    (c) The total production to count (in cartons) 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) For which you fail to provide acceptable production records;
    (C) That is damaged solely by uninsured causes; or
    (D) From which production is sold by direct marketing, if direct 
marketing is specifically permitted by the Special Provisions or a 
written agreement, and you fail to meet the requirements contained in 
section 10;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production determined to be marketable as fresh 
packed fruit; and
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we may defer 
the claim only if you agree to continue to care for the crop. We will 
then make another appraisal when you notify us of further damage or that 
harvest is general in the area unless you harvested the crop, in which 
case we will use the harvested production. If you do not continue to 
care for the crop, our appraisal made prior to deferring the claim will 
be used to determine the production to count;
    (2) All harvested production marketed as fresh packed fruit from the 
insurable acreage; and
    (3) All citrus that was disposed of or sold without an inspection or 
written consent.
    (d) Any production will be considered marketed or marketable as 
fresh packed fruit unless, due solely to insured causes, such production 
was not marketed or marketable as fresh packed fruit.
    (e) Citrus that cannot be marketed as fresh packed fruit due to 
insurable causes will not be considered production to count.
    (f) If we determine that frost protection equipment was not properly 
utilized or not properly reported, the indemnity for the unit will be 
reduced by the percentage of premium reduction allowed for frost 
protection equipment. You must, at our request, provide us records 
showing the start-stop times by date for each period the frost 
protection equipment was used.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[61 FR 44147, Aug. 28, 1996, as amended at 62 FR 65170, Dec. 10, 1997]



Sec. 457.122  Walnut crop insurance provisions.

    The walnut crop insurance provisions for the 1999 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:

                         Walnut Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Harvest--Removal of the walnuts from the orchard.
    Interplanted--Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Net delivered weight--Delivered weight (pounds) of dry, hulled, in-
shell walnuts, excluding foreign material.
    Pound--A unit of weight equal to 16 ounces avoirdupois.
    Production guarantee (per acre)--The number of pounds (whole in-
shell walnuts), determined by multiplying the approved APH yield per 
acre by the coverage level percentage you elect.

                            2. Unit Division

    Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Optional units may be 
established only if each optional unit is located on non-contiguous 
land, unless otherwise allowed by written agreement.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one price election for all the walnuts in 
the county insured under this policy unless the Special Provisions 
provide different price elections by variety or varietal group, in which 
case you may select one price election for each walnut variety or 
varietal group designated in the Special Provisions. The price elections 
you choose for each variety or varietal group

[[Page 419]]

must have the same percentage relationship to the maximum price offered 
by us for each variety or varietal group. For example, if you choose 100 
percent of the maximum price election for a specific variety or varietal 
group, you must also choose 100 percent of the maximum price election 
for all other varieties or varietal groups.
    (b) You must report, by the production reporting date designated in 
section 3 (Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities) of the Basic Provisions (Sec. 457.8), by 
variety or varietal group if applicable:
    (1) Any damage, removal of trees, change in practices, or any other 
circumstance that may reduce the expected yield below the yield upon 
which the insurance guarantee is based, and the number of affected 
acres;
    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting pattern;
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and anytime the planting pattern of such acreage 
is changed, the age of the crop that is interplanted with the walnuts, 
and type if applicable, and the planting pattern; and
    (5) Any other information that we request in order to establish your 
approved yield.
    We will reduce the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of the following: 
interplanted perennial crop; removal of trees; damage; change in 
practices and any other circumstance on the yield potential of the 
insured crop. If you fail to notify us of any circumstance that may 
reduce your yields from previous levels, we will reduce your production 
guarantee as necessary at any time we become aware of the circumstances.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is October 31 
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 January 31.

                             6. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the commercially grown 
English Walnuts (excluding black walnuts) in the county for which a 
premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are grown on tree varieties that:
    (1) Were commercially available when the trees were set out;
    (2) Are adapted to the area; and
    (3) Are grown on a root stock that is adapted to the area;
    (c) That are grown in an orchard that, if inspected, are considered 
acceptable by us;
    (d) On acreage where at least 90 percent of the trees have reached 
at least the ninth growing season after being set out, unless we agree 
in writing to insure trees not meeting this requirement; and
    (e) That are in a unit that consists of at least five acres, unless 
we agree in writing to insure a smaller unit.

                          7. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a 
crop planted with another crop, walnuts interplanted with another 
perennial crop are insurable unless we inspect the acreage and determine 
that it does not meet the requirements contained in your policy.

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on February 1 of each crop year, except that for 
the year of application, if your application is received after January 
22, but prior to February 1, insurance will attach on the 10th day after 
your properly completed application is received in our local office, 
unless we inspect the acreage during the 10 day period and determine 
that it does not meet insurability requirements. You must provide any 
information that we require for the crop or to determine the condition 
of the orchard.
    (2) The calendar date for the end of the insurance period for each 
crop year is November 15.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period. Acreage 
acquired after the acreage reporting date will not be insured.
    (2) If you relinquish your insurable share on any insurable acreage 
of walnuts on or before the acreage reporting date for the crop year, 
insurance will not be considered to have attached to, and no premium or 
indemnity will be due for such acreage for that crop year unless:

[[Page 420]]

    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            9. 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 during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and undergrowth have not been controlled or 
pruning debris has not been removed from the orchard;
    (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 irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against any damage or loss of production due to the inability to market 
the walnuts for any reason other than actual physical damage to the 
walnuts from an insurable cause specified in this section. For example, 
we will not pay you an indemnity if you are unable to market due to 
quarantine, boycott, or refusal of any person to accept production.

                10. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), if you intend 
to claim an indemnity on any unit, you must notify us prior to the 
beginning of harvest so that we may inspect the damaged production. You 
must not sell or dispose of the damaged crop until after we have given 
you written consent to do so. If you fail to meet the requirements of 
this section, all such production will be considered undamaged and 
included as production to count.

                         11. 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 such 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 the respective production 
guarantee;
    (2) Multiplying each result in section 11(b)(1) by the respective 
price election for each variety or varietal group;
    (3) Totaling the results in section 11(b)(2);
    (4) Multiplying the total production to be counted of each variety 
or varietal group, if applicable, (see section 11(c)) by the respective 
price election;
    (5) Totaling the results in section 11(b)(4);
    (6) Subtracting the result in section 11(b)(5) from the result in 
section 11(b)(3); and
    (7) Multiplying the result in section 11(b)(6) by your share.
    (c) The total production to count (whole in-shell pounds) 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 damaged solely by uninsured causes; or
    (C) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production; and
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we may defer 
the claim only if you agree to continue to care for the crop. We will 
then make another appraisal when you notify us of further damage or that 
harvest is general in the area unless you harvested the crop, in which 
case we will use the harvested production. If you do not continue to 
care for the crop, our appraisal made prior to deferring the claim will 
be used to determine the production to count; and
    (2) All harvested production from the insurable acreage.
    (d) Mature walnut production damaged due to an insurable cause of 
loss which occurs within the insurance period may be adjusted for 
quality based on an inspection by the Dried Fruit Association or as 
determined by us. Walnut production that has mold damage greater than 8 
percent, based on the net delivered weight, will be reduced by the 
factor contained in the Special Provisions. Walnut production that has 
mold damage greater than 30 percent, based on the net delivered weight, 
will not be considered as production to count unless such production is 
sold. If

[[Page 421]]

such production is sold, the total amount received for the production 
will be divided by the maximum available price election to establish the 
amount of production to count.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 20091, Apr. 25, 1997, as amended at 62 FR 65170, Dec. 10, 1997]



Sec. 457.123  Almond crop insurance provisions.

    The almond crop insurance provisions for the 1999 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

                         Almond Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Harvest. The removal of mature almonds from the orchard.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Meat pounds. The total pounds of almond meats (whole, chipped and 
broken, and in-shell meats) and rejects. Unshelled almonds will be 
converted to meat pounds in accordance with FCIC approved procedures.
    Production guarantee (per acre). The quantity of almonds (total meat 
pounds per acre) determined by multiplying the approved actual 
production history (APH) yield per acre by the coverage level percentage 
you elect.
    Set out. Transplanting the tree into the orchard.

                            2. Unit Division

    Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Optional units may be 
established only if each optional unit is located on non-contiguous 
land, unless otherwise allowed by written agreement.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one price election for all the almonds 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 almond 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) You must report, by the production reporting date designated in 
section 3 (Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities) of the Basic Provisions (Sec. 457.8), by type 
if applicable:
    (1) Any damage, removal of trees, change in practices, or any other 
circumstance that may reduce the expected yield below the yield upon 
which the insurance guarantee is based, and the number of affected 
acres;
    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting patterns;
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and anytime the planting pattern of such acreage 
is changed, the age of the crop that is interplanted with the almonds, 
and type if applicable, and the planting pattern; and
    (5) Any other information that we request in order to establish your 
approved yield.
    We will reduce the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of the following: 
interplanted perennial crop; removal of trees; damage; change in 
practices and any other circumstance on the yield potential of the 
insured crop. If you fail to notify us of any circumstance that may 
reduce your yields from previous levels, we will reduce your production 
guarantee as necessary at any time we become aware of the circumstance.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is August 31 preceding 
the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 (Life of Policy, Cancellation, and 
Termination) of the

[[Page 422]]

Basic Provisions (Sec. 457.8), the cancellation and termination dates 
are December 31.

                             6. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the almonds in the county for 
which a premium rate is provided by the actuarial documents:
    (a) In which you have a share unless allowed otherwise by section 
8(b);
    (b) That are grown for harvest as almonds;
    (c) That are irrigated;
    (d) That are grown in an orchard that, if inspected, is considered 
acceptable to us; and
    (e) On acreage where at least 90 percent of the trees have reached 
at least the seventh growing season after set out, unless we agree in 
writing to insure trees not meeting this requirement.

                          7. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a 
crop planted with another crop, almonds interplanted with another 
perennial crop are insurable unless we inspect the acreage and determine 
that it does not meet the requirements contained in your policy.

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on January 1 of each crop year, except that for 
the year of application, if your application is received after December 
21, but prior to January 1, insurance will attach on the 10th day after 
your properly completed application is received in our local office 
unless we inspect the acreage during the 10 day period and determine 
that it does not meet insurability requirements. You must provide any 
information that we require for the crop or to determine the condition 
of the orchard.
    (2) The calendar date for the end of the insurance period for each 
crop year is November 30.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period. Acreage 
acquired after the acreage reporting date will not be insured.
    (2) If you relinquish your insurable share on any insurable acreage 
of almonds on or before the acreage reporting date for the crop year, 
insurance will not be considered to have attached to, and no premium or 
indemnity will be due for such acreage for that crop year unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            9. 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 during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and undergrowth have not been controlled or 
pruning debris has not been removed from the orchard;
    (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) Earthquake;
    (6) Volcanic eruption;
    (7) Failure of the irrigation water supply, if caused by an insured 
peril that occurs during the insurance period; or
    (8) Wildlife, unless control measures have not been taken.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to the inability to market the 
almonds for any reason other than actual physical damage to the almonds 
from an insurable cause specified in this section. For example, we will 
not pay you an indemnity if you are unable to market due to quarantine, 
boycott, or refusal of any person to accept production.

                10. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), if you intend 
to claim an indemnity on any unit, you must notify us prior to the 
beginning of harvest so that we may inspect the damaged production. You 
must not sell or dispose of the damaged crop until after we have given 
you written consent to do so. If you fail to meet the requirements of 
this section, all such production will be considered undamaged and 
included as production to count.

                         11. 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:

[[Page 423]]

    (l) For any optional units, we will combine all optional units for 
which such 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 11(b)(1) by the respective 
price election for the type;
    (3) Totaling the results in section 11(b)(2);
    (4) Multiplying the total production to be counted of each type, if 
applicable, (see subsection 11(c)) by the respective price election;
    (5) Totaling the results in section 11(b)(4);
    (6) Subtracting the result in section 11(b)(5) from the result in 
section 11(b)(3); and
    (7) Multiplying the result in section 11(b)(6) by your share.
    (c) The total production to count, specified in meat pounds, 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 damaged solely by uninsured causes; or
    (C) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production; and
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we may defer 
the claim only if you agree to continue to care for the crop. We will 
then make another appraisal when you notify us of further damage or that 
harvest is general in the area unless you harvested the crop, in which 
case we will use the harvested production. If you do not continue to 
care for the crop, our appraisal made prior to deferring the claim will 
be used to determine the production to count; and
    (2) All harvested meat pounds which has been accepted by a buyer and 
all harvested meat pounds rejected by a buyer unless the meat pounds are 
rejected due to an insured cause of loss.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 25108, May 8, 1997, as amended at 62 FR 65170, Dec. 10, 1997]



Sec. 457.124  Raisin crop insurance provisions.

    The raisin 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

                         Raisin Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Crop year--In lieu of the definition of ``Crop year'' contained in 
section 1 of the Basic Provisions (Sec. 457.8), the calendar year in 
which the raisins are placed on trays for drying.
    Delivered ton--A ton of raisins delivered to a packer, processor, 
buyer or a reconditioner, before any adjustment for U. S. Grade B and 
better maturity standards, and after adjustments for moisture over 16 
percent and substandard raisins over 5 percent.
    RAC--The Raisin Administrative Committee, which operates under an 
order of the United States Department of Agriculture (USDA).
    Raisins--The sun-dried fruit of varieties of grapes designated 
insurable by the actuarial documents. These grapes will be considered 
raisins for the purpose of this policy when laid on trays in the 
vineyard to dry.
    Reference maximum dollar amount--The value per ton established by 
FCIC and shown in the actuarial documents.
    Substandard--Raisins that fail to meet the requirements of U.S. 
Grade C, or layer (cluster) raisins with seeds that fail to meet the 
requirements of U.S. Grade B.
    Table grapes--Grapes grown for commercial sale as fresh fruit on 
acreage where appropriate cultural practices were followed.
    Ton--Two thousand (2,000) pounds avoirdupois.
    Tonnage report--A report used to annually report, by unit, all the 
tons of raisins produced in the county in which you have a share.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will be divided into additional basic units by grape variety.

[[Page 424]]

    (b) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Optional units may be 
established only if each optional unit is located on non-contiguous 
land, unless otherwise allowed by written agreement.

            3. Amounts of Insurance and Production Reporting

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one coverage level percentage for all the 
raisins in the county insured under this policy.
    (b) The amount of insurance for the unit will be determined by 
multiplying the insured tonnage by the reference maximum dollar amount, 
by the coverage level percentage you elect, and by your share.
    (c) Insured tonnage is determined as follows:
    (1) For units not damaged by rain--The delivered tons; or
    (2) For units damaged by rain--By adding the delivered tons to any 
verified loss of production due to rain damage. When production from a 
portion of the acreage within a unit is removed from the vineyard and 
production from the remaining acreage is lost in the vineyard, the 
amount of production lost in the vineyard will be determined based on 
the number of tons of raisins produced on the acreage from which 
production was removed. When no production has been removed from the 
vineyard, the amount of production lost in the vineyard will be 
determined based on an appraisal.
    (3) Insured tonnage will be adjusted as follows:
    (i) The insured tonnage will be reduced 0.12 percent for each 0.10 
percent of moisture in excess of 16.0 percent. For example, 10.0 tons of 
raisins containing 18.0 percent moisture will be reduced to 9.760 tons 
of raisins;
    (ii) Insured tonnage used for dry edible fruit will be reduced by 
0.10 percent for each 0.10 percent of substandard raisins in excess of 
5.0 percent; and
    (iii) When raisins contain moisture in excess of 24.3 percent at the 
time of delivery and are released for a use other than dry edible fruit 
(e.g. distillery material), they will be considered to contain 24.3 
percent moisture.
    (4) If any raisins are delivered, the moisture content will be 
determined at the time of delivery.
    (d) Section 3(c) of the Basic Provisions is not applicable to this 
crop.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is April 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 July 31.

                  6. Acreage Report and Tonnage Report

    In lieu of the provisions contained in section 6 of the Basic 
Provisions (Sec. 457.8):
    (a) You must report by unit, and on our form, the acreage on which 
you intend to produce raisins for the crop year. This acreage report 
must be submitted to us on or before the sales closing date, and contain 
the following information:
    (1) All acreage of the crop (insurable and not insurable) in which 
you will have a share;
    (2) Your anticipated share at the time coverage will begin;
    (3) The variety; and
    (4) The location of each vineyard.
    (b) Acreage of the crop acquired after the acreage was reported, may 
be included on the acreage report if we agree to accept the additional 
acreage. Such additional acreage will not be added to the acreage report 
after you first place raisins from the additional acreage on trays for 
drying. Failure to report any acreage in which you have a share will 
result in denial of liability. If you elect not to produce raisins on 
any part of the acreage included on your acreage report, you must notify 
us in writing on or before September 21, and provide any records we may 
require to verify that raisins were not produced on that acreage.
    (c) If you fail to file an acreage report in a timely manner, or if 
the information reported is incorrect, we may deny liability on any 
unit.
    (d) In addition to the acreage report, you must annually submit a 
tonnage report, on our form, which includes by unit the number of 
delivered tons of raisins, and, if damage has occurred, the amount of 
any tonnage we determined was lost due to rain damage in the vineyard 
for each unit designated in the acreage report.
    (e) The tonnage report must be submitted to us as soon as the 
information is available, but not later than March 1 of the year 
following the crop year. Indemnities may be determined on the basis of 
information you submitted on this report. If you do not submit this 
report by the reporting date, we may, at our option, either determine 
the insured tonnage and share by unit or we may deny liability on any 
unit. This report may be revised only upon our approval. Errors in

[[Page 425]]

reporting units may be corrected by us at any time we discover the 
error.

                            7. 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 determined by multiplying the amount of insurance for 
the unit at the time insurance attaches by the premium rate and then 
multiplying that result by any applicable premium adjustment factors 
that may apply.

                             8. Insured Crop

    (a) In accordance with section 8 (Insured Crop) of the Basic 
Provisions (Sec. 457.8), the crop insured will be all the raisins in the 
county of grape varieties for which a premium rate is provided by the 
actuarial documents and in which you have a share.
    (b) In addition to the raisins not insurable under section 8 
(Insured Crop) of the Basic Provisions (Sec. 457.8), we do not insure 
any raisins:
    (1) Laid on trays after September 8 in vineyards with north-south 
rows in Merced or Stanislaus Counties, or after September 20 in all 
other counties;
    (2) From table grape strippings; or
    (3) From vines that received manual, mechanical, or chemical 
treatment to produce table grape sizing.

                           9. Insurance Period

    In lieu of the provisions of section 11 (Insurance Period) of the 
Basic Provisions (Sec. 457.8), insurance attaches on each unit at the 
time the raisins are placed on trays for drying and ends the earlier of:
    (a) October 20;
    (b) The date the raisins are removed from the trays;
    (c) The date the raisins are removed from the vineyard;
    (d) Total destruction of all raisins on a unit;
    (e) Final adjustment of a loss on a unit; or
    (f) Abandonment of the raisins.

                           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 
unavoidable loss of production resulting from rain that occurs during 
the insurance period and while the raisins are on trays or in rolls in 
the vineyard for drying.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to inability to market the 
raisins for any reason other than actual physical damage from an 
insurable cause specified in this section. For example, we will not pay 
you an indemnity if you are unable to market due to quarantine, boycott, 
or refusal of a person to accept production.

               11. Reconditioning Requirements and Payment

    (a) We may require you to recondition a representative sample of not 
more than 10 tons of damaged raisins to determine if they meet standards 
established by the RAC once reconditioned. If such standards are met, we 
may require you to recondition all the damaged production. If we 
determine that it is possible to recondition any damaged production and, 
if you do not do so, we will value the damaged production at the 
reference maximum dollar amount, except if your damaged production 
undergoes a USDA inspection and is stored by your packer with other 
producer's production to be reconditioned at a later date. If we agree, 
in writing, that it is not practical to recondition the damaged 
production, we will determine the number of tons meeting RAC standards 
that could be obtained if the production were reconditioned.
    (b) If the representative sample of raisins that we require you to 
recondition does not meet RAC standards for marketable raisins after 
reconditioning, the reconditioning payment will be the actual cost you 
incur to recondition the sample, not to exceed an amount that is 
reasonable and customary for such reconditioning, regardless of the 
coverage level selected.
    (c) A reconditioning payment, based on the actual (unadjusted) 
weight of the raisins, will be made if:
    (1) Insured raisin production:
    (i) Is damaged by rain within the insurance period;
    (ii) Is reconditioned by washing with water and then drying;
    (iii) Is insured at a coverage level greater than that applicable to 
the catastrophic risk protection plan of insurance; and either
    (2) The damaged production undergoes an inspection by USDA and is 
found to contain mold, embedded sand, or other rain-caused contamination 
determined by micro-analysis in excess of standards established by the 
RAC, or is found to contain moisture in excess of 18 percent; or
    (3) We give you consent to recondition the damaged production.
    (d) Your request for consent to any wash-and-dry reconditioning must 
identify the acreage on which the production to be reconditioned was 
damaged in order to be eligible for a reconditioning payment.
    (e) The reconditioning payment for raisins that meet RAC standards 
for marketable raisins after reconditioning will be the lesser of your 
actual cost for reconditioning or the amount determined by:

[[Page 426]]

    (1) Multiplying the greater of $125.00 or the reconditioning dollar 
amount per ton contained in the Special Provisions by your coverage 
level;
    (2) Multiplying the result of section 11(e)(1) by the actual number 
of tons of raisins (unadjusted weight) that are wash-and-dry 
reconditioned; and
    (3) Multiplying the result of section 11(e)(2) by your share.
    (f) Only one reconditioning payment will be made for any lot of 
raisins damaged during the crop year. Multiple reconditioning payments 
for the same production will not be made.

                12. Duties In The Event of Damage or Loss

    (a) In addition to the requirements of section 14 (Duties in the 
Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), the 
following will apply:
    (1) If you intend to claim an indemnity on any unit, you must give 
us notice within 72 hours of the time the rain fell on the raisins. We 
may reject any claim for indemnity if such notice is later. You must 
provide us the following information when you give us this notice:
    (i) The grape variety;
    (ii) The location of the vineyard and number of acres; and
    (iii) The number of vines from which the raisins were harvested.
    (2) We will not pay any indemnity unless you:
    (i) Authorize us in writing to obtain all relevant records from any 
raisin packer, raisin reconditioner, the RAC, or any other person who 
may have such records. If you fail to meet the requirements of this 
subsection, all insured production will be considered undamaged and 
valued at the reference maximum dollar value.
    (ii) Upon our request, provide us with records of previous years'' 
production and acreage. This information may be used to establish the 
amount of insured tonnage when insurable damage results in discarded 
production.
    (b) In lieu of the provisions in section 14 (Duties in the Event of 
Damage or Loss) of the Basic Provisions (Sec. 457.8) that require you to 
submit a claim for indemnity not later than 60 days after the end of the 
insurance period, any claim for indemnity must be submitted to us not 
later than March 31 following the date for the end of the insurance 
period.

                         13. 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 unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the acreage from which 
raisins were removed for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured tonnage of raisins by the reference 
maximum dollar amount and your coverage level percentage;
    (2) Subtracting from the total in section 13(b)(1) the total value 
of all insured damaged and undamaged raisins; and
    (3) Multiplying the result of section 13(b)(2) by your share.
    (c) For the purpose of determining the amount of indemnity, your 
share will not exceed the lesser of your share at the time insurance 
attaches or at the time of loss.
    (d) Undamaged raisins or raisins damaged solely by uninsured causes 
will be valued at the reference maximum dollar amount.
    (e) Raisins damaged partially by rain and partially by uninsured 
causes will be valued at the highest prices obtainable, adjusted for any 
reduction in value due to uninsured causes.
    (f) Raisins that are damaged by rain, but that are reconditioned and 
meet RAC standards for raisins, will be valued at the reference maximum 
dollar amount.
    (g) The value to count for any raisins produced on the unit that are 
damaged by rain and not removed from the vineyard will be the larger of 
the appraised salvage value or $35.00 per ton, except that any raisins 
that are damaged and discarded from trays or are lost from trays 
scattered in the vineyard as part of normal handling will not be 
considered to have any value. You must box and deliver any raisins that 
can be removed from the vineyard.
    (h) At our sole option, we may acquire all the rights and title to 
your share of any raisins damaged by rain. In such event, the raisins 
will be valued at zero in determining the amount of loss and we will 
have the right of ingress and egress to the extent necessary to take 
possession, care for, and remove such raisins.
    (i) Raisins destroyed, put to another use without our consent, or 
abandoned will be valued at the reference maximum dollar amount.

                     14. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 12070, Mar. 14, 1997, as amended at 62 FR 65170, Dec. 10, 1997]



Sec. 457.125  Safflower crop insurance provisions.

    The safflower crop insurance provisions for the 1998 and succeeding 
crop years in counties with a contract

[[Page 427]]

change date of December 31, and for the 1999 and succeeding crop years 
in counties with a contract change date of August 31 are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

                   Safflower Crop Insurance Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Harvest. Collecting the safflower seed by combining or threshing.
    Local market price. The cash price per pound for undamaged safflower 
(test weight of 35 pounds per bushel or higher and seed damage less than 
25 percent) offered by buyers.
    Nurse crop (companion crop). A crop planted into the same acreage as 
another crop, that is intended to be harvested separately, and which is 
planted to improve growing conditions for the crop with which it is 
grown.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, safflowers must initially be planted in rows, unless 
otherwise provided by the Special Provisions, actuarial documents, or by 
written agreement.
    Pound. Sixteen ounces avoirdupois.
    Value per pound. The cash price per pound for damaged safflower 
(test weight below 35 pounds per bushel, seed damage in excess of 25 
percent, or both).

  2. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    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 safflower 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 safflower 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.

                           3. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is August 31 preceding 
the cancellation date for California, and December 31 preceding the 
cancellation date for all other states.

                  4. 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:

------------------------------------------------------------------------
                                           Cancellation and termination
                 State                                dates
------------------------------------------------------------------------
California.............................  December 31.
All other states.......................  March 15.
------------------------------------------------------------------------

                             5. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all safflower in the county for 
which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That is planted for harvest as safflower seed;
    (c) That is 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.

                          6. Insurable Acreage

    In addition to the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8), we will not insure:
    (a) Safflower planted on land on which safflower, sunflower seed, 
any variety of dry beans, soybeans, mustard, rapeseed, or lentils were 
grown the preceding crop year, unless other rotation requirements are 
specified in the Special Provisions or we agree in writing to insure 
such acreage; or
    (b) Any acreage of safflower damaged before the final planting date, 
to the extent that the majority of producers in the area would normally 
not further care for the crop, unless the crop is replanted or we agree 
that it is not practical to replant.

                           7. 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 October 31 immediately following planting.

[[Page 428]]

                            8. Causes of Loss

    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 during the insurance period:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife, unless proper measures to control wildlife have not 
been taken;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if caused by an insured 
cause of loss that occurs during the insurance period.

                          9. Replanting Payment

    (a) In accordance with section 13 (Replanting Payment) of the Basic 
Provisions (Sec. 457.8), a replanting payment is allowed if the crop is 
damaged by an insurable cause of loss to the extent that the remaining 
stand will not produce at least 90 percent of the production guarantee 
for the acreage and it is practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of 20 percent of the production guarantee or 160 pounds, 
multiplied by your price election, multiplied by your insured share.
    (c) When safflower is replanted using a practice that is uninsurable 
as an original planting, the liability on the unit will be reduced by 
the amount of the replanting payment. The premium amount will not be 
reduced.

                10. Duties In The Event of Damage or Loss

    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.

                         11. 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 unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for the unit.
    (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 11(b)(1) by the respective 
price election;
    (3) Totaling the results in section 11(b)(2);
    (4) Multiplying the total production to be counted of each type if 
applicable, (see section 11(c)) by the respective price election;
    (5) Totaling the results in section 11(b)(4);
    (6) Subtracting the results from the total in section 11(b)(5) from 
the results in section 11(b)(3); and
    (7) Multiplying the result in section 11(b)(6) by your share.
    (c) The total production to count (in pounds) 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 the acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies and excess moisture in accordance with 
section 11(d)); and
    (iv) 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 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.

[[Page 429]]

    (d) Mature safflower may be adjusted for excess moisture and quality 
deficiencies. If moisture adjustment is applicable, it will be made 
prior to any adjustment for quality.
    (1) Production will be reduced by 0.12 percent for each 0.1 
percentage point of moisture in excess of 8 percent. We may obtain 
samples of the production to determine the moisture content.
    (2) Production will be eligible for quality adjustment if such 
production:
    (i) Has a test weight below 35 pounds per bushel;
    (ii) Has seed damage in excess of 25 percent; or
    (iii) Contains substances or conditions that are identified by the 
Food and Drug Administration or other public health organizations of the 
United States as being injurious to human or animal health.
    (3) Quality will be a factor in determining your loss only if:
    (i) The deficiencies, substances, or conditions resulted from a 
cause of loss against which insurance is provided under these crop 
provisions and that occurred within the insurance period;
    (ii) The deficiencies, substances, or conditions result in a value 
per pound that is less than the local market price;
    (iii) All determinations of these deficiencies, substances, or 
conditions are made using samples of the production obtained by us or by 
a disinterested third party approved by us; and
    (iv) The samples are analyzed by a grader licensed to grade 
safflower under the authority of the Agricultural Marketing Act or the 
United States Warehouse Act with regard to deficiencies in quality, or 
by a laboratory approved by us with regard to substances or conditions 
injurious to human or animal health. Test weight for quality adjustment 
purposes may be determined by our loss adjuster.
    (4) Safflower production that is eligible for quality adjustment, as 
specified in sections 11(d) (2) and (3), will be reduced as follows:
    (i) In accordance with the quality adjustment factors contained in 
the Special Provisions; or
    (ii) If quality adjustment factors are not contained in the Special 
Provisions:
    (A) By determining the value per pound and the local market price on 
the earlier of the date such quality adjusted production is sold or the 
date of final inspection for the unit. Discounts used to establish the 
value per pound will be limited to those which are usual, customary, and 
reasonable. The value per pound will not be reduced for:
    (1) Moisture content;
    (2) Damage due to uninsured causes; or
    (3) Drying, handling, processing, or any other costs associated with 
normal harvesting, handling, and marketing of safflower. We may obtain 
values per pound from any buyer of our choice. If we obtain values per 
pound from one or more buyers located outside your local market area, we 
will reduce such values per pound by the additional costs required to 
deliver the production to those buyers.
    (B) Divide the value per pound by the local market price to 
determine the quality adjustment factor; and
    (C) Multiply the adjustment factor by the number of pounds of the 
damaged production remaining after any reduction due to excessive 
moisture to determine the net production to count.
    (e) Any production harvested from other plants growing in the 
insured crop may be counted as production of the insured crop on a 
weight basis.

                         12. Prevented Planting

    Your prevented planing coverage will be 60 percent of your 
production guarantee for timely planted acreage. If you have limited or 
aditional levels of coverage, as specified in 7 CFR part 400, subpart T, 
and pay an additional premium, you may increase your prevented planting 
coverage to a level specified in the actuarial documents.

[62 FR 42649, Aug. 8, 1997, as amended at 62 FR 65171, Dec. 10, 1997]



Sec. 457.126  Popcorn cop isurance povisions.

    The Popcorn Crop Insurance Provisions for the 1999 and succeeding 
crop years are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

                    Popcorn Crop Insurance Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Base contract price. The price stipulated on the contract executed 
between you and the processor before any adjustments for quality.
    Harvest. Removing the grain or ear from the stalk either by hand or 
by machine.
    Merchantable popcorn. Popcorn that meets the provisions of the 
processor contract.

[[Page 430]]

    Planted acreage. In addition to the definition contained in the 
Basic Provisions, popcorn must initially be planted in rows far enough 
apart to permit mechanical cultivation, unless otherwise provided by the 
Special Provisions, actuarial documents, or by written agreement.
    Pound. Sixteen (16) ounces avoirdupois.
    Practical to replant. In addition to the definition contained in the 
Basic Provisions, it will not be considered practical to replant unless 
production from the replanted acreage can be delivered under the terms 
of the popcorn processor contract, or the processor agrees in writing 
that it will accept the production from the replanted acreage.
    Processor. Any business enterprise regularly engaged in processing 
popcorn that possesses all licenses, permits or approved inspections for 
processing popcorn required by the state in which it operates, and that 
possesses facilities, or has contractual access to such facilities, with 
enough equipment to accept and process the contracted popcorn within a 
reasonable amount of time after harvest.
    Processor contract. A written agreement between the producer and a 
processor, containing at a minimum:
    (a) The producer's commitment to plant and grow popcorn, and to 
deliver the popcorn production to the processor;
    (b) The processor's commitment to purchase all the production stated 
in the processor contract;
    (c) A date, if specified on the processor's contract, by which the 
crop must be harvested to be accepted; and
    (d) A base contract price.
Multiple contracts with the same processor, each of which stipulates a 
specific amount of production to be delivered under the terms of the 
processor contact, will be considered as a single processor contract.

                            2. Unit Division

    (a) For processor contracts that stipulate the amount of production 
to be delivered:
    (1) In lieu of the definition contained in the Basic Provisions, a 
basic unit will consist of all the acreage planted to the insured crop 
in the county that will be used to fulfill contracts with each 
processor;
    (i) There will be no more than one basic unit for all production 
contracted with each processor contract;
    (ii) In accordance with section 13 of these Crop Provisions, all 
production from any basic unit in excess of the amount under contract 
will be included as production to count if such production is applied to 
any other basic unit for which the contracted amount has not been 
fulfilled; and
    (2) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable.
    (b) For any processor contract that stipulates only the number of 
acres to be planted, the provisions contained in section 34 of the Basic 
Provisions will apply.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions, you may select only one price election for all the popcorn 
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 popcorn 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.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are:

------------------------------------------------------------------------
                                            Cancellation and termination
             State and county                          dates
------------------------------------------------------------------------
Val Verde, Edwards, Kerr, Kendall, Bexar,  January 15.
 Wilson, Karnes, Goliad, Victoria, and
 Jackson counties Texas, and all Texas
 counties lying south thereof.
All other Texas counties and all other     March 15.
 states.
------------------------------------------------------------------------

                          6. Report of Acreage

    In addition to the provisions of section 6 of the Basic Provisions, 
you must provide a copy of all processor contracts to us on or before 
the acreage reporting date.

                             7. Insured Crop

    (a) In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the popcorn in the county for which a premium rate 
is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That is planted for harvest as popcorn;
    (3) That is grown under, and in accordance with the requirements of, 
a processor contract executed on or before the acreage reporting date 
and is not excluded from the processor contract at any time during the 
crop year; and

[[Page 431]]

    (4) That is not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Interplanted with another crop; or
    (ii) Planted into an established grass or legume.
    (b) You will be considered to have a share in the insured crop if, 
under the processor contract, you retain control of the acreage on which 
the popcorn is grown, you have a risk of loss, and the processor 
contract provides for delivery of popcorn under specified conditions and 
at a stipulated base contract price.
    (c) A popcorn producer who is also a processor may be able to 
establish an insurable interest if the following requirements are met:
    (1) The producer must comply with these Crop Provisions;
    (2) The Board of Directors or officers of the processor must, prior 
to the sales closing date, execute and adopt a resolution that contains 
the same terms as an acceptable processor contract. Such resolution will 
be considered a processor contract under this policy; and
    (3) Our inspection reveals that the processing facilities comply 
with the definition of a processor contained in these Crop Provisions.

                          8. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions, 
any acreage of the insured crop damaged before the final planting date, 
to the extent that the majority of producers in the area would normally 
not further care for the crop, must be replanted unless we agree that it 
is not practical to replant.

                           9. Insurance Period

    In lieu of the provisions contained in section 11 of the Basic 
Provisions, regarding the end of the insurance period, insurance ceases 
on each unit or part of a unit at the earliest of:
    (a) The date the popcorn:
    (1) Was destroyed;
    (2) Should have been harvested but was not harvested;
    (3) Was abandoned; or
    (4) Was harvested;
    (b) When the processor contract stipulates a specific amount of 
production to be delivered, the date the production accepted by the 
processor equals the contracted amount of production;
    (c) Final adjustment of a loss; or
    (d) December 10 immediately following planting.

                           10. Causes of Loss

    (a) In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss that occur during 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 a cause of 
loss specified in sections 10(a)(1) through (7) that occurs during the 
insurance period.
    (b) In addition to the causes of loss excluded by section 12 of the 
Basic Provisions, we do not insure against any loss of production due 
to:
    (1) Damage resulting from frost or freeze after the date designated 
in the Special Provisions; or
    (2) Failure to follow the requirements contained in the processor 
contract.

                         11. Replanting Payment

    (a) In accordance with section 13 of the Basic Provisions, a 
replanting payment is allowed if the crop is damaged by an insurable 
cause of loss to the extent that the remaining stand will not produce at 
least 90 percent of the production guarantee for the acreage and it is 
practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of 20 percent of the production guarantee or 150 pounds, 
multiplied by your price election, multiplied by your insured share.
    (c) When popcorn is replanted using a practice that is uninsurable 
as an original planting, our liability for the unit will be reduced by 
the amount of the replanting payment. The premium amount will not be 
reduced.

                12. Duties in the Event of Damage or Loss

    In accordance with the requirements of section 14 of the Basic 
Provisions, 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 destroyed until the earlier of our 
inspection or 15 days after harvest of the balance of the unit is 
completed.
    13. Settlement of Claim
    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide acceptable production records:
    (1) For any optional unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.

[[Page 432]]

    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage for each type, if applicable, by 
its respective production guarantee;
    (2) Multiplying the result of section 13(b)(1) by the respective 
price election for each type, if applicable;
    (3) Totaling the results of section 13(b)(2) if there is more than 
one type;
    (4) Multiplying the total production to count (see section 13(c)), 
of each type if applicable, by its respective price election;
    (5) Totaling the results of section 13(b)(4) if there is more than 
one type;
    (6) Subtracting the result of section 13(b)(4) from the result in 
section 13(b)(2) if there is only one type or subtracting the result of 
section 13(b)(5) from the result of section 13(b)(3) if there is more 
than one type; and
    (7) Multiplying the result of section 13(b)(6) by your share.

 
 
 
For example:
You have a 100 percent share in 100 acres of Type A popcorn in the unit,
 with a guarantee of 2,500 pounds per acre and a price election of $.12
 per pound. You are only able to harvest 150,000 pounds. Your indemnity
 would be calculated as follows:
1....................  100 acres  x  2,500 pounds = 250,000 pound
                        guarantee;
2....................  250,00 pounds  x  $.12 price election = $30,000
                        value of guarantee;
4....................  150,000 pounds production to count  x  $.12 price
                        election = $18,000 value of production to count;
6....................  $30,000-$18,000 = $12,000 loss; and
7....................  $12,000  x  100 percent share = $12,000 indemnity
                        payment.
You also have a 100 percent share in 150 acres of type B popcorn in the
 same unit, with a guarantee of 2,250 pounds per acre and a price
 election of $.10 per pound. You are only able to harvest 70,000 pounds.
 Your total indemnity for both popcorn types A and B would be calculated
 as follows:
1....................  100 acres  x  2,500 pounds = 250,000 guarantee
                        for type A and 150 acres  x  2,250 pounds =
                        337,500 pound guarantee for type B;
2....................  250,000 pound guarantee  x  $.12 price election =
                        $30,000 value of guarantee for type A and
                        337,500 pound guarantee  x  $.10 price election
                        = $33,750 value guarantee for type B;
3....................  $30,000 + $33,750 = $63,750 total value
                        guarantee;
4....................  150,000 pounds  x  $.12 price election = $18,000
                        value of production to count for type A and
                       70,000 pounds  x  $.10 price election = $7,000
                        value of production to count for type B;
5....................  $18,000 + $7,000 = $25,000 total value of
                        production to count;
6....................  $63,750-$25,000 = $38,750 loss; and
7....................  $38,750  x  100 percent = $38,750 indemnity
                        payment.
 

    (c) The total production to count (in pounds) from all insurable 
acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) Damaged solely by uninsured causes; or
    (D) For which you fail to provide production records;
    (ii) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies and excess moisture in accordance with 
section 13(d));
    (iii) 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 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

[[Page 433]]

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;
    (2) All harvested production from the insurable acreage in the unit;
    (3) All harvested and appraised production lost or damaged by 
uninsured causes; and
    (4) For processor contracts that stipulate the amount of production 
to be delivered, all harvested popcorn production from any other 
insurable unit that has been used to fulfill your processor contract 
applicable to this unit.
    (5) Any production from yellow or white dent corn will be counted as 
popcorn on a weight basis and any production harvested from plants 
growing in the insured crop may be counted as popcorn production on a 
weight basis.
    (6) Any ear production for which we cannot determine a shelling 
factor will be considered to have an 80 percent shelling factor.
    (d) Mature popcorn may be adjusted for excess moisture and quality 
deficiencies. If moisture adjustment is applicable, it will be made 
prior to any adjustment for quality.
    (1) Production will be reduced by 0.12 percent for each 0.1 
percentage point for moisture in excess of 15 percent. We may obtain 
samples of the production to determine the moisture content.
    (2) Popcorn production will be eligible for quality adjustment if, 
due to an insurable cause of loss that occurs within the insurance 
period, it is not merchantable popcorn and is rejected by the processor. 
The production will be adjusted by:
    (i) Dividing the value per pound of the damaged popcorn by the base 
contract price per pound for undamaged popcorn; and
    (ii) Multiplying the result by the number of pounds of such popcorn.

                            14. Late Planting

    Late planting provisions in the Basic Provisions are applicable for 
popcorn if you provide written approval from the processor by the 
acreage reporting date that it will accept the production from the late 
planted acres when it is expected to be ready for harvest.

                         15. Prevented Planting

    Your prevented planting coverage will be 60 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to a level specified in the actuarial documents.

[63 FR 33838, June 22, 1998]



Sec. 457.127  Forage Production Winter Coverage Endorsement.

    The provisions of the Forage Production Winter Coverage Endorsement 
for the 1998 and succeeding crop years are as follows:

                        Department of Agriculture

                   Federal Crop Insurance Corporation

              Forage Production Winter Coverage Endorsement

    In return for payment of the additional premium designated in the 
actuarial table, the Common Crop Insurance Policy Basic Provisions 
(Sec. 457.8) and the Forage Production Crop Insurance Provisions 
(Sec. 457.117) are amended to incorporate the following terms and 
conditions:
    (a) For this Endorsement to be effective, you must have the Common 
Crop Insurance Policy Basic Provisions (Sec. 457.8) and the Forage 
Production Crop Insurance Provisions (Sec. 457.117) in force and you 
must comply with all terms and conditions contained therein.
    (b) This Endorsement is not available for forage crops insured under 
a Catastrophic Risk Protection Endorsement.
    (c) You must elect this Endorsement on your application or on a form 
approved by us, for coverage under this Endorsement, on or before the 
sales closing date specified in the Special Provisions for the crop year 
in which you wish to insure your forage under this Endorsement.
    (d) This Endorsement is available for the following acreage in all 
counties for which the actuarial table designates forage production 
premium rates:
    (1) Fall planted acreage, for the first and subsequent crop years 
following the year of establishment; and
    (2) Spring planted acreage, for the second and subsequent crop years 
following the year of establishment.
    (e) Under this Endorsement, the insurance period will be as follows:
    (1) Insurance will attach on acreage with an adequate stand on the 
later of the date we accept your application or the applicable calendar 
dates following the end of the insurance period for the previous crop 
year as listed below:
    (i) For all states except California--October 16;
    (ii) For California--January 1;
    (2) Insurance will end on the earliest of:
    (i) Total destruction of the forage crop;
    (ii) Removal from the windrow or the field for each cutting;
    (iii) Final adjustment of the loss;
    (iv) Abandonment of the forage crop;
    (v) The date grazing commences on the forage crop; or
    (vi) The following dates of the crop year:

[[Page 434]]

    (A) All states except California--October 15;
    (B) California--December 31.
    (f) This is a continuous Endorsement and it will remain in effect 
for as long as your forage production policy remains in effect or you 
cancel this coverage in accordance with paragraph (g).
    (g) This Endorsement may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding the crop year for which the cancellation of 
this Endorsement is to be effective.

[62 FR 14287, Mar. 26, 1997]



Sec. 457.128  Guaranteed production plan of fresh market tomato crop insurance provisions.

    The Guaranteed Production Plan of Fresh Market Tomato Crop Insurance

    FCIC Policies

                        Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

    Guarantee Production Plan of Fresh Market Tomato Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Acre--Forty-three thousand five hundred sixty (43,560) square feet 
of land when row widths do not exceed six feet, or if row widths exceed 
six feet, the land area on which at least 7,260 linear feet of rows are 
planted.
    Carton--A container that contains 25 pounds of fresh tomatoes unless 
otherwise provided in the Special Provisions.
    Direct marketing--Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    First fruit set--The date when 30 percent of the plants on the unit 
have produced fruit that has reached a minimum size of one inch in 
diameter.
    Harvest--Picking of marketable tomatoes.
    Mature green tomato--A tomato that:
    (a) Has a heightened gloss due to a waxy skin that cannot be torn by 
scraping;
    (b) Has a well-formed jelly-like substance in the locules;
    (c) Has seeds that are sufficiently hard so they are pushed aside 
and not cut by a sharp knife in slicing; and
    (d) Shows no red color.
    Planting--Transplanting the tomato plants into the field.
    Planting period--The time period designated in the Special 
Provisions during which the tomatoes must be planted to be insured as 
either spring-or fall-planted tomatoes.
    Plant stand--The number of live plants per acre before any damage 
occurs.
    Potential production--The number of cartons per acre of mature green 
or ripe tomatoes that the tomato plants would have produced by the end 
of the insurance period:
    (a) With a classification size of 6 x 7 (2-8/32 inch minimum 
diameter) or larger for all types except cherry, roma, or plum; or
    (b) Meeting the criteria specified in the Special Provisions for 
cherry, roma, or plum types.
    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, time to crop maturity, 
and marketing windows that replanting the insured crop will allow the 
crop to attain maturity prior to the calendar date for the end of the 
insurance period. In counties that do not have both spring and fall 
planting periods, it will not be considered practical to replant after 
the final planting date unless replanting is generally occurring in the 
area. In counties that have spring and fall planting periods, it will 
not be considered practical to replant after the final planting date for 
the planting period in which the crop was initially planted.
    Ripe tomato--A tomato that meets the definition of a mature green 
tomato, except the tomato shows some red color and can still be packed 
for fresh market under the agreement or contract with the packer.
    Row width--The distance in feet from the center of one row of plants 
to the center of an adjacent row.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will be divided into additional basic units by planting period, if 
separate planting periods are provided for in the Special Provisions.
    (b) Provisions in the Basic Provisions that allow optional units by 
irrigated and non-irrigated practices are not applicable.

[[Page 435]]

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one price election for all the tomatoes 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 tomato type designated in the Special 
Provisions. The price election 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) The production guarantees per acre are progressive by stages and 
increase at specified intervals to the final stage production guarantee. 
The stages and production guarantees are as follows:
    (1) For California:

------------------------------------------------------------------------
                            Percent of
                              stage 3
                              (final
           Stage              stage)             Length of time
                            production
                             guarantee
------------------------------------------------------------------------
1.........................         50   From planting until first fruit
                                         set.
2.........................         70   From first fruit set until
                                         harvested.
3.........................        100   Harvested acreage.
------------------------------------------------------------------------

    (2) For all other states, except California:

------------------------------------------------------------------------
                            Percent of
                              stage 4
                              (final
           Stage              stage)             Length of time
                            production
                             guarantee
------------------------------------------------------------------------
                  1.......         50   From planting until qualifying
                                         for stage 2.
2.........................         75   From the earlier of stakes
                                         driven, one tie and pruning, or
                                         30 days after planting until
                                         qualifying for stage 3.
3.........................         90   From the earlier of the end of
                                         stage 2 or 60 days after
                                         planting until qualifying for
                                         stage 4.
4.........................        100   From the earlier of 75 days
                                         after planting or the beginning
                                         of harvest.
------------------------------------------------------------------------

    (c) Any acreage of tomatoes damaged to the extent that producers in 
the area generally would not further care for the tomatoes will be 
deemed to have been destroyed even though you continue to care for the 
tomatoes. The production guarantee for such acreage will be the 
guarantee for the stage in which such damage occurs.
    (d) Any production guarantees for cherry, roma, or plum type 
tomatoes will be specified in the Special Provisions.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is September 30 
preceding the cancellation date for counties with a January 15 
cancellation date and December 31 preceding the cancellation date for 
all other counties.

                  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:

                      Cancellation and Termination
------------------------------------------------------------------------
                 State                                Dates
------------------------------------------------------------------------
California, Florida, Georgia, and South  January 15.
 Carolina.
All other states.......................  March 15.
------------------------------------------------------------------------

                          6. Report of Acreage

    (a) In addition to the provisions of section 6 (Report of Acreage) 
of the Basic Provisions (Sec. 457.8), you must report the row width.
    (b) If spring and fall planting periods are allowed in the Special 
Provisions you must report all the information required by section 6 
(Report of Acreage) of the Basic Provisions (Sec. 457.8) and these Crop 
Provisions by the acreage reporting date for each planting period.

                            7. Annual Premium

    In lieu of provisions contained in the Basic Provisions 
(Sec. 457.8), for determining premium amounts, the annual premium is 
determined by multiplying the final stage production guarantee by the 
price election, by the premium rate, by the insured acreage, by your 
share at the time coverage begins, and by any applicable premium 
adjustment factor contained in the Special Provisions.

                             8. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the tomatoes in the county 
for which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are transplanted tomatoes that have been planted for 
harvest as fresh market tomatoes;
    (c) That are planted within the spring or fall planting periods, as 
applicable, specified in the Special Provisions;
    (d) That, on or before the acreage reporting date, are subject to 
any agreement in writing (packing contract) executed between you

[[Page 436]]

and a packer, whereby the packer agrees to accept and pack the 
production specified in the agreement, unless you control a packing 
facility or an exception exists in the Special Provisions; and
    (e) That are not (unless allowed by the Special Provisions):
    (1) Grown for direct marketing;
    (2) Interplanted with another crop;
    (3) Planted into an established grass or legume; or
    (4) Cherry, roma, or plum type tomatoes.

                          9. Insurable Acreage

    (a) In addition to the provisions of section 9 (Insurable Acreage) 
of the Basic Provisions (Sec. 457.8):
    (1) Any acreage of the insured crop damaged before the final 
planting date, to the extent that the majority of growers in the area 
would normally not further care for the crop, must be replanted unless 
we agree that it is not practical to replant. Unavailability of plants 
will not be considered a valid reason for failure to replant.
    (2) We do not insure any acreage of tomatoes:
    (i) Grown by any person if the person had not previously:
    (A) Grown fresh market tomatoes for commercial sales; or
    (B) Participated in the management of a fresh market tomato farming 
operation, in at least one of the three previous years.
    (ii) That does not meet the rotation requirements contained in the 
Special Provisions;
    (iii) On which tomatoes, peppers, eggplants, or tobacco have been 
grown within the previous two years unless the soil was fumigated or 
nematicide was applied before planting the tomatoes, except that this 
limitation does not apply to a first planting in Pennsylvania or if 
otherwise specified in the Special Provisions; or
    (b) In lieu of the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8), that prohibit insurance from 
attaching if a crop has not been planted and harvested in at least one 
of the three previous calendar years, we will insure newly cleared land 
or former pasture land planted to fresh market tomatoes.

                          10. Insurance Period

    In lieu of the provisions of section 11 (Insurance Period) of the 
Basic Provisions (Sec. 457.8):
    (a) Coverage begins on each unit or part of a unit on the later of 
the date you submit your application or when the tomatoes are planted.
    (b) Coverage will end on any insured acreage at the earliest of:
    (1) Total destruction of the tomatoes;
    (2) Discontinuance of harvest;
    (3) The date harvest should have started on any acreage that was not 
harvested;
    (4) 120 days after the date of transplanting or replanting;
    (5) Completion of harvest;
    (6) Final adjustment of a loss; or
    (7) October 15 of the crop year in Delaware, Maryland, New Jersey, 
North Carolina, and Virginia; October 31 of the crop year in California; 
November 10 of the crop year in Florida, Georgia, and South Carolina; 
and September 20 of the crop year in all other States.

                           11. 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 during 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 irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production that occurs or becomes evident 
after the tomatoes have been harvested.

                         12. Replanting Payment

    (a) In accordance with section 13 (Replanting Payment) of the Basic 
Provisions (Sec.  457.8), a replanting payment is allowed if the crop is 
damaged by an insurable cause of loss and the acreage to be replanted 
has sustained a loss in excess of 50 percent of the plant stand.
    (b) The maximum amount of the replanting payment per acre will be:
    (1) Seventy (70) cartons multiplied by your price election, 
multiplied by your insured share for all insured tomatoes except cherry, 
roma or plum types; and
    (2) As specified in the Special Provisions for cherry, roma, or plum 
types.
    (c) In lieu of the provisions contained in section 13 (Replanting 
Payment) of the Basic Provisions (Sec. 457.8) that permit only one 
replanting payment each crop year, when both spring and fall planting 
periods are contained in the Special Provisions, you may be eligible for 
one replanting payment for acreage planted during each planting period 
within the crop year.

[[Page 437]]

                         13. 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 such 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 for each type, if applicable, by 
its respective production guarantee for the stage in which the damage 
occurred;
    (2) Multiplying the results of section 13(b)(1) by the respective 
price election for each type, if applicable;
    (3) Totaling the results of section 13(b)(2);
    (4) Multiplying the total production to be counted of each type, if 
applicable, (see section 13(c)) by the respective price election;
    (5) Totaling the results of section 13(b)(4);
    (6) Subtracting this result of section 13(b)(5) from the results in 
section 13(b)(3); and
    (7) Multiplying the result of section 13(b)(6) by your share.
    (c) The total production to count (in cartons) from all insurable 
acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide production records that are 
acceptable to us;
    (ii) Potential production lost due to uninsured causes;
    (iii) Unharvested production of mature green and ripe tomatoes 
remaining after harvest has ended:
    (A) With a classification size of 6  x  7 (2\8/32\ inch minimum 
diameter) or larger and that would grade eighty-five percent (85%) or 
better U.S. No. 1 for types other than cherry, roma, or plum; or
    (B) That grade in accordance with the requirements specified in the 
Special Provisions for cherry, roma or plum types.
    (iv) Potential production on unharvested acreage and potential 
production on acreage when final harvest has not been completed;
    (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 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 you 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:
    (i) That is marketed, regardless of grade; and
    (ii) That is unmarketed and:
    (A) That grades eighty-five percent (85%) or better U.S. No. 1 with 
a classification size of 6 x 7 (2-8/32 inch minimum diameter) or larger 
for all types except cherry, roma, or plum; or
    (B) That grade in accordance with the requirements specified in the 
Special Provisions for cherry, roma, or plum types.
    (d) Only that amount of appraised production that exceeds the 
difference between the final stage guarantee and the stage guarantee 
applicable to the acreage will be production to count.

                     14. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 23631, May 1, 1997; 62 FR 33539, June 20, 1997, as amended at 62 
FR 65171, Dec. 10, 1997; 63 FR 36157, July 2, 1998; 63 FR 50753, Sept. 
23, 1998]



Sec. 457.129  Fresh market sweet corn crop insurance provisions.

    The fresh market sweet corn crop insurance provisions for the 1999 
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

[[Page 438]]

                 Fresh Market Sweet Corn Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Container--The unit for measurement of the insured crop as specified 
in the Special Provisions.
    Crop year--In lieu of the definition of ``crop year'' contained in 
section 1 (Definitions) of the Basic Provisions (Sec. 457.8), crop year 
is a period of time that begins on the first day of the earliest 
planting period for fall planted sweet corn and continues through the 
last day of the insurance period for spring planted sweet corn. The crop 
year is designated by the calendar year in which spring planted sweet 
corn is harvested.
    Direct marketing--Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    Excess rain--An amount of precipitation sufficient to directly 
damage the crop.
    Excess wind--Wind speed strong enough to prevent adequate 
pollination or cause lodging of stalks and prevent a normal harvest.
    Freeze--The formation of ice in the cells of the plant or its fruit, 
caused by low air temperatures.
    Harvest--The picking of sweet corn on the unit.
    Marketable sweet corn--Sweet corn that meets the standards for 
grading U.S. No. 1 or better and will withstand normal handling and 
shipping.
    Plant stand--The number of live plants per acre prior to the 
occurrence of an insurable cause of loss.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, for each planting period, sweet corn seed must be 
planted in rows far enough apart to permit mechanical cultivation, 
unless otherwise provided by the Special Provisions, actuarial 
documents, or by written agreement.
    Planting period--The period of time designated in the actuarial 
documents in which fresh market sweet corn must be planted to be 
considered fall, winter, or spring-planted sweet corn.
    Potential production--The number of containers of sweet corn that 
the sweet corn plants will or would have produced per acre by the end of 
the insurance period, assuming normal growing conditions and practices.
    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 to the insured crop will allow 
the crop to attain maturity prior to the calendar date for the end of 
the insurance period (inability to obtain seed will not be considered 
when determining if it is practical to replant).
    Sweet corn--A type of corn with kernels containing a high percentage 
of sugar that is adapted for human consumption as a vegetable.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will also be divided into additional basic units by planting period.
    (b) Provisions in the Basic Provisions that allow optional units by 
irrigated and non-irrigated practices are not applicable.

              3. Amounts of Insurance and Production Stages

    (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 coverage 
level (and the corresponding amount of insurance designated in the 
actuarial documents for the applicable planting period and practice) for 
all the sweet corn in the county insured under this policy.
    (b) The amount of insurance you choose for each planting period and 
practice must have the same percentage relationship to the maximum price 
offered by us for each planting period and practice. For example, if you 
choose 100 percent of the maximum amount of insurance for a specific 
planting period and practice, you must also choose 100 percent of the 
maximum amount of insurance for all other planting periods and 
practices.
    (c) The production reporting requirements contained in section 3 
(Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities) of the Basic Provisions (Sec. 457.8), do not apply to fresh 
market sweet corn.
    (d) The amounts of insurance are progressive by stages as follows:

[[Page 439]]



------------------------------------------------------------------------
                       Percent of
                       the amount
                           of
        Stage          insurance               Length of time
                        per acre
                        that you
                        selected
------------------------------------------------------------------------
 1..................           65  From planting through the beginning
                                    of tasseling (which is when the
                                    tassel becomes visible above the
                                    whorl).
Final...............          100  From tasseling until the acreage is
                                    harvested.
------------------------------------------------------------------------

    (e) Any acreage of sweet corn damaged in the first stage to the 
extent that the majority of producers in the area would not normally 
further care for it, will be deemed to have been destroyed. The 
indemnity payable for such acreage will be based on the stage the plants 
had achieved when the damage occurred.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date shown below is the 
date preceding the cancellation date:

------------------------------------------------------------------------
             State and county                           Date
------------------------------------------------------------------------
All Florida counties; and all Georgia      April 30.
 counties for which the Special
 Provisions designate a fall planting
 period.
All Georgia counties for which the         November 30.
 Special Provisions do not designate a
 fall planting period; and all other
 States.
------------------------------------------------------------------------

                  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:
      
      
      
      
      
      
      
      
      
      
      
      
      

------------------------------------------------------------------------
                                           Cancellation and termination
            State and county                           Dates
------------------------------------------------------------------------
Florida; Atkinson, Baker, Berrien,        July 31.
 Brantley, Camden, Colquitt, Cook,
 Early, Mitchell, and Ware Counties
 Georgia and all counties south thereof
 for which the Special Provisions
 designate a fall planting period.
Alabama; South Carolina; and all Georgia  February 15.
 Counties for which the Special
 Provisions do not designate a fall
 planting period.
All other States........................  March 15.
------------------------------------------------------------------------

                          6. Report of Acreage

    In addition to the requirements of section 6 (Report of Acreage) of 
the Basic Provisions (Sec. 457.8), you must report on or before the 
acreage reporting date contained in the Special Provisions for each 
planting period, all the acreage of sweet corn in the county insured 
under this policy in which you have a share.

                            7. Annual Premium

    In lieu of the premium amount determinations contained in section 7 
(Annual Premium) of the Basic Provisions (Sec. 457.8), the annual 
premium amount for each cultural practice (e.g., fall-planted irrigated) 
is determined by multiplying the final stage amount of insurance per 
acre by the premium rate for the cultural practice as established in the 
Actuarial Table, by the insured acreage, by your share at the time 
coverage begins, and by any applicable premium adjustment factors 
contained in the actuarial documents.

                             8. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the sweet corn in the county 
for which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That is:
    (1) Planted to be harvested and sold as fresh market sweet corn;
    (2) Planted within the planting periods designated in the actuarial 
documents;
    (3) Grown under an irrigated practice, unless otherwise provided in 
the Special Provisions;
    (4) Grown by a person who in at least one of the three previous crop 
years:
    (i) Grew sweet corn for commercial sale; or
    (ii) Participated in managing a sweet corn farming operation;
    (c) That is not:
    (1) Interplanted with another crop;
    (2) Planted into an established grass or legume; or
    (3) Grown for direct marketing.

                          9. Insurable Acreage

    (a) In lieu of the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8), that prohibit insurance attaching if 
a crop has not been planted in at least one of

[[Page 440]]

the three previous crop years, we will insure newly cleared land or 
former pasture land planted to fresh market sweet corn.
    (b) In addition to the provisions of section 9 (Insurable Acreage) 
of the Basic Provisions (Sec. 457.8):
    (1) You must replant any acreage of sweet corn damaged during the 
planting period in which initial planting took place whenever less than 
75 percent of the plant stand remains: and
    (i) It is practical to replant: and
    (ii) If, at the time the crop was damaged, the final day of the 
planting period has not passed.
    (2) Whenever sweet corn initially is planted during the fall or 
winter planting periods and the condition specified in section 
9(b)(1)(ii) is not satisfied, you may elect:
    (i) To replant such acreage and collect any replant payment due as 
specified in section 12. The initial planting period coverage will 
continue for such replanted acreage.
    (ii) Not to replant such acreage and receive an indemnity based on 
the stage of growth the plants had attained at the time of damage. 
However, such an election will result in the acreage being uninsurable 
in the subsequent planting period.

                          10. Insurance Period

    In lieu of the provisions of section 11 (Insurance Period) of the 
Basic Provisions (Sec. 457.8), coverage begins on each unit or part of a 
unit the later of the date we accept your application, or when the sweet 
corn is planted in each planting period. Coverage ends at the earliest 
of:
    (a) Total destruction of the sweet corn on the unit;
    (b) Abandonment of the sweet corn on the unit;
    (c) The date harvest should have started on the unit on any acreage 
which will not be harvested;
    (d) Final adjustment of a loss on the unit;
    (e) Final harvest; or
    (f) 100 days after the date of planting or replanting.

                           11. 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 during the insurance period:
    (1) Excess rain;
    (2) Excess wind;
    (3) Fire;
    (4) Freeze;
    (5) Hail;
    (6) Tornado; or
    (7) Failure of the irrigation water supply, if caused by an insured 
cause of loss that occurs during the insurance period.
    (b) In addition to the causes of loss excluded 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) Disease or insect infestation, unless no effective control 
measure exists for such disease or insect infestation; or
    (2) Failure to market the sweet corn, unless such failure is due to 
actual physical damage caused by an insured cause of loss that occurs 
during the insurance period.

                         12. Replanting Payments

    (a) In accordance with section 13 (Replanting Payment) of the Basic 
Provisions (Sec. 457.8), a replanting payment is allowed if, due to an 
insured cause of loss, more than 25 percent of the plant stand will not 
produce sweet corn and it is practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of your actual cost of replanting or the result obtained by 
multiplying the per acre replanting payment amount contained in the 
Special Provisions by your insured share.
    (c) In lieu of the provisions contained in section 13 (Replanting 
Payment) of the Basic Provisions (Sec. 457.8), limiting a replanting 
payment to one each crop year, only one replanting payment will be made 
for acreage planted during each planting period within the crop year.

                13. Duties In The Event of Damage or Loss

    In addition to the requirements contained in section 14 (Duties In 
The Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), if 
you intend to claim an indemnity on any unit you also must give us 
notice not later than 72 hours after the earliest of:
    (a) The time you discontinue harvest of any acreage on the unit;
    (b) The date harvest normally would start if any acreage on the unit 
will not be harvested; or
    (c) The calendar date for the end of the insurance period.

                         14. 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 unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage in each stage by the amount of 
insurance per acre for the final stage;

[[Page 441]]

    (2) Multiplying each result in section 14(b)(1) by the percentage 
for the applicable stage (see section 3(d));
    (3) Total the results of section 14(b)(2);
    (4) Subtracting either of the following values from the result of 
section 14(b)(3):
    (i) For other than catastrophic risk protection coverage, the total 
value of production to be counted (see section 14(c)); or
    (ii) For catastrophic risk protection coverage, the result of 
multiplying the total value of production to be counted (see section 
14(c)) times:
    (A) Sixty percent for the 1998 crop year; or
    (B) Fifty-five percent for 1999 and subsequent crop years; and
    (5) Multiplying the result of section 14(b)(4) by your share.
    (c) The total value of production to count from all insurable 
acreage on the unit will include:
    (1) Not less than the amount of insurance per acre for the stage for 
any acreage:
    (i) That is abandoned;
    (ii) Put to another use without our consent;
    (iii) That is damaged solely by uninsured causes; or
    (iv) For which you fail to provide acceptable production records;
    (2) The value of the following appraised production will not be less 
than the dollar amount obtained by multiplying the number of containers 
of appraised sweet corn times the minimum value per container shown in 
the Special Provisions for the planting period:
    (i) Unharvested production (unharvested production that is damaged 
or defective due to insurable causes and is not marketable will not be 
counted as production to count);
    (ii) Production lost due to uninsured causes; and
    (iii) 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) We may require you to continue to care for the crop so that a 
subsequent appraisal may be made or the crop harvested to determine 
actual production (If we require you to continue to care for the crop 
and you do not do so, the original appraisal will be used); or
    (B) You may elect to continue to care for the crop, in which case 
the amount of production to count for the acreage will be the harvested 
production, or our reappraisal if the crop is not harvested.
    (3) The total value of all harvested production from the insurable 
acreage will be the dollar amount obtained by subtracting the allowable 
cost contained in the Special Provisions from the price received for 
each container of sweet corn (this result may not be less than the 
minimum value shown in the Special Provisions for any container of sweet 
corn), and multiplying this result by the number of containers of sweet 
corn harvested. Harvested mature sweet corn that is damaged or defective 
due to insurable causes and is not marketable, will not be counted as 
production to count.

                     15. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

                        16. Minimum Value Option

    (a) The provisions of this option are continuous and will be 
attached to and made a part of your insurance policy, if:
    (1) You elect the Minimum Value Option on your application, or on a 
form approved by us, on or before the sales closing date for the initial 
crop year in which you wish to insure fresh market sweet corn under this 
option, and pay the additional premium indicated in the actuarial 
documents for this optional coverage; and
    (2) You have not elected coverage under the Catastrophic Risk 
Protection Endorsement.
    (b) In lieu of the provisions contained in section 14(c)(3), the 
total value of harvested production will be determined as follows:
    (1) For sold production, the dollar amount obtained by subtracting 
the allowable cost contained in the Special Provisions from the price 
received for each container of sweet corn (this result may not be less 
than zero for any container of sweet corn), and multiplying this result 
by the number of containers of sweet corn sold; and
    (2) For marketable production that is not sold, the dollar amount 
obtained by multiplying the number of containers of such sweet corn on 
the unit by the minimum value shown in the Special Provisions for the 
planting period (harvested production that is damaged or defective due 
to insurable causes and is not marketable will not be counted as 
production).
    (c) This option may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding the crop year for which the cancellation of 
this option is to be effective.

[62 FR 14783, Mar. 28, 1997; 62 FR 26205, May 13, 1997, as amended at 62 
FR 65171, Dec. 10, 1997]



Sec. 457.130  Macadamia tree crop insurance provisions.

    The macadamia tree crop insurance provisions for the 1999 and 
succeeding crop years are as follows:

[[Page 442]]

    FCIC Policies

                        Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider).
    Both FCIC and reinsured policies:

                     Macadamia Tree Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Age. The number of complete 12-month periods that have elapsed since 
the month the trees were set out or were grafted, whichever is later. 
Age determination will be made for each unit, or portion thereof, as of 
January 1 of each crop year.
    Crop year. A period beginning with the date insurance attaches to 
the macadamia tree crop extending through December 31 of the same 
calendar year. The crop year is designated by the calendar year in which 
insurance attaches.
    Destroyed. Trees damaged to the extent that we determine 
replacement, including grafts, is required.
    Good farming practices. The cultural practices generally in use in 
the county for the crop to have normal growth and vigor, and are those 
recognized by the Cooperative State Research, Education, and Extension 
Service as compatible with agronomic and weather conditions in the area.
    Graft. The uniting of a macadamia shoot to an established macadamia 
tree rootstock for future production of macadamia nuts.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Irrigated practice. A method by which the normal growth and vigor of 
the insured trees is maintained by artificially applying adequate 
quantities of water during the growing season by appropriate systems and 
at the proper times.
    Rootstock. The root and stem portion of a macadamia tree to which a 
macadamia shoot can be grafted.

                            2. Unit Division

    (a) Sections 34(a) (1), (3), and (4) of the Basic Provisions are not 
applicable.
    (b) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Unless otherwise allowed 
by written agreement, optional units may be established only if each 
optional unit:
    (1) Contains at least 80 acres of insurable age macadamia trees; or
    (2) Is located on non-contiguous land.
    (c) You must have provided records, which can be independently 
verified, of acreage and age of trees for each unit for at least the 
last crop year.

    3. Insurance Guarantees, Coverage Levels, and Dollar Amounts 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):
    (1) You may select only one dollar amount of insurance for all the 
macadamia trees in the county in each age group contained in the 
actuarial table that are insured under this policy. The dollar amount of 
insurance you choose for each age group must have the same percentage 
relationship to the maximum dollar amount offered by us for each age 
group. For example, if you choose 100 percent of the maximum dollar 
amount of insurance for one age group, you must also choose 100 percent 
of the maximum dollar amount of insurance for all other age groups.
    (2) If the stand is less than 90 percent, based on the original 
planting pattern, the dollar amount of insurance will be reduced 1 
percent for each percent below 90 percent. For example, if the dollar 
amount of insurance you selected is $2,000 and the stand is 85 percent 
of the original stand, the dollar amount of insurance on which any 
indemnity will be based is $1,900 ($2,000 multiplied by 0.95).
    (3) You must report, by the sales closing date contained in the 
Special Provisions, by type if applicable:
    (i) Any damage, removal of trees, change in practices, or any other 
circumstance that may reduce the dollar amount of insurance and the 
number of affected acres;
    (ii) The number of trees on insurable and uninsurable acreage;
    (iii) The month and year on which the trees were set out or grafted 
and the planting pattern;
    (iv) For the first year of insurance following replacement, the 
month and year of replacement if more than 10 percent of the trees on 
any unit have been replaced in the previous five crop years; and
    (v) For the first year of insurance for acreage interplanted with 
another perennial crop, and any time the planting pattern of such 
acreage is changed:
    (A) The age of the interplanted crop, and type if applicable;
    (B) The planting pattern; and
    (C) Any other information that we request in order to establish your 
dollar amount of insurance.

[[Page 443]]

    We will reduce the dollar amount of insurance as necessary, based on 
our estimate of the effect of interplanted perennial crop, removal of 
trees, damage, change in practices, and any other circumstance that 
adversely affects the insured crop. If you fail to notify us of any 
circumstance that may reduce your dollar amount of insurance from 
previous levels, we will reduce your dollar amount of insurance as 
necessary at any time we become aware of the circumstance.
    (b) The production reporting requirements contained in section 3 
(Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities) of the Basic Provisions (Sec. 457.8), do not apply to 
macadamia trees.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is August 31 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 December 31.

                             6. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all macadamia trees in the county 
for which a premium rate is provided by the actuarial table:
    (a) In which you have a share;
    (b) That are grown for the production of macadamia nuts;
    (c) For which the rootstock is adapted to the area;
    (d) That are at least one year of age when the insurance period 
begins; and
    (e) That, if the orchard is inspected, is considered acceptable by 
us.

                          7. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a 
crop planted with another crop, macadamia trees interplanted with 
another perennial crop are insurable unless we inspect the acreage and 
determine that it does not meet the requirements contained in your 
policy.

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on January 1 of each crop year, except that for 
the year of application, if your application is received after December 
22 but prior to January 1, insurance will attach on the 10th day after 
your properly completed application is received in our local office, 
unless we inspect the acreage during the 10-day period and determine 
that it does not meet insurability requirements. You must provide any 
information that we require for the crop or to determine the condition 
of the orchard.
    (2) The calendar date for the end of the insurance period for each 
crop year is December 31.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable share on any insurable acreage 
of macadamia trees on or before the acreage reporting date for the crop 
year, insurance will not be considered to have attached to, and no 
premium or indemnity will be due for such acreage for that crop year 
unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            9. 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 during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the orchard;
    (3) Earthquake;
    (4) Volcanic eruption;
    (5) Wildlife, unless proper measures to control wildlife have not 
been taken; or
    (6) Failure of irrigation water supply, if caused by an insured 
cause of loss that occurs during the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage due to disease or insect infestation, unless adverse 
weather:
    (1) Prevents the proper application of control measures or causes 
properly applied control measures to be ineffective; or
    (2) Causes disease or insect infestation for which no effective 
control mechanism is available.

[[Page 444]]

                10. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), in case of 
damage or probable loss, if you intend to claim an indemnity on any 
unit, you must allow us to inspect all insured acreage before pruning or 
removing any damaged trees.

                         11. Settlement of Claim

    (a) We will determine your loss on a unit basis.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage by the dollar amount of 
insurance per acre for each age group;
    (2) Totaling the results in section 11(b)(1);
    (3) Multiplying the total dollar amount of insurance obtained in 
section 11(b)(2) by the applicable percent of loss, which is determined 
as follows:
    (i) Subtract the coverage level percent you elected from 100 
percent;
    (ii) Subtract the result obtained in section 11(b)(3)(i) from the 
actual percent of loss;
    (iii) Divide the result in section 11(b)(3)(ii) by the coverage 
level you elected (For example, if you elected the 75 percent coverage 
level and your actual percent of loss was 70 percent, the percent of 
loss specified in section 11(b)(3) would be calculated as follows: 
100%-75%=25%; 70%-25%=45%; 45%75%=60%.); and
    (4) Multiply the result in section 11(b)(3) by your share.
    (c) The total amount of loss will include both trees damaged and 
trees destroyed as follows:
    (1) Any orchard with over 80 percent actual damage due to an insured 
cause of loss will be considered to be 100 percent damaged; and
    (2) Any percent of damage by uninsured causes will not be included 
in the percent of loss.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 35668, July 2, 1997, as amended at 62 FR 65172, Dec. 10, 1997]



Sec. 457.131  Macadamia nut crop insurance provisions.

    The macadamia nut crop insurance provisions for the 2000 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:

                      Macadamia Nut Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Age. The number of complete 12-month periods that have elapsed since 
the month the trees were set out or were grafted, whichever is later. An 
age determination will be made for each unit, or portion thereof, as of 
January 1 of each crop year.
    Crop year. A period beginning with the date insurance attaches to 
the macadamia nut crop and extending through the normal harvest time. 
The crop year is designated by the calendar year in which the insurance 
period ends.
    Direct marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the orchard for the 
purpose of picking all or a portion of the crop.
    Graft. The uniting of a macadamia shoot to an established macadamia 
tree rootstock for future production of macadamia nuts.
    Harvest. Picking of mature macadamia nuts from the ground.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Pound. A unit of weight equal to 16 ounces avoirdupois.
    Production guarantee (per acre). The number of wet, in-shell pounds 
determined by multiplying the approved APH yield per acre by the 
coverage level percentage you elect.
    Rootstock. The root and stem portion of a macadamia tree to which a 
macadamia shoot can be grafted.
    Wet in-shell. The weight of the macadamia nuts as they are removed 
from the orchard with the nut meats in the shells after removal of the 
husk but prior to being dried.

                            2. Unit Division

    (a) Section 34(a)(1) of the Basic Provisions is not applicable.
    (b) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Unless otherwise allowed 
by written agreement, optional units may be established only if each 
optional unit:
    (1) Contains at least 80 acres of bearing macadamia trees; or

[[Page 445]]

    (2) Is located on non-contiguous land.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one price election for all the macadamia 
nuts 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 macadamia nut 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) You must report, by the production reporting date designated in 
section 3 (Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities) of the Basic Provisions (Sec. 457.8), by type 
if applicable:
    (1) Any damage, removal of trees, change in practices, or any other 
circumstance that may reduce the expected yield below the yield upon 
which the insurance guarantee is based and the number of affected acres;
    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and anytime the planting pattern of such acreage 
is changed:
    (i) The age of the interplanted crop, and type if applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield.
    We will reduce the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of the following: 
interplanted perennial crop; removal of trees; damage; change in 
practices and any other circumstance on the yield potential of the 
insured crop. If you fail to notify us of any circumstance that may 
reduce your yields from previous levels, we will reduce your production 
guarantee as necessary at any time we become aware of the circumstance.
    (c) The yield used to compute your production guarantee will be 
determined in accordance with Actual Production History (APH) 
regulations, 7 CFR part 400, subpart G, and applicable policy provisions 
unless damage or changes to the orchard or trees require establishment 
of the yield by another method. In the event of such damage or changes, 
the yield will be based on our appraisal of the potential of the insured 
acreage for the crop year.
    (d) Instead of reporting your macadamia nut production for the 
previous crop year, as required by section 3 of the Basic Provisions 
(Sec. 457.8), there is a one year lag period. Each crop year you must 
report your production from two crop years ago, e.g., on the 2001 crop 
year production report, you will provide your 1999 crop year production.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is August 31 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 December 31.

                             6. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all macadamia nuts in the county 
for which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are grown on tree varieties that:
    (1) Were commercially available when the trees were set out;
    (2) Are adapted to the area; and
    (3) Are grown on a rootstock that is adapted to the area.
    (c) That are grown in an orchard that, if inspected, is considered 
acceptable by us;
    (d) That are grown on trees that have reached at least the fifth 
growing season after being set out or grafted. However, we may agree in 
writing to insure acreage that has not reached this age if it has 
produced at least 200 pounds of (wet, in-shell) macadamia nuts per acre 
in a previous crop year; and
    (e) That are produced from blooms that normally occur during the 
calendar year in which insurance attaches and that are normally 
harvested prior to the end of the insurance period.

                          7. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a 
crop planted with another crop, macadamia nuts interplanted with another 
perennial crop are insurable unless we inspect the acreage and determine 
that it does not meet the requirements contained in your policy.

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):

[[Page 446]]

    (1) Coverage begins on January 1 of each crop year, except that for 
the year of application, if your application is received after December 
22 but prior to January 1, insurance will attach on the 10th day after 
your properly completed application is received in our local office, 
unless we inspect the acreage during the 10-day period and determine 
that it does not meet insurability requirements. You must provide any 
information that we require for the crop or to determine the condition 
of the orchard.
    (2) The calendar date for the end of the insurance period for each 
crop year is the second June 30th after insurance attaches.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable share on any insurable acreage 
of macadamia nuts on or before the acreage reporting date for the crop 
year, insurance will not be considered to have attached to, and no 
premium or indemnity will be due for such acreage for that crop year 
unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            9. 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 during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the orchard;
    (3) Earthquake;
    (4) Volcanic eruption;
    (5) Wildlife, unless proper measures to control wildlife have not 
been taken; or
    (6) Failure of irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to:
    (1) Disease or insect infestation, unless adverse weather:
    (i) Prevents the proper application of control measures or causes 
properly applied control measures to be ineffective; or
    (ii) Causes disease or insect infestation for which no effective 
control mechanism is available;
    (2) Inability to market the macadamia nuts for any reason other than 
actual physical damage from an insurable cause specified in this 
section. For example, we will not pay you an indemnity if you are unable 
to market due to quarantine, boycott, or refusal of any person to accept 
production.

                10. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), the following 
will apply:
    (a) You must notify us within 3 days of the date harvest should have 
started if the crop will not be harvested.
    (b) You must notify us at least 15 days before any production from 
any unit will be sold by direct marketing. We will conduct an appraisal 
that will be used to determine your production to count for production 
that is sold by direct marketing. If damage occurs after this appraisal, 
we will conduct an additional appraisal. These appraisals, and any 
acceptable records provided by you, will be used to determine your 
production to count. Failure to give timely notice that production will 
be sold by direct marketing will result in an appraised amount of 
production to count of not less than the production guarantee per acre 
if such failure results in our inability to make the required appraisal.
    (c) If you intend to claim an indemnity on any unit, you must notify 
us at least 15 days prior to the beginning of harvest or immediately if 
damage is discovered during harvest, so that we may inspect the damaged 
production. You must not destroy the damaged crop until after we have 
given you written consent to do so. If you fail to meet the requirements 
of this section and such failure results in our inability to inspect the 
damaged production, we may consider all such production to be undamaged 
and include it as production to count.

                         11. 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 such 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:

[[Page 447]]

    (1) Multiplying the insured acreage for each type, if applicable, by 
its respective production guarantee;
    (2) Multiplying each result in section 11(b)(1) by the respective 
price election for each type, if applicable;
    (3) Totaling the results in section 11(b)(2);
    (4) Multiplying the total production to be counted of each type, if 
applicable, (see section 11(c)) by the respective price election;
    (5) Totaling the results in section 11(b)(4);
    (6) Subtracting the results in section 11(b)(5) from the results in 
section 11(b)(3); and
    (7) Multiplying the result in section 11(b)(6) by your share.
    (c) The total production to count (wet, in-shell pounds) 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 sold by direct marketing if you fail to meet the 
requirements contained in section 10;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production; and
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we may defer 
the claim only if you agree to continue to care for the crop. We will 
then make another appraisal when you notify us of further damage or that 
harvest is general in the area unless you harvested the crop, in which 
case we will use the harvested production. If you do not continue to 
care for the crop, our appraisal made prior to deferring the claim will 
be used to determine the production to count; and
    (2) All harvested production from the insurable acreage.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 35664, July 2, 1997, as amended at 62 FR 65172, Dec. 10, 1997]



Sec. 457.132  Cranberry crop insurance provisions.

    The cranberry crop insurance provisions for the 1999 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

                        Cranberry Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Barrel--100 pounds of cranberries.
    Harvest--Removal of the cranberries from the bog.
    Market price--The cash price per barrel of cranberries offered by 
buyers in the area in which you normally market the cranberries.

                            2. Unit Division

    Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Optional units may be 
established only if each optional unit is located on non-contiguous 
land, unless otherwise allowed by written agreement.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one price election for all the cranberries 
in the county insured under this policy.
    (b) You must report, by the production reporting date designated in 
section 3 (Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities) of the Basic Provisions (Sec. 457.8):
    (1) Any damage, removal of vines, change in practices, or any other 
circumstance that may reduce the expected yield below the yield upon 
which the insurance guarantee is based, and the number of affected 
acres;
    (2) The age of the vines; and
    (3) Any other information that we request in order to establish your 
approved yield.
    We will adjust the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of the removal of 
vines, damage, change in practices, and any other circumstance that may 
affect the yield potential of the insured crop. If you fail to notify us 
of any circumstance that may affect your yields from previous levels, we 
will adjust your production guarantee as

[[Page 448]]

necessary at any time we become aware of the circumstance.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is August 31 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 November 20.

                             6. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the cranberries in the county 
for which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are grown for harvest as cranberries;
    (c) That are grown in a bog that, if inspected, is considered 
acceptable by us; and
    (d) That are grown on vines that have completed four growing seasons 
after the vines were set out, unless otherwise provided by the actuarial 
table or by written agreement.

                           7. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on November 21 of each crop year, except that 
for the year of application, if your application is received after 
November 11, but prior to November 21, insurance will attach on the 10th 
day after your properly completed application is received in our local 
office, unless we inspect the acreage during the 10 day period and 
determine that it does not meet insurability requirements. You must 
provide any information that we require for the crop or to determine the 
condition of the bog.
    (2) The calendar date for the end of the insurance period for each 
crop year is November 20.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable share on any insurable acreage 
of cranberries on or before the acreage reporting date for the crop 
year, insurance will not be considered to have attached to, and no 
premium or indemnity will be due for, such acreage for that crop year 
unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            8. 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 during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the bog;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption;
    (6) Failure of irrigation water supply, if caused by an insured 
peril that occurs during the insurance period; or
    (7) Failure or breakdown of irrigation equipment or facilities due 
to direct damage to the irrigation equipment or facilities from an 
insurable cause of loss if the cranberry crop is damaged by freezing 
temperatures within 72 hours of such failure or breakdown and repair or 
replacement was not possible before damage occurred.
    (b) In addition to the causes of loss excluded in section 12 (Cause 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to:
    (1) Disease or insect infestation, unless adverse weather:
    (i) Prevents the proper application of control measures or causes 
properly applied control measures to be ineffective; or
    (ii) Causes disease or insect infestation for which no effective 
control mechanism is available; or
    (2) Inability to market the cranberries for any reason other than 
actual physical damage from an insurable cause of loss specified in this 
section. For example, we will not pay you an indemnity if you are unable 
to market due to quarantine, boycott, or refusal of any person to accept 
production.

                9. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8):
    (a) If you discover damage, or if you intend to claim an indemnity 
on any insured unit, you must give us notice of probable loss:
    (1) At least 15 days before the beginning of any harvesting, or

[[Page 449]]

    (2) Immediately if probable loss is discovered after harvesting has 
begun.
    (b) You must not sell or dispose of any damaged production until the 
earlier of 15 days from the date of notice of loss or when we give you 
written consent to do so.
    (c) If you fail to meet the requirements of this section, and such 
failure results in our inability to inspect the damaged production, all 
such production will be considered undamaged and included as production 
to count.

                         10. 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 unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (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 the result of section 10(b)(1) by the price 
election;
    (3) Multiplying the total production to be counted, (see section 
10(c)) by the price election;
    (4) Subtracting the total in section 10(b)(3) from the total in 
section 10(b)(2); and
    (5) Multiplying the result in section 10(b)(4) by your share.
    (c) The total production to count (in barrels) 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) Damaged solely by uninsured causes;
    (C) For which you fail to provide acceptable production records; or
    (D) Destroyed or put to another use without our consent;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production; and
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we will use 
the appraised amount of production or defer the claim if you agree to 
continue to care for the crop. We will then make another appraisal when 
you notify us of further damage or that harvest is general to the area 
unless you harvested the crop, in which case we will use the harvested 
production. If you do not continue to care for the crop, our appraisal 
made prior to deferring the claim will be used to determine the 
production to count; and
    (2) All harvested production from the insurable acreage.
    (3) Harvested production which, due to insurable causes, is 
determined not to meet the United States Standards for Fresh Cranberries 
if available, or would not meet those standards if properly handled, or 
does not meet the quality requirements of the receiving handler if the 
United States Standards for Fresh Cranberries, if not available, and 
such harvested production has a value less than 75 percent of the market 
price for cranberries meeting the minimum requirements will be adjusted 
by:
    (i) Dividing the value per barrel of such cranberries by the market 
price per barrel for cranberries meeting the minimum requirements; and
    (ii) Multiplying the result by the number of barrels of such 
cranberries.

                     11. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 5905, Feb. 10, 1997, as amended at 62 FR 65172, Dec. 10, 1997]



Sec. 457.133  Prune crop insurance provisions.

    The prune crop insurance provisions for the 1999 and succeeding crop 
years are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

                          Prune Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Direct marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper or buyer. Examples of direct 
marketing include: selling through an on-farm or roadside stand, 
farmer's market, and permitting the general public to enter the field 
for the purpose of picking all or a portion of the crop.
    Harvest. Picking of mature prunes from the trees or ground either by 
hand or machine.

[[Page 450]]

    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Market price for standard prunes. The price per ton shown on the 
processor's settlement sheet for each size count of standard prunes.
    Natural condition prunes. The condition of prunes in which they are 
normally delivered from a dehydrator or dry yard.
    Prunes. Any type or variety of plums that is grown in the area for 
the production of prunes and that meets the requirements defined in the 
applicable Federal Marketing Agreement Dried Prune Order.
    Standard prunes. Any natural condition prunes:
    (a) That grade ``C'' or better in accordance with the United States 
Standards for Grades of Fresh Plums and Prunes; or
    (b) That meet or exceed the grading standards in effect for the crop 
year if a Federal Marketing Agreement Dried Prune Order has been 
established for the area in which the insured crop is grown.
    Substandard prunes. Any natural condition prunes failing to meet the 
applicable grading specifications for standard prunes.
    Ton. Two thousand (2,000) pounds avoirdupois.

                            2. Unit Division

    Provisions in the Basic Provisions that allow optional units by 
irrigated and non-irrigated practices are not applicable. Instead of 
establishing optional units by section, section equivalent, or FSA farm 
serial number optional units may be established if each optional unit is 
located on non-contiguous land.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions:
    (a) You may select only one price election for all the prunes in the 
county insured under this policy unless the Special Provisions provide 
different price elections by varietal group, in which case you may 
select one price election for each prune varietal group designated in 
the Special Provisions. The price elections you choose for each varietal 
group must have the same percentage relationship to the maximum price 
offered by us for each varietal group. For example, if you choose 100 
percent of the maximum price election for one varietal group, you must 
also choose 100 percent of the maximum price election for all other 
varietal groups.
    (b) You must report, by the production reporting date designated in 
section 3 of the Basic Provisions, by varietal group if applicable:
    (1) Any damage, removal of trees, change in practices, or any other 
circumstance that may reduce the expected yields below the yield upon 
which the insurance guarantee is based, and the number of affected 
acres;
    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and any time the planting pattern of such 
acreage is changed:
    (i) The age of the interplanted crop, and varietal group if 
applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield.
    We will reduce the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of interplanting the 
perennial crop; removal of trees; damage; a change in practices, and any 
other circumstance that may affect the yield potential of the insured 
crop. If you fail to notify us of any circumstance that may reduce your 
yields from previous levels, we will reduce your production guarantee at 
any time we become aware of the circumstance.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is October 31 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are January 31.

                             6. Insured Crop

    In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the prunes in the county for which a premium rate is 
provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are grown for the production of natural condition prunes;
    (c) That are grown on tree varieties that:
    (1) Were commercially available when the trees were set out;
    (2) Are adapted to the area;
    (3) Are grown on rootstock that is adapted to the area; and
    (4) Are irrigated (except where otherwise provided in the Special 
Provisions);
    (d) That are grown in an orchard that, if inspected, is considered 
acceptable by us; and
    (e) That are grown on trees that have reached at least the seventh 
growing season after being set out.

                          7. Insurable Acreage

    In lieu of the provisions in section 9 of the Basic Provisions that 
prohibit insurance attaching to a crop planted with another crop, prunes 
interplanted with another perennial

[[Page 451]]

crop are insurable unless we inspect the acreage and determine that it 
does not meet the insurability requirements contained in your policy.

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 of the Basic 
Provisions:
    (1) Coverage begins for each crop year on March 1.
    (2) The calendar date for the end of the insurance period for each 
crop year is:
    (i) October 1 for California; or
    (ii) October 15 for Oregon.
    (b) In addition to the provisions of section 11 of the Basic 
Provisions:
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable share on any insurable acreage 
of prunes on or before the acreage reporting date for the crop year and 
if the acreage was insured by you the previous crop year, insurance will 
not be considered to have attached to, and no premium or indemnity will 
be due for such acreage for that crop year unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            9. Causes of Loss

    (a) In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss that occur during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and undergrowth have not been controlled or 
pruning debris has not been removed from the orchard;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption; or
    (6) Failure of the irrigation water supply, if due to a cause 
specified in section 9(a)(1) through (5) that occurs during the 
insurance period.
    (b) In addition to the causes of loss excluded in section 12 of the 
Basic Provisions, we will not insure against damage or loss of 
production due to:
    (1) Disease or insect infestation, unless adverse weather:
    (i) Prevents the proper application of control measures or causes 
properly applied control measures to be ineffective; or
    (ii) Causes disease or insect infestation for which no effective 
control mechanism is available; or
    (2) Inability to market the prunes for any reason other than actual 
physical damage from an insurable cause specified in this section. For 
example, we will not pay you an indemnity if you are unable to market 
due to quarantine, boycott, or refusal of any person to accept 
production.

                10. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 of the Basic 
Provisions, the following will apply:
    (a) You must notify us within 3 days of the date harvest should have 
started if the crop will not be harvested.
    (b) You must notify us at least 15 days before any production from 
any unit will be sold by direct marketing or sold as fresh fruit. We 
will conduct an appraisal that will be used to determine your production 
to count for production that is sold by direct marketing or is sold as 
fresh fruit production. If damage occurs after this appraisal, we will 
conduct an additional appraisal. These appraisals, and any acceptable 
records provided by you, will be used to determine your production to 
count. Failure to give timely notice that production will be sold by 
direct marketing or sold as fresh fruit will result in an appraised 
amount of production to count of not less than the production guarantee 
per acre if such failure results in our inability to make the required 
appraisal.
    (c) If you intend to claim an indemnity on any unit, you must notify 
us at least 15 days prior to the beginning of harvest, or immediately if 
damage is discovered during harvest, so that we may inspect the damaged 
production.
    (d) You must not destroy the damaged crop until after we have given 
you written consent to do so. If you fail to meet the requirements of 
this section and such failure results in our inability to inspect the 
damaged production, all such production will be considered undamaged and 
included as production to count.

                         11. 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 such 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 each unit.

[[Page 452]]

    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage for each varietal group, if 
applicable, by its respective production guarantee;
    (2) Multiplying the result of 11(b)(1) by the respective price 
election for each varietal group, if applicable;
    (3) Totaling the results of section 11(b)(2) if there is more than 
one varietal group;
    (4) Multiplying the total production to count (see section 11(c)), 
of each varietal group if applicable, by its respective price election;
    (5) Totaling the results of section 11(b)(4) if there is more than 
one varietal group;
    (6) Subtracting the result of section 11(b)(4) from the result of 
section 11(b)(2) if there is only one varietal group or subtracting the 
result of section 11(b)(5) from the result of section 11(b)(3) if there 
is more than one varietal group; and
    (7) Multiplying the result of section 11(b)(6) by your share.

                               For Example

    You have a 100 percent share in 50 acres of varietal group A prunes 
in the unit, with a guarantee of 2.5 tons per acre and a price election 
of $630.00 per ton. You are only able to harvest 10.0 tons. Your 
indemnity would be calculated as follows:

(1) 50 acres  x  2.5 tons = 125.0 ton guarantee;
(2) 125.0 tons  x  $ 630.00 price election = $78,750.00 value of 
          guarantee;
(4) 10.0 tons  x  $630.00 price election = $6,300.00 value of production 
          to count;
(6) $78,750.00-$6,300.00 = $72,450.00 loss; and
(7) $72,450.00  x  100 percent = $72,450 indemnity payment.

    You also have a 100 percent share in 50 acres of varietal group B 
prunes in the same unit, with a guarantee of 2.0 ton per acre and a 
price election of $550.00 per ton. You are only able to harvest 5.0 
tons. Your total indemnity for both varietal groups A and B would be 
calculated as follows:

(1) 50 acres  x  2.5 tons = 125.0 ton guarantee for varietal group A and 
          50.0 acres  x  2.0 tons = 100.0 ton guarantee for varietal 
          group B;
(2) 125.0 ton guarantee  x  $630.00 price election = $78,750.00 value of 
          guarantee for varietal group A and 100.0 ton guarantee  x  
          $550.00 price election = $55,000.00 value guarantee for 
          varietal group B;
(3) $78,750.00 + $55,000.00 = $133,750.00 total value guarantee;
(4) 10.0 tons  x  $630.00 price election = $6,300.00 value of production 
          to count for varietal group A and 5.0 tons  x  $550.00 price 
          election = $2,750.00 value of production to count for varietal 
          group B;
(5) $6,300.00 + $2,750.00 = $9,050.00 total value of production to 
          count;
(6) $133,750.00-$9,050.00 = $124,700.00 loss; and
(7) $124,700.00 loss  x  100 percent = $124,700 indemnity payment.

    (c) The total production to count (in tons) from all insurable 
acreage on the unit will include all harvested and appraised production 
of natural condition prunes that grade substandard or better and any 
production that is harvested and intended for use as fresh fruit. The 
total production to count 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 sold by direct marketing or sold as fresh fruit if you 
fail to meet the requirements contained in section 10;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production; and
    (iv) Potential production on insured acreage you intend to abandon 
or 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 you do not agree with our appraisal, we may defer the claim 
only if you agree to continue to care for the crop. We will then make 
another appraisal when you notify us of further damage or that harvest 
is general in the area unless you harvested the crop, in which case we 
will use the harvested production. If you do not continue to care for 
the crop, our appraisal made prior to deferring the claim will be used 
to determine the production to count; and
    (2) All harvested production from the insurable acreage.
    (d) Any prune production harvested for fresh fruit will be converted 
to a dried prune weight basis by dividing the total amount (in tons) of 
fresh fruit production by 3.0.
    (e) Any production of substandard prunes resulting from damage by 
insurable causes will be adjusted based on the average size count as 
indicated on the applicable Dried Fruit Association (DFA) Inspection 
Report and Certification Form. Any insurable damage will be adjusted by:
    (1) Dividing the value per ton of such substandard prunes by the 
market price per ton for standard prunes (of the same size count); and
    (2) Multiplying the result by the number of tons of such prunes.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 58630, Oct. 30, 1997, as amended at 62 FR 65172, Dec. 10, 1997]

[[Page 453]]



Sec. 457.134  Peanut crop insurance provisions.

    The peanut crop insurance provisions for the 1999 and succeeding 
crop years are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)

    Both FCIC and reinsured policies:

                    Peanut Crop Insurance Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions, with (1) controlling (2), etc.

                             1. Definitions

    Approved yield. The yield calculated in accordance with 7 CFR part 
400, subpart G, if required by section 3(c) of these provisions.
    Average price per pound:
    (1) The average CCC support price per pound, by type, for 
Segregation I peanuts and Segregation II and III peanuts eligible to be 
valued as quota peanuts; or
    (2) The highest non-quota price election contained in the Special 
Provisions for all Segregation II and III peanuts not eligible to be 
valued as quota peanuts.
    Average support price per pound. The average price per pound for 
each type of quota peanuts announced by the USDA under the peanut price 
support program.
    CCC. Commodity Credit Corporation, a wholly owned government 
corporation within USDA.
    County. In addition to the definition contained in the Basic 
Provisions, ``county'' also includes any land identified by a FSA farm 
serial number for such county but physically located in another county.
    Effective poundage marketing quota. The number of pounds reported on 
the acreage report as eligible for the average support price per pound 
(including transfers of quota peanuts from one farm serial number to 
another farm serial number), not to exceed the Marketing Quota 
established by FSA for the farm serial number.
    Farmers' stock peanuts. Peanuts customarily marketed by producers, 
produced in the United States, and which are not shelled, crushed, 
cleaned, or otherwise changed (except for removal of foreign material, 
loose shelled kernels, and excess moisture) from the condition in which 
peanuts are harvested.
    Green peanuts. Peanuts that are harvested and marketed prior to 
maturity without drying or removal of moisture either by natural or 
artificial means.
    Inspection certificate and sales memorandum. A USDA form that 
records the inspection grading results and marketing record for the net 
weight of peanuts delivered to a buyer.
    Non-quota peanuts. Peanuts other than quota peanuts.
    Planted acreage. In addition to the requirement in the definition in 
the Basic Provisions, peanuts must initially be planted in rows wide 
enough apart to permit mechanical cultivation. Acreage planted in any 
other manner will not be insurable unless otherwise provided by the 
Special Provisions or by written agreement.
    Production guarantee (per acre). In addition to the definition of 
``production guarantee (per acre)'' in the Basic Provisions, the 
production guarantee (per acre) is the number of pounds determined by 
multiplying the yield per acre contained in the actuarial documents or 
the approved yield multiplied by the coverage level percentage you 
elect.
    Quota peanuts. Peanuts that are eligible to be valued at the average 
support price per pound.
    Segregation I, II, or III. Grades designated and defined for peanuts 
by the Agricultural Marketing Service of USDA.
    Value per pound. A price determined by USDA as shown on the USDA 
``Inspection Certificate and Sales Memorandum'' or other value accepted 
by us.

                            2. Unit Division

    (a) In lieu of the provisions in section 34 of the Basic Provisions 
that permit optional unit by section, section equivalent, irrigated or 
non-irrigated acreage, each optional unit must be located in a separate 
farm identified by a single FSA Farm Serial Number.
    (b) We may reject or modify any FSA reconstitution for the purpose 
of the unit definition, if we determine the reconstitution was done in 
whole or in part to defeat the purpose of the Federal crop insurance 
program or to gain a disproportionate advantage under this policy.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions:
    (a) The price elections you choose for the quota and non-quota 
peanuts must have the same percentage relationship to the maximum price 
election offered by us for quota and non-quota peanuts. For example, if 
you choose 100 percent of the maximum quota peanut price election, you 
must also choose 100 percent of the maximum non-quota election.

[[Page 454]]

    (b) The maximum pounds that may be insured at the quota price 
election are the lesser of :
    (1) The effective poundage marketing quota; or
    (2) The insured acreage multiplied by the production guarantee. If 
the insured acres multiplied by the production guarantee exceeds the 
effective poundage marketing quota, the difference will be insured at 
the non-quota peanut price election.
    (c) You may be required to file an annual production report to us, 
if required by the Special Provisions, to establish an approved yield in 
lieu of the yield published in the actuarial documents. If we require 
you to file an annual production report, you must do so in accordance 
with section 3(c) of the Basic Provisions.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are:

                      Cancellation and Termination
------------------------------------------------------------------------
                  State and county                          Dates
------------------------------------------------------------------------
Jackson, Victoria, Golliad, Bee, Live Oak,           January 15
 McMullen, La Salle, and Dimmit Counties, Texas and
 all Texas Counties lying south thereof.
El Paso, Hudspeth, Culberson, Reeves, Loving,        February 28
 Winkler, Ector, Upton, Reagan, Sterling, Coke, Tom
 Green, Concho, McCulloch, San Saba, Mills,
 Hamilton, Bosque, Johnson, Tarrant, Wise, Cooke
 Counties, Texas, and all Texas counties south and
 east thereof; and all other states.
New Mexico; Oklahoma; Virginia; and all other Texas  March 15
 counties.
------------------------------------------------------------------------

                          6. Report of Acreage

    In addition to the requirements of section 6 of the Basic 
Provisions, you must report the effective poundage marketing quota, if 
any, that is applicable to each basic and optional unit for the current 
crop year.

                            7. Annual Premium

    In lieu of the premium amount determinations contained in section 
7(c) of the Basic Provisions, the annual premium will be determined by:
    (a) Multiplying the insured effective poundage marketing quota by 
the price election for quota peanuts;
    (b) Multiplying the insured pounds of non-quota peanuts by the price 
election for non-quota peanuts;
    (c) Totaling the results of section 7(a) and 7(b);
    (d) Multiplying the total of section 7(c) by the applicable premium 
rate stated in the actuarial documents;
    (e) Multiplying the result of section 7(d) by your share at the time 
coverage begins; and
    (f) Multiplying the result of section 7(e) by any premium adjustment 
percentages that may apply.

                             8. Insured Crop

    In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the peanuts in the county for which a premium rate 
is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are planted for the purpose of marketing as farmers' stock 
peanuts;
    (c) That are a type of peanut designated in the Special Provisions 
as being insurable; and
    (d) That are not (unless allowed by the Special Provisions or by 
written agreement):
    (1) Planted for the purpose of harvesting as green peanuts;
    (2) Interplanted with another crop; or
    (3) Planted into an established grass or legume.

                          9. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions:
    (a) Any acreage of the insured crop damaged before the final 
planting date, to the extent that the majority of producers in the area 
would normally not further care for the crop, must be replanted unless 
we agree that replanting is not practical.
    (b) We will not insure any acreage:
    (1) On which peanuts are grown using no-till or minimum tillage 
farming methods unless allowed by the Special Provisions or written 
agreement; or
    (2) Which does not meet the rotation requirements, if any, contained 
in the Special Provisions.

                          10. Insurance Period

    In accordance with the provisions of section 11 of the Basic 
Provisions, the calendar date for the end of the insurance period is the 
date immediately following planting as follows:
    (a) November 30 in all states except New Mexico, Oklahoma, and 
Texas; and
    (b) December 31 in New Mexico, Oklahoma, and Texas.

[[Page 455]]

    (c) ``Removal of peanuts from the field'' replaces ``harvest'' as an 
event marking the end of the insurance period in section 11 of the Basic 
Provisions.

                           11. Causes of Loss

    In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss that occur during the insurance period:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if due to a cause of 
loss contained in section 11(a) through (g) that occurs during the 
insurance period.

                         12. Replanting Payments

    (a) In accordance with section 13 of the Basic Provisions:
    (1) A replanting payment is allowed if the crop is damaged by an 
insurable cause of loss to the extent that the remaining stand will not 
produce at least 90 percent of the production guarantee for the acreage 
and it is practical to replant.
    (2) The maximum amount of the replanting payment for the unit will 
be the lesser of :
    (i) Eighty dollars ($80.00) per acre multiplied by the number of 
acres replanted and multiplied by your insured share;
    (ii) The actual cost of replanting per acre multiplied by the number 
of acres replanted and multiplied by your insured share; or
    (iii) Twenty percent (20%) of the production guarantee multiplied by 
your quota price election, multiplied by the number of acres replanted, 
and multiplied by your insured share.
    (b) When peanuts are replanted using a practice that is uninsurable 
as an original planting, the liability for the unit will be reduced by 
the amount of the replanting payment. The premium amount will not be 
reduced.

                13. Duties In The Event of Damage or Loss

    In accordance with the requirements of section 14 of the Basic 
Provisions, the representative samples of the unharvested crop that we 
may require must be at least 10 feet wide and extend the entire length 
of each field in the unit. If you intend to put the acreage to another 
use or not harvest the crop, the samples must not be harvested or 
destroyed until our inspection.

                         14. 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 such production records were not provided; and
    (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) When settling your claim, the effective poundage marketing 
quota, if any, for each unit will be limited to the lesser of:
    (1) The amount of the effective poundage marketing quota reported on 
the acreage report;
    (2) The amount of the FSA effective poundage marketing quota; or
    (3) The amount determined at the final settlement of your claim.
    (c) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage for the unit by the production 
guarantee per acre, by type if applicable;
    (2) Subtracting the insured effective poundage marketing quota from 
the result of section 14(c)(1) to determine the amount of insured non-
quota peanuts;
    (3) Multiplying the insured effective poundage marketing quota and 
the result of section 14(c)(2) by the respective price election by type, 
if applicable, for quota and non-quota peanuts, respectively;
    (4) Totaling the results of section 14(c)(3) (This amount will be 
the same as (3) if there is only one type);
    (5) Multiply the production to count for quota and non-quota peanuts 
(see section 14(d)), for each type if applicable, by the respective 
price elections;
    (6) Totaling the results of section 14(c)(5) (This amount will be 
the same as (5) if there is only one type);
    (7) Subtracting the result of section 14(c)(6) from section 
14(c)(4); and
    (8) Multiplying the result in section 14(b)(7) and section 14(b)(8) 
by your share.
    For example:
    You have 100 percent share in 25 acres of Valencia peanuts in the 
unit, with a 2000 pounds per acre guarantee, an effective poundage 
marketing quota of 40,000 pounds, and a price election of $0.34 per 
pound for quota and $0.15 per pounds for non-quota. You are able to 
harvest 43,000 pounds in which 40,000 pounds are quota segregation I and 
3,000 pounds are non-quota segregation II and III due to quality 
adjustment. Your indemnity would be calculated as follows:
    (1) 25 acres  x  2,000 pounds per acre = 50,000 pounds guarantee;
    (2) 50,000 pounds guarantee -40,000 pounds of effective marketing 
quota = 10,000 pounds of non-quota guarantee;

[[Page 456]]

    (3) 40,000 pounds  x  $.34 price election for quota = $13,600.00 
value of guarantee; 10,000 pounds  x  $.15 price election for non-quota 
= $1,500.00 value of guarantee;
    (4) $13,600.00 + $1,500.00 = $15,100.00 total of value of guarantee;
    (5) 40,000 pounds of quota production to count  x  .34 = $13,600.00 
quota value of production to count;
    3,000 pounds of non-quota production to count  x  .15 = $450.00 non-
quota value of production to count;
    (6) $13,600.00 + $450.00 = $14,050.00 total value of production to 
count;
    (8) $15,100.00 total value guarantee -$14,050.00 total value of 
production to count = $1,050.00 loss; and
    (9) $1,050.00 value of loss  x  100 percent = $1,050.00 indemnity 
payment.
    (d) The total production to count (in pounds) from all insurable 
acreage on the unit will include all appraised and harvested production.
    (e) All appraised production will include:
    (1) Not less than the production guarantee for acreage:
    (i) That is abandoned;
    (ii) Put to another use without our consent;
    (iii) Damaged solely by uninsured causes; or
    (iv) For which you fail to provide production records that are 
acceptable to us; or
    (v) Not replanted as required by this policy.
    (2) Production lost due to uninsured causes;
    (3) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies and excess moisture in accordance with 
section 14(f)); and
    (4) 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:
    (i) 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 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
    (ii) 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
    (5) All harvested production from the insurable acreage.
    (f) Mature peanut production that is damaged by insurable causes and 
for which the value per pound is less than the average support price per 
pound for the type will be adjusted by:
    (1) Dividing the value per pound for the insured type of peanuts by 
the applicable average price per pound; and
    (2) Multiplying this result by the number of pounds of such 
production.
    (g) To enable us to determine the net weight and quality of 
production of any peanuts for which an ``Inspection Certificate and 
Sales Memorandum'' has not been issued, we must be given the opportunity 
to have such peanuts inspected and graded before you dispose of them. If 
you dispose of any production without giving us the opportunity to have 
the peanuts inspected and graded, the gross weight of such production 
will be used in determining total production to count unless you submit 
a marketing record satisfactory to us which clearly shows the net weight 
and quality of such peanuts.

    Note: In accordance with the Federal Crop Insurance Act, in the 
event of a crop loss, policyholders with the Catastrophic Risk 
Protection level of coverage must elect to either receive benefits under 
these Crop Provisions or if applicable, the Commodity Credit Corporation 
Quota Loan Pool Regulations.)

[63 FR 31335, June 9, 1998; 63 FR 52134, Sept. 30, 1998]



Sec. 457.135  Onion crop insurance provisions.

    The onion crop insurance provisions for the 1998 and succeeding crop 
years in counties with a contract change date of December 31, and for 
the 1999 and succeeding crop years in counties with a contract change 
date of June 30 are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

                          Onion Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1)

[[Page 457]]

The Catastrophic Risk Protection Endorsement, if applicable; (2) the 
Special Provisions; (3) these Crop Provisions; and (4) the Basic 
Provisions with (1) controlling (2) etc.

                             1. Definitions

    Damaged onion production. Storage type onions that do not grade U.S. 
No. 1 or do not satisfy any other standards that may be contained in the 
Special Provisions; or non-storage type onions which do not satisfy 
standards contained in any applicable marketing order or other standards 
that may be contained in the Special Provisions.
    Direct Marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of harvesting all or a portion of the crop.
    Harvest. Removal of the onions from the field after topping and 
lifting or digging.
    Hundredweight. 100 pounds avoirdupois.
    Lifting or digging. A pre-harvest process in which the onion roots 
are severed from the soil and the onion bulbs laid on the surface of the 
soil for drying in the field.
    Non-storage onions. Generally of a Bermuda, Granex, or Grano 
variety, or hybrids developed from these varieties, that are harvested 
as a bulb and dried only a short time, and consequently have a higher 
moisture content. They are thinner skinned, contain a higher sugar 
content, and are generally milder in flavor than storage onions. Due to 
a higher moisture and sugar content, they are subject to deterioration 
both on the surface and internally if not used shortly after harvest.
    Onion production. Onions of recoverable size and condition, with 
excess dirt and foliage material removed and that are not considered 
damaged onion production.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, onions must be planted in rows.
    Production guarantee (per acre):
    (a) First stage production guarantee--Thirty-five percent (35%) of 
the final stage production guarantee.
    (b) Second stage production guarantee--Sixty percent (60%) of the 
final stage production guarantee.
    (c) Final stage production guarantee--The quantity of onions (in 
hundredweight) determined by multiplying the approved yield per acre by 
the coverage level percentage you elect.
    Storage onions. Onions other than a Bermuda, Granex, or Grano 
variety, or hybrids developed from these varieties that are harvested as 
a bulb and dried to a lower moisture content, are firmer, have more 
outer layers of paper-like skin, and are darker in color than non-
storage onions. They are generally more pungent, have a lower sugar 
content, and can normally be stored for several months under proper 
conditions prior to use without deterioration.
    Topping. A pre-harvest process to initiate curing, in which onion 
foliage is removed or bent over.
    Type. A category of onions as identified in the Special Provisions.

                            2. Unit Division

    (a) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number are not 
applicable.
    (b) In addition to, or instead of, establishing optional units by 
irrigated acreage or non-irrigated acreage, optional units may be 
established by type, if the specific type is designated in the Special 
Provisions.

  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 onions 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 onion 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) Your production guarantee progresses, in stages, to the final 
stage production guarantee. Stages will be determined on an acre basis 
and at least 75% of the plants on such acreage must be at the same stage 
to qualify for the applicable stage guarantee. The stages are as 
follows:
    (1) First stage extends from planting through the emergence of the 
third leaf for direct seeded onions, and has a guarantee of 35 percent 
of the final stage production guarantee.
    (2) Second stage extends from emergence of the fourth leaf for 
direct seeded onions, or from transplanting of onion plants or sets, 
until the acreage has been subjected to topping and lifting or digging, 
and has a guarantee of 60 percent of the final stage production 
guarantee.
    (3) Final stage extends from the completion of topping and lifting 
or digging on the acreage until the end of the insurance period, and is 
the quantity of onions (in hundredweight) determined by multiplying the

[[Page 458]]

approved yield per acre by the coverage level percentage elected.
    (c) Any acreage of onions damaged in the first or second stage, to 
the extent that producers in the area would not normally further care 
for the onions, will be deemed to have been destroyed even though you 
may continue to care for the onions. The production guarantee for such 
acreage will not exceed the production guarantee for the stage in which 
the damage occurred.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is June 30 preceding 
the cancellation date for counties with an August 31 cancellation date, 
and November 30 preceding the cancellation date for all other counties.

                  5. Cancellation and Termination Dates

    In accordance with section 2 (Life of the Policy, Cancellation, and 
Termination) of the Basic Provisions (Sec. 457.8), the cancellation and 
termination dates are:

------------------------------------------------------------------------
                                                      Cancellation and
                 State and county                     termination date
------------------------------------------------------------------------
All Georgia Counties; Umatilla County, Oregon;     Aug. 31.
 Kinney, Uvalde, Medina, Bexar, Wilson, Karnes,
 Bee, and San Patricio, Counties, Texas, and all
 Texas Counties lying south thereof; Walla Walla
 County, Washington.
All other states and counties....................  Feb. 1.
------------------------------------------------------------------------

                            6. Annual Premium

    In lieu of the provisions of section 7(c) (Annual Premium) of the 
Basic Provisions (Sec. 457.8), the annual premium amount is computed by 
multiplying the final stage production guarantee by the price election, 
the premium rate, the insured acreage, your share at the time of 
planting, and any applicable premium adjustment factors contained in the 
actuarial documents.

                             7. Insured Crop

    In accordance with section 8 (Insured Crop of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the storage and non-storage 
onions (excluding green (bunch) or seed onions, chives, garlic, leeks, 
and scallions) in the county for which a premium rate is provided by the 
actuarial documents:
    (a) In which you have a share;
    (b) That are planted for harvest as either storage onions or non-
storage onions;
    (c) That are not (unless allowed by the Special Provisions or by 
written agreement):
    (1) Interplanted with another crop, unless the onions are 
interplanted with a windbreak crop and the windbreak crop is destroyed 
within 70 days after completion of seeding or transplanting; 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 of the 
insured crop that:
    (a) Was planted the previous year to storage or non-storage onions, 
green (bunch) onions, seed onions, chives, garlic, leeks, shallots, or 
scallions unless different rotation requirements are specified in the 
Special Provisions or we agree in writing to insure such acreage; 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 
the crop and is not replanted, unless we agree that it is not practical 
to replant.

                           9. Insurance Period

    (a) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8), the acreage must be planted on or 
before the final planting date designated in the Special Provisions 
except as allowed in section 14(c).
    (b) The insurance period ends at the earliest of:
    (1) The calendar date for the end of the insurance period as 
follows:
    (i) June 1 for Vidalia, and any other non-storage onions planted in 
the State of Georgia;
    (ii) July 15 for 1015 Super Sweets, and any other non-storage onions 
in the State of Texas;
    (iii) July 31 for Walla Walla Sweets, and any other non-storage 
onions in the states of Oregon and Washington;
    (iv) August 31 for all non-storage onions in any other state; and
    (v) October 15 for all storage onions; or
    (2) The following event for each unit or portion of a unit:
    (i) Removal of the onions from the field; or
    (ii) Fourteen days after lifting or digging.

                           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

[[Page 459]]

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, unless control measures have not been taken;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply, if caused by an insured 
peril 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 damage that occurs 
or becomes evident after the end of the insurance period, including, but 
not limited to, loss of production that occurs after onions have been 
placed in storage.

                         11. Replanting Payment

    (a) In accordance with section 13 (Replanting Payment) of the Basic 
Provisions (Sec. 457.8), a replanting payment is allowed if the crop is 
damaged by an insurable cause of loss to the extent that the remaining 
stand will not produce at least 90 percent of the final stage production 
guarantee for the acreage and we determine that it is practical to 
replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of 7 percent of the final stage production guarantee or 18 
hundredweight multiplied by your price election for the type and by your 
insured share.
    (c) When onions are replanted using a practice that is uninsurable 
as an original planting, the liability for the unit will be reduced by 
the amount of the replanting payment. The premium amount will not be 
reduced.

                12. 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), any 
representative samples of the unharvested crop that may be required 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) You must notify us at least 15 days before any production from 
any unit will be sold by direct marketing. We will conduct an appraisal 
that will be used to determine your production to count for production 
that is sold by direct marketing. If damage occurs after this appraisal, 
we will conduct an additional appraisal. These appraisals, and any 
acceptable records provided by you, will be used to determine your 
production to count. Failure to give timely notice that production will 
be sold by direct marketing will result in an appraised amount of 
production to count that is not less than the production guarantee per 
acre if such failure results in our inability to make the required 
appraisal.

                         13. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide 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 of section 13(b)(1) by the respective 
price election;
    (3) Totaling the results in section 13(b)(2);
    (4) Multiplying the total production to be counted (see section 
13(c)) by the respective price elections you chose;
    (5) Totaling the results of section 13(b)(4);
    (6) Subtracting the result in section 13(b)(5) from the result in 
13(b)(3); and
    (7) Multiplying the result in section 13(b)(6) by your share.
    (c) The total production (in hundredweight) to count from all 
insurable acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) That is direct marketed to consumers if you fail to meet the 
requirements contained in section 12;
    (C) Put to another use without our consent;
    (D) That is damaged solely by uninsured causes; or
    (E) For which you fail to provide production records that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested onion production (mature unharvested production 
may be adjusted based on the percent of damaged onion production in 
accordance with section 13(d));
    (iv) The appraised production that exceeds the difference between 
the first or second stage (as applicable) and the final stage production 
guarantee for acreage that does not qualify for the final stage 
guarantee, if such acreage is not subject to section 13(c)(1) (i) and 
(ii); and

[[Page 460]]

    (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 if you put the acreage to another use or abandon the 
crop.
    (vi) 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 amount of production to count 
for such acreage will be based on the harvested onion 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 onion 
production, or our reappraisal if additional damage occurs and the crop 
is not harvested.
    (2) All harvested onion production from the insurable acreage.
    (d) If the damage to onion production (harvested or unharvested) 
exceeds the percentage shown by type in the Special Provisions, no 
production will be counted for that unit or portion of a unit unless the 
damaged onion production from that acreage is subsequently sold.
    (e) The extent of any damaged onion production must be determined 
not later than the time onions are placed in storage if the production 
is stored prior to sale, or the date the onions are delivered to a 
packer, processor, or other handler if production is not stored.

                         14. Prevented Planting

    Your prevented planting coverage will be 45 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to a level specified in the actuarial documents.

[62 FR 28613, May 27, 1997, as amended at 62 FR 65173, Dec. 10, 1997]



Sec. 457.136  Guaranteed tobacco crop insurance provisions

    The Guaranteed Tobacco Crop Insurance Provisions for the 1999 and 
succeeding crop years are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)

    Both FCIC and reinsured policies:

              Guaranteed Tobacco Crop Insurance Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Adequate stand. A population of live plants per unit of acreage that 
can be expected to produce at least your production guarantee.
    Approved yield. The yield calculated in accordance with 7 CFR part 
400, subpart G, if required by section 3(b) of these provisions.
    Average value. For appraised production, the estimated value of all 
such production divided by the appraised pounds. For harvested 
production, the total value of such production divided by the harvested 
pounds.
    Basic unit. In lieu of the definition in the Basic Provisions, a 
basic unit is all insurable acreage of an insurable type of tobacco in 
the county in which you have a share on the date of planting for the 
crop year and that is identified by a single FSA farm serial number at 
the time insurance first attaches under these provisions for the crop 
year.
    Carryover tobacco. Any tobacco produced on the FSA farm serial 
number in previous years that remained unsold at the end of the most 
recent marketing year.
    Discount variety. Tobacco defined as such under the provisions of 
the United States Department of Agriculture tobacco price support 
program.
    Fair market value. The current year's tobacco season average market 
price for the applicable type of tobacco obtained from the average sale 
of tobacco through a market other than an auction warehouse.
    Harvest. Cutting or priming and removing all insured tobacco from 
the field in which it was grown.
    Hydroponic plants. Seedlings grown in liquid nutrient solutions.
    Late planting period. In lieu of the definition in section 1 of the 
Basic Provisions, the period that begins the day after the final 
planting date for the insured crop and ends 15 days after the final 
planting date, unless otherwise specified in the Special Provisions.
    Market price.
    (a) For types 11, 12, 13, 14, 21, 22, 23, 31, 35, 36, 37, 42, 44, 
54, and 55:
    (1) The support price per pound for the insured type of tobacco as 
announced by the

[[Page 461]]

USDA for its tobacco price support program; or
    (2) The current year's season average market price, when available; 
if not available because the insured type of tobacco has not been 
marketed in the area, the previous year's season average market price 
for the applicable insured type tobacco grown in the area for any crop 
year a tobacco price support program is not in effect.
    (b) For types 32, 41, 51, 52, and 61, the current year's season 
average market price, when available; if not available because the 
insured type of tobacco has not been marketed in the area, the previous 
year's season average market price for the applicable insured type of 
tobacco grown in the area.
    Planted acreage. Land in which tobacco seedlings, including 
hydroponic plants, have been transplanted by hand or machine from the 
tobacco bed to the field.
    Pound. Sixteen ounces avoirdupois.
    Priming. A method of harvesting tobacco by which each leaf is 
severed from the stalk as it matures.
    Production guarantee (per acre). Either the number of pounds of 
tobacco for the tobacco type and classification shown on the county 
actuarial table, or the approved yield as provided in the Special 
Provisions, multiplied by the coverage level percentage you elect.
    Replanting. In lieu of the definition in section 1 of the Basic 
Provisions, performing the cultural practices necessary to replace the 
tobacco plant, and then replacing the tobacco plant in the insured 
acreage with the expectation of producing at least the guarantee.
    Season average market price. The simple average price paid by buyers 
for a tobacco type for all days sales occur at public markets during the 
tobacco sales season in the area in which the farm is located.
    Support price. The average price per pound for the type of tobacco 
as announced by the USDA under its tobacco price support program, or, if 
there is no such program, as announced by FCIC.
    Tobacco bed. An area protected from adverse weather in which tobacco 
seeds are sown and seedlings are grown until transplanted into the 
tobacco field by hand or machine.

                            2. Unit Division

    A unit will be determined in accordance with the definition of basic 
unit contained in section 1 of these Crop Provisions. The provision in 
the Basic Provisions regarding optional units are not applicable, unless 
specified by the Special Provisions.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions:
    (a) You must select only one price election and coverage level for 
each guaranteed tobacco type designated in the Special Provisions that 
you elect to insure.
    (b) A production report, if required by the Special Provisions, must 
be filed in accordance with section 3(c) of the Basic Provisions.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are March 15.

                          6. Report of Acreage

    In addition to the requirements of section 6 of the Basic 
Provisions, you must report any carryover tobacco from previous years on 
the acreage report.

                             7. Insured Crop

    In accordance with section 8 of the Basic Provisions, the insured 
crop will be any of the tobacco types designated in the Special 
Provisions, in which you have a share, that you elect to insure, and for 
which a premium rate is provided by the actuarial documents.

                          8. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions, 
we will not insure any acreage under these crop provisions that is:
    (a) Planted to a discount variety;
    (b) Planted to a tobacco type for which no premium rate is provided 
by the actuarial documents;
    (c) Planted in any manner other than as provided in the definition 
of ``planted acreage'' in section 1 of these Crop Provisions, unless 
otherwise provided by the Special Provisions or by written agreement; or
    (d) Damaged before the final planting date to the extent that most 
producers of tobacco acreage with similar characteristics in the area 
would normally not further care for the crop, unless such crop is 
replanted or we agree that replanting is not practical.

                           9. Insurance Period

    In accordance with the provisions of section 11 of the Basic 
Provisions, insurance ceases at the earliest of:
    (a) Total destruction of the tobacco on the unit;
    (b) Weighing-in at the tobacco warehouse;
    (c) Removal of the tobacco from the field where grown except for 
curing, grading, packing, or immediate delivery to the tobacco 
warehouse; or

[[Page 462]]

    (d) The calendar date for the end of the insurance period, which is:
    (i) Types 11 and 12--November 30;
    (ii) Type 13--October 31;
    (iii) Type 14--October 15;
    (iv) Types 31 and 36--February 28;
    (v) Types 21, 35 and 37--March 15;
    (vi) Types 22 and 23--April 15;
    (vii) Type 32--May 15;
    (viii) All other types--April 30.

                           10. Causes of Loss

    In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss that occur during the insurance period:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if caused by a peril 
specified in section 10(a) through (g) that occurs during the insurance 
period.

                11. Duties In The Event of Damage or Loss

    (a) In accordance with the requirements of section 14 of the Basic 
Provisions, any representative samples we may require of each 
unharvested tobacco type must be at least 5 feet wide (at least two 
rows), and extend the entire length of each field in the unit. The 
samples must not be harvested or destroyed until after our inspection.
    (b) If tobacco types 11, 12, 13, or 14 are insured and you have 
filed a notice of damage, you also must leave all tobacco stalks and 
stubble intact for our inspection. The stalks and stubble must not be 
destroyed until we give you written consent to do so or until 30 days 
after the end of the insurance period, whichever is earlier.

                         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 unit, we will combine all optional units for 
which such 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, by type if applicable;
    (2) Multiplying each result in section 12(b)(1) by the respective 
price election, by type if applicable;
    (3) Totaling the results of section 12(b)(2) if there are more than 
one type;
    (4) Multiplying the total production to count (see section 12(c)), 
for each type if applicable, by its respective price election;
    (5) Totaling the results of section 12(b)(4), if there are more than 
one type;
    (6) Subtracting the results of section 12(b)(4) from the results of 
section 12(b)(2) if there is only one type or subtracting the results of 
section 12(b)(5) from the result of section 12(b)(3) if there are more 
than one type; and
    (7) Multiplying the result of section 12(b)(6) by your share.
    For example:
    You have 100 percent share in 1 acre of type 35 (dark air cured) 
guaranteed tobacco in the unit, with a 2,000 pounds per acre guarantee 
and a price election of $2.00 per pound. You are only able to harvest 
500 pounds. Your indemnity would be calculated as follows:
    (1) 1.0 acre  x  2,000 pounds = 2,000 pounds guarantee;
    (2) 2,000 pounds  x  $2.00 price election = $4,000.00 value of 
guarantee;
    (4) 500 pounds  x  $2.00 price election = $1,000.00 value of 
production to count;
    (6) $4,000.00-$1,000.00 = $3,000.00 loss; and
    (7) $3,000  x  100 percent = $3,000 indemnity payment.
    (c) The total production to count (pounds of appraised or harvested 
production multiplied by the applicable price) for all insurable acreage 
on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee per acre for the unit for 
any acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) That is damaged solely by uninsured causes;
    (D) For which you fail to provide production records, if required by 
the Special Provisions, that are acceptable to us; or
    (E) Of types 11, 12, 13, or 14 when the stalks and stubble have been 
destroyed without our consent;
    (ii) Production lost due to uninsured causes.
    (iii) Potential production on insured acreage that you intend to put 
to another use or abandon with our consent, 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,

[[Page 463]]

representative samples of the crop in locations acceptable to us (The 
value of production to count for such acreage will be the number of 
pounds harvested or appraised production multiplied by the support price 
taken 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 insurable acreage.
    (d) Mature tobacco production that is damaged by insurable causes 
will be adjusted for quality based on the USDA Official Standard Grades 
for the insured type if it has an average value less than the market 
price, as follows:
    (1) Divide the average value of the damaged appraised and/or 
harvested production by the market price;
    (2) Multiply the result in section 12(d)(1) (not to exceed 1.0) by 
the number of pounds of damaged appraised and/or harvested tobacco; and
    (3) Multiply the product by your price election.
    If no market price has been established for the grade of the damaged 
tobacco, a market price will be imputed by reducing the lowest available 
market price by 20 percent for each grade that the production falls 
below the grade for which such lowest market price is available.
    (e) To enable us to determine the fair market value of tobacco not 
sold through auction warehouses, we must be given the opportunity to 
inspect such tobacco before it is sold, contracted to be sold, or 
otherwise disposed. Failure to provide us the opportunity to inspect 
such tobacco may result in rejection of any claim for indemnity.
    (f) If we consider the best offer you receive for any such tobacco 
to be inadequate, we may obtain additional offers on your behalf.
    (g) Once we agree that any carryover or current year's tobacco has 
no market value due to insured causes, you must destroy it and it will 
not be considered production to count. If you refuse to destroy such 
tobacco, we will include it as production to count and value it at the 
support price.

                            13. Late Planting

    In lieu of late planting provisions in the Basic Provisions 
regarding acreage initially planted after the final planting date, 
insurance will be provided for acreage planted to the insured crop after 
the final planting date as follows:
    (a) The production guarantee (per acre) for each type planted during 
the late planting period will be reduced by:
    (1) One percent (1%) for the 1st through the 10th day; and
    (2) Two percent (2%) for the 11th through the 15th day;
    (b) The premium amount for insurable acreage planted to the insured 
crop after the final planting date will be the same as that for timely 
planted acreage. If the amount of premium you are required to pay (gross 
premium less our subsidy) for acreage planted after the final planting 
date exceeds the liability on such acreage, coverage for those acres 
will not be provided (no premium will be due and no indemnity will be 
paid for such acreage).

                         14. Prevented Planting

    The prevented planting provisions in the Basic Provisions are not 
applicable to guaranteed tobacco.

[63 FR 34552, June 25, 1998]



Sec. 457.137  Green pea crop insurance provisions.

    The Green Pea Crop Insurance Provisions for the 1998 and succeeding 
crop years are as follows:

    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies

                        Green Pea Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Base contract price. The price stipulated in the processor contract 
for the tenderometer reading, grade factor, or sieve size that is 
designated in the Special Provisions, if applicable, without regard to 
discounts or incentives that may apply.
    Bypassed acreage. Land on which production is ready for harvest but 
the processor elects not to accept such production so it is not 
harvested.
    Combining (vining). Separating pods from the vines and, in the case 
of shell peas, separating the peas from the pod for delivery to the 
processor.

[[Page 464]]

    Dry peas. Green peas that have matured to the dry form for use as 
food, feed, or seed.
    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 required by the green pea processor contract with the 
processing company, and recognized by the Cooperative State Research, 
Education, and Extension Service as compatible with agronomic and 
weather conditions in the county.
    Green peas. Shell type and pod type peas that are grown under a 
processor contract to be canned or frozen and sold for human 
consumption.
    Harvest. Combining (vining) of the peas.
    Nurse crop (companion crop). A crop planted into the same acreage as 
another crop, that is intended to be harvested separately, and which is 
planted to improve growing conditions for the crop with which it is 
grown.
    Peas. Green or dry peas.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, peas must initially be placed in rows to be considered 
planted. Acreage planted in any other manner will not be insurable 
unless otherwise provided by the Special Provisions or by written 
agreement.
    Pod type. Green peas genetically developed to be eaten without 
shelling (e.g., snap peas, snow peas, and Chinese peas).
    Practical to replant. In lieu of the definition of ``practical to 
replant'' contained in section 1 of the Basic Provisions, 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, time to crop maturity, and 
marketing window, 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 unless 
the replanted acreage can produce at least 75 percent of the approved 
yield, and the processor agrees in writing that it will accept the 
production from the replanted acreage.
    Price election. In lieu of the definition of ``Price election'' 
contained in section 1 of the Basic Provisions, price election is 
defined as the price per pound stated in the processor contract 
(contracted price) for the tenderometer reading, grade factor, or sieve 
size contained in the Special Provisions.
    Processor. Any business enterprise regularly engaged in canning or 
freezing green peas for human consumption, that possesses all licenses 
and permits for processing green peas required by the state in which it 
operates, and that possesses facilities, or has contractual access to 
such facilities, with enough equipment to accept and process contracted 
green peas within a reasonable amount of time after harvest.
    Processor contract. A written agreement between the producer and a 
processor, containing at a minimum:
    (a) The producer's commitment to plant and grow green peas, and to 
deliver the green pea production to the processor;
    (b) The processor's commitment to purchase all the production stated 
in the processor contract; and
    (c) A base contract price.
    Multiple contracts with the same processor that specify amounts of 
production will be considered as a single processor contract unless the 
contracts are for different types of green peas.
    Production guarantee (per acre).--The number of pounds determined by 
multiplying the approved actual production history yield per acre by the 
coverage level percentage you elect. For shell type peas, the weight 
will be determined after shelling.
    Shell type. Green peas genetically developed to be shelled prior to 
eating, canning or freezing.

                            2. Unit Division

    (a) For any processor contract that stipulates the amount of 
production to be delivered:
    (1) In lieu of the definition contained in the Basic Provisions, a 
basic unit will consist of all acreage planted to the insured crop in 
the county that will be used to fulfill contracts with each processor;
    (i) There will be no more than one basic unit for all production 
contracted with each processor contract;
    (ii) In accordance with section 12, all production from any basic 
unit in excess of the amount under contract will be included as 
production to count if such production is applied to any other basic 
unit for which the contracted amount has not been fulfilled; and
    (2) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Optional units may only 
be established based on shell type and pod type green peas if the shell 
type acreage does not continue into the pod type acreage in the same 
rows or planting pattern.
    (b) For any processor contract that stipulates the number of acres 
to be planted, in addition to or instead of, establishing optional units 
by section, section equivalent or FSA farm serial number, or irrigated 
and non-irrigated acreage, optional units may be established based on 
shell type and pod type green peas if the shell type acreage does not 
continue into the pod type acreage in the same rows or planting pattern.

[[Page 465]]

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                              Indemnities.

    In addition to the requirements of section 3 of the Basic 
Provisions:
    (a) You may select only one price election for all the green peas in 
the county insured under this policy unless the Special Provisions 
provide different price elections by type. The percentage of the maximum 
price election you choose for one type will be applicable to all other 
types insured under this policy.
    (b) The appraised production from bypassed acreage that could have 
been accepted by the processor will be included when determining your 
approved yield.
    (c) Acreage that is bypassed because it was damaged by an insurable 
cause of loss will be considered to have a zero yield when determining 
your approved yield.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are:

                      Cancellation and Termination
------------------------------------------------------------------------
                   State                                Dates
------------------------------------------------------------------------
Delaware and Maryland......................  Feb. 15.
All other states...........................  Mar. 15.
------------------------------------------------------------------------

                          6. Report of Acreage

    In addition to the provisions of section 6 of the Basic Provisions, 
you must provide a copy of all processor contracts to us on or before 
the acreage reporting date.

                             7. Insured Crop

    (a) In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the shell type and pod type green peas in the county 
for which a premium rate is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That are grown under, and in accordance with, the requirements 
of a processor contract executed on or before the acreage reporting date 
and are not excluded from the processor contract at any time during the 
crop year; and
    (3) That are not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Interplanted with another crop;
    (ii) Planted into an established grass or legume; or
    (iii) Planted as a nurse crop.
    (b) You will be considered to have a share in the insured crop if, 
under the processor contract, you retain control of the acreage on which 
the green peas are grown, you are at risk of loss, and the processor 
contract provides for delivery of green peas under specified conditions 
and at a stipulated base contract price.
    (c) A commercial green pea producer who is also a processor may 
establish an insurable interest if the following requirements are met:
    (1) The producer must comply with these Crop Provisions;
    (2) Prior to the sales closing date, the Board of Directors or 
officers of the processor must execute and adopt a resolution that 
contains the same terms as an acceptable processor contract. Such 
resolution will be considered a processor contract under this policy; 
and
    (3) Our inspection reveals that the processing facilities comply 
with the definition of a processor contained in these Crop Provisions.

                          8. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions:
    (a) Any acreage of the insured crop that is damaged before the final 
planting date, to the extent that the majority of producers in the area 
would normally not further care for the crop, must be replanted unless 
we agree that it is not practical to replant; and
    (b) We will not insure any acreage that does not meet the rotation 
requirements, if applicable, contained in the Special Provisions.

                           9. Insurance Period

    In lieu of the provisions contained in section 11 of the Basic 
Provisions, regarding the end of the insurance period, insurance ceases 
at the earlier of:
    (a) The date the green peas:
    (1) Were destroyed;
    (2) Should have been harvested but were not harvested;
    (3) Were abandoned; or
    (4) Were harvested;
    (b) The date you harvest sufficient production to fulfill your 
processor contract if the processor contract stipulates a specific 
amount of production to be delivered;
    (c) Final adjustment of a loss; or
    (d) September 15 of the calendar year in which the insured green 
peas would normally be harvested; or
    (e) September 30 of the calendar year in which the insured peas 
would normally be harvested if you provide notice to us that the insured 
crop will be harvested as dry peas (see section 11(d)).

                           10. Causes of Loss

    In accordance with the provisions of section 12 of the Basic 
Provisions:

[[Page 466]]

    (a) Insurance is provided only against the following causes of loss 
that occur during the insurance period:
    (1) Adverse weather conditions, including:
    (i) Excessive moisture that prevents harvesting equipment from 
entering the field or that prevents the timely operation of harvesting 
equipment; and
    (ii) Abnormally hot or cold temperatures that cause an unexpected 
number of acres over a large producing area to be ready for harvest at 
the same time, affecting the timely harvest of a large number of such 
acres or the processing of such production is beyond the capacity of the 
processor, either of which causes the acreage to be bypassed.
    (2) Fire;
    (3) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (4) Plant disease but only on acreage not planted to peas the 
previous crop year. (In certain instances, contained in the Special 
Provisions or in a written agreement, acreage planted to peas the 
previous year may be covered. Damage due to insufficient or improper 
application of disease control measures is not covered);
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply, if due to a cause of 
loss contained in section 10(a)(1) through (7) that occurs during the 
insurance period.
    (b) In addition to the causes of loss excluded by section 12 of the 
Basic Provisions, we will not insure any loss of production due to:
    (1) Bypassed acreage because of:
    (i) The breakdown or non-operation of equipment or facilities; or
    (ii) The availability of a crop insurance payment. We may deny any 
indemnity immediately in such circumstance or, if an indemnity has been 
paid, require you to repay it to us with interest at any time acreage 
was bypassed due to the availability of a crop insurance payment or;
    (2) Your failure to follow the requirements contained in the 
processor contract.

                11. Duties In The Event of Damage or Loss

    In addition to the notices required by section 14 of the Basic 
Provisions, you must give us notice:
    (a) Not later than 48 hours after:
    (1) Total destruction of the green peas on the unit; or
    (2) Discontinuance of harvest on a unit on which unharvested 
production remains.
    (b) Within 3 days after the date harvest should have started on any 
acreage that will not be harvested unless we have previously released 
the acreage. You must also provide acceptable documentation of the 
reason the acreage was bypassed. Failure to provide such documentation 
will result in our determination that the acreage was bypassed due to an 
uninsured cause of loss. If the crop will not be harvested and you wish 
to destroy the crop, you must leave representative samples of the 
unharvested crop for our inspection. The samples must be at least 10 
feet wide and extend the entire length of each field in each unit. The 
samples must not be destroyed until the earlier of our inspection or 15 
days after notice is given to us;
    (c) At least 15 days prior to the beginning of harvest if you intend 
to claim an indemnity on any unit, or immediately if damage is 
discovered during the 15 day period or during harvest, so that we may 
inspect any damaged production. If you fail to notify us and such 
failure results in our inability to inspect the damaged production, we 
will consider all such production to be undamaged and include it as 
production to count. You are not required to delay harvest; and
    (d) Prior to the time the green peas would normally be harvested if 
you intend to harvest the green peas as dry peas.

                         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 such 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, by type if applicable;
    (2) Multiplying each result of section 12(b)(1) by the respective 
price election, by type if applicable;
    (3) Totaling the results of section 12(b)(2) if there are more than 
one type;
    (4) Multiplying the total production to count (see section 12(c)), 
for each type if applicable, by its respective price election;
    (5) Totaling the results of section 12(b)(4) if there are more than 
one type;
    (6) Subtracting the results of section 12(b)(4) from the results of 
section 12(b)(2) if there is only one type or subtracting the results of 
section 12(b)(5) from the result of section 12(b)(3) if there are more 
than one type; and
    (7) Multiplying the result of section 12(b)(6) by your share.
    For example:
    You have a 100 percent share in 100 acres of shell type green peas 
in the unit, with a guarantee of 4,000 pounds per acre and a price 
election of $0.09 per pound. You are only able to harvest 200,000 
pounds. Your indemnity would be calculated as follows:


[[Page 467]]


(1) 100 acres  x  4,000 pounds = 400,000 pounds guarantee;
(2) 400,000 pounds  x  $0.09 price election = $36,000.00 value of 
          guarantee;
(4) 200,000 pounds  x  $0.09 price election = $18,000.00 value of 
          production to count;
(6) $36,000.00 - $18,000.00 = $18,000.00 loss; and
(7) $18,000.00  x  100 percent = $18,000.00 indemnity payment.

    You also have a 100 percent share in 100 acres of pod type green 
peas in the same unit, with a guarantee of 5,000 pounds per acre and a 
price election of $0.13 per pound. You are only able to harvest 450,000 
pounds. Your total indemnity for both shell type and pod type green peas 
would be calculated as follows:

(1) 100 acres  x  4,000 pounds = 400,000 pounds guarantee for the shell 
          type, and 100 acres  x  5,000 pounds = 500,000 pounds 
          guarantee for the pod type;
(2) 400,000 pounds guarantee  x  $0.09 price election = $36,000.00 value 
          of guarantee for the shell type, and 500,000 pounds guarantee 
          x  $0.13 price election = $65,000.00 value of guarantee for 
          the pod type;
(3) $36,000.00 + $65,000.00 = $101,000.00 total value of guarantee;
(4) 200,000 pounds  x  $0.09 price election = $18,000.00 value of 
          production to count for the shell type, and
    4450,000 pounds  x  $0.13 = $58,500.00 value of production to count 
for the pod type;
(5) $18,000.00 + $58,500.00 = $76,500.00 total value of production to 
          count;
(6) $101,000.00 - $76,500.00 = $24,500.00 loss; and
(7) $24,500.00 loss  x  100 percent = $24,500.00 indemnity payment.

    (c) The total production to count, specified in pounds, from all 
insurable acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) That is put to another use without our consent;
    (C) That is damaged solely by uninsured causes or;
    (D) For which you fail to provide production records that are 
acceptable to us.
    (ii) Production lost due to uninsured causes.
    (iii) Production on acreage that is bypassed unless the acreage was 
bypassed due to an insured cause of loss which resulted in production 
which would not be acceptable under the terms of the processor contract.
    (iv) 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 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.
    (2) All harvested green pea production from the insurable acreage. 
The amount of such production will be determined by dividing the dollar 
amount paid, payable, or which should have been paid under the terms of 
the processor contract for the quality and quantity of the peas 
delivered to the processor by the base contract price per pound;
    (3) All harvested green pea production from any of your other 
insurable units that have been used to fulfill your processor contract 
for this unit; and
    (4) All dry pea production from the insurable acreage if you gave 
notice in accordance with section 11(d) for any acreage you intended to 
harvest as dry peas. The harvested or appraised dry pea production will 
be multiplied by 1.667 for shell types and 3.000 for pod types to 
determine the green pea production equivalent. No adjustment for quality 
deficiencies will be allowed for dry pea production.

                            13. Late Planting

    A late planting period is not applicable to green peas unless 
allowed by the Special Provisions and you provide written approval from 
the processor by the acreage reporting date that it will accept the 
production from the late planted acres when it is expected to be ready 
for harvest.

                         14. Prevented Planting

    Your prevented planting coverage will be 40 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to a level specified in the actuarial documents.

[62 FR 61903, Nov. 20, 1997, as amended at 62 FR 65173, Dec. 10, 1997]

[[Page 468]]



Sec. 457.138  Grape crop insurance provisions.

    The grape crop insurance provisions for the 1999 and succeeding crop 
years are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

                          Grape Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Graft. To unite a shoot or bud (scion) with a rootstock or an 
existing vine in accordance with recommended practices to form a living 
union.
    Harvest. Picking the clusters of grapes from the vines either by 
hand or machine.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Set out. Physically planting the desired variety of grape plant in 
the ground in a desired planting pattern.
    Ton. Two thousand (2,000) pounds avoirdupois.
    Varietal group. Grapes with similar characteristics that are grouped 
for insurance purposes as specified in the Special Provisions.

                            2. Unit Division

    (a) In California only, a basic unit, as defined in section 1 of the 
Basic Provisions will be divided into additional basic units by each 
variety that you insure.
    (b) In California only, provisions in the Basic Provisions that 
provide for optional units by section, section equivalent, or FSA farm 
serial number and by irrigated and non-irrigated practices are not 
applicable. Optional units may be established only if each optional unit 
is located on non-contiguous land, unless otherwise allowed by written 
agreement.
    (c) In all states except California, in addition to, or instead of, 
establishing optional units by section, section equivalent, or FSA farm 
serial number and by irrigated and non-irrigated acreage as provided in 
the unit division provisions contained in the Basic Provisions a 
separate optional unit may be established if each optional unit:
    (1) Is located on non-contiguous land; or
    (2) Consists of a separate varietal group when separate varietal 
groups are specified in the Special Provisions.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) In California, you may select only one price election and 
coverage level for each grape variety in the county specified in the 
Special Provisions.
    (b) In Idaho, Oregon, and Washington, you may select only one 
coverage level and only one price election for all the grapes in the 
county insured under this policy unless the Special Provisions provide 
different price elections by varietal group, in which case you may 
select one price election for each varietal group designated in the 
Special Provisions. The price elections you choose for each varietal 
group are not required to have the same percentage relationship to the 
maximum price offered by us for each varietal group. For example, if you 
choose 100 percent of the maximum price election for one varietal group, 
you may choose 80 percent of the maximum price election for all other 
varietal groups. However, if you elect the Catastrophic Risk Protection 
level of insurance for any varietal group, that level of coverage will 
be applicable to all insured grapes in the county.
    (c) In all other states, you may select only one coverage level and 
only one price election for all the grapes in the county insured under 
this policy unless the Special Provisions provide different price 
elections by varietal group, in which case you may select one price 
election for each varietal group designated in the Special Provisions. 
The price elections you choose for each varietal group must have the 
same percentage relationship to the maximum price offered by us for each 
varietal group. For example, if you choose 100 percent of the maximum 
price election for one varietal group, you must also choose 100 percent 
of the maximum price election for all other varietal groups.
    (d) In California only, if the Special Provisions do not provide a 
price election for a specific variety you wish to insure, you may apply 
for a written agreement to establish a price election. Your application 
for the written agreement must include:
    (1) The number of tons sold for at least the two most recent crop 
years; and
    (2) The price received for all production of the variety in the 
years for which production records are provided.
    (e) You must report, by the production reporting date designated in 
section 3 (Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities) of the

[[Page 469]]

Basic Provisions (Sec. 457.8), by variety or varietal group, if 
applicable :
    (1) Any damage, removal of bearing vines, change in practices or any 
other circumstance that may reduce the expected yield below the yield 
upon which the insurance guarantee is based, and the number of affected 
acres;
    (2) The number of bearing vines on insurable and uninsurable 
acreage;
    (3) The age of the vines and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and anytime the planting pattern of such acreage 
is changed:
    (i) The age of the interplanted crop, and the type or variety or 
varietal group, if applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield.
    We will reduce the yield used to establish your production 
guarantee, based on our estimate of the effect of the following: 
Interplanted perennial crop; removal of vines; damage; change in 
practices and any other circumstance that may affect the yield potential 
of the insured crop. If you fail to notify us of any circumstance that 
may reduce your yields from previous levels, we will reduce your 
production guarantee at any time we become aware of the circumstance.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is August 31 preceding 
the cancellation date for all states except California, and October 31 
preceding the cancellation date for California.

                  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 January 31 in California and November 20 in all 
other states.

                          6. Report of Acreage

    In addition to the requirements of section 6 (Report of Acreage) of 
the Basic Provisions (Sec. 457.8), you must report your acreage by each 
grape variety you insure in California, or by varietal group in all 
other states.

                             7. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be any insurable variety that you 
elect to insure in California or all insurable varieties in all other 
states in the county for which a premium rate is provided by the 
actuarial documents:
    (a) In which you have a share;
    (b) That are grown for wine, juice, raisins, or canning;
    (c) That are grown in a vineyard that, if inspected, is considered 
acceptable by us;
    (d) That, after being set out or grafted, have reached the number of 
growing seasons designated by the Special Provisions; and
    (e) That have produced an average of two tons of grapes per acre 
during at least one of the three crop years immediately preceding the 
insured crop year, unless we inspect and allow insurance on such 
acreage.

                          8. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8) that prohibit insurance attaching to a 
crop planted with another crop, grapes interplanted with another 
perennial crop are insurable unless we inspect the acreage and determine 
that it does not meet the requirements contained in your policy.

                           9. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on February 1 in California and November 21 in 
all other states of each crop year. Notwithstanding the previous 
sentence, for the year of application, if your application is received 
after January 22 but prior to February 1 in California, or after 
November 11 but prior to November 21 in all other states, insurance will 
attach on the 10th day after your properly completed application is 
received in our local office, unless we inspect the acreage during the 
10 day period and determine that it does not meet insurability 
requirements. You must provide any information that we require for the 
crop or to determine the condition of the vineyard.
    (2) The calendar date for the end of the insurance period for each 
crop year is the date during the calendar year in which the grapes are 
normally harvested, as follows:
    (i) October 10 in Mississippi and Texas;
    (ii) November 1 in Idaho, Oregon, and Washington;
    (iii) November 10 in California; and
    (iv) November 20 in all other states.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins, but on or before the acreage reporting date for the 
crop year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period. Acreage 
acquired after the acreage reporting date will not be insured.

[[Page 470]]

    (2) If you relinquish your insurable share on any insurable acreage 
of grapes on or before the acreage reporting date for the crop year, 
insurance will not be considered to have attached to, and no premium or 
indemnity will be due for such acreage for that crop year unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                           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 during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the vineyard;
    (3) Insects, except as excluded in 10(b)(1), 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 irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to:
    (1) Phylloxera, regardless of cause; or
    (2) Inability to market the grapes for any reason other than actual 
physical damage from an insurable cause specified in this section. For 
example, we will not pay you an indemnity if you are unable to market 
due to quarantine, boycott, or refusal of any person to accept 
production.

                11. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), the following 
will apply:
    (a) You must notify us within 3 days of the date harvest should have 
started if the crop will not be harvested.
    (b) If the crop has been damaged during the growing season and you 
previously gave notice in accordance with section 14 of the Basic 
Provisions (Sec. 457.8), you must also provide notice at least 15 days 
prior to the beginning of harvest if you intend to claim an indemnity as 
a result of the damage previously reported. You must not destroy the 
damaged crop that is marketed in normal commercial channels, until after 
we have given you written consent to do so. If you fail to meet the 
requirements of this section, all such production will be considered 
undamaged and included as production to count.

                         12. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide acceptable production records:
    (1) For any optional units, we will combine all optional units for 
which such 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 you selected for each variety or varietal group;
    (3) Totaling the results in section 12(b)(2);
    (4) Multiplying the total production to count of each variety or 
varietal group, if applicable, (see section 12 (c) through (e)) by the 
respective price election you selected;
    (5) Totaling the results in section 12(b)(4);
    (6) Subtracting the result in section 12(b)(5) from the result in 
section 12(b)(3); and
    (7) Multiplying the result in section 12(b)(6) by your share.
    (c) The total production to count (in tons) 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 or destroyed by you without our consent;
    (B) That is damaged solely by uninsured causes; or
    (C) For which you fail to provide production records;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies in accordance with subsection 12 (e)); 
and
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we may defer 
the claim only if you agree to continue to care for the crop. We will 
then make another appraisal when you notify us of further damage or that 
harvest is general

[[Page 471]]

in the area unless you harvested the crop, in which case we will use the 
harvested production. If you do not continue to care for the crop, our 
appraisal made prior to deferring the claim will be used to determine 
the production to count; and
    (2) All harvested production from the insurable acreage. Grape 
production that is harvested and dried for raisins will be converted to 
a fresh weight basis by multiplying the number of tons of raisin 
production by 4.5.
    (d) If any grapes are harvested before normal maturity or for a 
special use (such as Champagne or Botrytis-affected grapes), the 
production of such grapes will be increased by the factor obtained by 
dividing the price per ton received for such grapes by the price per ton 
for fully matured grapes of the type for which the claim is being made.
    (e) Mature marketable grape production may be adjusted for quality 
deficiencies as follows:
    (1) Production will be eligible for quality adjustment if, due to 
insurable causes, it has a value of less than 75 percent of the average 
market price of undamaged grapes of the same or similar variety. The 
value per ton of the qualifying damaged production and the average 
market price of undamaged grapes will be determined on the earlier of 
the date the damaged production is sold or the date of final inspection 
for the unit. The average market price of undamaged production will be 
calculated by averaging the prices being paid by usual marketing outlets 
for the area during the week in which the damaged grapes were valued.
    (2) Grape production that is eligible for quality adjustment, as 
specified in subsection 12(e)(1) will be reduced by:
    (i) Dividing the value per ton of the damaged grapes by the maximum 
price election available for such grapes to determine the quality 
adjustment factor; and
    (ii) Multiplying this result (not to exceed 1.000) by the number of 
tons of the eligible damaged grapes.

                     13. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 33741, June 23, 1997, as amended at 62 FR 65173, Dec. 10, 1997; 
63 FR 31338, June 9, 1998]



Sec. 457.139  Fresh market tomato (dollar plan) crop insurance provisions.

    The fresh market tomato (dollar plan) crop insurance provisions for 
the 1999 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

            Fresh market tomato (dollar plan) crop provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Acre--43,560 square feet of land when row widths do not exceed six 
feet, or if row widths exceed six feet, the land area on which at least 
7,260 linear feet of rows are planted.
    Carton--Twenty-five (25) pounds of the insured crop.
    Crop year--In lieu of the definition of ``crop year'' contained in 
section 1 (Definitions) of the Basic Provisions (Sec. 457.8), crop year 
is a period of time that begins on the first day of the earliest 
planting period for fall planted tomatoes and continues through the last 
day of the insurance period for spring planted tomatoes. The crop year 
is designated by the calendar year in which spring planted tomatoes are 
harvested.
    Direct marketing--Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    Excess rain--An amount of precipitation sufficient to directly 
damage the crop.
    Freeze--The formation of ice in the cells of the plant or its fruit, 
caused by low air temperatures.
    Harvest--The picking of tomatoes on the unit.
    Mature green tomato--A tomato that:
    (1) Has a glossy waxy skin that cannot be torn by scraping;
    (2) Has well-formed, jelly-like substance in the locules;
    (3) Has seeds that are sufficiently hard so as to be pushed aside 
and not cut by a sharp knife in slicing; and
    (4) Shows no red color.
    Plant stand--The number of live plants per acre prior to the 
occurrence of an insurable cause of loss.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, for

[[Page 472]]

each planting period, tomato seed or transplants must initially be 
planted in rows, unless otherwise provided by Special Provisions, 
actuarial documents, or by written agreement.
    Planting period--The period of time designated in the actuarial 
documents in which the tomatoes must be planted to be considered fall, 
winter or spring-planted tomatoes.
    Potential production--The number of cartons of mature green or ripe 
tomatoes that the tomato plants will or would have produced per acre, 
assuming normal growing conditions and practices, by the end of the 
insurance period:
    (a) With a classification size of 6 x 7 (2\8/32\ inch minimum 
diameter) or larger for all types except cherry or plum tomatoes; or
    (b) With a classification size as allowed by written agreement for 
cherry or plum tomatoes.
    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 to the insured crop will allow 
the crop to attain maturity prior to the calendar date for the end of 
the insurance period (inability to obtain plants or seed will not be 
considered when determining if it is practical to replant).
    Ripe tomato--A tomato that has a definite break in color from green 
to tannish-yellow, pink or red.
    Row width--The widest distance from the center of one row of plants 
to the center of an adjacent row of plants.
    Tropical depression--A system identified by the U.S. Weather Service 
as a tropical depression, and for the period of time so designated, 
including tropical storms, gales, and hurricanes.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will also be divided into additional basic units by planting period.
    (b) Provisions in the Basic Provisions that allow optional units by 
irrigated and non-irrigated practices are not applicable.

              3. Amounts of Insurance and Production Stages

    (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 coverage 
level (and the corresponding amount of insurance designated in the 
actuarial documents for the applicable planting period and practice) for 
all the tomatoes in the county insured under this policy.
    (b) The amount of insurance you choose for each planting period and 
practice must have the same percentage relationship to the maximum price 
offered by us for each planting period and practice. For example, if you 
choose 100 percent of the maximum amount of insurance for a specific 
planting period and practice, you must also choose 100 percent of the 
maximum amount of insurance for all other planting periods and 
practices.
    (c) The production reporting requirements contained in section 3 
(Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities) of the Basic Provisions (Sec. 457.8), do not apply to fresh 
market dollar plan tomatoes.
    (d) The amounts of insurance per acre are progressive by stages as 
follows:

------------------------------------------------------------------------
                  Percent of
                  amount of
                  insurance     Length of time if     Length of time if
     Stage         per acre       direct seeded         transplanted
                   that you
                   selected
------------------------------------------------------------------------
1..............           50  From planting         From planting
                               through the 59th      through the 29th
                               day after planting.   day after planting.
2..............           75  From the 60th day     From the 30th day
                               after planting        after planting
                               until the beginning   until the beginning
                               of stage 3.           of stage 3.
3..............           90  From the 90th day     From the 60th day
                               after planting        after planting
                               until the beginning   until the beginning
                               of the final stage.   of the final stage.
Final..........          100  Begins the earlier    Begins the earlier
                               of 105 days after     of 75 days after
                               planting, or the      planting, or the
                               beginning of          beginning of
                               harvest.              harvest.
------------------------------------------------------------------------

    (e) Any acreage of tomatoes damaged in the first, second, or third 
stage to the extent that the majority of producers in the area would not 
normally further care for it, will be deemed to have been destroyed. The 
indemnity payable for such acreage will be based on the stage the plants 
had achieved when the damage occurred.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the

[[Page 473]]

contract change date is April 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 July 31.

                          6. Report of Acreage

    In addition to the requirements of section 6 (Report of Acreage) of 
the Basic Provisions (Sec. 457.8), you must report on or before the 
acreage reporting date contained in the Special Provisions for each 
planting period:
    (a) All the acreage of tomatoes in the county insured under this 
policy in which you have a share;
    (b) The dates the acreage was planted within each planting period; 
and
    (c) The row width.

                            7. Annual Premium

    In lieu of the premium amount determinations contained in section 7 
(Annual Premium) of the Basic Provisions (Sec. 457.8), the annual 
premium amount for each cultural practice (e.g., fall direct-seeded 
irrigated) is determined by multiplying the final stage amount of 
insurance per acre by the premium rate for the cultural practice as 
established in the Actuarial Table, by the insured acreage, by your 
share at the time coverage begins, and by any applicable premium 
adjustment factors contained in the actuarial documents.

                             8. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the tomatoes in the county 
for which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are:
    (1) Planted to be harvested and sold as fresh market tomatoes;
    (2) Planted within the planting periods designated in the actuarial 
documents;
    (3) Grown under an irrigated practice;
    (4) Grown on acreage covered by plastic mulch except where the 
Special Provisions allows otherwise;
    (5) Grown by a person who in at least one of the three previous crop 
years:
    (i) Grew tomatoes for commercial sale; or
    (ii) Participated in managing a fresh market tomato farming 
operation;
    (c) That are not:
    (1) Interplanted with another crop;
    (2) Planted into an established grass or legume;
    (3) Grown for direct marketing; or
    (4) Plum or cherry type tomatoes, unless allowed by written 
agreement.

                          9. Insurable Acreage

    (a) In lieu of the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8), that prohibit insurance attaching if 
a crop has not been planted in at least one of the three previous crop 
years, we will insure newly cleared land and former pasture land planted 
to fresh market tomatoes.
    (b) In addition to the provisions of section 9 (Insurable Acreage) 
of the Basic Provisions (Sec. 457.8):
    (1) You must replant any acreage of tomatoes damaged during the 
planting period in which initial planting took place whenever less than 
50 percent of the plant stand remains: and
    (i) It is practical to replant;
    (ii) If, at the time the crop was damaged, the final day of the 
planting period has not passed; and
    (iii) The damage occurs within 30 days of transplanting or 60 days 
of direct seeding.
    (2) Whenever tomatoes initially are planted during the fall or 
winter planting periods and the conditions specified in sections 9(b)(1) 
(ii) and (iii) are not satisfied, you may elect:
    (i) To replant such acreage and collect any replant payment due as 
specified in section 12. The initial planting period coverage will 
continue for such replanted acreage.
    (ii) Not to replant such acreage and receive an indemnity based on 
the stage of growth the plants had attained at the time of damage. 
However, such an election will result in the acreage being uninsurable 
in the subsequent planting period.
    (3) We will not insure any acreage on which tomatoes (except for 
replanted tomatoes in accordance with sections 9(b) (1) and (2)), 
peppers, eggplants, or tobacco have been grown and the soil was not 
fumigated or otherwise properly treated before planting tomatoes.

                          10. Insurance Period

    In lieu of the provisions of section 11 (Insurance Period) of the 
Basic Provisions (Sec. 457.8), coverage begins on each unit or part of a 
unit the later of the date we accept your application, or when the 
tomatoes are planted in each planting period. Coverage ends at the 
earliest of:
    (a) Total destruction of the tomatoes on the unit;
    (b) Abandonment of the tomatoes on the unit;
    (c) The date harvest should have started on the unit on any acreage 
which will not be harvested;
    (d) Final adjustment of a loss on the unit;
    (e) Final harvest; or
    (f) The calendar date for the end of the insurance period as 
follows:
    (1) 140 days after the date of direct seeding or replanting with 
seed; and

[[Page 474]]

    (2) 125 days after the date of transplanting or replanting with 
transplants.

                           11. 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 during the insurance period:
    (1) Excess rain;
    (2) Fire;
    (3) Freeze;
    (4) Hail;
    (5) Tornado;
    (6) Tropical depression; or
    (7) Failure of the irrigation water supply, if caused by an insured 
cause of loss that occurs during the insurance period.
    (b) In addition to the causes of loss excluded 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) Disease or insect infestation, unless no effective control 
measure exists for such disease or insect infestation; or
    (2) Failure to market the tomatoes, unless such failure is due to 
actual physical damage caused by an insured cause of loss that occurs 
during the insurance period.

                         12. Replanting Payments

    (a) In accordance with section 13 (Replanting Payment) of the Basic 
Provisions (Sec. 457.8), a replanting payment is allowed if, due to an 
insured cause of loss, more than 50 percent of the plant stand will not 
produce tomatoes and it is practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of your actual cost of replanting or the result obtained by 
multiplying the per acre replanting payment amount contained in the 
Special Provisions by your insured share.
    (c) In lieu of the provisions contained in section 13 (Replanting 
Payment) of the Basic Provisions (Sec. 457.8), that limit a replanting 
payment to one each crop year, only one replanting payment will be made 
for acreage planted during each planting period within the crop year.

                13. Duties In The Event of Damage or Loss

    In addition to the requirements contained in section 14 (Duties In 
The Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), if 
you intend to claim an indemnity on any unit you must also give us 
notice not later than 72 hours after the earliest of:
    (a) The time you discontinue harvest of any acreage on the unit;
    (b) The date harvest normally would start if any acreage on the unit 
will not be harvested; or
    (c) The calendar date for the end of the insurance period.

                         14. 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 unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage in each stage by the amount of 
insurance per acre for the final stage;
    (2) Multiplying each result in section 14(b)(1) by the percentage 
for the applicable stage (see section 3(d));
    (3) Total the results of section 14(b)(2);
    (4) Subtracting either of the following values from the result of 
section 14(b)(3):
    (i) For other than catastrophic risk protection coverage, the total 
value of production to be counted (see section 14(c)); or
    (ii) For catastrophic risk protection coverage, the result of 
multiplying the total value of production to be counted (see section 
14(c)) by:
    (A) Sixty percent for the 1998 crop year; or
    (B) Fifty-five percent for 1999 and subsequent crop years; and
    (5) Multiplying the result of section 14(b)(4) by your share.
    (c) The total value of production to count from all insurable 
acreage on the unit will include:
    (1) Not less than the amount of insurance per acre for the stage for 
any acreage:
    (i) That is abandoned;
    (ii) Put to another use without our consent;
    (iii) That is damaged solely by uninsured causes; or
    (iv) For which you fail to provide acceptable production records;
    (2) The value of the following appraised production will not be less 
than the dollar amount obtained by multiplying the number of cartons of 
appraised tomatoes by the minimum value per carton shown in the Special 
Provisions for the planting period:
    (i) Potential production on any acreage that has not been harvested 
the second time for ground-culture tomatoes (the third time for staked 
tomatoes);
    (ii) Unharvested mature green tomatoes (unharvested production that 
is damaged or defective due to insurable causes and is not marketable 
will not be counted as production to count);
    (iii) Production lost due to uninsured causes; and
    (iv) 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

[[Page 475]]

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) We may require you to continue to care for the crop so that a 
subsequent appraisal may be made or the crop harvested to determine 
actual production. (If we require you to continue to care for the crop 
and you do not do so, the original appraisal will be used); or
    (B) You may elect to continue to care for the crop, in which case 
the amount of production to count for the acreage will be the harvested 
production, or our reappraisal if the crop is not harvested.
    (3) The total value of all harvested production from the insurable 
acreage will be the dollar amount obtained by subtracting the allowable 
cost contained in the Special Provisions from the price received for 
each carton of tomatoes (this result may not be less than the minimum 
value shown in the Special Provisions for any carton of tomatoes), and 
multiplying this result by the number of cartons of tomatoes harvested. 
Harvested production that is damaged or defective due to insurable 
causes and is not marketable, will not be counted as production to 
count.

                     15. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

                        16. Minimum Value Option

    (a) The provisions of this option are continuous and will be 
attached to and made a part of your insurance policy, if:
    (1) You elect either Option I or Option II of the Minimum Value 
Option on your application, or on a form approved by us, on or before 
the sales closing date for the initial crop year in which you wish to 
insure fresh market tomatoes (dollar plan) under this option, and pay 
the additional premium indicated in the actuarial documents for this 
optional coverage; and
    (2) You have not elected coverage under the Catastrophic Risk 
Protection Endorsement.
    (b) In lieu of the provisions contained in section 14(c)(3), the 
total value of harvested production will be determined as follows:
    (1) If you selected Option I of the Minimum Value Option, the total 
value of harvested production will be as follows:
    (i) For sold production, the dollar amount obtained by subtracting 
the allowable cost contained in the Special Provisions from the price 
received for each carton of tomatoes (this result may not be less than 
the minimum value option price contained in the Special Provisions for 
any cartons of tomatoes), and multiplying this result by the number of 
carton of tomatoes sold; and
    (ii) For marketable production that is not sold, the dollar amount 
obtained by multiplying the number of cartons of such tomatoes on the 
unit by the minimum value shown in the Special Provisions for the 
planting period (harvested production that is damaged or defective due 
to insurable causes and is not marketable will not be counted as 
production).
    (2) If you selected Option II of the Minimum Value Option, the total 
value of harvested production will be as provided in section 16(b)(1), 
except that the dollar amount specified in section (16)(b)(1)(i) may not 
be less than zero.
    (c) This option may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding the crop year for which the cancellation of 
this option is to be effective.

[62 FR 14777, Mar. 28, 1997; 62 FR 63634, Dec. 2, 1997, as amended at 62 
FR 65174, Dec. 10, 1997]



Sec. 457.140  Dry pea crop insurance provisions.

    The Dry Pea 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:

                         Dry Pea Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions.

    Adequate stand. A population of live plants per acre that will 
produce at least the yield used to establish your production guarantee.
    Base price. The price per pound stipulated in the processor contract 
without regard to discounts or incentives that may apply, and that will 
be paid to the producer for at least 50 percent of the total production 
under contract with the seed company.
    Combining. A mechanical process that separates the peas from the 
pods and other vegetative matter and place the peas into a temporary 
storage receptacle.
    Conditioning. A process that improves the quality of production by 
screening or any other operation commonly used in the dry

[[Page 476]]

pea industry to remove dry peas that are deficient in quality.
    Contract seed peas. Dry peas produced for seed to be planted at a 
future date and that:
    (a) Are grown on acreage enrolled in the seed certification program 
administered by the state in which the peas are produced;
    (b) Are grown on acreage planted in the spring; and
    (c) Are under a seed company contract.
    Dry peas. Peas of the following types:
    (a) All spring-planted smooth green and yellow varieties of 
commercial dry edible peas, and peas grown to produce seed to be planted 
at a future date that do not meet the requirements contained in the seed 
company contract;
    (b) All fall-planted varieties of Austrian Winter Peas only if 
provided for in the Special Provisions;
    (c) All spring-planted varieties of lentils; and
    (d) All varieties of contract seed peas.
    Harvest. Combining of dry peas.
    Local market price. The cash price per pound for the U.S. No. 1 
grade of dry peas as determined by us. Such price will be the prevailing 
dollar amount these buyers are willing to pay for dry peas containing 
the maximum limits of quality deficiencies allowable for the U.S. No. 1 
grade. Factors not associated with grading under the United States 
Standards for Whole Dry Peas, Split Peas and Lentils will not be 
considered.
    Nurse crop (companion crop). A crop planted into the same acreage as 
another crop, that is intended to improve the growing conditions for the 
crop with which it is grown and that is not intended to be harvested 
with the insured crop.
    Planted acreage. In addition to the definition contained in the 
Basic Provisions, dry peas must initially be planted in rows to be 
considered planted. 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 addition to the definition contained in the 
Basic Provisions, it will not be considered practical to replant dry 
peas, except for seed peas, more than 25 days after the final planting 
date unless replanting is generally occurring in the area. For seed 
peas, it will not be considered practical to replant unless production 
from the replanted acreage can be delivered under the terms of the seed 
pea processor contract or the seed company agrees in writing to accept 
such production.
    Price election. In addition to the provisions of the definition 
contained in the Basic Provisions, the price election for contract seed 
peas will be a percentage (not to exceed 100 percent) of the base price 
that you elect.
    Seed company. Any business enterprise regularly engaged in the 
processing of contract seed peas, that possesses all licenses and 
permits for marketing contract seed peas required by the state in which 
it operates, and that owns, or has contracted, sufficient drying, 
screening, and bagging or packaging equipment to accept and process the 
contract seed peas within a reasonable amount of time after harvest.
    Seed company contract. A written agreement between the producer and 
the seed company, executed by the acreage reporting date, containing at 
a minimum:
    (a) The producer's promise to plant and grow one or more specific 
varieties of contract seed peas, and deliver the production from those 
varieties to the seed company;
    (b) The seed company's promise to purchase all the production stated 
in the contract; and
    (c) A fixed price, or a method to determine such price based on 
published information compiled by a third party, that will be paid to 
the producer for at least 50 percent of the production stated in the 
contract.

                            2. Unit Division

    (a) In addition to, or instead of, establishing optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated acreage as provided in the unit division provisions 
contained in the Basic Provisions, a separate optional unit may be 
established for each pea type listed in section 1 of these Crop 
Provisions.
    (b) Contract seed peas may qualify for optional units only if the 
seed company contract specifies the number of acres under contract. 
Contract seed peas produced under a seed company contract that specifies 
only an amount of production or a combination of acreage and production, 
are not eligible for optional units.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions, you may select only one price election for all the dry peas, 
including contract seed peas, 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 dry pea type so 
designated in the Special Provisions. The price elections you choose for 
each type are not required to 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 may 
choose 80 percent of the maximum price election for another type. 
However, if you elect the Catastrophic Risk Protection level of 
insurance for any dry pea type, the same level of coverage will be 
applicable to all insured acreage in the county.

[[Page 477]]

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are March 15.

                          6. Report of Acreage

    In addition to the provisions of section 6 of the Basic Provisions, 
you must submit a copy of the seed company contract to us on or before 
the acreage reporting date if you are insuring contract seed peas.

                             7. Insured Crop

    (a) In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the dry pea types in the county (including Austrian 
Winter Peas if you request insurance for such peas in accordance with 
section 7(c)) for which a premium rate is provided by the actuarial 
documents:
    (1) In which you have a share;
    (2) That are planted for harvest as dry peas and which, if grown 
under a seed company contract, are not excluded from such contract 
during the crop year;
    (3) That are grown in accordance with the requirements of the seed 
company contract, if applicable;
    (4) That are not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Interplanted with another crop;
    (ii) Planted into an established grass or legume; or
    (iii) Planted as a nurse crop.
    (b) You will be considered to have a share in the insured crop if, 
under the processor contract, you retain control of the acreage on which 
the contract seed peas are grown, you are at risk of loss, and the 
processor contract is in effect.
    (c) Austrian Winter Peas are only insurable if you request insurance 
in writing for such dry peas, and we agree in writing to provide 
coverage. Your request to insure Austrian Winter Peas must be submitted 
to us not later than the sales closing date. We will not agree to insure 
Austrian Winter Peas unless an adequate stand exists in the spring.
    (d) Any acreage of dry peas that is destroyed and replanted to a 
different insurable type of dry peas will be considered insured acreage. 
The guarantee and premium for acreage replanted to a different insurable 
type will be based on the replanted type and will be calculated in 
accordance with sections 3 and 7 of the Basic Provisions and section 3 
of these Crop Provisions.

                          8. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions:
    (a) We will not insure any acreage that does not meet the rotation 
requirements, if applicable, contained in the Special Provisions; or
    (b) Any acreage of the insured crop damaged before the final 
planting date, to the extent that most producers of the crop or acreage 
with similar characteristics in the area would normally not further care 
for the crop, must be replanted unless we agree that it is not practical 
to replant. We will not require you to replant if it is not practical to 
replant the type of dry peas originally planted.

                           9. Insurance Period

    In addition to the provisions of section 11 of the Basic Provisions:
    (a) Coverage for Austrian Winter Peas, will begin on the earlier of 
March 16 or the date we agree to accept the acreage for insurance, but 
not before March 1; and
    (b) The calendar date for the end of the insurance period for all 
insurable types of dry peas in the county is September 30 of the crop 
year in which the crop normally is harvested unless otherwise specified 
in the Special Provisions.

                           10. Causes of Loss

    In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss that occur during the insurance period:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if due to a cause of 
loss contained in section 10(a) through (g) that occurs during the 
insurance period.

                11. Duties In The Event of Damage or Loss

    In accordance with the requirements of section 14 of the Basic 
Provisions, 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. If you intend to destroy the crop prior to harvest, the samples 
must not be destroyed until after our inspection.

[[Page 478]]

                         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 such 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 to your pea crop covered by this 
policy, we will settle your claim by:
    (1) Multiplying the insured acreage of each dry pea type, if 
applicable, excluding contract seed peas, by its respective production 
guarantee;
    (2) Multiplying each result of section 12(b)(1) by the respective 
price election;
    (3) Totaling the results of section 12(b)(2);
    (4) Multiplying the insured acreage of each contract seed pea 
variety by its respective production guarantee;
    (5) Multiplying each result of section 12(b)(4) by the applicable 
base price;
    (6) Multiplying each result of section 12(b)(5) by your selected 
price election percentage;
    (7) Totaling the results of section 12(b)(6);
    (8) Totaling the results of section 12(b)(3) and section 12(b)(7);
    (9) Multiplying the total production to be counted of each dry pea 
type, excluding contract seed peas, if applicable (see section 12(d)), 
by the respective price elections;
    (10) Totaling the value of all contract seed pea production (see 
section 12(c));
    (11) Totaling the results of section 12(b)(9) and section 12(b)(10);
    (12) Subtracting the result of section 12(b)(11) from the result in 
section 12(b)(8); and
    (13) Multiplying the result of section 12(b)12 by your share.
    For example:
    You have a 100 percent share in 100 acres of spring-planted smooth 
green dry edible peas in the unit, with a guarantee of 4,000 pounds per 
acre and a price election of $0.09 per pound. You are only able to 
harvest 200,000 pounds. Your indemnity would be calculated as follows:
    (1) 100 acres  x  4,000 pounds = 400,000 pounds guarantee;
    (2) 400,000 pounds  x  $0.09 price election = $36,000.00 value of 
guarantee;
    (9) 200,000 pounds  x  $0.09 price election = $18,000.00 value of 
production to count; $36,000.00 value of guarantee -$18,000.00 value of 
production to count = $18,000.00 loss; and
    (13) $18,000.00  x  100 percent = $18,000.00 indemnity payment.
    You also have a 100 percent share in 100 acres of contract seed peas 
in the same unit, with a guarantee of 5,000 pounds per acre and a base 
price of $0.40 per pound. Your selected price election percentage is 75 
percent. You are only able to harvest 450,000 pounds. Your total 
indemnity for both spring-planted smooth green dry edible peas and 
contract seed peas would be calculated as follows:
    (1) 100 acres  x  4,000 pounds = 400,000 pounds guarantee for the 
spring-planted smooth green dry edible pea type, and
    (4) 100 acres  x  5,000 pounds = 500,000 pounds guarantee for the 
contract seed pea type;
    (2) 400,000 pounds guarantee  x  $0.09 price election = $36,000.00 
value of guarantee for the spring-planted smooth green dry edible pea 
type, and
    (5) 500,000 pounds guarantee  x  $0.40 base price = $200,000.00 
gross value of guarantee for the contract seed pea type;
    (6) $200,000  x  .75 price election percentage = $150,000 net value 
of guarantee for the contract seed pea type;
    (8) $36,000.00+$150,000.00 = $186,000.00 total value of guarantee;
    (9) 200,000 pounds  x  $0.09 price election = $18,000.00 value of 
production to count for the spring-planted smooth green dry edible pea 
type, and
    (10) 450,000 pounds  x  $0.30 = $135,000.00 value of production to 
count for the contract seed pea type;
    (11) $18,000.00+$135,000.00 = $153,000.00 total value of production 
to count;
    (12) $186,000.00-$153,000.00 = $33,000.00 loss; and
    (13) $33,000.00 loss  x  100 percent = $33,000.00 indemnity payment.
    (c) The value of contract seed pea production to count for each 
variety in the unit will be determined as follows:
    (1) For production meeting the minimum quality requirements 
contained in the seed company contract, and for production that does not 
meet such requirements due to uninsured causes:
    (i) Multiplying the local market price or base price per pound, 
whichever is greater, by the price election percentage you selected; and
    (ii) Multiplying the result by the number of pounds of such 
production.
    (2) For mature production not meeting the minimum quality 
requirements contained in the seed pea processor contract due to 
insurable causes, and immature production that is appraised:
    (i) Multiplying the highest local market price available for such 
dry peas by the price election percentage you selected; and
    (ii) Multiplying the result by the number of pounds of such 
production.
    (d) The total pea production to count (in pounds) 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;

[[Page 479]]

    (B) That is put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide production records that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production of dry 
peas, excluding Austrian Winter Peas, may be adjusted for quality 
deficiencies in accordance with section 12 (c) or (e), if applicable); 
and
    (iv) 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 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 the crop is not harvested; and
    (2) All harvested production from the insurable acreage.
    (e) Mature production of smooth green and yellow peas, lentils, and 
seed peas that do not qualify as contract seed peas under the policy 
terms, and that are not deliverable under the contract or are sold under 
the contract for less than the contract price, may be adjusted for 
quality deficiencies. No adjustment for quality deficiencies will be 
allowed for Austrian Winter Peas.
    (1) Production will be eligible for quality adjustment if:
    (i) Deficiencies in quality, in accordance with the United States 
Standards for Whole Dry Peas, Split Peas, and Lentils, result in 
production grading U.S. No. 2 or worse because of defects, color, 
skinned production (lentils only), odor, material weathering, or 
distinctly low quality; or
    (ii) Substances or conditions are present that are identified by the 
Food and Drug Administration or other public health organizations of the 
United States as being injurious to human or animal health.
    (2) Quality will be a factor in determining your loss only if:
    (i) The deficiencies, substances, or conditions resulted from a 
cause of loss against which insurance is provided under these Crop 
Provisions and which occurs within the insurance period;
    (ii) The deficiencies, substances, or conditions result in a net 
price for the damaged production that is less than the local market 
price;
    (iii) All determinations of these deficiencies, substances, or 
conditions are made using samples of the production obtained by us or by 
a disinterested third party approved by us; and
    (iv) The samples are analyzed by a grader licensed to grade dry peas 
under the authority of the United States Agricultural Marketing Act or 
the United States Warehouse Act with regard to deficiencies in quality, 
or by a laboratory approved by us with regard to substances or 
conditions injurious to human or animal health. Test weight for quality 
adjustment purposes may be determined by our loss adjuster.
    (3) Dry Pea production that is eligible for quality adjustment, as 
specified in sections 12(e) (1) and (2), will be reduced as follows:
    (i) The highest local market price for the qualifying damaged 
production will be determined on the earlier of the date such damaged 
production is sold or the date of final inspection for the unit. The 
highest local market price for the qualifying damaged production will be 
determined in the local area to the extent feasible. We may obtain 
prices from any buyer of our choice. If we obtain prices from one or 
more buyers located outside your local market area, we will reduce such 
prices by the additional costs required to deliver the dry peas to those 
buyers. Discounts used to establish the net value of the damaged 
production will be limited to those that are usual, customary, and 
reasonable.
    The value will not be reduced for:
    (A) Moisture content;
    (B) Damage due to uninsured causes; or
    (C) Drying, handling, processing, or any other costs associated with 
normal harvesting, handling, and marketing of the dry peas; except, if 
the value of the damaged production can be increased by conditioning, we 
may reduce the value of the production after it has been conditioned by 
the cost of conditioning but not lower than the value of the production 
before conditioning;
    (ii) The value per pound of the damaged or conditioned production 
will be divided by the local market price to determine the quality 
adjustment factor;
    (iii) The number of pounds of the damaged or conditioned production 
will then be multiplied by the quality adjustment factor to

[[Page 480]]

determine the production count to be included in section 12(d); and
    (iv) Any production harvested from plants growing in the insured 
crop may be counted as production of the insured crop on a weight basis.

                         13. Prevented Planting

    Your prevented planting coverage will be 60 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage as specified in 7 CFR part 400, subpart T, 
and pay an additional premium, you may increase your prevented planting 
coverage to a level specified in the actuarial documents.

[62 FR 65744, Dec. 16, 1997, as amended at 63 FR 36157, July 2, 1998]



Sec. 457.141  Rice crop insurance provisions.

    The Rice Crop Insurance Provisions for the 1998 and succeeding crop 
years are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and Reinsured Policies

                          Rice Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Flood irrigation. An irrigated practice commonly used for rice 
production whereby the planted acreage is intentionally covered with 
water that is maintained at a uniform and shallow depth throughout the 
growing season.
    Harvest. Combining or threshing the rice for grain. A crop that is 
swathed prior to combining is not considered harvested.
    Local market price. The cash price per pound for the U.S. No. 3 
grade of rough rice offered by buyers in the area in which you normally 
market the rice. Factors not associated with grading under the United 
States Standards for Rice including, but not limited to, protein and oil 
content or milling quality will not be considered.
    Planted. The uniform placement of an adequate amount of rice seed 
into a prepared seedbed by one of the following methods:
    (a) Drill seeding--Using a grain drill to incorporate the seed to a 
proper soil depth;
    (b) Broadcast seeding--Distributing seed evenly onto the surface of 
an un-flooded seedbed followed by either timely mechanical incorporation 
of the seed to a proper soil depth in the seedbed or flushing the 
seedbed with water; or
    (c) Broadcast seeding into a controlled flood--Distributing the rice 
seed onto a prepared seedbed that has been intentionally covered to a 
proper depth by water. The water must be free of movement and be 
completely contained on the acreage by properly constructed levees and 
gates.
    Acreage seeded in any other manner will not be insurable unless 
otherwise provided by the Special Provisions or by written agreement.
    Saline water. Water that contains a concentration of salt sufficient 
to cause damage to the insured crop.
    Second crop rice. The regrowth of a stand of rice following harvest 
of the initially insured rice crop that can be harvested in the same 
crop year.
    Swathed. Severance of the stem and grain head from the ground 
without removal of the rice kernels from the plant and placing in a 
windrow.
    Total milling yield. Rice production consisting of heads, second 
heads, screenings, and brewer's rice as defined by the official United 
States Standards for Rice.

                            2. Unit Division

    Provisions in the Basic Provisions that allow optional units by 
irrigated and non-irrigated practices are not applicable.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    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 rice 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 rice 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.

                           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.

[[Page 481]]

                  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:

------------------------------------------------------------------------
                                            Cancellation and termination
             State and county                           date
------------------------------------------------------------------------
Jackson, Victoria, Goliad, Bee, Live Oak,  January 15.
 McMullen, La Salle, and Dimmit Counties,
 Texas; and all Texas counties south
 thereof.
Florida..................................  February 15.
All other Texas counties and all other     February 28.
 states.
------------------------------------------------------------------------

                             6. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the rice in the county for 
which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That is planted for harvest as grain;
    (c) That is flood irrigated; and
    (d) That is not wild rice.

                          7. Insurable Acreage

    In addition to the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8):
    (a) We will not insure any acreage planted to rice:
    (1) The preceding crop year unless allowed by the Special 
Provisions; or
    (2) That does not meet the rotation requirements shown in the 
Special Provisions; and
    (b) Any acreage of the insured crop damaged before the final 
planting date, to the extent that producers in the area would normally 
not further care for the crop, must be replanted unless we agree that it 
is not practical to replant.

                           8. 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 October 31 immediately following planting.

                            9. 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 during the insurance period:
    (1) Adverse weather conditions (except drought);
    (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 that occurs during the insurance period.
    (b) In addition to the causes of loss not insured against in section 
12 (Causes of Loss) of the Basic Provisions (Sec. 457.8), we will not 
insure against any loss of production due to the application of saline 
water.

                         10. Replanting Payment

    (a) A replanting payment for rice is allowed as follows:
    (1) You must comply with all requirements regarding replanting 
payments contained under section 13 (Replanting Payment) of the Basic 
Provisions (Sec. 457.8);
    (2) The rice must be damaged by an insurable cause of loss to the 
extent that the remaining stand will not produce at least 90 percent of 
the production guarantee for the acreage; and
    (3) The replanted rice must be seeded at a rate that is normal for 
initially planted rice (if new seed is planted at a reduced seeding rate 
into a partially damaged stand of rice, the acreage will not be eligible 
for a replanting payment).
    (b) In accordance with the provisions of section 13 (Replanting 
Payment) of the Basic Provisions (Sec. 457.8), the maximum amount of the 
replanting payment per acre will be the lesser of 20 percent of the 
production guarantee or 400 pounds, multiplied by your price election, 
multiplied by your insured share.
    (c) When rice is replanted using a practice that is uninsurable for 
an original planting, the liability for the unit will be reduced by the 
amount of the replanting payment. The premium amount will not be 
reduced.

                11. Duties in the Event of Damage or Loss

    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.

                         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 such production records were not provided; or

[[Page 482]]

    (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 on any unit by:
    (1) Multiplying the insured acreage by its respective production 
guarantee by type, if applicable;
    (2) Multiplying each result in section 12(b)(1) by the respective 
price election by type, if applicable;
    (3) Totaling the results of section 12(b)(2);
    (4) Multiplying the total production to be counted by type, if 
applicable, (see section 12(c) through (e)) by the respective price 
election;
    (5) Totaling the results of section 12(b)(4);
    (6) Subtracting the result of section 12(b)(5) from the result of 
section 12(b)(3); and
    (7) Multiplying the result of section 12(b)(6) by your share.
    (c) The total production to count (in pounds) from all insurable 
acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies and excess moisture in accordance with 
section 12(d));
    (iv) 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 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 you 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, including 
any production from a second rice crop harvested in the same crop year.
    (d) Mature rough rice may be adjusted for excess moisture and 
quality deficiencies. If moisture adjustment is applicable, it will be 
made prior to any adjustment for quality.
    (1) Production will be reduced by 0.12 percent for each 0.1 
percentage point of moisture in excess of 12 percent. We may obtain 
samples of the production to determine the moisture content.
    (2) Production will be eligible for quality adjustment if:
    (i) Deficiencies in quality, in accordance with the Official United 
States Standards for Rice, result in rice not meeting the grade 
requirements for U.S. No. 3 (grades U.S. No. 4 or worse) because of red 
rice, chalky kernels or damaged kernels;
    (ii) The rice has a total milling yield of less than 68 pounds per 
hundredweight;
    (iii) The whole kernel weight is less than 55 pounds per 
hundredweight of milled rice for medium and short grain varieties;
    (iv) The whole kernel weight is less than 48 pounds per 
hundredweight of milled rice for long grain varieties; or
    (v) Substances or conditions are present that are identified by the 
Food and Drug Administration or other public health organizations of the 
United States as being injurious to human or animal health.
    (3) Quality will be a factor in determining your loss only if:
    (i) The deficiencies, substances, or conditions specified in section 
12(d)(2) resulted from a cause of loss against which insurance is 
provided under these crop provisions and which occurs within the 
insurance period;
    (ii) The deficiencies, substances, or conditions specified in 
section 12(d)(2) result in a net price for the damaged production that 
is less than the local market price;
    (iii) All determinations of these deficiencies, substances, or 
conditions specified in section 12(d)(2) are made using samples of the 
production obtained by us or by a disinterested third party approved by 
us; and
    (iv) The samples are analyzed by a grader licensed to grade rice 
under the authority of the United States Agriculture Marketing Act or 
the United States Warehouse Act with regard to deficiencies in quality, 
or by a laboratory approved by us with regard to substances or 
conditions injurious to human or animal health. Notwithstanding the 
preceding sentence, test weight for quality adjustment purposes may be 
determined by our loss adjuster.

[[Page 483]]

    (4) Rice production that is eligible for quality adjustment, as 
specified in sections 12(d) (2) and (3), will be reduced as follows:
    (i) In accordance with quality adjustment factors contained in the 
Special Provisions; or
    (ii) If quality adjustment factors are not contained in the Special 
Provisions, as follows:
    (A) The market price of the qualifying damaged production and the 
local market price will be determined on the earlier of the date such 
quality adjusted production is sold or the date of final inspection for 
the unit. The price for the qualifying damaged production will be the 
market price for the local area to the extent feasible. Discounts used 
to establish the net price of the damaged production will be limited to 
those that are usual, customary, and reasonable. The price will not be 
reduced for:
    (1) Moisture content;
    (2) Damage due to uninsured causes; or
    (3) Drying, handling, processing, or any other costs associated with 
normal harvesting, handling, and marketing of the rice; except, if the 
price of the damaged production can be increased by conditioning, we may 
reduce the price of the production after it has been conditioned by the 
cost of conditioning but not lower than the value of the production 
before conditioning,
    (We may obtain prices from any buyer of our choice. If we obtain 
prices from one or more buyers located outside your local market area, 
we will reduce such prices by the additional costs required to deliver 
the rice to those buyers.);
    (B) The value of the damaged or conditioned production will be 
divided by the local market price to determine the quality adjustment 
factor; and
    (C) The number of pounds remaining after any reduction due to 
excessive moisture (the moisture-adjusted gross pounds (if appropriate)) 
of the damaged or conditioned production will then be multiplied by the 
quality adjustment factor to determine the net production to count.
    (e) Any production harvested from plants growing in the insured crop 
may be counted as production of the insured crop on a weight basis.

                         13. Prevented Planting

    Your prevented planting coverage will be 45 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to a level specified in the actuarial documents.

[62 FR 28310, May 23, 1997, as amended at 62 FR 65174, Dec. 10, 1997]



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

                 United States 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 policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, as applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions, with (1) controlling (2), etc.

                             1. Definitions

    Buyer. A business entity in the business of buying or processing 
potatoes, that possesses all the licenses and permits required by the 
state in which it operates, and has the facilities to accept the 
potatoes purchased.
    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.
    Discard. Disposal of production by you, or a person acting for you, 
without receiving any value for it.
    Disposed. Any disposition of the crop including but not limited to 
sale or discard.
    Grade inspection. An inspection in which samples of production are 
obtained by us, or a party approved by us, prior to the sale, storage, 
or disposal of any lot of potatoes, or any portion of a lot and 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, in accordance with the United States Standards for Grades 
of Potatoes.
    Harvest. Lifting potatoes from within the soil to the soil surface.
    Hundredweight. One hundred (100) pounds avoirdupois.

[[Page 484]]

    Local market. The area in which the insured potatoes are normally 
sold.
    Lot. A quantity of production that can be separated from other 
quantities of production by grade characteristics, load, location or 
other distinctive features.
    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.
    Reduction percentage. A factor determined based on the weight of 
only freeze damaged production in a sample of potatoes in relationship 
to the total weight of the sample, and the provisions in section 
11(g)(1) of these crop provisions; and that is used to determine a 
quantity of potatoes that will not be included as production to count.
    Tuber rot. Any soft, mushy, or leaky condition of potato tissue 
(soft rot or wet breakdown as defined in the United States Standards for 
Grades of Potatoes), including, but not limited to, breakdown caused by 
Southern Bacterial Wilt, Ring Rot, or Late Blight.

  2. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    (a) In addition to the requirements of section 3 of the Basic 
Provisions, 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. If the Special Provisions 
provide for different price elections by type, 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 election 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 the production from any acreage of the insured crop is not 
harvested, the price used to determine your indemnity will be 80 percent 
of your price election.
    (c) Any acreage of potatoes damaged to the extent that similarly 
situated 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 the potatoes. The price election for unharvested 
acreage will apply to such acreage.

                           3. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  4. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are March 15.

                            5. Annual Premium

    In lieu of the premium computation method contained in section 7 of 
the Basic Provisions, the annual premium amount (y) is computed by 
multiplying (a) the production guarantee by (b) the price election for 
harvested acreage, by (c) the premium rate, by (d) the insured acreage, 
by (e) your share at the time of planting, and by (f) any applicable 
premium adjustment factors contained in the actuarial documents (a  x  b 
 x  c  x  d  x  e  x  f = y).

                             6. Insured Crop

    In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the potatoes in the county for which a premium rate 
is provided by the actuarial documents:
    (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 Provision or by 
written agreement):
    (1) Interplanted with another crop; or
    (2) Planted into an established grass or legume.

                          7. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions, 
we will not insure any acreage that:
    (a) Does not meet the rotation requirements contained in the Special 
Provisions for the crop; or
    (b) Is damaged before the final planting date to the extent that 
similarly situated producers in the area would normally not further care 
for the crop, unless it is replanted or we agree that it is not 
practical to replant.

                           8. Insurance Period

    In accordance with the provisions of section 11 of the Basic 
Provisions, the calendar date for the end of the insurance period is the 
date immediately following planting as follows (exceptions, if any, for 
specific counties, varieties or types are contained in the Special 
Provisions):
    (a) October 1, in Alaska;
    (b) October 10 in Nebraska and Wyoming;

[[Page 485]]

    (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.

                            9. Causes of Loss

    (a) In accordance with the provisions of section 12 of the Basic 
Provisions, 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 only if sufficient and proper pest control measures 
are used;
    (4) Plant disease, but only if sufficient and proper disease control 
measures are used;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply, if caused by an insured 
peril that occurs during the insurance period (see section 9(a)(1) 
through (7)).
    (b) In addition to the causes of loss not insured against as 
contained in section 12 of the Basic Provisions, 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, as limited by the 
Special Provisions.

                10. Duties in the Event of Damage or Loss

    (a) In accordance with the requirements of section 14 of the Basic 
Provisions, you must leave representative samples at least 10 feet wide 
and extending the entire length of each field in the unit if you are 
going to destroy any acreage of the insured crop that will not be 
harvested.
    (b) We must be given the opportunity to perform a grade inspection 
on the production from any unit for which you have given notice of 
damage.

                         11. 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; and
    (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 (If there is unharvested acreage in the unit, the harvested 
and unharvested acreage will be determined separately);
    (2) Multiplying each result in section 11(b)(1) by the respective 
price election (The price election may be limited as specified in 
section 3.);
    (3) Totaling the results of section 11(b)(2);
    (4) Multiplying the total production to be counted of each type, if 
applicable (see section 11(d)), by the respective price election;
    (5) Totaling the results of section 11(b)(4);
    (6) Subtracting the results of section 11(b)(5) from the result in 
section 11(b)(3); and
    (7) Multiplying the result of section 11(b)(6) by your share.
    For example:
    You have a 100 percent share in 100 harvested acres of potatoes in 
the unit, with a guarantee of 150 hundredweight per acre and a price 
election of $4.00 per hundredweight. You are only able to harvest 10,000 
hundredweight. Your indemnity would be calculated as follows:
    (1) 100 acres  x  150 hundredweight = 15,000 hundredweight 
guarantee;
    (2) 15,000 hundredweight  x  $4.00 price election = $60,000.00 value 
of guarantee;
    (4) 10,000 hundredweight  x  $4.00 price election = $40,000.00 value 
of production to count;
    (6) $60,000.00 - $40,000.00 = $20,000.00 loss; and
    (7) $20,000.00  x  100 percent = $20,000.00 indemnity payment.
    You also have a 100 percent share in 100 unharvested acres of 
potatoes in the same unit, with a guarantee of 150 hundredweight per 
acre and a price election of $3.20 per hundredweight. The price election 
for unharvested acreage is 80.0 percent of your elected price election 
($4.00  x  0.80 = $3.20.) This unharvested acreage was appraised at 35 
hundredweight per acre for a total of 3500 hundredweight as production 
to count. Your total indemnity for the harvested and unharvested acreage 
would be calculated as follows:
    (1) 100 acres  x  150 hundredweight = 15,000 hundredweight guarantee 
for the harvested acreage, and 100 acres  x  150 hundredweight = 15,000 
hundredweight guarantee for the unharvested acreage;
    (2) 15,000 hundredweight guarantee  x  $4.00 price election = 
$60,000.00 value of guarantee for the unharvested acreage, and 15,000 
hundredweight guarantee  x  $3.20 price election = $48,000.00 value of 
guarantee for the unharvested acreage;
    (3) $60,000.00 + $48,000.00 = $108,000.00 total value of guarantee;
    (4) 10,000 hundredweight  x  $4.00 price election = $40,000.00 value 
of production to count

[[Page 486]]

for the harvested acreage, and 3500 hundredweight  x  $3.20 = $11,200.00 
value of production to count for the unharvested acreage;
    (5) $40,000.00 + $11,200.00 = $51,200.00 total value of production 
to count;
    (6) $108,000.00 - $51,200.00 = $56,800.00 loss; and
    (7) $56,800.00 loss  x  100 percent = $56,800.00 indemnity payment.
    (c) The extent of any quality loss must be determined based on 
samples obtained 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 considered to be 45 days prior to the calendar date for 
the end of the insurance period, unless otherwise specified in the 
Special Provisions. 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 (the value of unharvested production 
will be calculated using the reduced price election determined in 
section 2(b) and unharvested production may be adjusted in accordance 
with sections 11(e), (f), (g), and (h)); 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 price used to determine the 
amount of any indemnity will be limited as specified in section 2 even 
if the representative samples are harvested. 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 or tuber rot that is evident at, 
or prior to, the end of the insurance period; and
    (2) A grade inspection is performed.
    (f) Potato production that is eligible for quality adjustment, as 
specified in section 11(e), with 5 percent damage or less (by weight) 
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 11(e), with 5.1 percent damage or more (by weight) 
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 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. 
However, if you do not discard any harvested production within 21 days 
of the end of the insurance period that has freeze damage in excess of 
17.9 percent, we will include 15 percent of such production when 
determining the amount of production to count.
    (2) For potatoes that have tuber rot due to an insurable cause other 
than freeze, production to count will be determined as follows:
    (i) For potatoes for which a price is agreed upon between you and a 
buyer within 21 days (60 days if the Northern Potato Crop Insurance 
Storage Coverage Endorsement is applicable) if the end of the insurance 
period, or that are delivered to a buyer within 21 days (60 days if the 
Northern Potato Crop Insurance Storage Coverage Endorsement is 
applicable) of the end of the insurance period, by dividing the price 
received or that will be received per hundredweight by the highest

[[Page 487]]

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 to 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 21 days (60 days if the 
Northern Potato Crop Insurance Storage Coverage Endorsement is 
applicable) of the end of the insurance period 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) 05. 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 10.4 
percent.
    (iii) For potatoes for which a price is not agreed upon between you 
and a buyer within 21 days (60 days if the Northern Potato Crop 
Insurance Storage Coverage Endorsement is applicable) of the end of the 
insurance period and that remain in storage 22 or more days (61 or more 
days if the Northern Potato Crop Insurance Storage Coverage Endorsement 
is applicable) after the end of the insurance period, adjustment will be 
made in accordance with section 11(g)(2)(ii)(B).
    (h) When a combination of freeze damage or a tuber rot condition is 
5.1 percent (by weight) or greater, the amount of production to count 
for production affected by tuber rot will first be determined in 
accordance with section 11(g)(2). If production is not sold within the 
time frame specified in section 11(g)(2), this amount will be further 
adjusted as follows:
    (1) The percentage of potatoes with freeze damage will be determined 
by dividing the weight of potatoes with only freeze damage in 
representatives samples of the production by the total weight of the 
samples;
    (2) The reduction percentage will be determined based on the result 
of section 11(h)(1) and section 11(g)(1); and
    (3) The reduction percentage determined in section 11(h)(2) will be 
multiplied by the amount of production determined in accordance with 
section 11(g)(2).

                         12. Prevented Planting

    Your prevented planting coverage will be 25 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional coverage, as specified in 7 CFR part 400, subpart T, and pay 
an additional premium, you may increase your prevented planting coverage 
to a level specified in the actuarial documents.

[62 FR 65331, Dec. 12, 1997]



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

                 United States 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 documents, this endorsement is attached to and made part of 
your Northern Potato Crop Provisions subject to the terms and conditions 
described herein. In the event of a conflict between the Northern Potato 
Crop Provisions and this endorsement, this endorsement will control.
    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 will be insured under this endorsement except:
    (a) Any acreage specifically excluded by the actuarial documents; 
and
    (b) Any acreage grown for seed.
    4. We will adjust production to count (determined in accordance with 
section 15 of the Basic Provisions and section 11 of the Northern Potato 
Crop Provisions) from (1) unharvested acreage; (2) harvested acreage 
that is stored after a grade inspection; or (3) that is marketed after a 
grade inspection; and that 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 potatoes on a 
lot basis and must not be separable from undamaged production using

[[Page 488]]

methods used by the potato packers or processors to whom you normally 
deliver your potato production), will be adjusted as follows:
    (1) For potatoes for which a price is agreed upon in writing between 
you and a buyer within 21 days (60 days if the Northern Potato Crop 
Insurance Storage Coverage Endorsement is applicable) of the end of the 
insurance period, or that are delivered to a buyer within 21 days (60 
days if the Northern Potato Crop Insurance Storage Coverage Endorsement 
is applicable) of the end of the insurance period, by multiplying the 
production to count by the factor (not to exceed 1.0) that results from 
dividing the price received or that will be received per hundredweight 
of the damaged production by the highest available price election. This 
method of adjustment will not be performed if it has already been 
performed under the terms of section 11(g)(2)(i) of the Northern Potato 
Crop Insurance Provisions. If production is sold for a price lower than 
the value appropriate to 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 21 days (60 days if the 
Northern Potato Crop Insurance Storage Coverage Endorsement is 
applicable) of the end of the insurance period 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). The price used for the damaged 
production will be the price you could have received in the local 
market.
    (3) For potatoes for which a price is not agreed upon between you 
and a buyer within 21 days (60 days if the Northern Potato Crop 
Insurance Storage Coverage Endorsement is applicable) of the end of the 
insurance period and that remain in storage 22 or more days (61 or more 
days if the Northern Potato Crop Insurance Storage Coverage Endorsement 
is applicable) after the end of the insurance period, 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) The combined weight of sampled potatoes that grade U.S. No. 2 or 
better and that are damaged by freeze or tuber rot will be divided by 
the total sample weight; and
    (2) The percentage determined in section 4(b)(1) above will be 
divided by the applicable percentage factor determined in accordance 
with section 9.
    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 documents may provide ``U.S. No. 1'' in place of 
``U.S. No. 2'' as used in this endorsement. If both U.S. No. 1 and 2 are 
available in the actuarial documents, you may elect U.S. No. 1 or 2 by 
potato type or group, if separate types or groups are specified in the 
Special Provisions.
    9. Percentage factor means the historical average percentage of 
potatoes grading U.S. No. 2 or better, by type, determined from your 
records. If at least 4 continuous years of records are available, the 
percentage factor will be the simple average of the available records 
not to exceed 10 years. If less than four years of records are 
available, the percentage factor will be determined based on a 
combination of your records and the percentage factor contained in the 
Special Provisions.

[62 FR 65335, Dec. 12, 1997]



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

                 United States 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 documents, this endorsement is attached to and made part of 
your Northern Potato Crop Provisions and Quality Endorsement subject to 
the terms and conditions described herein. In the event of a conflict 
between the Northern Potato Crop Provisions or Quality Endorsement and 
this endorsement, this endorsement will control.
    2. You must have a Northern Potato Quality Endorsement 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

[[Page 489]]

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 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 insurable acreage will be determined by 
dividing the stated amount of production by the approved yield for the 
acreage. The number of acres insured under this endorsement will not 
exceed the actual number of acres planted to the potato types and which 
are needed to fulfill the contract.
    6. In lieu of the provisions contained in section 4 of the Northern 
Potato Quality Endorsement, production that is rejected by the processor 
will be adjusted as follows: Production to count (determined in 
accordance with section 15 of the Basic Provisions and section 11 of the 
Northern Potato Crop Provisions) from (1) unharvested acreage; (2) 
harvested acreage that is stored after a grade inspection; or (3) that 
is marketed after a grade inspection; and that contains potatoes that:
    (a) Grade less than U.S. No. 2 due to internal defects, a specific 
gravity lower than the lesser of 1.074 or the minimum acceptable amount 
specified in the processor contract, 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 used by 
the processors to which you normally deliver your potato production), 
will be adjusted as follows:
    (1) For potatoes for which a price is agreed upon in writing between 
you and a buyer within 21 days (60 days if the Northern Potato Crop 
Insurance Storage Coverage Endorsement is applicable) of the end of the 
insurance period, or that are delivered to a buyer within 21 days (60 
days if the Northern Potato Crop Insurance Storage Coverage Endorsement 
is applicable) of the end of the insurance period, by multiplying the 
production to count by the factor (not to exceed 1.0) that results from 
dividing the price received or that will be received per hundredweight 
of the damaged production by the highest available price election. This 
method of adjustment will not be performed if it has already been 
performed under the terms of section 11(g)(2)(i) of the Northern Potato 
Crop Insurance Provisions. 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 21 days (60 days if the 
Northern Potato Crop Insurance Storage Coverage Endorsement is 
applicable) of the end of the insurance period 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 6(a)(1). The price used for the damaged 
production will be the price you could have received in the local 
market.
    (3) For potatoes for which a price is not agreed upon in writing 
between you and a buyer within 21 days (60 days if the Northern Potato 
Crop Insurance Storage Coverage Endorsement is applicable) of the end of 
the insurance period and that remain in storage 22 or more days (61 or 
more days if the Northern Potato Crop Insurance Storage Coverage 
Endorsement is applicable) after the end of the insurance period, 
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) The combined weight of sampled potatoes that grade U.S. No. 2 or 
better and that are damaged by freeze or tuber rot will be divided by 
the total sample weight; and
    (2) The percentage determined in section 6(b)(1) above will be 
divided by the applicable percentage factor determined in accordance 
with section 10.
    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 documents may provide ``U.S. No. 1'' in place of 
``U.S. No. 2'' as used in this endorsement. If both U.S. No. 1 and 2 are 
available in the actuarial documents, you may elect U.S. No. 1 or 2 by 
potato type or group, if separate types or groups are specified in the 
Special Provisions.
    10. Percentage factor means the historical average percentage of 
potatoes grading U.S. No. 2 or better, by type, determined from your 
records. If at least 4 continuous years of records are available, the 
percentage factor will be the simple average of the available records 
not to exceed 10 years. If less than

[[Page 490]]

four years of records are available, the percentage factor will be 
determined based on a combination of your records and the percentage 
factor contained in the Special Provisions.

[62 FR 65336, Dec. 12, 1997]



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:

                 United States 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 documents, this endorsement is attached to and made part of 
your Northern Potato Crop Provisions subject to the terms and conditions 
described herein. In the event of a conflict between the Northern Potato 
Provisions and this endorsement, this endorsement will control.
    2. For the purpose of this endorsement, the term ``potato certified 
seed program'' means the state program administered by the public agency 
responsible for the seed certification process within the state in which 
the seed is produced.
    3. 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 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.
    4. 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 5 below.
    5. The certified seed acreage you insure in the current crop year 
cannot be greater than 125 percent of your average number of acres 
entered into and passing certification in the potato certified seed 
program in the three previous calendar years unless a written agreement 
provides otherwise. 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 your acres entered into and 
passing certification in the potato certified seed program the 3 
previous calendar years by 1.25 and divide this result by the number of 
acres grown by you for certified seed in the current crop year; and
    (b) Multiply the result of section 5(a) (not to exceed 1.0) by the 
production guarantee for certified seed for the current crop year.
    6. 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 your acres entered into the potato seed 
certification program administered by the state in which the seed is 
grown.
    7. 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.
    8. 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 contained in the Special Provisions for 
that purpose, multiplied by your production guarantee for such acreage, 
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.
    9. 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.

[62 FR 65337, Dec. 12, 1997]



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

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

[[Page 491]]

       Northern Potato Crop Insurance Storage Coverage Endorsement

    1. In return for payment of the required additional premium as 
contained in the actuarial documents, this endorsement is attached to 
and made part of your Northern Potato Crop Provisions subject to the 
terms and conditions described herein. In the event of a conflict 
between the Northern Potato Crop Provisions and this endorsement, this 
endorsement will control.
    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. When such contract requires 
delivery of a stated amount of production, rather than all of the 
production from a stated amount of acres, the number of acres not 
insured under this endorsement will be determined by dividing the stated 
amount of production by the approved yield for the acreage. 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 this 
endorsement, and you elect to exercise this option. If you elect this 
endorsement, such exclusions 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 pro rata based on the production placed in storage from each 
unit. Such allocation will be allowed only if verifiable records of 
production placed in storage are available by unit. If you do not have 
verifiable records, all units without verifiable records will be 
combined in accordance with section 11 of the Northern Potato Crop 
Provisions. 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 
contributing 500 hundredweight and 750 hundredweight to the unit 
contributing 1500 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. The extended coverage provided by this endorsement will be 
applicable only if:
    (a) Insured potatoes are damaged within the insurance period by an 
insured cause other than freeze that later results in:
    (1) Tuber rot as defined in the Northern Potato Crop Provisions, to 
the extent that 5.1 percent (by weight) or more of the insured 
production is affected;
    (2) Internal defects to the extent that such defects are in excess 
of the amount allowed for the U.S. grade standard you elected for 
purposes of coverage under the Northern Potato Crop Insurance Quality 
Endorsement. Such defects must not be separable from undamaged 
production using methods used by the packers or processors to which you 
normally deliver your potato production. This coverage is applicable 
only to production covered under the Northern Potato Crop Insurance 
Quality Endorsement; or
    (3) A specific gravity lower than the lesser of 1.074 or the minimum 
acceptable amount specified in the processor contract, or a fry color of 
No. 3 or darker due to either sugar exceeding 10 percent or sugar ends 
exceeding 19 percent. This coverage is applicable only to production 
covered under the Northern Potato Crop Insurance Processing Quality 
Endorsement.
    (b) You notify us within 72 hours of your initial discovery of any 
damage that has or that may later result in the quality deficiencies 
specified in section 5(a);
    (c) The percentage of production that has any of the quality 
deficiencies specified in section 5(a) is determined no later than 60 
days after the end of the insurance period; and
    (d) 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, in accordance with the United States Standards for Grades 
of Potatoes. Samples of damaged production must be obtained by us or 
party approved by us prior to the sale or disposal of any lot of 
potatoes. Or, if production is not sold or disposed of within 60 days of 
the end of the insurance period, samples must be obtained within 60 days 
of the end of the insurance period.

[62 FR 65337, Dec. 12, 1997]



Sec. 457.147  Central and Southern potato crop insurance provisions.

    The Central and Southern Potato Crop Insurance Provisions for the 
1999 and succeeding crop years are as follows:
    FCIC Policies


[[Page 492]]



                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

               Central and Southern Potato Crop Provisions

    These provisions will be applicable in: Alabama; Arizona; all 
California counties except Humboldt, Modoc and Siskiyou; Delaware; 
Florida; Georgia; Maryland; Missouri; New Jersey; New Mexico; North 
Carolina; Oklahoma; Texas; and Virginia.
    If a conflict exists among the policy provisions, the order of 
priority is as follows:
    (1) The Catastrophic Risk Protection Endorsement, as applicable; (2) 
the Special Provisions; (3) these Crop Provisions; and (4) the Basic 
Provisions, with (1) controlling (2), etc.

                             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.
    Discard. Disposal of production by you, or a person acting for you, 
without receiving any value for it.
    Disposed. Any disposition of the crop including but not limited to 
sale or discard.
    Grade inspection. An inspection in which samples of production are 
obtained by us, or a party approved by us, prior to the sale, storage or 
disposal of any lot of potatoes, or any portion of a lot and 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, in accordance with the United States Standards for Grades 
of Potatoes.
    Harvest. Lifting potatoes from within the soil to the soil surface.
    Hundredweight. One hundred (100) pounds avoirdupois.
    Lot. A quantity of production that can be separated from other 
quantities of production by grade characteristics, load, location or 
other distinctive features.
    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, 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.

                            2. Unit Division

    A basic unit, as defined in section 1 of the Basic Provisions, will 
be divided into additional basic units by planting period.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    (a) In addition to the requirements of section 2 of the Basic 
Provisions, 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. If the Special Provisions 
provide for different price elections by type, 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 election 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 the production from any acreage of the insured crop is not 
harvested, the price used to determine your indemnity will be 80 percent 
of your price election.
    (c) Any acreage of potatoes damaged to the extent that similarly 
situated 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 the potatoes. The price election for unharvested 
acreage will apply to such acreage.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, 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 of the Basic Provisions, the 
cancellation and termination dates are:

[[Page 493]]



------------------------------------------------------------------------
                 State and county                          Dates
------------------------------------------------------------------------
Pinellas, Hillsborough, Polk, Oseola, and Brevard  Sep. 30.
 Counties, Florida, and all Florida counties
 lying south thereof.
Arizona; all California counties; and all Texas    Nov. 30.
 counties except Bailey, Castro, Dallam, Deaf
 Smith, Floyd, Gaines, Hale, Hartley, Haskell,
 Knox, Lamb, Parmer, Swisher, and Yoakum.
Alabama; Delaware; Georgia; Maryland; Missouri;    Dec. 31.
 New Jersey; North Carolina; Virginia; and all
 Florida counties except Pinellas, Hillsborough,
 Polk, Oseola, and Brevard Counties, Florida, and
 all Florida counties to the south thereof.
Oklahoma; and Haskell and Knox Counties, Texas...  Feb. 28.
Bailey, Castro, Dallam, Deaf Smith, Floyd,         Mar. 15.
 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 of 
the Basic Provisions, the annual premium amount (y) is computed by 
multiplying (a) the production guarantee by (b) the price election for 
harvested acreage, by (c) the premium rate, by (d) the insured acreage, 
by (e) your share at the time of planting, and by (f) any applicable 
premium adjustment factors contained in the actuarial documents (a x b x 
c x d x e x f = y).

                             7. Insured Crop

    In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the potatoes in the county for which a premium rate 
is provided by the actuarial documents:
    (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 of the Basic Provisions, 
we will not insure any acreage that:
    (a) Does not meet the rotation requirements contained in the Special 
Provisions for the crop; 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 
similarly situated producers in the area would normally not further care 
for the crop, 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 of the Basic 
Provisions, the calendar date for the end of the insurance period is the 
date immediately following planting as follows (exceptions, if any, for 
specific counties, varieties or types are 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 Arizona; and Virginia.
    (c) August 15 in Oklahoma; and Haskell and Knox Counties, Texas.
    (d) In Alabama; California; Florida; and Georgia; the dates 
established by the Special Provisions for each planting period; and
    (e) October 15 in Bailey, Castro, Dallam, Deaf Smith, Floyd, Gains, 
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 of the Basic 
Provisions, 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 only if sufficient and proper pest control measures 
are used;
    (4) Plant disease, but only if sufficient and proper disease control 
measures are used;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply, if caused by an insured 
peril that occurs during the insurance period (see section 10(a) (1) 
through (7)).
    (b) In addition to the causes of loss not insured against as 
contained in section 12 of the Basic Provisions, 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, as limited by the 
Special Provisions.

                11. Duties in the Event of Damage or Loss

    (a) In accordance with the requirements of section 14 of the Basic 
Provisions, you must

[[Page 494]]

leave representative samples at least 10 feet wide and extending the 
entire length of each field in the unit if you are going to destroy any 
acreage of the insured crop that will not be harvested.
    (b) We must be given the opportunity to perform a grade inspection 
on the production from 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; and
    (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 (if there is unharvested acreage in the unit, the harvested 
and unharvested acreage will be determined separately);
    (2) Multiplying each result in section 12(b)(1) by the respective 
price election (the price election may be limited as specified in 
section 3.);
    (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.
    For example:
    You have a 100 percent share in 100 harvested acres of potatoes in 
the unit, with a guarantee of 150 hundredweight per acre and a price 
election of $4.00 per hundredweight. You are only able to harvest 10,000 
hundredweight. Your indemnity would be calculated as follows:
    (1) 100 acres  x  150 hundredweight=15,000 hundredweight guarantee;
    (2) 15,000 hundredweight  x  $4.00 price election=$60,000.00 value 
of guarantee;
    (4) 10,000 hundredweight  x  $4.00 price election=$40,000.00 value 
of production to count;
    (6) $60,000.00-$40,000.00=$20,000.00 loss; and
    (7) $20,000.00 x 100 percent=$20,000.00 indemnity payment.
    You also have a 100 percent share in 100 unharvested acres of 
potatoes in the same unit, with a guarantee of 150 hundredweight per 
acre and a price election of $3.20 per hundredweight. (The price 
election for unharvested acreage is 80.0 percent of your elected price 
election ($4.00 x 0.80=$3.20.) This unharvested acreage was appraised at 
35 hundredweight per acre for a total of 3,500 hundredweight as 
production to count. Your total indemnity for the harvested and 
unharvested acreage would be calculated as follows:
    (1) 100 acres  x  150 hundredweight = 15,000 hundredweight guarantee 
for the harvested acreage, and
    100 acres  x  150 hundredweight = 15,000 hundredweight guarantee for 
the unharvested acreage;
    (2) 15,000 hundredweight guarantee  x  $4.00 price election = 
$60,000.00 value of guarantee for the harvested acreage, and
    15,000 hundredweight guarantee  x  $3.20 price election = $48,000.00 
value of guarantee for the unharvested acreage;
    (3) $60,000.00 + $48,000.00 = $108,000.00 total value of guarantee;
    (4) 10,000 hundredweight  x  $4.00 price election = $40,000.00 value 
of production to count for the harvested acreage, and
    3500 hundredweight  x  $3.20 = $11,200.00 value of production to 
count for the unharvested acreage;
    (5) $40,000.00 + $11,200.00 = $51,200.00 total value of production 
to count;
    (6) $108,000.00 - $51,200 = $56,800.00 loss; and
    (7) $56,800.00 loss  x  100 percent = $56,800.00 indemnity payment.
    (c) The extent of any quality loss must be determined based on 
samples obtained 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. The date the potatoes would have reached full 
maturity will be considered to be 45 days prior to the calendar date for 
the end of the insurance period, unless otherwise specified in the 
Special Provisions. This adjustment will not be

[[Page 495]]

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 (the value of unharvested production 
will be calculated using the reduced price election determined in 
section 3(b) and 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, 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 price used to determine the 
amount of any indemnity will be limited as specified in section 3 even 
if the representative samples are harvested. 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 any lot of potatoes 
that is:
    (i) Stored;
    (ii) Sold as seed;
    (iii) Sold for human consumption; or
    (iv) Harvested and not sold or that is appraised if such lot meets 
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 left unharvested and does not meet the standards for grading 
U.S. No. 2 or better due to internal defects; or
    (iii) does not meet the standards for grading U.S. No. 2 or better 
due to external defects, is harvested, and it is not practical to 
separate the damaged production.

                         13. Prevented Planting

    Your prevented planting coverage will be 25 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional coverage, as specified in 7 CFR part 400, subpart T, and pay 
an additional premium, you may increase your prevented planting coverage 
to a level specified in the actuarial documents.

[62 FR 65333, Dec. 12, 1997]



Sec. 457.148  Fresh market pepper crop insurance provisions.

    The fresh market pepper crop insurance provisions for the 1999 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

                   Fresh Market Pepper Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Acre--43,560 square feet of land when row widths do not exceed six 
feet, or if row widths exceed six feet, the land area on which at least 
7,260 linear feet of rows are planted.

[[Page 496]]

    Bell pepper--An annual pepper (of the capsicum annum species, 
grossum group), widely cultivated for its large, crisp, edible fruit.
    Box--One and one-ninth (1\1/9\) bushels of the insured crop.
    Crop year--In lieu of the definition of ``crop year'' contained in 
section 1 (Definitions) of the Basic Provisions (Sec. 457.8), crop year 
is a period of time that begins on the first day of the earliest 
planting period for fall planted peppers and continues through the last 
day of the insurance period for spring planted peppers. The crop year is 
designated by the calendar year in which spring planted peppers are 
harvested.
    Direct marketing--Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    Excess rain--An amount of precipitation sufficient to directly 
damage the crop.
    Freeze--The formation of ice in the cells of the plant or its fruit, 
caused by low air temperatures.
    Harvest--The picking of peppers on the unit.
    Mature bell pepper--A pepper that has reached the stage of 
development that will withstand normal handling and shipping.
    Plant stand--The number of live plants per acre prior to the 
occurrence of an insurable cause of loss.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, for each planting period, pepper seed or transplants 
must initially be planted in rows, unless otherwise provided by the 
Special Provisions, actuarial documents, or by written agreement.
    Planting period--The period of time designated in the actuarial 
documents in which the peppers must be planted to be considered fall, 
winter or spring-planted peppers.
    Potential production--The number of boxes of mature bell peppers 
that the pepper plants will or would have produced per acre by the end 
of the insurance period, assuming normal growing conditions and 
practices.
    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 to the insured crop will allow 
the crop to attain maturity prior to the calendar date for the end of 
the insurance period (inability to obtain plants or seed will not be 
considered when determining if it is practical to replant).
    Row width--The widest distance from the center of one row of plants 
to the center of an adjacent row of plants.
    Tropical depression--A system identified by the U.S. Weather Service 
as a tropical depression, and for the period of time so designated, 
including tropical storms, gales, and hurricanes.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will also be divided into additional basic units by planting period.
    (b) Provisions in the Basic Provisions that allow optional units by 
irrigated and non-irrigated practices are not applicable.

              3. Amounts of Insurance and Production Stages

    (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 coverage 
level (and the corresponding amount of insurance designated in the 
actuarial documents for the applicable planting period and practice) for 
all the peppers in the county insured under this policy.
    (b) The amount of insurance you choose for each planting period and 
practice must have the same percentage relationship to the maximum price 
offered by us for each planting period and practice. For example, if you 
choose 100 percent of the maximum amount of insurance for a specific 
planting period and practice, you must also choose 100 percent of the 
maximum amount of insurance for all other planting periods and 
practices.
    (c) The production reporting requirements contained in section 3 
(Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities) of the Basic Provisions (Sec. 457.8) do not apply to fresh 
market peppers.
    (d) The amounts of insurance per acre are progressive by stages as 
follows:

------------------------------------------------------------------------
                    Percent of
                    the amount
                        of
      Stage         insurance    Length of time if    Length of time if
                     per acre      direct-seeded         transplanted
                     that you
                     selected
------------------------------------------------------------------------
1................           65  From planting        From planting
                                 through the 74th     through the 44th
                                 day after planting.  day after
                                                      planting.

[[Page 497]]

 
2................           85  From the 75th day    From the 45th day
                                 after planting       after planting
                                 until the            until the
                                 beginning of stage   beginning of stage
                                 3.                   3.
3................          100  Begins the earlier   Begins the earlier
                                 of 110 days after    of 80 days after
                                 planting, or the     planting, or the
                                 beginning of         beginning of
                                 harvest.             harvest.
------------------------------------------------------------------------

    (e) Any acreage of peppers damaged in the first or second stage to 
the extent that the majority of producers in the area would not normally 
further care for it, will be deemed to have been destroyed. The 
indemnity payable for such acreage will be based on the stage the plants 
had achieved when the damage occurred.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is April 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 July 31.

                          6. Report of Acreage

    In addition to the requirements of section 6 (Report of Acreage) of 
the Basic Provisions (Sec. 457.8), you must report on or before the 
acreage reporting date contained in the Special Provisions for each 
planting period:
    (a) All the acreage of peppers in the county insured under this 
policy in which you have a share;
    (b) The dates the acreage was planted within each planting period; 
and
    (c) The row width.

                            7. Annual Premium

    In lieu of the premium amount determinations contained in section 7 
(Annual Premium) of the Basic Provisions (Sec. 457.8), the annual 
premium amount for each cultural practice (e.g., fall direct-seeded 
irrigated) is determined by multiplying the third stage amount of 
insurance per acre by the premium rate for the cultural practice as 
established in the Actuarial Table, by the insured acreage, by your 
share at the time coverage begins, and by any applicable premium 
adjustment factors contained in the actuarial documents.

                             8. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the bell peppers in the 
county for which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are:
    (1) Planted to be harvested and sold as mature fresh market bell 
peppers;
    (2) Planted within the planting periods designated in the actuarial 
documents;
    (3) Grown under an irrigated practice;
    (4) Grown on acreage covered by plastic mulch except where the 
Special Provisions allow otherwise;
    (5) Grown by a person who in at least one of the three previous crop 
years:
    (i) Grew bell peppers for commercial sale; or
    (ii) Participated in managing a bell pepper farming operation;
    (c) That are not:
    (1) Interplanted with another crop;
    (2) Planted into an established grass or legume;
    (3) Pimento peppers; or
    (4) Grown for direct marketing.

                          9. Insurable Acreage

    (a) In lieu of the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8), that prohibit insurance attaching if 
a crop has not been planted in at least one of the three previous crop 
years, we will insure newly cleared land or former pasture land planted 
to fresh market peppers.
    (b) In addition to the provisions of section 9 (Insurable Acreage) 
of the Basic Provisions (Sec. 457.8):
    (1) You must replant any acreage of peppers damaged during the 
planting period in which initial planting took place whenever less than 
50 percent of the plant stand remains: and
    (i) It is practical to replant;
    (ii) If, at the time the crop was damaged, the final day of the 
planting period has not passed; and
    (iii) The damage occurs within 30 days of transplanting or 60 days 
of direct-seeding.
    (2) Whenever peppers initially are planted during the fall or winter 
planting periods and the conditions specified in sections 9(b)(1) (ii) 
and (iii) are not satisfied, you may elect:
    (i) To replant such acreage and collect any replant payment due as 
specified in section

[[Page 498]]

12. The initial planting period coverage will continue for such 
replanted acreage.
    (ii) Not to replant such acreage and receive an indemnity based on 
the stage of growth the plants had attained at the time of damage. 
However, such an election will result in the acreage being uninsurable 
in the subsequent planting period.
    (3) We will not insure any acreage on which peppers (except for 
replanted peppers in accordance with sections 9(b)(1) and (2)), 
tomatoes, eggplants, or tobacco have been grown and the soil was not 
fumigated or otherwise properly treated before planting peppers.

                          10. Insurance Period

    In lieu of the provisions of section 11 (Insurance Period) of the 
Basic Provisions (Sec. 457.8), coverage begins on each unit or part of a 
unit the later of the date we accept your application, or when the 
peppers are planted in each planting period. Coverage ends at the 
earliest of:
    (a) Total destruction of the peppers on the unit;
    (b) Abandonment of the peppers on the unit;
    (c) The date harvest should have started on the unit on any acreage 
which will not be harvested;
    (d) Final adjustment of a loss on the unit;
    (e) Final harvest; or
    (f) The calendar date for the end of the insurance period as 
follows:
    (1) 165 days after the date of direct-seeding or replanting with 
seed; and
    (2) 150 days after the date of transplanting or replanting with 
transplants.

                           11. 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 during the insurance period:
    (1) Excess rain;
    (2) Fire;
    (3) Freeze;
    (4) Hail;
    (5) Tornado;
    (6) Tropical depression; or
    (7) Failure of the irrigation water supply, if caused by an insured 
cause of loss that occurs during the insurance period.
    (b) In addition to the causes of loss excluded 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) Disease or insect infestation, unless no effective control 
measure exists for such disease or insect infestation; or
    (2) Failure to market the peppers, unless such failure is due to 
actual physical damage caused by an insured cause of loss that occurs 
during the insurance period.

                         12. Replanting Payments

    (a) In accordance with section 13 (Replanting Payment) of the Basic 
Provisions (Sec. 457.8), a replanting payment is allowed if, due to an 
insured cause of loss, more than 50 percent of the plant stand will not 
produce peppers and it is practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of your actual cost of replanting or the result obtained by 
multiplying the per acre replanting payment amount contained in the 
Special Provisions by your insured share.
    (c) In lieu of the provisions contained in section 13 (Replanting 
Payment) of the Basic Provisions (Sec. 457.8), that limit a replanting 
payment to one each crop year, only one replanting payment will be made 
for acreage planted during each planting period within the crop year.

                13. Duties In The Event of Damage or Loss

    In addition to the requirements contained in section 14 (Duties In 
The Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), if 
you intend to claim an indemnity on any unit you also must give us 
notice not later than 72 hours after the earliest of:
    (a) The time you discontinue harvest of any acreage on the unit;
    (b) The date harvest normally would start if any acreage on the unit 
will not be harvested; or
    (c) The calendar date for the end of the insurance period.

                         14. 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 unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage in each stage by the amount of 
insurance per acre for the final stage;
    (2) Multiplying each result in section 14(b)(1) by the percentage 
for the applicable stage (see section 3(d));
    (3) Total the results of section 14(b)(2);
    (4) Subtracting either of the following values from the result of 
section 14(b)(3):
    (i) For other than catastrophic risk protection coverage, the total 
value of production to be counted (see section 14(c)); or
    (ii) For catastrophic risk protection coverage, the result of 
multiplying the total value of production to be counted (see section 
14(c)) by:
    (A) Sixty percent for the 1998 crop year; or

[[Page 499]]

    (B) Fifty-five percent for 1999 and subsequent crop years; and
    (5) Multiplying the result of section 14(b)(4) by your share.
    (c) The total value of production to count from all insurable 
acreage on the unit will include:
    (1) Not less than the amount of insurance per acre for the stage for 
any acreage:
    (i) That is abandoned;
    (ii) Put to another use without our consent;
    (iii) That is damaged solely by uninsured causes; or
    (iv) For which you fail to provide acceptable production records;
    (2) The value of the following appraised production will not be less 
than the dollar amount obtained by multiplying the number of boxes of 
appraised peppers by the minimum value per box shown in the Special 
Provisions for the planting period:
    (i) Potential production on any acreage that has not been harvested 
the third time;
    (ii) Unharvested mature bell peppers (unharvested production that is 
damaged or defective due to insurable causes and is not marketable will 
not be counted as production to count);
    (iii) Production lost due to uninsured causes; and
    (iv) 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) We may require you to continue to care for the crop so that a 
subsequent appraisal may be made or the crop harvested to determine 
actual production (If we require you to continue to care for the crop 
and you do not do so, the original appraisal will be used); or
    (B) You may elect to continue to care for the crop, in which case 
the amount of production to count for the acreage will be the harvested 
production, or our reappraisal if the crop is not harvested.
    (3) The total value of all harvested production from the insurable 
acreage will be the dollar amount obtained by subtracting the allowable 
cost contained in the Special Provisions from the price received for 
each box of peppers (this result may not be less than the minimum value 
shown in the Special Provisions for any box of peppers), and multiplying 
this result by the number of boxes of peppers harvested. Harvested 
production that is damaged or defective due to insurable causes and is 
not marketable, will not be counted as production to count.

                     15. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

                        16. Minimum Value Option

    (a) The provisions of this option are continuous and will be 
attached to and made a part of your insurance policy, if:
    (1) You elect either Option I or Option II of the Minimum Value 
Option on your application, or on a form approved by us, on or before 
the sales closing date for the initial crop year in which you wish to 
insure fresh market peppers under this option, and pay the additional 
premium indicated in the actuarial documents for this optional coverage; 
and
    (2) You have not elected coverage under the Catastrophic Risk 
Protection Endorsement.
    (b) In lieu of the provisions contained in section 14(c)(3), the 
total value of harvested production will be determined as follows:
    (1) If you selected Option I of the Minimum Value Option, the total 
value of harvested production will be as follows:
    (i) For sold production, the dollar amount obtained by subtracting 
the allowable cost contained in the Special Provisions from the price 
received for each box of peppers (this result may not be less than the 
minimum value option price contained in the Special Provisions for any 
box of peppers), and multiplying this result by the number of boxes of 
peppers sold; and
    (ii) For marketable production that is not sold, the dollar amount 
obtained by multiplying the number of boxes of such peppers on the unit 
by the minimum value shown in the Special Provisions for the planting 
period (harvested production that is damaged or defective due to 
insurable causes and is not marketable will not be counted as 
production).
    (2) If you selected Option II of the Minimum Value Option, the total 
value of harvested production will be as provided in section 16(b)(1), 
except that the dollar amount specified in section 16(b)(1)(i) may not 
be less than zero.
    (c) This option may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding the crop year for which the cancellation of 
this option is to be effective.

[62 FR 14789, Mar. 28, 1997, as amended at 62 FR 65174, Dec. 10, 1997]



Sec. 457.149  Table grape crop insurance provisions.

    The table grape crop insurance provisions for the 1999 and 
succeeding crop years are as follows:
    For FCIC policies:


[[Page 500]]



                        Department of Agriculture

                   Federal Crop Insurance Corporation

                         For Reinsured Policies

(Insurance provider's name or other appropriate heading)
    For both FCIC and reinsured policies:

                       Table Grape Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Adapted. Varieties that are recognized by the Cooperative State 
Research, Education, and Extension Service as compatible with agronomic 
and weather conditions in the county.
    Cluster thinning and removal. Removing parts of an immature cluster 
or the entire cluster of grapes.
    Direct marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    Graft. To unite a shoot or bud (scion) with a rootstock or an 
existing vine in accordance with recommended practices to form a living 
union.
    Harvest. Severing the clusters of mature grapes from the vine.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Lug. Twenty pounds of table grapes in the Coachella Valley, 
California district; 21 pounds in all other California districts; and 20 
pounds in Arizona.
    Set out. Physically planting the grape plant in the vineyard.
    Table grapes. Grapes that are grown for commercial sale for human 
consumption as fresh fruit on acreage where the cultural practices to 
produce fresh marketable grapes are carried out.

                            2. Unit Division

    (a) A basic unit, as defined in section 1 of the Basic Provisions, 
will be divided into additional basic units by each table grape variety 
designated in the Special Provisions.
    (b) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Optional units may be 
established only if each optional unit is located on non-contiguous 
land, unless otherwise allowed by written agreement.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one price election and coverage level for 
each table grape variety in the county insured under this policy.
    (b) You must report, by the production reporting date designated in 
section 3 (Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities) of the Basic Provisions (Sec. 457.8), by 
variety if applicable:
    (1) Any damage, removal of bearing vines, change in practices, or 
any other circumstance that may reduce the expected yield below the 
yield upon which the insurance guarantee is based, and the number of 
affected acres;
    (2) The number of bearing vines on insurable and uninsurable 
acreage;
    (3) The age of the vines and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and any time the planting pattern of such 
acreage is changed:
    (i) The age of the interplanted crop, and type if applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield.
    We will reduce the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of the following: 
Interplanting perennial crop, removal of vines, damage, change in 
practices and any other circumstance that may affect the yield potential 
of the insured crop. If you fail to notify us of any circumstance that 
may reduce your yields from previous levels, we will reduce your 
production guarantee as necessary at any time we become aware of the 
circumstance.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is October 31 
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 January 31.

                          6. Report of Acreage

    In addition to the requirements of section 6 (Report of Acreage) of 
the Basic Provisions

[[Page 501]]

(Sec. 457.8), you must report the acreage of table grapes in the county 
by variety.

                             7. Insured Crop

    (a) In accordance with section 8 (Insured Crop) of the Basic 
Provisions (Sec. 457.8), the crop insured will be any insurable variety 
of grapes in the county that you elect and for which a premium rate is 
provided by the actuarial documents:
    (1) In which you have a share;
    (2) That are grown for harvest as table grapes;
    (3) That are adapted to the area; and
    (4) That are grown in a vineyard that, if inspected, is considered 
acceptable by us.
    (b) In addition to table grapes not insurable under section 8 
(Insured Crop) of the Basic Provisions (Sec. 457.8), we do not insure 
any table grapes grown on vines:
    (1) That, after being set out or grafted, have not reached the 
number of growing seasons designated by the Special Provisions; or
    (2) That have not produced an average of at least 150 lugs of table 
grapes per acre in at least one of the most recent three crop years in 
your actual production history base period. However, we may inspect and 
agree in writing to insure acreage that has not produced this amount.

                          8. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8) that prohibit insurance attaching to a 
crop planted with another crop, table grapes interplanted with another 
perennial crop are insurable unless we inspect the acreage and determine 
that it does not meet the requirements contained in your policy.

                           9. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on February 1 of each crop year, except that for 
the year of application, if your application is received after January 
22 but prior to February 1, insurance will attach on the 10th day after 
your properly completed application is received in our local office, 
unless we inspect the acreage during the 10-day period and determine 
that it does not meet insurability requirements. You must provide any 
information that we require for the crop or to determine the condition 
of the vineyard.
    (2) The calendar date for the end of the insurance period for each 
crop year is the date during the calendar year in which the grapes are 
normally harvested or contained in the Special Provisions as provided to 
you on or before the contract change date.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable share on any insurable acreage 
of table grapes on or before the acreage reporting date for the crop 
year, insurance will not be considered to have attached to, and no 
premium will be due or indemnity paid for such acreage for that crop 
year unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                           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 during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the vineyard;
    (3) Wildlife;
    (4) Earthquake;
    (5) Volanic eruption; or
    (6) Failure of irrigation water supply, if caused by an insured 
cause of loss ((a)(1) through (5) of this section) that occurs during 
the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to:
    (1) Disease or insect infestation, unless adverse weather:
    (i) Prevents the proper application of control measures or causes 
properly applied control measures to be ineffective; or
    (ii) Causes disease or insect infestation for which no effective 
control mechanism is available;
    (2) Phylloxera, regardless of cause; or
    (3) Inability to market the table grapes for any reason other than 
actual physical damage from an insurable cause specified in this 
section. For example, we will not pay you an indemnity if you are unable 
to market due to quarantine, boycott, or refusal of any person to accept 
production.

                11. Duties In the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of

[[Page 502]]

the Basic Provisions (Sec. 457.8), the following will apply:
    (a) You must notify us within 3 days after the date harvest should 
have started if the crop will not be harvested.
    (b) You must notify us at least 15 days before any production from 
any unit will be sold by direct marketing. We will conduct an appraisal 
that will be used to determine your production to count for production 
that is sold by direct marketing. If damage occurs after this appraisal, 
we will conduct an additional appraisal. These appraisals, and any 
acceptable records provided by you, will be used to determine your 
production to count. Failure to give timely notice that production will 
be sold by direct marketing will result in an appraised amount of 
production to count of not less than the production guarantee per acre 
if such failure results in our inability to make the required appraisal.
    (c) If the crop has been damaged during the growing season, you must 
provide notice at least 15 days prior to the beginning of harvest if you 
intend to claim an indemnity as a result of the damage previously 
reported. You must not destroy the damaged crop until the earlier of 15 
days from the date you gave notice of loss, or our written consent to do 
so. If you fail to meet the requirements of this section all such 
production will be considered undamaged and included as production to 
count.

                         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 unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (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 the result in section 12(b)(1) by the respective 
price election for the variety;
    (3) Totaling the results in section 12(b)(2);
    (4) Multiplying the total production to be counted of the variety 
(see section 12(c)) by the respective price election;
    (5) Totaling the results in section 12(b)(4);
    (6) Subtracting the result 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 total production to count (in lugs) 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 sold by direct marketing if you fail to meet the 
requirements in section 11(b);
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production that meets, or would meet if properly 
handled, the California Department of Food and Agriculture minimum 
standards for table grapes; and
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we may defer 
the claim only if you agree to continue to care for the crop. We will 
then make another appraisal when you notify us of further damage or that 
harvest is general in the area unless you harvested the crop, in which 
case we will use the harvested production. If you do not continue to 
care for the crop, our appraisal made prior to deferring the claim will 
be used to determine the production to count; and
    (2) All harvested production from insurable acreage regardless of 
condition or disposition. The quantity of production to count for table 
grape production damaged by insurable causes within the insurance period 
that is marketed for any use other than table grapes will be determined 
by multiplying the greater of (1) the value of the table grapes per ton 
or (2) $50, by the number of tons and dividing that result by the 
highest price election available for the insured unit. This result will 
be the number of lugs to count.

                     13. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 47747, Sept. 11, 1997, as amended at 62 FR 65175, Dec. 10, 1997]



Sec. 457.150  Dry bean crop insurance provisions.

    The dry bean 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

[[Page 503]]

                        Dry Bean Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Actual value--The dollar value received, or that could be received, 
for contract seed beans under a seed bean processor contract if the 
contract seed bean production is properly handled in accordance with the 
requirements of such contract.
    Base price--The price per pound (excluding any discounts or 
incentives that may apply) that is stated in the seed bean processor 
contract and that will be paid to the producer for at least 50 percent 
of the total production under contract with the seed company.
    Beans--Dry beans and contract seed beans.
    Combining--A harvesting process that uses a machine to separate the 
beans from the pods and other vegetative matter and place the beans into 
a temporary storage receptacle.
    Contract seed beans--Dry beans grown under the terms of a seed bean 
processor contract for the purpose of producing seed to be used for 
producing dry beans or vegetable beans in a future crop year.
    Dry beans--The crop defined by The United States Standards for Beans 
excluding contract seed beans.
    Harvest--Combining the beans. Beans which are swathed or knifed 
prior to combining are not considered harvested.
    Local market price--The cash price per hundredweight for the U.S. 
No. 2 grade of dry beans of the insured type offered by buyers in the 
area in which you normally market the dry beans. Moisture content and 
factors not associated with grading under the United States Standards 
for Beans will not be considered in establishing this price.
    Net price--The dollar value of dry bean production received, or that 
could have been received, after reductions in value due to insurable 
causes of loss.
    Pick--The percentage, on a weight basis, of defects including 
splits, damaged (including discolored) beans, contrasting types, and 
foreign material that remains in the dry beans after dockage has been 
removed by the proper use of screens or sieves.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, beans must initially be planted in rows far enough 
apart to permit mechanical cultivation, unless otherwise provided by the 
Special Provisions, actuarial documents, 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, time to crop maturity, 
and marketing window, 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. For contract seed beans, it will not be 
considered practical to replant unless production from the replanted 
acreage can be delivered under the terms of the seed bean processor 
contract or the seed company agrees to accept such production.
    Seed bean processor contract--A written agreement between the 
contract seed bean producer and the seed company, containing at a 
minimum:
    (a) The contract seed bean producer's promise to plant and grow one 
or more specific varieties of contract seed beans, and deliver the 
production from those varieties to the seed company;
    (b) The seed company's promise to purchase all the production stated 
in the contract; and
    (c) A base price, or a method to determine such price based on 
published independent information, that will be paid to the contract 
seed bean producer for the production stated in the contract.
    Seed company--Any business enterprise regularly engaged in the 
processing of seed beans, that possesses all licenses and permits for 
marketing seed beans required by the State in which it operates, and 
that possesses or has contracted for facilities, with enough drying, 
screening and bagging or packaging equipment to accept and process the 
seed beans within a reasonable amount of time after harvest.
    Swathing or knifing--Severance of the bean plant from the ground, 
including the pods and beans, and placing them into windrows.
    Type--A category of beans identified as a type in the Special 
Provisions.

                            2. Unit Division

    (a) In addition to the definition of basic unit in section 1 of the 
Basic Provisions, all acreage of contract seed beans qualifies as a 
separate basic unit. For production based seed bean processor contracts, 
the basic unit will consist of all the acreage needed to produce the 
amount of production under contract, based on the actual production 
history of the acreage. For acreage based seed bean processor contracts, 
the basic unit will consist of all acreage specified in the contract.
    (b) In addition to, or instead of, establishing optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated acreage as provided

[[Page 504]]

in the unit division provisions contained in the Basic Provisions, a 
separate optional unit may be established for each bean type shown in 
the Special Provisions.
    (c) Contract seed beans may qualify for optional units only if the 
seed bean processor contract specifies the number of acres under 
contract. Contract seed beans produced under a seed bean processor 
contract that specifies only an amount of production or a combination of 
acreage and production, are not eligible for optional units.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    (a) In addition to the requirements of section 3(b) (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 dry beans 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 dry bean type 
designated in the Special Provisions. The price elections you choose for 
each type are not required to 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 may 
also choose 75 percent of the maximum price election for another type.
    (b) For contract seed beans only, the dollar amount of insurance is 
obtained by multiplying the production guarantee per acre for each 
variety in the unit by the insured acreage of that variety, times the 
applicable base price, and times the price election percentage you 
selected. The total of these results will be the amount of insurance for 
contract seed beans in the unit.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions, the contract change date is November 30 (December 17 for the 
1998 crop year only) 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:

----------------------------------------------------------------------------------------------------------------
                   State and county                                Cancellation and termination dates
----------------------------------------------------------------------------------------------------------------
California............................................                                              February 28.
All other States......................................                                                 March 15.
----------------------------------------------------------------------------------------------------------------

                          6. Report of Acreage

    For contract seed beans only, in addition to the requirements of 
section 6 (Report of Acreage) of the Basic Provisions (Sec. 457.8), you 
must submit a copy of the seed bean processor contract on or before the 
acreage reporting date.

                             7. Insured Crop

    (a) In accordance with section 8 (Insured Crop) of the Basic 
Provisions(Sec. 457.8), the crop insured will be all the beans in the 
county for which a premium rate is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That are planted for harvest as:
    (i) Dry beans; or
    (ii) If applicable, contract seed beans, if the seed bean processor 
contract is executed on or before the acreage reporting date; and
    (3) That are not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Interplanted with another crop; or
    (ii) Planted into an established grass or legume.
    (b) For contract seed beans only:
    (1) An instrument in the form of a ``lease'' under which you retain 
control of the acreage on which the insured crop is grown and that 
provides for delivery of the crop under substantially the same terms as 
a seed bean processor contract may be treated as a contract under which 
you have an insurable interest in the crop; and
    (2) We will not insure any acreage of contract seed beans produced 
by a seed company.
    (c) In addition to the types of dry beans designated in the Special 
Provisions, we will insure other types if:
    (1) The type you intend to plant has been demonstrated to be adapted 
to the area. Evidence of adaptability must include:
    (i) Results of test plots for 2 years and recommendations by a 
university or seed company; or
    (ii) Two years of production reports that indicate your experience 
producing the type in your production area;
    (2) You submit on or before the sales closing date your production 
reports and prices received, or the test plot results, and evidence of 
market potential, including the price buyers are willing to pay for the 
type; and
    (3) Both parties (you and us) enter into a written agreement 
allowing insurance on the type in accordance with section 18 of the 
Basic Provisions.
    (d) Any acreage of beans that is destroyed and replanted to a 
different insurable type of

[[Page 505]]

beans will be considered insured acreage in accordance with section 11.

                          8. Insurable Acreage

    In addition to the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8):
    (a) We will not insure any acreage that does not meet the rotation 
requirements contained in the Special Provisions; or
    (b) Any acreage of the insured crop damaged before the final 
planting date, to the extent that the majority of growers in the area 
would normally not further care for the crop, must be replanted unless 
we agree that replanting is not practical. We will not require you to 
replant if it is not practical to replant to the same type of beans as 
originally planted.

                           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:
    (a) October 15 in Oklahoma, New Mexico, and Texas;
    (b) November 15 in California; and
    (c) October 31 in all other States.

                           10. Causes of Loss

    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 during the insurance period:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.

                         11. Replanting Payments

    (a) In accordance with section 13 (Replanting Payment) of the Basic 
Provisions (Sec. 457.8), a replanting payment is allowed if the bean 
crop is damaged by an insurable cause of loss to the extent that the 
remaining stand will not produce at least 90 percent of the production 
guarantee for the acreage and it is practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of 10 percent of the production guarantee for the type to be 
replanted or 120 pounds multiplied by your price election for the type 
to be replanted and by your insured share.
    (c) When beans are replanted using a practice that is uninsurable as 
an original planting, the liability for the unit will be reduced by the 
amount of the replanting payment. The premium amount will not be 
reduced.
    (d) The guarantee and premium for acreage replanted to a different 
insurable type will be based on the replanted type and will be 
calculated in accordance with sections 3 (Insurance Guarantees, Coverage 
Levels, and Prices for Determining Indemnities) and 7 (Annual Premium) 
of the Basic Provisions (Sec. 457.8) and section 3 of these Crop 
Provisions.

                12. Duties in the Event of Damage or Loss

    In accordance with the requirements of section 14 (Duties in the 
Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), 
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.

                         13. 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 such 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 unit.
    (b) In the event of loss or damage to your bean crop covered by this 
policy, we will settle your claim by:
    (1) Multiplying the insured acreage of each dry bean type by its 
respective production guarantee;
    (2) Multiplying each result in section 13(b)(1) by the respective 
price election for each insured type;
    (3) Totaling the results in section 13(b)(2);
    (4) Multiplying the insured acreage of each contract seed bean type 
by its respective production guarantee;
    (5 ) Multiplying each result in section 13(b)(4) by the applicable 
base price;
    (6) Multiplying each result in section 13(b)(5) by your selected 
price election percentage;
    (7) Totaling the results in section 13(b)(6);
    (8) Totaling the results in section 13(b)(3) and section 13(b)(6);
    (9) Multiplying the total production to be counted of each dry bean 
type if applicable, (see section 13(d)) by the respective price 
election;

[[Page 506]]

    (10) Totaling the value of all contract seed bean production (see 
section 13(c));
    (11) Totaling the results in section 13(b)(9) and section 13(b)(10);
    (12) Subtracting the total in section 13(b)(11) from the total in 
section 13(b)(8); and
    (13) Multiplying the result by your share.
    (c) The value of contract seed bean production to count for each 
type in the unit will be determined as follows:
    (1) For production meeting the minimum quality requirements 
contained in the seed bean processor contract and for production that 
does not meet such requirements due to uninsured causes:
    (i) Multiplying the actual value or base price per pound, whichever 
is greater, by the price election percentage you selected; and
    (ii) Multiplying the result by the number of pounds of such 
production.
    (2) For production not meeting the minimum quality requirements 
contained in the seed bean processor contract due to insurable causes:
    (i) Multiplying the actual value by the price election percentage 
you selected; and
    (ii) Multiplying the result by the number of pounds of such 
production.
    (d) The total bean production to count (in pounds) 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; or
    (D) For which you fail to provide production records that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production of dry 
beans may be adjusted for quality deficiencies and excess moisture in 
accordance with section 13(e)); and
    (iv) 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 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.
    (e) Mature dry bean production to count may be adjusted for excess 
moisture and quality deficiencies. If moisture adjustment is applicable, 
it will be made prior to any adjustment for quality. Adjustment for 
excess moisture and quality deficiencies will not be applicable to 
contract seed beans.
    (1) Production will be reduced by 0.12 percent for each 0.1 
percentage point of moisture in excess of 18 percent. We may obtain 
samples of the production to determine the moisture content.
    (2) Production will be eligible for quality adjustment if:
    (i) A pick is designated in the Special Provisions and the pick of 
the damaged production exceeds this designation; or
    (ii) A pick is not designated in the Special Provisions and 
deficiencies in quality, in accordance with the United States Standards 
for Beans, result in dry beans not meeting the grade requirements for 
U.S. No. 2 (grades U.S. No. 3 or worse) because the beans are damaged or 
badly damaged; or
    (iii) Substances or conditions are present that are identified by 
the Food and Drug Administration or other public health organizations of 
the United States as being injurious to human or animal health.
    (3) Quality will be a factor in determining your loss only if:
    (i) The deficiencies, substances, or conditions resulted from a 
cause of loss against which insurance is provided under these crop 
provisions and which occurs within the insurance period;
    (ii) The deficiencies, substances, or conditions result in a net 
price for the damaged production that is less than the local market 
price;
    (iii) All determinations of these deficiencies, substances, or 
conditions are made using samples of the production obtained by us or by 
a disinterested third party approved by us; and
    (iv) The samples are analyzed by a grader licensed to grade dry 
beans under the authority of the United States Agricultural Marketing 
Act or the United States Warehouse Act with regard to deficiencies in 
quality, or by a laboratory approved by us with regard to substances or 
conditions injurious to human or animal health. (Test

[[Page 507]]

weight for quality adjustment purposes may be determined by our loss 
adjuster.)
    (4) Dry bean production that is eligible for quality adjustment, as 
specified in sections 13(e) (2) and (3), will be reduced:
    (i) If a conversion factor is designated by the Special Provisions, 
by multiplying the number of pounds of eligible production by the 
conversion factor designated in the Special Provisions for the 
applicable grade or pick; or
    (ii) If a conversion factor is not designated by the Special 
Provisions as follows:
    (A) The market price of the qualifying damaged production and the 
local market price will be determined on the earlier of the date such 
quality adjusted production is sold or the date of final inspection for 
the unit. If a local market price is not available for the insured crop 
year, the current years' maximum price election available for the 
applicable type will be used. The price for the qualifying damaged 
production will be the market price for the local area to the extent 
feasible. We may obtain prices from any buyer of our choice. If we 
obtain prices from one or more buyers located outside your local market 
area, we will reduce such prices by the additional costs required to 
deliver the dry beans to those buyers. Discounts used to establish the 
net price of the damaged production will be limited to those that are 
usual, customary, and reasonable. The price of the damaged production 
will not be reduced for:
    (1) Moisture content;
    (2) Damage due to uninsured causes; or
    (3) Drying, handling, processing, including trading tare for grade 
to obtain a higher grade and price, or any other costs associated with 
normal harvesting, handling, and marketing of the dry beans; except, if 
the price of the damaged production can be increased by conditioning, we 
may reduce the price of the production after it has been conditioned by 
the cost of conditioning but not lower than the value of the production 
before conditioning;
    (B) The value per pound of the damaged or conditioned production 
will be divided by the local market price to determine the quality 
adjustment factor; and
    (C) The number of pounds remaining after any reduction due to 
excessive moisture (the moisture-adjusted gross pounds (if appropriate)) 
of the damaged or conditioned production will then be multiplied by the 
quality adjustment factor to determine the net production to count.
    (f) Any production harvested from plants growing in the insured crop 
may be counted as production of the insured crop on a weight basis.

                         14. Prevented Planting

    Your prevented planting coverage will be 60 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to a level specified in the actuarial documents.

[62 FR 6105, Feb. 11, 1997, as amended at 62 FR 63633, Dec. 2, 1997; 62 
FR 65175, Dec. 10, 1997]



Sec. 457.151  Forage seeding crop insurance provisions.

    The forage seeding crop insurance provisions for the 1999 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:

                     Forage Seeding Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Crop year--The period within which the planting is or normally would 
become established and shall be designated by the calendar year in which 
the planting is made for spring planted acreage and the next succeeding 
calendar year for fall planted acreage.
    Fall planted--A forage crop seeded after June 30.
    Forage--Planted perennial alfalfa, perennial red clover, perennial 
grasses, or a mixture thereof, or other species, as shown in the 
actuarial documents.
    Good farming practices--The cultural practices generally in use in 
the county for the crop to make normal progress toward maturity and 
produce a normal stand, and are those recognized by the Cooperative 
State Research, Education, and Extension Service as compatible with 
agronomic and weather conditions in the county.
    Harvest--Severance of the forage plant from the land with the 
intention of using it as livestock feed. Grazing will not be considered 
harvested.
    Normal stand--A population of live plants per square foot that meets 
the minimum required number of plants as shown in the Special 
Provisions.
    Nurse Crop (companion crop)--A crop seeded into the same acreage as 
another crop, that is intended to be harvested separately, and

[[Page 508]]

that is planted to improve growing conditions for the crop with which it 
is grown.
    Planted acreage--In addition to the provisions in section 1 of the 
Basic Provisions, land on which seed is initially spread onto the soil 
surface by any method and subsequently is mechanically incorporated into 
the soil in a timely manner and at the proper depth will be considered 
planted, unless otherwise provided by the Special Provisions, actuarial 
documents, or written agreement.
    Replanting--Performing the cultural practices necessary to prepare 
the land for replacing of the forage seed and then replacing the forage 
seed in the insured acreage with the expectation of producing a normal 
stand. Replacing new seed into an existing damaged stand, which results 
in a reduced seeding rate from the original seeding rate, will not be 
considered replanting.
    Spring planted--A forage crop seeded before July 1.

                            2. Unit Division

    A basic unit, as defined in section 1 of the Basic Provisions, will 
also be divided into additional basic units by spring planted and fall 
planted acreage.

                         3. Amounts of Insurance

    (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 only select one coverage 
level and the corresponding amount of insurance designated in the 
actuarial documents for the applicable type and practice for all the 
forage seeding in the county that is insured under this policy. The 
amount of insurance you choose for each type and practice must have the 
same percentage relationship to the maximum amount of insurance offered 
by us for each type and practice. For example, if you choose 100 percent 
of the maximum amount of insurance for a specific type and practice, you 
must also choose 100 percent of the maximum amount of insurance for all 
other types and practices.
    (b) The production reporting requirements contained in section 3 
(Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities) of the Basic Provisions (Sec. 457.8), do not apply to 
forage seeding.

                           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 for counties with a March 15 
cancellation date and April 30 preceding the cancellation date for all 
other counties.
    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:

------------------------------------------------------------------------
                                            Cancellation and termination
             State and County                          dates
------------------------------------------------------------------------
Nevada, New Hampshire, New York,           July 31.
 Pennsylvania, Vermont.
All other states.........................  March 15.
------------------------------------------------------------------------

                             6. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the forage in the county for 
which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That is planted during the current crop year, or replanted the 
calendar year following planting, to establish a normal stand of forage 
intended for harvest as livestock feed;
    (c) That is not grown with the intent to be grazed, or not grazed at 
any time during the insurance period; and
    (d) That is not interplanted with another crop, except nurse crops, 
unless allowed by the Special Provisions or by written agreement.

                          7. Insurable Acreage

    In addition to the provisions of section 9 (Insurable Acreage) of 
the Basic Provisions (Sec. 457.8), any acreage of the insured crop 
damaged before the final planting date, to the extent that such acreage 
has less than a normal stand, must be replanted unless we agree that it 
is not practical to replant.

                           8. Insurance Period

    In lieu of the provisions of section 11 (Insurance Period) of the 
Basic Provisions (Sec. 457.8) regarding when insurance ends, forage 
seeding insurance will end at the earliest of:
    (a) Total destruction of the insured crop on the unit;
    (b) The initial harvest of the unit, if a late harvest date is not 
listed in the Special Provisions;
    (c) The first harvest after the late harvest date, if a late harvest 
date is specified in the Special Provisions. You may harvest the crop as 
often as practical in accordance with good farming practices on or 
before the late harvest date.
    (d) Final adjustment of a loss on a unit;
    (e) Abandonment of the insured crop;
    (f) The date grazing commences on the insured crop; or
    (g) May 21 of the calendar year following seeding for spring-planted 
forage; or October 15 of the calendar year following seeding for fall-
planted forage.

[[Page 509]]

                            9. Causes of Loss

    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 that result in loss of, or failure to establish, a 
stand of forage that occur during the insurance period:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.

                         10. Replanting Payment

    In lieu of the provisions contained in section 13 (Replanting 
Payment) of the Basic Provisions (Sec. 457.8):
    (a) A replanting payment is allowed only in counties for which the 
Special Provisions designate both fall and spring final planting dates 
if:
    (1) The insured fall planted acreage is damaged by an insurable 
cause of loss to the extent that less than 75 percent of a normal stand 
remains;
    (2) It is practical to replant;
    (3) We give written consent to replant; and
    (4) Such acreage is replanted the following spring by the spring 
final planting date.
    (b) The amount of the replanting payment will be equal to 50 percent 
of the amount of the liability determined in accordance with section 
12(a).
    (c) No replanting payment will be made on acreage for which one 
replanting payment has been allowed.
    (d) If the information reported by you on the acreage report results 
in a lower premium than the actual premium determined to be due based on 
the acreage, share, practice, or type determined actually to have 
existed, the replanting payment will be reduced proportionately.

                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 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 tilling of the balance of the unit is completed.
    (b) In addition to the requirements of section 14 (Duties in the 
Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), you must 
give us written notice if, during the period before destroying the crop 
on any fall planted acreage that is damaged, you decide to replant the 
acreage by the spring final planting date.

                         12. Settlement of Claim

    (a) In the event of loss or damage covered by this policy, we will 
settle your claim on any unit by:
    (1) Multiplying the insured acreage of each type and practice by the 
amount of insurance for the applicable type and practice;
    (2) Totaling the results in section 12(a)(1);
    (3) Multiplying the total of the acres with an established stand 
plus 10 percent of the planted acres for the insured acreage of each 
type and practice in the unit by the amount of insurance for the 
applicable type and practice;
    (4) Totaling the results in section 12(a)(3);
    (5) Subtracting the result in section 12(a)(4) from the result in 
section 12(a)(2); and
    (6) Multiplying the result in section 12(a)(5) by your share.
    (b) The acres with an established stand will include:
    (1) Acreage that has at least 75 percent of a normal stand;
    (2) Acreage abandoned or put to another use without our prior 
written consent;
    (3) Acreage damaged solely by an uninsured cause; or
    (4) Acreage that is harvested and not reseeded.
    (c) The amount of indemnity on any spring planted acreage determined 
in accordance with section 12(a) will be reduced 50 percent if the stand 
is less than 75 percent but more than 55 percent of a normal stand.

                     13. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 13291, Mar. 20, 1997, as amended at 62 FR 65175, Dec. 10, 1997]

    Editorial Note: At 62 FR 65175, Dec. 10, 1997, Sec. 457.151 was 
amended in section 1 by revising the definition ``Sales closing date'', 
however, this definition was not included when this section was added at 
62 FR 13291, Mar. 20, 1997.



Sec. 457.152  Hybrid seed corn crop insurance provisions.

    The Hybrid Seed Corn Crop Insurance Provisions for the 1998 and 
succeeding crop years are as follows:
    FCIC Policies


[[Page 510]]



                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and Reinsured policies

                    Hybrid Seed Corn Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions, (Sec. 457.8) with (1) 
controlling (2), etc.

                             1. Definitions

    Adjusted yield. An amount determined by multiplying the county yield 
by the coverage level factor.
    Amount of insurance per acre. A dollar amount determined by 
multiplying the adjusted yield by the price election you select and 
subtracting any minimum guaranteed payment, not to exceed the total 
compensation specified in the hybrid seed corn processor contract. If 
your hybrid seed corn processor contract contains a minimum guaranteed 
payment that is stated in bushels, we will convert that value to dollars 
by multiplying it by the price election you selected.
    Approved yield. In lieu of the definition contained in the Basic 
Provisions, an amount FCIC determines to be representative of the yield 
that the female parent plants are expected to produce when grown under a 
specific production practice. FCIC will establish the approved yield 
based upon records provided by the seed company and other information it 
deems appropriate.
    Bushel. Fifty-six pounds avoirdupois of shelled corn, 70 pound 
avoirdupois of ear corn, or the number of pounds determined under the 
seed company's normal conversion chart when that chart is used to 
determine the approved yield and the claim for indemnity.
    Certified seed test. A warm germination test performed on clean seed 
according to specifications of the ``Rules for Testing Seeds'' of the 
Association of Official Seed Analysts.
    Commercial hybrid seed corn. The offspring produced by crossing a 
male and female parent plant, each having a different genetic character. 
This offspring is the product intended for use by an agricultural 
producer to produce a commercial field corn crop for grain.
    County yield. An amount contained in the actuarial documents that is 
established by FCIC to represent the yield that a producer of hybrid 
seed corn would be expected to produce if the acreage had been planted 
to commercial field corn.
    Coverage level factor. A factor contained in the Special Provisions 
to adjust the county yield for commercial field corn to reflect the 
higher value of hybrid seed corn.
    Dollar value per bushel. An amount that determines the value of any 
seed production to count. It is determined by dividing the amount of 
insurance per acre by the result of multiplying the approved yield by 
the coverage level percentage, expressed as a decimal.
    Female parent plants. Corn plants that are grown for the purpose of 
producing commercial hybrid seed corn and have had the stamens removed 
or are otherwise male sterile.
    Field run. Commercial hybrid seed corn production before it has been 
dried, screened, or processed.
    Good farming practices. In addition to the definition contained in 
the Basic Provisions, good farming practices include those practices 
required by the hybrid seed corn processor contract.
    Harvest. Combining, threshing or picking ears from the female parent 
plants to obtain commercial hybrid seed corn.
    Hybrid seed corn processor contract. An agreement executed between 
the hybrid seed corn crop producer and a seed company containing, at a 
minimum:
    (a) The producer's promise to plant and grow male and female parent 
plants, and to deliver all commercial hybrid seed corn produced from 
such plants to the seed company;
    (b) The seed company's promise to purchase the commercial hybrid 
seed corn produced by the producer; and
    (c) Either a fixed price per unit of measure (bushels, 
hundredweight, etc.) of the commercial hybrid seed corn or a formula to 
determine the value of such seed. Any formula for establishing the value 
must be based on data provided by a public third party that establishes 
or provides pricing information to the general public, based on prices 
paid in the open market (e.g., commodity futures exchanges), to be 
acceptable for the purpose of this policy.
    Inadequate germination. Germination of less than 80 percent of the 
commercial hybrid seed corn as determined by using a certified seed 
test.
    Insurable interest. Your share of the financial loss that occurs in 
the event seed production is damaged by a cause of loss specified in 
section 10.
    Local market price. The cash price offered by buyers for any 
production from the female parent plants that is not considered 
commercial hybrid seed corn under the terms of this policy.
    Male parent plants. Corn plants grown for the purpose of pollinating 
female parent plants.
    Minimum guaranteed payment. A minimum amount (usually stated in 
dollars or bushels)

[[Page 511]]

specified in your hybrid seed corn processor contract that will be paid 
or credited to you by the seed company regardless of the quantity of 
seed produced.
    Non-seed production. Production that does not qualify as seed 
production because of inadequate germination.
    Planted acreage. In addition to the definition contained in the 
Basic Provisions, the insured crop must be planted in rows wide enough 
to permit mechanical cultivation, unless otherwise provided by the 
Special Provisions or by written agreement.
    Planting pattern. The arrangement of the rows of the male and female 
parent plants in a field. An example of a planting pattern is four 
consecutive rows of female parent plants followed by two consecutive 
rows of male parent plants.
    Practical to replant. In addition to the definition contained in the 
Basic Provisions, practical to replant applies to either the female or 
male parent plant. It will not be considered practical to replant unless 
production from the replanted acreage can be delivered under the terms 
of the hybrid seed corn processor contract, or the seed company agrees 
that it will accept the production from the replanted acreage.
    Prevented planting. In addition to the definition contained in the 
Basic Provisions, prevented planting applies to the female and male 
parent plants. The male parent plants must be planted in accordance with 
the requirements of the hybrid seed corn processor contract to be 
considered planted.
    Sample. For the purpose of the certified seed test, at least 3 
pounds of randomly selected field run shelled corn for each variety of 
commercial hybrid seed corn grown on the unit.
    Seed company. A business enterprise that possesses all licenses for 
marketing commercial hybrid seed corn required by the state in which it 
is domiciled or operates, and which possesses facilities with enough 
storage and drying capacity to accept and process the insured crop 
within a reasonable amount of time after harvest. If the seed company is 
the insured, it must also be a corporation.
    Seed production. All seed produced by female parent plants with a 
germination rate of at least 80 percent as determined by a certified 
seed test.
    Shelled corn. Kernels that have been removed from the cob.
    Variety. The name, number or code assigned to a specific genetic 
cross by the seed company or the Special Provisions for the insured crop 
in the county.

                            2. Unit Division

    For any processor contract that stipulates the amount of production 
to be delivered:
    (a) In lieu of the definition of ``basic unit'' contained in the 
Basic Provisions, a basic unit will consist of all acreage planted to 
the insured crop in the county that will be used to fulfill a hybrid 
seed corn processor contract;
    (b) There will be no more than one basic unit for all production 
contracted with each processor contract;
    (c) In accordance with section 12, all production from any basic 
unit in excess of the amount under contract will be included as 
production to count if such production is applied to any other basic 
unit for which the contracted amount has not been fulfilled; and
    (d) Optional units will not be established.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    (a) In addition to the requirements of section 3 of the Basic 
Provisions, you may select only one price election for all the hybrid 
seed corn in the county insured under this policy unless the Special 
Provisions provide different price elections by variety, in which case 
you may select one price election for each hybrid seed corn variety 
designated in the Special Provisions. The price election you choose for 
each variety must have the same percentage relationship to the maximum 
price offered by us for each variety. For example, if you choose 100 
percent of the maximum price election for one specific variety, you must 
also choose 100 percent of the maximum price election for all other 
varieties.
    (b) The production reporting requirements contained in section 3 of 
the Basic Provisions are not applicable to this contract.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are March 15.

                          6. Report of Acreage

    In addition to the requirements of section 6 of the Basic 
Provisions, you must:
    (a) Report by type and variety, the location and insurable acreage 
of the insured crop;
    (b) Report any acreage that is uninsured, including that portion of 
the total acreage occupied by male parent plants; and
    (c) Certify that you have a hybrid seed corn processor contract and 
report the amount, if any, of any minimum guaranteed payment.

                             7. Insured Crop

    (a) In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the female parent plants in the county for

[[Page 512]]

which a premium rate is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That are grown under a hybrid seed corn processor contract 
executed before the acreage reporting date;
    (3) That are planted for harvest as commercial hybrid seed corn in 
accordance with the requirements of the hybrid seed corn processor 
contract and the production management practices of the seed company; 
and
    (4) That are not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Planted with a mixture of female and male parent seed in the 
same row;
    (ii) Planted for any purpose other than for commercial hybrid seed 
corn;
    (iii) Interplanted with another crop; or
    (iv) Planted into an established grass or legume.
    (b) An instrument in the form of a ``lease'' under which you retain 
control of the acreage on which the insured crop is grown and that 
provides for delivery of the crop under substantially the same terms as 
a hybrid seed corn processor contract will be treated as a contract 
under which you have an insurable interest in the crop.
    (c) A commercial hybrid seed corn producer who is also a seed 
company may be able to insure the hybrid seed corn crop if the following 
requirements are met:
    (1) The seed company has an insurable interest in the hybrid seed 
corn crop;
    (2) Prior to the sales closing date, the Board of Directors of the 
seed company has executed and adopted a corporate resolution that 
contains the same terms as a hybrid seed corn processor contract. This 
corporate resolution will be considered a contract under this policy;
    (3) Sales records for at least the previous years' seed production 
must be provided to confirm that the seed company has produced and sold 
seed. If such records are not available, the crop may be insured under 
the Coarse Grains Crop Provisions with a written agreement; and
    (4) Our inspection reveals that the storage and drying facilities 
satisfy the definition of a seed company.
    (d) Any of the insured crop that is under contract with different 
seed companies may be insured under separate policies with different 
insurance providers provided all acreage of the insured crop in the 
county is insured. If you elect to insure the insured crop with 
different insurance providers, you agree to pay separate administrative 
fees for each insurance policy.

                          8. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions, 
we will not insure any acreage of the insured crop:
    (a) Planted and occupied exclusively by male parent plants;
    (b) Not in compliance with the rotation requirements contained in 
the Special Provisions or, if applicable, required by the hybrid seed 
corn processor contract; or
    (c) If either the female or male parent plants are damaged before 
the final planting date and we determine that the insured crop is 
practical to replant but it is not replanted.

                           9. Insurance Period

    (a) In addition to the provisions of section 11 of the Basic 
Provisions, insurance attaches upon completion of planting of:
    (1) The female parent plant seed on or before the final planting 
date designated in the Special Provisions, except as allowed in section 
16 of the Basic Provisions; and
    (2) The male parent plant seed.
    (b) In accordance with the provisions of section 11 of the Basic 
Provisions, the calendar date for the end of the insurance period is the 
October 31 immediately following planting.

                           10. Causes of Loss

    (a) In accordance with the provisions of section 12 of the Basic 
Provisions, 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 due to a cause of 
loss contained in section 10(a) (1) through (7) that occurs during the 
insurance period.
    (b) In addition to the causes of loss excluded by section 12 of the 
Basic Provisions, we will not insure against any loss of production due 
to:
    (1) The use of unadapted, incompatible, or genetically deficient 
male or female parent plant seed;
    (2) Frost or freeze after the date established by the Special 
Provisions;
    (3) Failure to follow the requirements stated in the hybrid seed 
corn processor contract and production management practices of the seed 
company;
    (4) Inadequate germination, even if resulting from an insured cause 
of loss, unless you have provided adequate notice as required by section 
11(b)(1); or
    (5) Failure to plant the male parent plant seed at a time or in a 
manner sufficient to assure adequate pollination of the female parent 
plants, unless you are prevented from

[[Page 513]]

planting the male parent plant seed by an insured cause of loss.

                11. Duties In The Event of Damage or Loss

    (a) In accordance with the requirements of section 14 of the Basic 
Provisions, you must leave representative samples of at least one 
complete planting pattern of the female and male parent plant rows that 
extend the entire length of each field in the unit. If you are going to 
destroy any acreage of the insured crop that will not be harvested, the 
samples must not be destroyed until after our inspection.
    (b) In addition to the requirements of section 14 of the Basic 
Provisions:
    (1) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate inadequate germination on any 
unit; and
    (2) You must provide a completed copy of your hybrid seed corn 
processor contract unless we have determined it has already been 
provided by the seed company, and the seed company certifies that such 
contract is used for all its growers without any waivers or amendments.

                         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 such 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) You will not receive an indemnity payment on a unit if the seed 
company refuses to provide us with records we require to determine the 
dollar value per bushel of production for each variety.
    (c) In the event of loss or damage covered by this policy, we will 
settle your claim on any unit by:
    (1) Multiplying the insured acreage by its respective amount of 
insurance per acre, by type and variety if applicable;
    (2) Totaling the results of section 12(c)(1) if there are more than 
one type or variety;
    (3) Multiplying the total seed production to count (see section 
12(d)) for each type and variety of commercial hybrid seed corn by the 
applicable dollar value per bushel for that type or variety;
    (4) Multiplying the total non-seed production to count (see section 
12(e)) for each type and variety by the applicable local market price 
determined on the earlier of the date the non-seed production is sold or 
the date of final inspection;
    (5) Totaling the results of sections 12(c)(3) and 12(c)(4) by type 
and variety;
    (6) Subtracting the result of section 12(c)(5) from the result of 
section 12(c)(1) if there is only one type or variety, or subtracting 
the result of 12(c)(5) from the result of section 12(c)(2) if there are 
more than one type or variety; and
    (7) Multiplying the result of section 12(c)(6) by your share. For 
example:
    You have a 100 percent share in 50 acres insured for the development 
of variety ``A'' hybrid seed corn in the unit, with an amount of 
insurance per acre guarantee of $340 (county yield of 160 bushels times 
a coverage level factor of .867 for the 65 percent coverage level, times 
a price election of $2.45 per bushel, minus the minimum guaranteed 
payment of zero). Your seed production was 1,400 bushels and the dollar 
value per bushel was $9.80. Your non-seed production was 100 bushels 
with a local market value of $2.00 per bushel. Your indemnity would be 
calculated as follows:
    (1) 50 acres x $340=$17,000 amount of insurance guarantee;
    (3) 1,400 bushels x $9.80=$13,720 value of seed production;
    (4) 100 bushel of non-seed x $2.00=$200 of non-seed production;
    (5) $13,720+$200=$13,920;
    (6) $17,000-$13,920=$3,080; and
    (7) $3,080 x 100 percent share=$3,080 indemnity payment.
    You also have a 100 percent share in 50 acres insured for the 
development of variety ``B'' hybrid seed corn in the unit, with an 
amount of insurance per acre guarantee of $297 (county yield of 140 
bushels times a coverage level factor of .867 for the 65 percent 
coverage level, times a price election of $2.45 per bushel, minus the 
minimum guaranteed payment of zero). You harvested 1,200 bushels and the 
dollar value per bushel for the harvested amount was $8.56. You also 
harvested 200 bushels of non-seed with a market value of $2.00 per 
bushel. Your indemnity would be calculated as follows:
    (1) 50 acres x $340=$17,000 amount of insurance guarantee for type 
``A'' and 50 acres x $297=$14,850 amount of insurance guarantee for type 
``B'';
    (2) $17,000+$14,850=$31,850 amount of insurance guarantee;
    (3) 1,400 bushels x $9.80=$13,720 value of seed production for type 
``A'' and 1,200 bushels x $8.56=$10,272 value of seed production for 
type ``B'';
    (4) 100 bushels of non-seed x $2.00=$200 of non-seed production for 
type ``A'' and 200 bushels of non-seed x $2.00=$400 of non-seed 
production for type ``B'';
    (5) $13,720+$200+$10,272+$400=$24,592 value of production to count;
    (6) $31,850-$24,592=$7,258; and
    (7) $7,258 x 100 percent share=$7,258 indemnity payment.
    (d) Production to be counted as seed production will include:

[[Page 514]]

    (1) All appraised production as follows:
    (i) Not less than the amount of insurance per acre for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Mature unharvested production with a germination rate of at 
least 80 percent of the commercial hybrid seed corn as determined by a 
certified seed test. Any such production may be adjusted in accordance 
with section 12(f);
    (iv) Immature appraised production;
    (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 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) Harvested production that you deliver as commercial hybrid seed 
corn to the seed company stated in your hybrid seed corn processor 
contract, regardless of quality, unless the production has inadequate 
germination.
    (e) Production to be counted as non-seed production will include all 
harvested or mature appraised production that does not qualify as seed 
production to count as specified in section 12(d). Any such production 
may be adjusted in accordance with section 12(f).
    (f) For the purpose of determining the quantity of mature 
production:
    (1) Shelled commercial hybrid seed corn will be:
    (i) Increased 0.12 percent for each 0.1 percentage point of moisture 
below 15 percent; or
    (ii) Decreased 0.12 percent for each 0.1 percentage point of 
moisture in excess of 15 percent.
    (2) The weight of ear corn required to equal one bushel of shelled 
seed corn will be increased 1.5 pounds for each full percentage point of 
moisture in excess of 14 percent, and any portion of a percentage point 
will be disregarded. The moisture content of ear corn will be determined 
from a shelled sample of the ear corn.
    (3) When records of commercial hybrid seed corn production provided 
by the seed company have been adjusted to a shelled corn basis of 15.0 
percent moisture and 56 pound avoirdupois bushels, sections 12(f)(1) and 
(2) above will not apply to harvested production. In such cases, records 
of the seed company will be used to determine the amount of production 
to count, provided that the moisture and weight of such production are 
calculated on the same basis as that used to determine the approved 
yield.

                         13. Prevented Planting

    Your prevented planting coverage will be 50 percent of your amount 
of insurance for timely planted acreage. If you have limited or 
additional levels of coverage as specified in 7 CFR part 400, subpart T, 
and pay an additional premium, you may increase your prevented planting 
coverage to a level specified in the actuarial documents.

[62 FR 65350, Dec. 12, 1997; 62 FR 67117, Dec. 23, 1997]



Sec. 457.153  Peach crop insurance provisions.

    The Peach Crop Insurance Provisions for the 1999 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:

                          Peach Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Actual price per bushel for:

[[Page 515]]

    (a) Fresh peaches means the average price per bushel of U.S. Extra 
No. 1 ``2-inch'' peaches (if not available, the next larger size for 
which a price is available) determined from applicable prices reported 
by the Market News Service of the United States Department of 
Agriculture for seven consecutive marketing days, commencing with the 
day harvest of the variety begins. In the absence of FOB shipping point 
price from the Market News Service, the price per bushel of U.S. Extra 
No. 1 ``2-inch'' peaches will be the total of the price election and 
allowable costs for the undamaged peaches; and
    (b) Processing peaches means the average price per bushel received 
from the processor for that applicable variety determined for seven 
consecutive marketing days, commencing with the day harvest of the 
variety begins.
    Bearing tree. A tree in at least the 4th growing season after set 
out.
    Bushel. Fifty pounds of ungraded peaches.
    Direct marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, or permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    Harvest. The picking or removal of mature peaches from the trees 
either by hand or machine.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Loss in quality. When the crop is damaged to the extent that the 
producer does not receive the average price for U.S. Extra No. 1 peach.
    Packing shed. A facility at which peaches are graded, packed and 
cooled in preparation for shipment to a wholesale market.
    Set out. Transplanting the tree into the orchard.

  2. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one price election for all the peaches 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 peach type (fresh or processing) 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 choose 100 percent of the 
maximum price election for all other types.
    (b) You must report, not later than the production reporting date 
designated in section 3 (Insurance Guarantees, Coverage Levels, and 
Prices for Determining Indemnities) of the Basic Provisions 
(Sec. 457.8), by type if applicable:
    (1) Any damage, removal of or addition of trees, or change in 
practices, or any other circumstance that may reduce the expected yield 
below the yield upon which the insurance guarantee is based, and the 
number of affected acres;
    (2) The number of bearing and non-bearing trees on insurable and 
uninsurable acreage;
    (3) The age of the trees, variety, type, and the planting pattern; 
and
    (4) For the first year of insurance, acreage interplanted with 
another perennial crop, and anytime the planting pattern of such acreage 
is changed:
    (i) The age of the crop that is interplanted with the peaches;
    (ii) The variety, and type if applicable;
    (iii) The planting pattern; and
    (iv) Any other reasonable and pertinent information that we request 
in order to establish your approved yield.
    We will adjust the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of interplanting a 
perennial crop; removal or addition of trees or varieties of trees; 
physical or structural tree damage; a change in practices or changes in 
tree population and density, and any other circumstance affecting the 
yield potential of the insured crop. If you fail to notify us of any 
circumstance that may affect your yields from previous levels, we will 
adjust your production guarantee as necessary at any time we become 
aware of the circumstance.

                           3. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is August 31 preceding 
the cancellation date.

                  4. 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 November 20.

                             5. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the peaches in the county for 
which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are grown on tree varieties that:
    (1) Were commercially available when the trees were set out;

[[Page 516]]

    (2) Are a variety having a chilling hour requirement that is 
appropriate for the area;
    (3) Are grown on a root stock that is adapted to the area.
    (c) That the crop insured will be any of the types or varieties of 
peaches that are grown for the production of Fresh or Processing Peaches 
(except Processing Peaches excluded in California) on insured acreage 
and for which a guarantee and premium rate are provided by the Actuarial 
Table.
    (d) That are grown in an orchard that, if inspected, is considered 
acceptable by us; and
    (e) That has reached at least the fourth growing season after set 
out. However, we may agree in writing to insure acreage that has not 
reached this age if it has produced at least 100 bushels of peaches per 
acre.

                          6. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a 
crop planted with another crop, peaches interplanted with another 
perennial crop are insurable unless we inspect the acreage and determine 
that it does not meet the requirements contained in your policy.

                           7. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on November 21 of each crop year, except that 
for the year of application, if your application is received after 
November 11 but prior to November 21, insurance will attach on the 10th 
day after your properly completed application is received in our local 
office, unless we inspect the acreage during the 10-day period and 
determine that it does not meet insurability requirements. You must 
provide any information that we require for the crop to determine the 
condition of the orchard.
    (2) The calendar date for the end of the insurance period for each 
crop year is September 30.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable interest on any acreage of 
peaches on or before the acreage reporting date for the crop year and if 
the acreage was insured by you the previous crop year, insurance will 
not be considered to have attached, and no premium or indemnity will be 
due for such acreage for that crop year unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            8. 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, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the orchard;
    (3) Earthquake;
    (4) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (5) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (6) Volcanic eruption;
    (7) Wildlife, unless control measures have not been taken;
    (8) An insufficient number of chilling hours to effectively break 
dormancy; or
    (9) Failure of irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to:
    (1) Split pits, regardless of cause; or
    (2) Inability to market the peaches for any reason other than actual 
physical damage from an insurable cause specified in this section. For 
example, we will not pay you an indemnity if you are unable to market 
due to quarantine, boycott, or refusal of any person to accept 
production.

                9. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), and unless the 
insurance period has ended prior to each of the following events, the 
following will apply:
    (a) You must notify us within three days of the date that harvest of 
the damaged variety should have started if the crop will not be 
harvested.
    (b) You must notify us at least 15 days before any production from 
any unit will be sold by direct marketing unless you have records 
verifying that the direct market peaches were ``weighed and graded'' 
through

[[Page 517]]

a packing shed. Failure to give timely notice that production will be 
sold by direct marketing will result in an appraised amount of 
production to count not less than the production guarantee per acre if 
such failure results in our inability to make the required appraisal.
    (c) If you previously gave notice in accordance with section 14 of 
the Basic Provisions (Sec. 457.8), and if you intend to claim an 
indemnity on any unit, you must notify us at least 15 days prior to the 
beginning of harvest of the damaged variety, so that we may inspect the 
damaged production. You must not sell or dispose of the damaged crop 
until after we have given you written consent to do so.
    (d) If you fail to meet the requirements of this section and such 
failure results in our inability to inspect the damaged production, all 
such production will be considered undamaged and included as production 
to count.

                         10. 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 such 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 for each type, if applicable, by 
its respective production guarantee;
    (2) Multiplying each result in section 10(b)(1) by the respective 
price election;
    (3) Totaling the results in section 10(b)(2);
    (4) Multiplying the total production to be counted by type, if 
applicable, (see subsection 10(c)) by the respective price election;
    (5) Totaling the results in section 10(b)(4);
    (6) Subtracting the total in section 10(b)(5) from the total in 
section 10(b)(3); and
    (7) Multiplying the result in section 10(b)(6) by your share.
    (c) The total production to count (in bushels) from all insurable 
acreage on the unit will include:
    (1) All appraised production will be determined as follows:
    (i) Not less than the production guarantee per acre for acreage:
    (A) That is abandoned;
    (B) From which production is sold by direct marketing if you fail to 
meet the requirements contained in section 9;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide production records that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production;
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we may defer 
the claim only if you agree to continue to care for the crop. We will 
then make another appraisal when you notify us of further damage or that 
harvest is general in the area unless you harvested the crop, in which 
case we will use the harvested production. If you do not continue to 
adequately care for the crop, our appraisal made prior to deferring the 
claim will be used to determine the production to count; and
    (v) Any appraised production on insured acreage will be considered 
production to count unless such production is exceeded by the actual 
harvested production.
    (2) All harvested production from the insurable acreage.
    (3) Mature marketable peach production may be reduced as a result of 
a loss in quality due to an insured cause of loss. The amount of 
production to count for such peaches will be determined as follows:
    (i) Peaches grown for fresh use by:
    (A) Dividing the value of the damaged peaches by the actual price 
for undamaged peaches; and
    (B) Multiplying the result of section 10(c)(3)(i)(A) by the number 
of bushels of the eligible damaged peaches.
    (ii) Peaches grown for processing by:
    (A) Dividing the value of the damaged peaches by the actual price of 
undamaged peaches for processing; and
    (B) Multiplying the result of section 10(c)(3)(ii)(A) by the number 
of bushels of the eligible damaged peaches.
    (4) Peaches that cannot be marketed due to insurable causes will not 
be considered production to count.

                     11. Late and Prevented Planting

    the late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 39923, July 25, 1997, as amended at 62 FR 65176, Dec. 10, 1997]



Sec. 457.154  Processing sweet corn crop insurance provisions.

    The Processing Sweet Corn Crop Insurance Provisions for the 1998 and 
succeeding crop years are as follows:
    FCIC Policies


[[Page 518]]



                        Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

                  Processing Sweet Corn Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Base contract price. The price stipulated on the processor contract 
without regard to discounts or incentives that may apply.
    Bypassed acreage. Land on which production is ready for harvest but 
the processor elects not to accept such production so it is not 
harvested.
    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 required by the sweet corn processor contract with the 
processing company, and recognized by the Cooperative State Research, 
Education, and Extension Service as compatible with agronomic and 
weather conditions in the county.
    Harvest. The removal of the ears from the stalks for the purpose of 
delivery to the processor.
    Planted acreage. In addition to the definition contained in the 
Basic Provisions, sweet corn must initially be placed in rows far enough 
apart to permit mechanical cultivation. 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, 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, time to crop maturity, and 
marketing window, 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 unless 
the replanted acreage can produce at least 75 percent of the approved 
yield, and the processor agrees in writing that it will accept the 
production from the replanted acreage.
    Processor. Any business enterprise regularly engaged in canning or 
freezing processing sweet corn for human consumption, that possesses all 
licenses and permits for processing sweet corn required by the state in 
which it operates, and that possesses facilities, or has contractual 
access to such facilities, with enough equipment to accept and process 
contracted processing sweet corn within a reasonable amount of time 
after harvest.
    Processor contract. A written agreement between the producer and a 
processor, containing at a minimum:
    (a) The producer's commitment to plant and grow sweet corn, and to 
deliver the sweet corn production to the processor;
    (b) The processor's commitment to purchase all the production stated 
in the processor contract; and
    (c) A base contract price.
    Multiple contracts with the same processor that specify amounts of 
production will be considered as a single processor contract.
    Ton. Two thousand (2,000) pounds avoirdupois.
    Unhusked ear weight. Weight of the seed-bearing spike of sweet corn 
including the membranous or green outer envelope.
    Usable tons. The quantity of sweet corn for which the producer is 
compensated or should have been compensated by the processor.

                            2. Unit Division

    (a) For processor contracts that stipulate the amount of production 
to be delivered:
    (1) In lieu of the definition contained in the Basic Provisions, a 
basic unit will consist of all acreage planted to the insured crop in 
the county that will be used to fulfill contracts with each processor;
    (i) There will be no more than one basic unit for all production 
contracted with each processor contract;
    (ii) In accordance with section 12, all production from any basic 
unit in excess of the amount under contract will be included as 
production to count if such production is applied to any other basic 
unit for which the contracted amount has not been fulfilled; and
    (2) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable.
    (b) For any processor contract that stipulates the number of acres 
to be planted, the provisions contained in section 34 of the Basic 
Provisions will apply.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions:

[[Page 519]]

    (a) You may select only one price election for all the processing 
sweet corn in the county insured under this policy unless the Special 
Provisions provide different price elections by type. The percentage of 
the maximum price elections you choose for one type will be applicable 
to all other types insured under this policy.
    (b) The insurance guarantee per acre is expressed as tons of 
unhusked ear weight. Any other measured production will be converted to 
an unhusked ear weight equivalent.
    (c) The appraised production from bypassed acreage that could have 
been accepted by the processor will be included when determining your 
approved yield.
    (d) Acreage that is bypassed because it was damaged by an insurable 
cause of loss will be considered to have a zero yield when determining 
your approved yield.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are March 15.

                          6. Report of Acreage

    In addition to the provisions of section 6 of the Basic Provisions, 
you must provide a copy of all processor contracts to us on or before 
the acreage reporting date.

                             7. Insured Crop

    (a) In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the processing sweet corn in the county for which a 
premium rate is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That is grown under, and in accordance with, the requirements of 
a processor contract executed on or before the acreage reporting date 
and not excluded from the processor contract at any time during the crop 
year; and
    (3) That is not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Interplanted with another crop; or
    (ii) Planted into an established grass or legume.
    (b) You will be considered to have a share in the insured crop if, 
under the processor contract, you retain control of the acreage on which 
the sweet corn is grown, you are at risk of loss, and the processor 
contract provides for delivery of sweet corn under specified conditions 
and at a stipulated base contract price.
    (c) A commercial sweet corn producer who is also a processor may 
establish an insurable interest if the following requirements are met:
    (1) The producer must comply with these Crop Provisions;
    (2) Prior to the sales closing date, the Board of Directors or 
officers of the processor must execute and adopt a resolution that 
contains the same terms as an acceptable processor contract. Such 
resolution will be considered a processor contract under this policy; 
and
    (3) Our inspection reveals that the processing facilities comply 
with the definition of a processor contained in these Crop Provisions.

                          8. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions:
    (a) Any acreage of the insured crop that is damaged before the final 
planting date, to the extent that the majority of producers in the area 
would normally not further care for the crop, must be replanted unless 
we agree that it is not practical to replant; and
    (b) We will not insure any acreage that does not meet the rotation 
requirements, if applicable, contained in the Special Provisions.

                           9. Insurance Period

    In lieu of the provisions contained in section 11 of the Basic 
Provisions, regarding the end of the insurance period, insurance ceases 
at the earlier of:
    (a) The date the sweet corn:
    (1) Was destroyed;
    (2) Should have been harvested but was not harvested;
    (3) Was abandoned; or
    (4) Was harvested;
    (b) The date you harvest sufficient production to fulfill your 
processor contract if the processor contract stipulates a specific 
amount of production to be delivered;
    (c) Final adjustment of a loss; or
    (d) Unless otherwise agreed to in writing, the calendar date for the 
end of the insurance period in which the sweet corn would normally be 
harvested as follows:
    (1) September 30 in Malheur County, Oregon, all Idaho counties, and 
all Iowa counties;
    (2) October 20 in all other Oregon counties, and in all Washington 
counties; or
    (3) September 20 in all other states.

                           10. Causes of Loss

    In accordance with the provisions of section 12 of the Basic 
Provisions:
    (a) Insurance is provided only against the following causes of loss 
that occur during the insurance period:
    (1) Adverse weather conditions, including:
    (i) Excessive moisture that prevents harvesting equipment from 
entering the field or

[[Page 520]]

that prevents the timely operation of harvesting equipment; and
    (ii) Abnormally hot or cold temperatures that cause an unexpected 
number of acres over a large producing area to be ready for harvest at 
the same time, affecting the timely harvest of a large number of such 
acres or the processing of such production is beyond the capacity of the 
processor, either of which causes the acreage to be bypassed.
    (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 or as otherwise limited by the 
Special Provisions;
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply, if due to a cause of 
loss listed in section 10(a)(1) through (7) that occurs during the 
insurance period.
    (b) In addition to the causes of loss excluded in section 12 of the 
Basic Provisions, we will not insure any loss of production due to:
    (1) Bypassed acreage because of:
    (i) The breakdown or non-operation of equipment or facilities; or
    (ii) The availability of a crop insurance payment. We may deny any 
indemnity immediately in such circumstance or, if an indemnity has been 
paid, require you to repay it to us with interest at any time acreage 
was bypassed due to the availability of a crop insurance payment; or
    (2) Your failure to follow the requirements contained in the 
processor contract.

                11. Duties In The Event of Damage or Loss

    In addition to the requirements of section 14 of the Basic 
Provisions, you must give us notice:
    (a) Not later than 48 hours after:
    (1) Total destruction of the sweet corn on the unit; or
    (2) Discontinuance of harvest on a unit on which unharvested 
production remains.
    (b) Within 3 days after the date harvest should have started on any 
acreage that will not be harvested unless we have previously released 
the acreage. You must also provide acceptable documentation of the 
reason the acreage was bypassed. Failure to provide such documentation 
will result in our determination that the acreage was bypassed due to an 
uninsured cause of loss. If the crop will not be harvested and you wish 
to destroy the crop, you must leave representative samples of the 
unharvested crop for our inspection. The samples must be at least 10 
feet wide and extend the entire length of each field in each unit. The 
samples must not be destroyed until the earlier of our inspection or 15 
days after notice is given to us; and
    (c) At least 15 days prior to the beginning of harvest if you intend 
to claim an indemnity on any unit, or immediately if damage is 
discovered during the 15 day period or during harvest, so that we may 
inspect any damaged production. If you fail to notify us and such 
failure results in our inability to inspect the damaged production, we 
will consider all such production to be undamaged and include it as 
production to count. You are not required to delay harvest.

                         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 such 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, by type if applicable;
    (2) Multiplying each result of section 12(b)(1) by the respective 
price election, by type if applicable;
    (3) Totaling the results of section 12(b)(2) if there are more than 
one type;
    (4) Multiplying the total production to count (see section 12(c)), 
for each type if applicable, by its respective price election;
    (5) Totaling the results of section 12(b)(4) if there are more than 
one type;
    (6) Subtracting the results of section 12(b)(4) from the results of 
section 12(b)(2) if there is only one type or subtracting the results of 
section 12(b)(5) from the result of section 12(b)(3) if there are more 
than one type; and
    (7) Multiplying the result of section 12(b)(6) by your share.
    For example:
    You have a 100 percent share in 100 acres of type A processing sweet 
corn in the unit, with a guarantee of 3.0 tons per acre and a price 
election of $50.00 per ton. You are only able to harvest 200 tons. Your 
indemnity would be calculated as follows:

(1) 100 acres x 3.0 tons=300 tons guarantee;
(2) 300 tons x $50.00 price election=$15,000.00 value of guarantee;
(4) 200 tons x $50.00 price election=$10,000.00 value of production to 
          count;
(6) $15,000.00-$10,000.00=$5,000.00 loss;
(7) $5,000.00 x 100 percent=$5,000.00 indemnity payment.

    You also have a 100 percent share in 100 acres of type B processing 
sweet

[[Page 521]]

corn in the same unit, with a guarantee of 4.0 tons per acre and a price 
election of $45.00 per ton. You are only able to harvest 350 tons. Your 
total indemnity for both types A and B would be calculated as follows:

(1) 100 acres x 3.0 tons=300 tons guarantee for type A, and
    100 acres x 4.0 tons=400 tons guarantee for type B;
(2) 300 tons x $50.00 price election=$15,000.00 value of guarantee for 
          type A, and
    400 tons x $45.00 price election=$18,000.00 value of guarantee for 
type B;
(3) $15,000.00 + $18,000.00=$33,000.00 total value of guarantee;
(4) 200 tons x $50.00 price election=$10,000.00 value of production to 
          count for type A, and
    350 tons x $45.00 price election=$15,750.00 value of production to 
count for type B;
(5) $10,000.00+$15,750.00=$25,750.00 total value of production to count;
(6) $33,000.00-$25,750.00=$7,250.00 loss;
(7) $7,250.00 loss x 100 percent=$7,250.00 indemnity payment.

    (c) The total production to count, specified in tons of unhusked ear 
weight, from all insurable acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) That is put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide production records that are 
acceptable to us.
    (ii) Production lost due to uninsured causes.
    (iii) Production on acreage that is bypassed unless the acreage was 
bypassed due to an insured cause of loss which resulted in production 
which would not be acceptable under the terms of the processor contract.
    (iv) 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 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.
    (2) All harvested processing sweet corn production from the 
insurable acreage. The amount of such production will be:
    (i) The usable tons of processing sweet corn shown on the processor 
settlement sheet, if available; or
    (ii) Determined by dividing the dollar amount paid, payable, or 
which should have been paid under the terms of the processor contract 
for the quantity of the sweet corn delivered to the processor by the 
base contract price per ton; and
    (3) All harvested processing sweet corn production from any other 
insurable units that have been used to fulfill your processor contract 
for this unit.
    The total production to count will be expressed as an unhusked ear 
weight. Any other measure of production will be converted to an unhusked 
ear weight equivalent.

                            13. Late Planting

    A late planting period is not applicable to processing sweet corn 
unless allowed by the Special Provisions and you provide written 
approval from the processor by the acreage reporting date that it will 
accept the production from the late planted acres when it is expected to 
be ready for harvest.
    14. Prevented Planting.
    Your prevented planting coverage will be 40 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to the levels specified in the actuarial documents.

[62 FR 65342, Dec. 12, 1997]



Sec. 457.155  Processing bean crop insurance provisions.

    The Processing Bean Crop Insurance Provisions for the 1998 and 
succeeding crop years are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

[[Page 522]]

                     Processing Bean Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Base contract price. The price stipulated in the processor contract 
for the grade factor or sieve size that is designated in the Special 
Provisions, if applicable, without regard to discounts or incentives 
that may apply.
    Broker. A business enterprise that has all the licenses and permits 
required by the state in which it operates, and has a long term 
agreement in writing with a processor to purchase and deliver processing 
beans.
    Bypassed acreage. Land on which production is ready for harvest but 
the processor elects not to accept such production so it is not 
harvested.
    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 required by the bean processor contract with the 
processing company, and recognized by the Cooperative State Research, 
Education, and Extension Service as compatible with agronomic and 
weather conditions in the county.
    Harvest. The mechanical picking of bean pods from the vines.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, beans must initially be placed in rows far enough 
apart to permit mechanical cultivation to be considered planted. 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, 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, time to crop maturity, and 
marketing window, 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 unless 
the replanted acreage can produce at least 75 percent of the approved 
yield, and the processor agrees in writing that it will accept the 
production from the replanted acreage.
    Processing beans. Lima, snap, or other bean types identified in the 
Special Provisions that are grown under a processor contract to be 
canned or frozen and sold for human consumption.
    Processor. Any business enterprise regularly engaged in canning or 
freezing processing beans for human consumption, that possesses all 
licenses and permits for processing beans required by the state in which 
it operates, and that possesses facilities, or has contractual access to 
such facilities, with enough equipment to accept and process the 
contracted beans within a reasonable amount of time after harvest.
    Processor contract. A written agreement between the producer and a 
processor, or between the producer and a broker, containing at a 
minimum:
    (a) The producer's commitment to plant and grow processing beans, 
and to deliver the bean production to the processor or broker;
    (b) The processor's, or broker's, commitment to purchase all the 
production stated in the processor contract; and
    (c) A base contract price.
    Multiple contracts with the same processor that specify amounts of 
production will be considered as a single processor contract unless the 
contracts are for different types of processing beans.
    Ton. Two thousand (2,000) pounds avoirdupois.
    Type. A category of processing beans identified as a type in the 
Special Provisions.

                            2. Unit Division

    (a) For any processor contract that stipulates the amount of 
production to be delivered:
    (1) In lieu of the definition contained in the Basic Provisions, a 
basic unit will consist of all acreage planted to the insured crop in 
the county that will be used to fulfill contracts with each processor;
    (i) There will be no more than one basic unit for all production 
contracted with each processor contract;
    (ii) In accordance with section 12, all production from any basic 
unit in excess of the amount under contract will be included as 
production to count if such production is applied to any other basic 
unit for which the contracted amount has not been fulfilled; and
    (2) Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Optional units will not 
be established.
    (b) For any processor contract that stipulates the number of acres 
to be planted, in addition to or instead of, establishing optional units 
by section, section equivalent or FSA farm serial number, or irrigated 
and non-irrigated acreage, optional units may be established by type if 
acreage of one type does not continue into acreage of another type in 
the same rows or planting pattern.

[[Page 523]]

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions:
    (a) You may select only one price election for all the processing 
beans in the county insured under this policy unless the Special 
Provisions provide different price elections by type. The percentage of 
the maximum price elections you choose for one type will be applicable 
to all other types insured under this policy.
    (b) The appraised production from bypassed acreage that could have 
been accepted by the processor will be included when determining your 
approved yield.
    (c) Acreage that is bypassed because it was damaged by an insurable 
cause of loss will be considered to have a zero yield when determining 
your approved yield.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are March 15.

                          6. Report of Acreage

    In addition to the provisions of section 6 of the Basic Provisions, 
you must provide a copy of all processor contracts to us on or before 
the acreage reporting date.

                             7. Insured Crop

    (a) In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the processing beans in the county for which a 
premium rate is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That are grown under, and in accordance with, the requirements 
of a processor contract executed on or before the acreage reporting date 
and are not excluded from the processor contract at any time during the 
crop year; and
    (3) That are not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Interplanted with another crop; or
    (ii) Planted into an established grass or legume.
    (b) You will be considered to have a share in the insured crop if, 
under the processor contract, you retain control of the acreage on which 
the processing beans are grown, you are at risk of loss, and the 
processor contract provides for delivery of the processing beans under 
specified conditions and at a stipulated base contract price.
    (c) A commercial processing bean producer who is also a processor or 
broker may establish an insurable interest if the following requirements 
are met:
    (1) The producer must comply with these Crop Provisions;
    (2) Prior to the sales closing date, the Board of Directors or 
officers of the processor or the broker must execute and adopt a 
resolution that contains the same terms as an acceptable processor 
contract. Such resolution will be considered a processor contract under 
this policy; and
    (3) Our inspection reveals that the processing facilities comply 
with the definition of a processor contained in these Crop Provisions.

                          8. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions:
    (a) Any acreage of the insured crop that is damaged before the final 
planting date, to the extent that the majority of producers in the area 
would normally not further care for the crop, must be replanted unless 
we agree that it is not practical to replant; and
    (b) We will not insure acreage that does not meet any rotation 
requirements, if applicable, contained in the Special Provisions.

                           9. Insurance Period

    In lieu of the provisions contained in section 11 of the Basic 
Provisions, regarding the end of the insurance period, insurance ceases 
at the earlier of:
    (a) The date the processing beans:
    (1) Were destroyed;
    (2) Should have been harvested but were not harvested;
    (3) Were abandoned; or
    (4) Were harvested;
    (b) The date you harvest sufficient production to fulfill your 
processor contract if the processor contract stipulates a specific 
amount of production to be delivered;
    (c) Final adjustment of a loss; or
    (d) The date shown below for the end of the insurance period in the 
calendar year in which the processing beans would normally be harvested, 
unless otherwise agreed to in writing, as follows:
    (1) October 30 for all processing beans in the state of Arkansas;
    (2) October 15 for all processing beans in the states of Delaware, 
Maryland, and New Jersey;
    (3) October 5 for all processing beans in the states of Idaho, 
Oregon, and Washington;
    (4) September 30 for snap beans in the state of New York;
    (5) September 20 for snap beans in all other states; or
    (6) October 5 for lima beans in all other states.

[[Page 524]]

                           10. Causes of Loss

    In accordance with the provisions of section 12 of the Basic 
Provisions:
    (a) Insurance is provided only against the following causes of loss 
that occur during the insurance period:
    (1) Adverse weather conditions, including:
    (i) Excessive moisture that prevents the harvesting equipment from 
entering the field or that prevents the timely operation of harvesting 
equipment; and
    (ii) Abnormally hot or cold temperatures that cause an unexpected 
number of acres over a large producing area to be ready for harvest at 
the same time, affecting the timely harvest of a large number of such 
acres or the processing of such production is beyond the capacity of the 
processor, either of which causes the acreage to be bypassed.
    (2) Fire;
    (3) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (4) Plant disease on acreage not planted to processing beans the 
previous crop year. (In certain instances, contained in the Special 
Provisions or in a written agreement, acreage planted to processing 
beans the previous year may be covered. Damage due to insufficient or 
improper application of disease control measures is not covered);
    (5) Wildlife;
    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of the irrigation water supply, if due to a cause of 
loss contained in section 10 (a)(1) through (7) that occurs during the 
insurance period.
    (b) In addition to the causes of loss excluded in section 12 of the 
Basic Provisions, we will not insure any loss of production due to:
    (1) Bypassed acreage because of:
    (i) The breakdown or non-operation of equipment or facilities; or
    (ii) The availability of a crop insurance payment. We may deny any 
indemnity immediately in such circumstance or, if an indemnity has been 
paid, require you to repay it to us with interest at any time acreage 
was bypassed due to the availability of a crop insurance payment; or
    (2) Your failure to follow the requirements contained in the 
processor contract.

                11. Duties In The Event of Damage or Loss

    In addition to the notice required by section 14 of the Basic 
Provisions, you must give us notice:
    (a) Not later than 48 hours after:
    (1) Total destruction of the processing beans on the unit; or
    (2) Discontinuance of harvest on a unit on which unharvested 
production remains.
    (b) Within 3 days after the date harvest should have started on any 
acreage that will not be harvested unless we have previously released 
the acreage. You must also provide acceptable documentation of the 
reason the acreage was bypassed. Failure to provide such documentation 
will result in our determination that the acreage was bypassed due to an 
uninsured cause of loss. If the crop will not be harvested and you wish 
to destroy the crop, you must leave representative samples of the 
unharvested crop for our inspection. The samples must be at least 10 
feet wide and extend the entire length of each field in each unit. The 
samples must not be destroyed until the earlier of our inspection or 15 
days after notice is given to us; and
    (c) At least 15 days prior to the beginning of harvest if you intend 
to claim an indemnity on any unit, or immediately if damage is 
discovered during the 15 day period or during harvest. If you fail to 
notify us and such failure results in our inability to inspect the 
damaged production, we will consider all such production to be undamaged 
and include it as production to count. You are not required to delay 
harvest.

                         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 such 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, by type if applicable;
    (2) Multiplying each result of section 12(b)(1) by the respective 
price election, by type if applicable;
    (3) Totaling the results of section 12(b)(2) if there are more than 
one type;
    (4) Multiplying the total production to count (see section 12(c)), 
for each type if applicable, by its respective price election;
    (5) Totaling the results of section 12(b)(4) if there are more than 
one type;
    (6) Subtracting the results of section 12(b)(4) from the results of 
section 12(b)(2) if there is only one type or subtracting the results of 
section 12(b)(5) from the result of section 12(b)(3) if there are more 
than one type; and
    (7) Multiplying the result of section 12(b)(6) by your share.
    For example:
    You have a 100 percent share in 100 acres of snap type processing 
beans in the unit, with a guarantee of 3.0 tons per acre and a price 
election of $110.00 per ton. You are only able to harvest 200 tons. Your 
indemnity would be calculated as follows:


[[Page 525]]


(1) 100 acres  x  3.0 tons = 300 tons guarantee;
(2) 300 tons  x  $110.00 price election = $33,000.00 value of guarantee;
(3) 200 tons  x  $110.00 price election = $22,000.00 value of production 
          to count;
(4) $33,000.00 - $22,000.00 = $11,000.00 loss; and
(5) $11,000.00  x  100 percent = $11,000.00 indemnity payment.
    You also have a 100 percent share in 100 acres of lima type 
processing beans in the same unit, with a guarantee of 1.0 ton per acre 
and a price election of $225.00 per ton. You are only able to harvest 75 
tons. Your total indemnity for both snap and lima types processing beans 
would be calculated as follows:

(1) 100 acres  x  3.0 tons = 300 tons guarantee for the snap type, and 
          100 acres  x  1.0 ton = 100 tons guarantee for the lima type;
(2) 300 tons  x  $110.00 price election = $33,000.00 value of guarantee 
          for the snap type, and 100 tons  x  $225.00 price election = 
          $22,500.00 value of guarantee for the lima type;
(3) $33,000.00 + $22,500.00 = $55,500.00 total value of guarantee;
(4) 200 tons  x  $110.00 price election = $22,000.00 value of production 
          to count for the snap type, and 75 tons  x  $225.00 price 
          election = $16,875.00 value of production to count for the 
          lima type;
(5) $22,000.00 + $16,875.00 = $38,875.00 total value of production to 
          count;
(6) $55,500.00 - $38,875.00 = $16,625.00 loss; and
(7) $16,625.00 loss  x  100 percent = $16,625.00 indemnity payment.

    (c) The total production to count, specified in tons, from all 
insurable acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) That is put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide production records that are 
acceptable to us.
    (ii) Production lost due to uninsured causes.
    (iii) Production on acreage that is bypassed unless the acreage was 
bypassed due to an insured cause of loss which resulted in production 
which would not be acceptable under the terms of the processor contract.
    (iv) 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 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.
    (2) All harvested processing bean production from the insurable 
acreage. The amount of such production will be:
    (i) The usable tons of processing beans shown on the processor 
settlement sheet, if available; or
    (ii) Determined by dividing the dollar amount paid, payable, or 
which should have been paid under the terms of the processor contract 
for the quality and quantity of beans to be delivered to the processor 
by the base contract price per ton; and
    (3) All harvested processing bean production from any other 
insurable units that have been used to fulfill your processor contract 
for this unit.

                            13. Late Planting

    A late planting period is not applicable to processing beans unless 
allowed by the Special Provisions and you provide written approval from 
the processor by the acreage reporting date that it will accept the 
production from the late planted acres when it is expected to be ready 
for harvest.

                         14. Prevented Planting

    Your prevented planting coverage will be 40 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to a level specified in the actuarial documents.

[62 FR 58625, Oct. 30, 1997, as amended at 62 FR 65176, Dec. 10, 1997]



Sec. 457.156  Quota tobacco crop insurance provisions.

    The Quota Tobacco Crop Insurance Provisions for the 1999 and 
succeeding crop years are as follows:
    FCIC Policies

[[Page 526]]

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured policies:

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

                 Quota Tobacco Crop Insurance Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Amount of insurance. The dollar amount determined by multiplying the 
insured poundage quota by the current year's support price or the 
percentage of the current year's support price you select less any 
adjustments for late planting as specified in section 14.
    Approved yield. The yield calculated in accordance with 7 CFR part 
400, subpart G, if required by the Special Provisions.
    Basic unit. In lieu of the definition in the Basic Provisions, a 
basic unit is all insurable acreage of an insurable type of tobacco in 
the county in which you have a share on the date of planting for the 
crop year and that is identified by a single FSA farm serial number at 
the time insurance first attaches under these provisions for the crop 
year.
    Carryover tobacco. Any tobacco produced on the land identified by a 
FSA farm serial number in previous years that remained unsold at the end 
of the most recent marketing year.
    County. In lieu of the definition in the Basic Provisions, county is 
defined as the county or other political subdivision of a state shown on 
your accepted application including any land identified by a FSA farm 
serial number for such county but physically located in another county.
    Discount variety. Tobacco defined as such under the provisions of 
the United States Department of Agriculture tobacco price support 
program.
    Effective poundage marketing quota. The farm marketing quota as 
established and recorded by the local FSA office for the land identified 
by the FSA farm serial number plus any additional poundage, as allowed 
by the USDA Tobacco Marketing Quota Regulations, that you intend to 
produce for each unit in that crop year minus the amount of any 
carryover tobacco. The term may not include any tobacco that would be 
subject to a marketing quota penalty under USDA Tobacco Marketing Quota 
Regulations. For any crop year in which there are no effective USDA 
Tobacco Marketing Quota Regulations, the effective poundage marketing 
quota will be the pounds obtained by multiplying the applicable approved 
yield per acre by the lower of the reported or insured acreage on the 
basic unit, unless otherwise provided by the actuarial documents.
    Fair market value. The current year's tobacco season average price 
for the applicable type of tobacco obtained from the sale of the tobacco 
through a market other than an auction warehouse.
    Farm yield. The yield per acre used by FSA to establish the 
effective poundage marketing quota for land identified by a FSA farm 
serial number, unless we have estab lished a yield for that land in the 
actuarial documents.
    Harvest. Cutting and removing all insured tobacco from the field in 
which it was grown.
    Hydroponic plants. Seedlings grown in liquid nutrient solutions.
    Insured poundage quota. The lesser of:
    (1) The product (in pounds) obtained by multiplying the effective 
poundage marketing quota for the land identified by a FSA farm serial 
number by your selected coverage level; or
    (2) The farm yield or approved yield, as applicable, adjusted for 
late planting in accordance with section 14, if applicable, multiplied 
by the appropriate number of insured acres and by your selected coverage 
level.
    Late planting period. In lieu of the definition in section 1 of the 
Basic Provisions, the period that begins the day after the final 
planting date for the insured crop and ends 15 days after the final 
planting date, unless otherwise specified in the Special Provisions.
    Market price. The previous years' season average price published by 
National Agricultural Statistics Service for the applicable type of 
tobacco in the area.
    Marketing year. The marketing year published by National 
Agricultural Statistics Service for the applicable type of tobacco in 
the area.
    Planted acreage. Land in which tobacco seedlings, including 
hydroponic plants, have been transplanted by hand or machine from the 
tobacco bed to the field.
    Pound. Sixteen ounces avoirdupois.
    Replanting. In lieu of the definition in section 1 of the Basic 
Provisions, performing the cultural practices necessary to replace the 
tobacco plant, and then replacing the tobacco plant in the insured 
acreage with the expectation of producing at least the quota.
    Support price. The average price per pound for the type of tobacco 
as announced by the USDA under its tobacco price support program, or, if 
there is no such program, as announced by FCIC.
    Tobacco bed. An area protected from adverse weather, in which 
tobacco seeds are sown and seedlings are grown until transplanted into 
the tobacco field by hand or machine.

[[Page 527]]

                            2. Unit Division

    A unit will be determined in accordance with the definition of basic 
unit contained in section 1 of these Crop Provisions. The provision in 
the Basic Provisions regarding optional units are not applicable, unless 
specified by the Special Provisions.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to section 3 of the Basic Provisions, a production 
report, if required by the Special Provisions, must be filed in 
accordance with section 3(c) of the Basic Provisions.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are March 15.

                          6. Report of Acreage

    In addition to the requirements of section 6 of the Basic 
Provisions:
    (a) You must report the effective poundage marketing quota and 
specify any amount of carryover tobacco, if applicable.
    (b) You must provide a copy of any written lease agreement between 
you and any landlord or tenant showing the amount of the effective 
poundage marketing quota allocated to you. The written lease agreement 
must:
    (1) Identify all other persons sharing in the effective poundage 
marketing quota; and
    (2) Be submitted to your local insurance provider's office on or 
before the acreage reporting date.
    (c) In the event of a loss, if the written lease agreement has been 
submitted timely, we will distribute the effective poundage marketing 
quota in accordance with the terms of the written lease agreement. If 
the written lease agreement is not submitted timely, we will prorate the 
effective poundage marketing quota across the FSA farm serial number to 
all insured and uninsured persons based on planted acres within land 
identified by the FSA farm serial number.

                            7. Annual Premium

    In lieu of paragraph (c) of section 7 of the Basic Provisions, your 
annual premium amount is determined by either:
    (a) Multiplying the amount of insurance by the rate, your share, and 
any premium adjustment percentages that may apply; or
    (b) If no support price program exists, multiplying the approved 
yield by the coverage level, the support price, the acres, your share, 
and any premium adjustment percentages that may apply.

                             8. Insured Crop

    (a) In accordance with section 8 of the Basic Provisions, the crop 
insured will be any of the tobacco types designated in the Special 
Provisions for the county, in which you have a share, that you elect to 
insure, and for which a premium rate is provided by the actuarial 
documents.
    (b) In addition to section 8 of the Basic Provisions, the crop 
insured will not include any poundage above the effective poundage 
marketing quota or the insured poundage quota.

                          9. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions, 
we will not insure any acreage under these crop provisions that is:
    (a) Planted to a discount variety;
    (b) Planted to a tobacco type for which no premium rate is provided 
by the actuarial documents;
    (c) Planted in any manner other than as provided in the definition 
of ``planted acreage'' in section 1 of these Crop Provisions, unless 
otherwise provided by the Special Provisions or by written agreement; or
    (d) Damaged before the final planting date to the extent that most 
of the producers of tobacco acreage with similar characteristics in the 
area would normally not further care for the crop, unless such crop is 
replanted or we agree that replanting is not practical.

                          10. Insurance Period

    In accordance with the provisions of section 11(b) of the Basic 
Provisions, insurance ceases at the earliest of:
    (a) Total destruction of the tobacco on the unit;
    (b) Weighing-in at the tobacco warehouse;
    (c) Removal of the tobacco from the field where grown except for 
curing, grading, packing, or immediate delivery to the tobacco 
warehouse; or
    (d) The February 28 immediately following the normal harvest period.

                           11. Causes of Loss

    In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss that occur during the insurance period:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;

[[Page 528]]

    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if caused by a peril 
specified in section 11 (a) through (g) that occurs during the insurance 
period.

                12. Duties In The Event of Damage or Loss

    In accordance with the requirements of section 14 of the Basic 
Provisions, any representative samples we may require of each 
unharvested tobacco type must be at least 5 feet wide (at least two 
rows) and extend the entire length of each field in the unit. The 
samples must not be harvested or destroyed until after our inspection.

                         13. 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, we will 
allocate any commingled production to such units in proportion to our 
liability on the harvested acreage for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured poundage quota by your elected 
percentage of the current year's support price.
    (2) Subtracting the total value of the production to be counted (see 
section 13(c)) from the amount of insurance; and
    (3) Multiplying the result in section 13(b)(1) by your share. For 
example:
    You have 100 percent share of type 31 quota tobacco in the unit, 
with an insurable poundage quota of 1,000 pounds and a support price of 
$1.73 per pound. The amount of insurance equals $1730.00 (1,000 
insurable poundage quota  x  $1.73 support price). You are only able to 
harvest 600 pounds. The value of the total production to count equals 
$1038.00 (600 harvested pounds  x  $1.73 support price). Your indemnity 
would be calculated as follows:
    (1) $1730.00 (amount of insurance)-$1038.00 (value of the total 
production to count) = $692.00 loss
    (2) $692.00 loss x 100 percent = $692.00 indemnity payment
    (c) The value of the total production to count (pounds of appraised 
or harvested production) for all insurable acreage on the unit will 
include:
    (1) All appraised production as follows:
    (i) Not less than the amount of insurance per insured acre for the 
unit for any acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records, if 
required by the Special Provisions;
    (ii) The value of production lost due to uninsured causes which is 
the number of pounds of such production multiplied by the support price;
    (iii) The value of potential production on unharvested insured 
acreage that you intend to put to another use with our consent, if you 
and we agree on the number of pounds of such production to count which 
will be multiplied by the support price. 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 
allow you 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 value of production to count for 
such acreage will be the number of pounds of harvested or appraised 
production taken from samples at the time harvest should have occurred 
multiplied by the support price. If you do not leave the required 
samples intact, or you fail to provide sufficient care for the samples, 
the value of production to count will be our appraisal made prior to 
giving you consent to put the acreage to another use multiplied by the 
support price); or
    (B) If you elect to continue to care for the crop, the value of 
production to count for the acreage will be the harvested production, or 
our reappraisal multiplied by the support price if additional damage 
occurs and the crop is not harvested;
    (2) All harvested production from insurable acreage multiplied by:
    (i) The average price for any tobacco sold on a warehouse floor; and
    (ii) Fair market value for all other tobacco sold or not sold.
    (d) Mature tobacco production that is damaged by insurable causes 
will be adjusted for quality based on the USDA Official Standard Grades 
for the insured type of tobacco.
    (e) To enable us to determine the fair market value of tobacco not 
sold through auction warehouses, you must give us the opportunity to 
inspect such tobacco before it is sold, contracted to be sold, or 
otherwise disposed. Failure to provide us the opportunity to inspect 
such tobacco may result in rejection of any claim for indemnity.
    (f) If we consider the best offer you receive for such tobacco to be 
inadequate, we may obtain additional offers on your behalf.
    (g) Once we agree that any carryover or current year's tobacco has 
no market value due to insured causes, you must destroy it. If you 
disagree and refuse to destroy the tobacco with no value, we will 
determine the value and count it as production to count.

                            14. Late Planting

    (a) In lieu of late planting provisions in the Basic Provisions 
regarding acreage initially

[[Page 529]]

planted after the final planting date, insurance will be provided for 
acreage planted to the insured crop after the final planting date as 
follows:
    (1) For each acre or portion thereof planted during the first 10 
days after the final planting date, the farm yield will be reduced by 1 
percent per day; and
    (2) For each acre or portion thereof planted during the 11th through 
the 15th day after the final planting date, the farm yield will be 
reduced by 2 percent per day.
    (b) If you plant enough acreage to fulfill the effective poundage 
marketing quota, there will be no reduction in the insured poundage 
quota as a result of any late planted acreage.

                         15. Prevented Planting

    The prevented planting provisions in the Basic Provisions are not 
applicable to quota tobacco.

[63 FR 34782, June 26, 1998]



Sec. 457.157  Plum crop insurance provisions.

    The plum crop insurance provisions for the 1999 and succeeding crop 
years are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured policies:

                          Plum Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic isions with (1) controlling (2), etc.

                             1. Definitions

    Adapted. Varieties of the insured crop that are recognized by the 
Cooperative State Research, Education, and Extension Service as 
compatible with agronomic and weather conditions in the county.
    Direct marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper, or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    Harvest. The picking of mature plums from the trees by hand.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Lug. Twenty-eight (28) pounds of the insured crop.
    Scion. Twig or portion of a twig of one plant that is grafted onto a 
stock of another.
    Varietal group. Different varieties of plums that are grouped 
according to the normal maturity dates as specified in the Special 
Provisions.

                            2. Unit Division

    Provisions in the Basic Provisions that allow optional units by 
section, section equivalent, or FSA farm serial number and by irrigated 
and non-irrigated practices are not applicable. Optional units must meet 
one or more of the following, as applicable, unless otherwise provided 
by the Special Provisions, actuarial documents, or written agreement:
    (a) Optional units may be established if each optional unit is 
located on non-contiguous land.
    (b) In addition to, or instead of, establishing optional units for 
non-contiguous land, optional units may be established by varietal group 
when provided for in the Special Provisions. The requirements of section 
34(a)(1) of the Basic Provisions are not applicable for this method of 
unit division.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 (Insurance Guarantees, 
Coverage Levels, and Prices for Determining Indemnities) of the Basic 
Provisions (Sec. 457.8):
    (a) You may select only one price election for all the plums in the 
county insured under this policy unless the Special Provisions provide 
different price elections by varietal group, in which case you may 
select one price election for each plum varietal group designated in the 
Special Provisions. The price elections you choose for each varietal 
group must have the same percentage relationship to the maximum price 
offered by us for each varietal group. For example, if you choose 100 
percent of the maximum price election for one varietal group, you must 
also choose 100 percent of the maximum price election for all other 
varietal groups.
    (b) You must report, by the production reporting date designated in 
section 3 (Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities) of the Basic Provisions (Sec. 457.8), by 
varietal group if applicable:
    (1) Any damage, removal of trees, change in practices, or any other 
circumstance that may reduce the expected yield below the yield upon 
which the insurance guarantee is based, and the number of affected 
acres;

[[Page 530]]

    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and any time the planting pattern of such 
acreage is changed:
    (i) The age of the interplanted crop and varietal group if 
applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield.
    We will reduce the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of interplanting a 
perennial crop, removal of trees, damage, change in practice, and any 
other circumstance that may effect the yield potential of the insured 
crop. If you fail to notify us of any circumstance that may reduce your 
yields from previous levels, we will reduce your production guarantee as 
necessary at any time we become aware of the circumstance.

                           4. Contract Changes

    In accordance with section 4 (Contract Changes) of the Basic 
Provisions (Sec. 457.8), the contract change date is October 31 
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 January 31.

                             6. Insured Crop

    In accordance with section 8 (Insured Crop) of the Basic Provisions 
(Sec. 457.8), the crop insured will be all the plums in the county for 
which a premium rate is provided by the actuarial documents:
    (a) In which you have a share;
    (b) That are grown on tree varieties that:
    (1) Were commercially available when the trees were set out;
    (2) Are adapted to the area;
    (3) Are grown on rootstock that is adapted to the area; and
    (4) Are regulated by the California Tree Fruit Agreement, California 
Advisory Board Standards, a related crop advisory board, or the State;
    (c) That are irrigated;
    (d) That have produced an average of at least 200 lugs per acre in 
at least one of the three most recent actual production history crop 
years, unless we inspect the acreage and give our approval to insure 
such acreage in writing;
    (e) That are grown in an orchard that, if inspected, is considered 
acceptable by us; and
    (f) That have reached at least the fifth (5th) growing season after 
set out. Plums produced on scions that have not reached the fifth 
growing season may be insured if the provisions in section 6(a), (b), 
(c), and (e) are met. Such trees must have produced at least 200 lugs 
per acre in at least one year after being grafted.

                          7. Insurable Acreage

    In lieu of the provisions in section 9 (Insurable Acreage) of the 
Basic Provisions (Sec. 457.8) that prohibit insurance attaching to a 
crop planted with another crop, plums interplanted with another 
perennial crop are insurable unless we inspect the acreage and determine 
that it does not meet the requirements contained in your policy.

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8):
    (1) Coverage begins on February 1 of each crop year. Notwithstanding 
the previous sentence, for the year of application, if your application 
is received after January 22 but prior to February 1, insurance will 
attach on the 10th day after your properly completed application is 
received in our local office unless we inspect the acreage during the 
10-day period and determine that it does not meet insurability 
requirements. You must provide any information that we require for the 
crop or to determine the condition of the orchard.
    (2) The calendar date for the end of the insurance period for each 
crop year is September 30.
    (b) In addition to the provisions of section 11 (Insurance Period) 
of the Basic Provisions (Sec. 457.8):
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable share on any insurable acreage 
of plums on or before the acreage reporting date for the crop year, 
insurance will not be considered to have attached to, and no premium or 
indemnity will be due for such acreage for that crop year unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

[[Page 531]]

                            9. 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 during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the orchard;
    (3) Wildlife, unless control measures have not been taken;
    (4) Earthquake;
    (5) Volcanic eruption;
    (6) An insufficient number of chilling hours to effectively break 
dormancy; or
    (7) Failure of the irrigation water supply, if caused by an insured 
peril that occurs during the insurance period.
    (b) In addition to the causes of loss excluded in section 12 (Causes 
of Loss) of the Basic Provisions (Sec. 457.8), we will not insure 
against damage or loss of production due to:
    (1) Disease or insect infestation, unless adverse weather:
    (i) Prevents the proper application of control measures or causes 
properly applied control measures to be ineffective; or
    (ii) Causes disease or insect infestation for which no effective 
control mechanism is available;
    (2) Rejection of the crop by the packing house due to being 
undersized, immature, overripe, or mechanically damaged; or
    (3) Inability to market the plums for any reason other than actual 
physical damage from an insurable cause specified in this section. For 
example, we will not pay you an indemnity if you are unable to market 
due to quarantine, boycott, or refusal of any person to accept 
production.

                10. Duties In The Event of Damage or Loss

    In addition to the requirements of section 14 (Duties in the Event 
of Damage or Loss) of the Basic Provisions (Sec. 457.8), the following 
will apply:
    (a) You must notify us within 3 days of the date harvest should have 
started if the crop will not be harvested.
    (b) You must notify us at least 15 days before any production from 
any unit will be sold by direct marketing. We will conduct an appraisal 
that will be used to determine your production to count for production 
that is sold by direct marketing. If damage occurs after this appraisal, 
we will conduct an additional appraisal. These appraisals, and any 
acceptable records provided by you, will be used to determine your 
production to count. Failure to give timely notice that production will 
be sold by direct marketing will result in an appraised amount of 
production to count of not less than the production guarantee per acre 
if such failure results in our inability to make the required appraisal.
    (c) If you intend to claim an indemnity on any unit, you must notify 
us at least 15 days prior to the beginning of harvest or immediately if 
damage is discovered during harvest, so that we may inspect the damaged 
production.
    (d) You must not destroy the damaged crop until after we have given 
you written consent to do so.
    (e) If you fail to notify us in accordance with this section, we may 
consider all such production to be undamaged and include it as 
production to count.

                         11. 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 unit, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic unit, we will allocate any commingled production 
from 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 for each varietal group, if 
applicable, by its respective production guarantee;
    (2) Multiplying the results in section 11(b)(1) by the respective 
price election for each varietal group, if applicable;
    (3) Totaling the results in section 11(b)(2);
    (4) Multiplying the total production to be counted of each varietal 
group, if applicable, (see section 11(c)) by the respective price 
election;
    (5) Totaling the results in section 11(b)(4);
    (6) Subtracting the results in section 11(b)(5) from the results in 
section 11 (b)(3); and
    (7) Multiplying the result in section 11(b)(6) by your share.
    (c) The total production to count (in lugs) 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 sold by direct marketing directly if you fail to meet 
the requirement contained in section 10;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide production records that are 
acceptable to us.
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production; and
    (iv) Potential production on insured acreage that you intend to 
abandon or no longer care for, if you and we agree on the appraised 
amount of production. Upon such agreement,

[[Page 532]]

the insurance period for that acreage will end. If you do not agree with 
our appraisal, we may defer the claim only if you agree to continue to 
care for the crop. We will then make another appraisal when you notify 
us of further damage or that harvest is general in the area unless you 
harvested the crop, in which case we will use the harvested production. 
If you do not continue to care for the crop, our appraisal made prior to 
deferring the claim will be used to determine the production to count; 
and
    (2) All harvested production from the insurable acreage:
    (i) That is packed and sold as fresh fruit and meets the U.S. No. 1 
standards as modified by the California Tree Fruit Agreement publication 
for plums for the applicable crop year;
    (ii) That is packed and sold as fresh fruit but does not meet the 
grade requirements specified in section 11(c)(2)(i) due to insurable 
causes. Such production will be adjusted by:
    (A) Dividing the value per lug of this production by the highest 
price election available for the applicable varietal group; and
    (B) Multiplying the resulting factor, if less than 1.0, by the 
number of lugs of such plums.
    (iii) That is damaged and is, or could be, marketed for any use 
other than fresh packed plums. Such production will be adjusted by:
    (A) Multiplying the number of tons of such production by the value 
per ton of the damaged plums or $50.00, whichever is greater; and
    (B) Dividing that result by the highest price election available for 
the applicable varietal group.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 33735, June 23, 1997, as amended at 62 FR 65177, Dec. 10, 1997]



Sec. 457.158  Apple crop insurance provisions.

    The Apple Crop Insurance Provisions for the 1999 and succeeding crop 
years are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured policies

(Appropriate title for insurance provider)

    Both FCIC and reinsured policies:

                     Apple Crop Insurance Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions, with (1) controlling (2), etc.

                             1. Definitions

    Area A. A geographic area that includes Montana, Wyoming, Utah, New 
Mexico and all states west thereof.
    Area B. A geographic area that includes all states not included in 
Area A, except for Colorado.
    Area C. Colorado.
    Bin. A container that contains a minimum of 875 pounds of apples or 
some other quantity designated in the Special Provisions.
    Box. A container that contains 35 pounds of apples or some other 
quantity designated in the Special Provisions.
    Bushel. In all states except Colorado, 42 pounds of apples. In 
Colorado, 40 pounds of apples.
    Culls. Apples that fail to meet the requirements of U.S. Cider 
Grade.
    Direct marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as a wholesaler, 
retailer, packer, processor, shipper, buyer or broker. Examples of 
direct marketing include selling through an on-farm or roadside stand, 
or a farmer's market, and permitting the general public to enter the 
field for the purpose of picking all or a portion of the crop.
    Excessive sun. Exposure of unharvested apples to direct or indirect 
sunlight that causes apples to grade less than U.S. Fancy due to 
sunburn.
    Harvest. The picking of mature marketable apples from the trees or 
removing such apples from the ground.
    Marketable. Apple production that grades U.S. No. 1, 2, or Cider in 
accordance with the United States Standards for Grades of Apples.
    Non-contiguous. Any two or more tracts of land whose boundaries do 
not touch at any point, except that land separated only by a public or 
private right-of-way, waterway, or an irrigation canal will be 
considered as contiguous.
    Pound. Sixteen (16) ounces avoirdupois.
    Production guarantee (per acre). The quantity of apples (boxes or 
bushels) determined by multiplying the approved APH yield per acre by 
the coverage level percentage you elect.
    Russeting. A brownish roughened area on the surface of the apple.
    Sunburn. As defined in the United States Standards for Grades of 
Apples.

[[Page 533]]

                            2. Unit Division

    In addition to the requirements of section 34(b) of the Basic 
Provisions, optional units may be established if each optional unit is 
located on non-contiguous land.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions:
    (a) You may select only one price election for all the apples 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 apple 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) You must report, by the production reporting date designated in 
section 3 of the Basic Provisions, by type if applicable:
    (1) Any damage, removal of trees, change in practices, or any other 
circumstance that may reduce the expected yield below the yield upon 
which the insurance guarantee is based, and the number of affected 
acres;
    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting pattern;
    (4) The separate acreage of apples intended for fresh-market or 
processing as shown on the actuarial table; and
    (5) For the first year of insurance for acreage interplanted with 
another perennial crop, and anytime the planting pattern of such acreage 
has changed:
    (i) The age of the interplanted crop, and type if applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield. We will reduce the yield used to establish your 
production guarantee as necessary, based on our estimate of the effect 
of the following: interplanted perennial crop; removal of trees; damage; 
change in practices and any other circumstance on the yield potential of 
the insured crop. If you fail to notify us of any circumstance that may 
reduce your yields from previous levels, we will reduce your production 
guarantee as necessary at any time we become aware of the circumstance.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is August 31 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are November 20.

                             6. Insured Crop

    In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the apples in the county for which a premium rate is 
provided by the actuarial table:
    (a) In which you have a share;
    (b) That are grown on tree varieties that:
    (1) Are adapted to the area;
    (2) Are in area A and have produced at least an average of 10 bins 
per acre;
    (3) Are in area B and have produced at least an average of 150 
bushels per acre;
    (4) Are in Area C and have produced at least an average of 200 
bushels per acre; and
    (c) That are grown in an orchard that, if inspected, is considered 
acceptable by us.

                          7. Insurable Acreage

    In lieu of the provisions in section 9 of the Basic Provisions that 
prohibit insurance attaching to a crop planted with another crop, apples 
interplanted with another perennial crop are insurable unless we inspect 
the acreage and determine that it does not meet the insurability 
requirements contained in your policy.

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 of the Basic 
Provisions:
    (1) Coverage begins on November 21 of each crop year, except for the 
year of application, if your application is received after November 11 
but prior to November 21. In that case, insurance will attach on the 
10th day after your properly completed application is received in our 
local office unless we inspect the acreage prior to the end of the 10 
day period and determine that it does not meet insurability 
requirements. You must provide any information that we require for the 
crop to determine the condition of the orchard.
    (2) The calendar date for the end of the insurance period for each 
crop year is November 5.
    (b) In addition to the provisions of section 11 of the Basic 
Provisions:
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date for the beginning of the insurance period. There will no 
coverage of any insurable interest acquired after the acreage reporting 
date.
    (2) If you relinquish your insurable share on any insurable acreage 
of apples on or before the acreage reporting date for the crop year, and 
the acreage was insured by you the

[[Page 534]]

previous crop year, insurance will not be considered to have attached 
to, and no premium or indemnity will be due for such acreage for that 
crop year unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            9. Causes of Loss

    (a) In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss that occur during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and other forms of undergrowth have not been 
controlled or unmulched pruning debris has not been removed from the 
orchard;
    (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) Earthquake;
    (6) Volcanic eruption;
    (7) Failure of the irrigation water supply, if caused by an insured 
peril that occurs during the insurance period;
    (8) Excess sun, only if you have elected the Fresh Fruit Option B 
and the Sunburn Option as described in section 13; and
    (9) Wildlife;
    (b) In addition to the causes of loss excluded in section 12 of the 
Basic Provisions, we will not insure against damage or loss of 
production due to:
    (1) Failure of the fruit to size, shape, or color properly; or
    (2) Inability to market the apples for any reason other than actual 
physical damage from an insurable cause specified in this section. For 
example, we will not pay you an indemnity if you are unable to market 
due to quarantine, boycott, or refusal of any person to accept 
production.
    (3) Mechanical damage including, but not limited to, limb rubs, 
scars, and punctures; or
    (4) Russeting.

                10. Duties In the Event of Damage or Loss

    In addition to the requirements of section 14 of the Basic 
Provisions, the following will apply:
    (a) You must notify us within three 3 days of the date harvest 
should have started if the crop will not be harvested.
    (b) You must notify us at least 15 days before any production from 
any unit will be sold by direct marketing. We will conduct an appraisal 
that will be used to determine your production to count for production 
that is sold by direct marketing. If damage occurs after this appraisal, 
we will conduct an additional appraisal. These appraisals, and any 
acceptable records provided by you, will be used to determine your 
production to count. Failure to give timely notice that production will 
be sold by direct marketing will result in an appraised amount of 
production to count of not less than the production guarantee per acre 
if such failure results in our inability to make the required appraisal.
    (c) If you intend to claim an indemnity on any unit, you must notify 
us at least 15 days prior to the beginning of harvest, or immediately if 
damage is discovered during harvest, so that we may inspect the damaged 
production.
    (d) You must not destroy the damaged crop until after we have given 
you written consent to do so. If you fail to meet the requirements of 
this section and such failure results in our inability to inspect the 
damaged production, all such production will be considered undamaged and 
included as production to count.

                         11. 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 unit, we will combine all optional units for 
which such 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, by type if applicable;
    (2) Multiplying each result in section 11(b)(1) by the respective 
price election, by type if applicable;
    (3) Totaling the results in section 11(b)(2) if there are more than 
one type;
    (4) Multiplying the total production to count (see section 11(c)), 
for each type if applicable, by the respective price election;
    (5) Totaling the results in section 11(b)(4), if there are more than 
one type;
    (6) Subtracting the total in section 11(b)(5) from the total in 
section 11(b)(3); and
    (7) Multiplying the result in section 11(b)(6) by your share.
    For example:
    You have 100 percent share in 28 acres of fresh market apples and 30 
acres of processing apples in the unit, with a 300 bushel per acre 
guarantee and a price election of $5.00 per bushel for fresh market and 
$2.00 per bushel for processing. You are only able to harvest 4,500 
bushels of fresh market apples

[[Page 535]]

and 6,500 bushels of processing. Your indemnity would be calculated as 
follows:
    (1) 28 acres  x  300 bushels = 8,400 bushels guarantee of fresh 
market; 30 acres  x  300 bushels = 9,000 bushels guarantee of 
processing;
    (2) 8,400 bushels  x  $5.00 price election = $42,000.00 value of 
guarantee for fresh market; 9,000 bushels  x  $2.00 price election = 
$18,000.00 value of guarantee for processing;
    (3) $42,000.00 + $18,000.00 = $60,000 total value guarantee;
    (4) 4,500.00 bushels  x  $5.00 price election = $22,500.00 value of 
production to count for fresh market;
    6,500.00 bushels  x  $2.00 price election = $13,000.00 value of 
production to count for processing;
    (5) $22,500.00 + $13,000.00 = $35,500.00 total value of production 
to count;
    (6) $60,000.00-$35,500.00 = $24,500.00 loss; and
    (7) $24,000.00  x  100 percent = $24,500.00 indemnity payment.
    (c) The total production to count (boxes or bushels) 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 sold by direct marketing if you fail to meet the 
requirements contained in section 10;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production; and
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we may defer 
the claim only if you agree to continue to care for the crop. We will 
then make another appraisal when you notify us of further damage or that 
harvest is general in the area unless you harvested the crop, in which 
case we will use the harvested production. If you do not continue to 
care for the crop, our appraisal made prior to deferring the claim will 
be used to determine the production to count; and
    (2) All marketable harvested production from the insurable acreage.
    (3) Mature marketable apple production may be reduced as a result of 
loss in quality due to hail, wind, freeze, or sunburn in accordance with 
section 13 of these provisions, if you elect one or more of these 
coverages.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

              13. Optional Coverage for Quality Adjustment

    (a) These quality adjustment options apply only if the following 
conditions are met:
    (1) You have not elected to insure your apples under the 
Catastrophic Risk Protection (CAT) Endorsement.
    (2) You elected the Fresh Fruit Option A or the Fresh Fruit Option 
B; or you elected both the Fresh Fruit Option B and the Sunburn Option 
on your application or other form approved by us, and did so on or 
before the sales closing date for the initial crop year for which you 
wish it to be effective. By doing so, you agreed to pay the additional 
premium designated in the actuarial documents for this optional 
coverage; and
    (3) You or we did not cancel the option in writing on or before the 
cancellation date. Your election of CAT coverage for any crop year after 
this endorsement is effective will be considered as notice of 
cancellation by you.
    (b) If you select Fresh Fruit Option A only, Fresh Fruit Option A 
will apply to all of your apples intended for processing and fresh 
market.
    (c) If you select Fresh Fruit Option B, those provisions will apply 
to all of your apples intended for fresh market and the provisions of 
Fresh Fruit Option A will apply to all of your apples intended for 
processing.
    (d) If you select the Sunburn Option as designated in the Special 
Provisions, you must also select Fresh Fruit Option B.
    (e) In addition to the requirements of section 10 of these 
provisions, you must permit us to inspect and grade the fruit prior to 
harvest or no quality adjustment will be made.
    (f) Fresh Fruit Option A and Fresh Fruit Option B are subject to the 
following conditions:
    (1) Fresh Fruit Option A--In addition to section 11(c) of these 
provisions and notwithstanding the definition of ``marketable'' in 
section 1 of these provisions, your production to count will be adjusted 
when your apples are damaged by hail to the extent that such apples will 
not grade U.S. No. 1 (processing). Harvested apple production that is 
damaged by hail to the extent that it does not grade 80 percent U.S. No. 
1 (processing) or better, in accordance with applicable USDA Standards 
for Grades of Apples, will be adjusted as follows:
    (i) Production to count with 21 through 40 percent not grading U.S. 
No. 1 (processing) or better will be reduced 2 percent for each full 
percent in excess of 20 percent.
    (ii) Production to count with 41 through 50 percent not grading U.S. 
No. 1 (processing) or better will be reduced 40 percent plus an 
additional 3 percent for each full percent in excess of 40 percent.
    (iii) Production to count with 51 percent through 64 percent not 
grading U.S. No. 1

[[Page 536]]

(processing) or better will be reduced 70 percent plus an additional 2 
percent for each full percent in excess of 50 percent.
    (iv) Production to count with 65 percent or more not grading U.S. 
No. 1 (processing) or better will be considered 100 percent cull 
production.
    (v) The difference between the total production and the production 
to count as determined above will be considered cull production.
    (vi) Thirty (30) percent of all cull production will be considered 
production to count, unless otherwise specified in the Special 
Provisions.
    (vii) No reduction in production to count will be applied to any 
apple grading less than U.S. No. 1 (processing) due solely to size, 
shape, russeting, or color.
    (viii) Any appraisal we make on the insured acreage will be 
considered production to count unless such appraised production is 
knocked to the ground by wind or hail or frozen on the tree to the 
extent that harvest is not practical.
    (2) Fresh Fruit Option B--Notwithstanding section 11(c) and the 
definitions of ``harvest'' and ``marketable'' in section 1 of these 
provisions, the total production to count for a unit will include all 
harvested and appraised production. Harvested apple production that is 
damaged by hail to the extent that it does not grade 80 percent U.S. 
Fancy or better, in accordance with applicable USDA Standards for Grades 
of Apples, will be adjusted as follows:
    (i) Production to count with 21 through 40 percent not grading U.S. 
Fancy or better will be reduced 2 percent for each full percent in 
excess of 20 percent.
    (ii) Production to count with 41 through 50 percent not grading U.S. 
Fancy or better will be reduced 40 percent plus an additional 3 percent 
for each full percent in excess of 40 percent.
    (iii) Production to count with 51 percent through 64 percent not 
grading U.S. Fancy or better will be reduced 70 percent plus an 
additional 2 percent for each full percent in excess of 50 percent.
    (iv) Production to count with 65 percent or more not grading U.S. 
Fancy or better will be considered 100 percent cull production.
    (v) The difference between the total production and the production 
to count as determined above will be considered cull production.
    (vi) Apples that are knocked to the ground by wind or frozen to the 
extent they can be harvested but not marketed as U.S. Fancy grade apples 
will be considered 100 percent cull production.
    (vii) Thirty (30) percent of all cull production will be considered 
production to count, unless otherwise specified in the Special 
Provisions.
    (viii) No reduction in production to count will be applied to any 
apple grading less than U.S. Fancy due solely to size, shape, russeting, 
or color.
    (ix) Any appraisal we make on the insured acreage will be considered 
production to count unless such appraised production is knocked to the 
ground by wind, hail, or frozen on the tree to the extent that harvest 
is not practical.
    (g) Sunburn Option
    (1) In addition to the causes of loss specified in section 9 of 
these provisions, excess sun is an insurable cause of loss.
    (2) Notwithstanding the definitions of ``harvest'' and 
``marketable'' in section 1 and 11(c)(1) and (2) of these provisions, 
the total production to be counted for a unit will include all harvested 
and appraised production. Harvested apple production that, due to 
excessive sun or in conjunction with hail damage, does not grade 80 
percent U.S. Fancy or better, in accordance with applicable USDA 
Standards, will be adjusted as follows:
    (i) Production to count with 21 through 40 percent not grading U.S. 
Fancy or better due solely to excessive sun or excessive sun along with 
hail damage, will be reduced 2 percent for each full percent in excess 
of 20 percent.
    (ii) Production to count with 41 through 50 percent not grading U.S. 
Fancy or better due solely to excessive sun or excessive sun along with 
hail damage, will be reduced 40 percent plus an additional 3 percent for 
each full percent in excess of 40 percent.
    (iii) Production to count with 51 through 64 percent not grading 
U.S. Fancy or better due solely to excessive sun or excessive sun along 
with hail damage, will be reduced 70 percent plus an additional 2 
percent for each full percent in excess of 50 percent.
    (iv) Production to count with 65 percent or more not grading U.S. 
Fancy or better due solely to excessive sun or excessive sun along with 
hail damage, will be considered 100 percent cull production.
    (v) The difference between the total production and the production 
to count as determined above will be considered cull production.
    (vi) Thirty (30) percent of all cull production will be considered 
as production to count unless otherwise specified in the Special 
Provisions.

[63 FR 17054, Apr. 8, 1998]



Sec. 457.159  Stonefruit crop insurance provisions.

    The Stonefruit Crop Insurance Provisions for the 1999 and succeeding 
crop years are as follows:
    FCIC Policies

[[Page 537]]

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)

    Both FCIC and reinsured policies:

                  Stonefruit Crop Insurance Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Direct marketing. Sale of the insured crop directly to consumers 
without the intervention of an intermediary such as wholesaler, 
retailer, packer, processor, shipper, or buyer. Examples of direct 
marketing include selling through an on-farm or roadside stand, farmer's 
market, and permitting the general public to enter the field for the 
purpose of picking all or a portion of the crop.
    Grading standards. The California Tree Fruit Agreement Marketing 
Order, or California State Department of Food and Agriculture Code of 
Regulations in effect for the appropriate crop, type, or varietal group.
    Harvest. The picking of mature stonefruit either by hand or machine.
    Interplanted. Acreage on which two or more crops are planted in any 
form of alternating or mixed pattern.
    Lug. A container of fresh stonefruit of specified weight. Lugs of 
varying sizes will be converted to standard lug equivalents on the basis 
of the following average net pounds of packed fruit:

------------------------------------------------------------------------
                                                                  Pounds
                              Crop                               per lug
------------------------------------------------------------------------
Fresh Apricots.................................................       24
Fresh Nectarines...............................................       25
Fresh Freestone Peaches........................................       22
------------------------------------------------------------------------

    Weight for Processing Apricots, Processing Cling Peaches, and 
Processing Freestone Peaches are specified in tons.
    Marketable. Stonefruit production acceptable for processing or other 
human consumption, even if it fails to meet the State Department of Food 
and Agriculture minimum grading standard.
    Processor. A business enterprise regularly engaged in processing 
fruit for human consumption that possesses all licenses and permits for 
processing fruit required by the state in which it operates, and that 
possesses facilities, or has contractual access to such facilities, with 
enough equipment to accept and process contracted fruit within a 
reasonable amount of time after harvest.
    Stonefruit. Any of the following crops grown for fresh market or 
processing:

(a) Fresh Apricots,
(b) Fresh Freestone Peaches,
(c) Fresh Nectarines,
(d) Processing Apricots,
(e) Processing Cling Peaches, and
(f) Processing Freestone Peaches.

    Ton. Two thousand (2,000) pounds avoirdupois.
    Type. Class of a stonefruit crop with similar characteristics that 
are grouped for insurance purposes.
    Varietal group. A subclass of type.

                            2. Unit Division

    Notwithstanding the provisions of section 34 of the Basic Provisions 
that allow optional units by section, section equivalent, or FSA farm 
serial number and by irrigated and non-irrigated practices, optional 
units will only be allowed as stated herein or by written agreement.
    (a) Optional Units on Acreage Located on Non-contiguous Land: 
Optional units may be established if each optional unit is located on 
non-contiguous land.
    (b) Optional Units by Type or Varietal Group: Optional units may be 
established by type or varietal group if allowed by the Special 
Provisions.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions:
    (a) You may select only one price election and coverage level for 
each crop grown in the county and listed in the Special Provisions that 
is insured under this policy. If separate price elections are available 
by type or varietal group of a crop, the price elections you choose for 
each type or varietal group must have the same percentage relationship 
to the maximum price offered by us for each type or varietal group. For 
example, if you choose 100 percent of the maximum price election for one 
type of cling peaches, you must choose 100 percent of the maximum price 
election for all other types of cling peaches.
    (b) You must report, by the production reporting date designated in 
section 3 of the Basic Provisions, by type or varietal group, if 
applicable, for each stonefruit crop:
    (1) Any damage, removal of trees, change in practices, or any other 
circumstance that may reduce the expected yield below the yield upon 
which the insurance guarantee is based, and the number of affected 
acres;
    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial

[[Page 538]]

crop, and any time the planting pattern of such acreage is changed:
    (i) The age of the interplanted crop, and type or varietal group if 
applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield.
    We will reduce the yield used to establish your production guarantee 
as necessary, based on our estimate of the effect of interplanting a 
perennial crop, removal of trees, damage, change in practice, and any 
other circumstance that could affect the yield potential of the insured 
crop. If you fail to notify us of any circumstance that may reduce your 
yields from previous levels, we will reduce your production guarantee as 
necessary at any time we become aware of the circumstance.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is October 31 preceding the cancellation date.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are January 31.

                             6. Insured Crop

    In accordance with section 8 of the Basic Provisions, the crop 
insured will be all of each stonefruit crop you elect to insure, that is 
grown in the county, and for which premium rates are provided in the 
actuarial documents:
    (a) In which you have a share;
    (b) That is grown on trees that:
    (1) Were commercially available when the trees were set out;
    (2) Is adapted to the area; and
    (3) Is grown on a root stock that is adapted to the area;
    (c) That is irrigated;
    (d) That have produced at least 200 lugs of fresh market production 
per acre, or at least 2.2 tons per acre for processing crops, in at 
least 1 of the 3 most recent actual production history crop years, 
unless we inspect such acreage and give our approval in writing;
    (e) That are regulated by the California Tree Fruit Agreement or 
related crop advisory board for the state (for applicable types);
    (f) That are grown in an orchard that, if inspected, is considered 
acceptable by us; and
    (g) That have reached at least the fifth growing season after set 
out. However, we may agree in writing to insure acreage that has not 
reached this age if it meets the requirements of subsection (d) of this 
section.

                          7. Insurable Acreage

    In lieu of the provisions of section 9 of the Basic Provisions that 
prohibit insurance attaching to a crop planted with another crop, 
stonefruit interplanted with another perennial crop is insurable unless 
we inspect the acreage and determine that it does not meet the 
requirements for insurability contained in your policy.

                           8. Insurance Period

    (a) In accordance with the provisions of section 11 of the Basic 
Provisions:
    (1) Coverage begins on February 1 of each crop year, except that for 
the year of application, if your application is received after January 
22 but prior to February 1, insurance will attach on the 10th day after 
your properly completed application is received in our local office 
unless we inspect the acreage and determine that it does not meet 
insurability requirements. You must provide any information that we 
require for the crop or to determine the condition of the orchard.
    (2) The calendar date for the end of the insurance period for each 
crop year is:
    (i) July 31 for all apricots; and
    (ii) September 30 for all nectarines and peaches.
    (b) In addition to the provisions of section 11 of the Basic 
Provisions:
    (1) If you acquire an insurable share in any insurable acreage after 
coverage begins but on or before the acreage reporting date for the crop 
year, and after an inspection we consider the acreage acceptable, 
insurance will be considered to have attached to such acreage on the 
calendar date of acquisition.
    (2) If you lose or relinquish your insurable share on any insurable 
acreage of stonefruit on or before the acreage reporting date for the 
crop year and if the acreage was insured by you the previous crop year, 
insurance will not be considered to have attached to, and no premium or 
indemnity will be due for such acreage for that crop year unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.

                            9. Causes of Loss

    (a) In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss that occur during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the orchard;

[[Page 539]]

    (3) Wildlife;
    (4) Earthquake;
    (5) Volcanic eruption; or
    (6) Failure of the irrigation water supply, if due to a cause of 
loss contained in sections 9(a)(1) through (5) that occurs during the 
insurance period.
    (b) In addition to the causes of loss excluded by section 12 of the 
Basic Provisions, we will not insure against damage or loss of 
production due to:
    (1) Disease or insect infestation, unless adverse weather:
    (i) Prevents the proper application of control measures or causes 
properly applied control measures to be ineffective; or
    (ii) Causes disease or insect infestation for which no effective 
control mechanism is available;
    (2) Split pits regardless of cause; or
    (3) Inability to market the insured crop for any reason other than 
actual physical damage from an insurable cause of loss specified in this 
section. For example, we will not pay you an indemnity if you are unable 
to market due to quarantine, boycott, or refusal of any person to accept 
production.

                10. Duties in the Event of Damage or Loss

    In addition to the requirements of section 14 of the Basic 
Provisions, the following will apply:
    (a) You must notify us within 3 days after the date harvest should 
have started if the insured crop will not be harvested.
    (b) You must notify us at least 15 days before any production from 
any unit will be sold by direct marketing. We will conduct an appraisal 
that will be used to determine your production to count for production 
that is sold by direct marketing. If damage occurs after this appraisal, 
we will conduct an additional appraisal. These appraisals, and any 
acceptable records provided by you, will be used to determine your 
production to count. Failure to give timely notice that production will 
be sold by direct marketing will result in an appraised amount of 
production to count of not less than the production guarantee per acre 
if such failure results in our inability to make the required appraisal.
    (c) In addition to section 14 of the Basic Provisions, if you intend 
to claim an indemnity on any unit, you must give us notice at least 15 
days prior to the beginning of harvest. You must not destroy the damaged 
crop until after we have given you written consent to do so. If you fail 
to notify us and such failure results in our inability to inspect the 
damaged production, we may consider all such production to be undamaged 
and include it as production to count.

                         11. 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 such 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 for each type or varietal group 
by its respective production guarantee;
    (2) Multiplying each result of section 11(b)(1) by the respective 
price election for the type or varietal group;
    (3) Totaling the results of section 11(b)(2). (If there is only one 
type or varietal group, the result of (3) will be the same as the result 
of (2));
    (4) Multiplying the total production to count (see section 11(c)), 
for each type or varietal group, by the respective price election;
    (5) Totaling the results of section 11(b)(4);
    (6) Subtracting the result of section 11(b)(5) from the result of 
section 11(b)(2). (If there is only one type or varietal group, the 
result of (6) will be the same as the result of (5)); and
    (7) Multiplying the result of section 11(b)(6) by your share.

                              For example:

    You have a 100 percent share in 50 acres of varietal group A 
stonefruit in the unit, with a guarantee of 500 lugs per acre and a 
price election of $6.00 per lug. You are only able to harvest 5,000 
lugs. Your indemnity would be calculated as follows:

(1) 50.0 acres  x  500 lugs = 25,000 lugs guarantee;
(2) and (3) 25,000 lugs  x  $6.00 price election = $150,000.00 value of 
          guarantee;
(4) 5,000 lugs  x  $6.00 price election = $30,000.00 value of production 
          to count;
(5) and (6) $150,000.00--$30,000.00 = $120,000.00 loss; and
(7) $120,000.00  x  100 percent = $120,000 indemnity payment.

    You also have a 100 percent share in 50 acres of varietal group B 
stonefruit in the unit, with a guarantee of 300 lugs per acre and a 
price election of $3.00 per lug. You are only able to harvest 3,000 
lugs. Your indemnity would be calculated as follows:
    (1) 50.0 acres  x  500 lugs varietal group A = 25,000 lugs 
guarantee; and 50.0 acres  x  300 lugs varietal group B = 15,000 lugs 
guarantee;
    (2) 25,000 lugs  x  $ 6.00 price election = $150,000.00 value of 
guarantee for varietal group A; and 15,000 lugs  x  $3.00 price election 
= $45,000.00 value of guarantee for varietal group B;

[[Page 540]]

    (3) $150,00.00 + $45,000.00 = $195,000.00 total value of guarantee;
    (4) 5,000 lugs varietal group A  x  $6.00 price election = 
$30,000.00 value of production to count; and 3,000 lugs varietal group B 
 x  $3.00 price election = $9,000.00 value of production to count; and
    (5) $30,000.00 + $9,000.00 = $39,000.00 total value of production to 
count;
    (6) $195,000.00--$39,000.00 = $156,000.00 loss
    (7) $156,000.00 loss  x  1.000 = $156,000 indemnity payment.
    (c) The total production to count (in lugs or tons) from all 
insurable acres on a 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 sold by direct marketing if you fail to meet the 
requirements contained in section 10;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide production records that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production that would be marketable if harvested; 
and
    (iv) Potential production on insured acreage that you intend to 
abandon or 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 you do not agree with our appraisal, we may defer 
the claim only if you agree to continue to care for the insured crop. We 
will then make another appraisal when you notify us if any further 
damage or that harvest is general in the area unless you harvested the 
crop. If you harvest the crop we will use the harvested production. If 
you do not continue to care for the crop, our appraisal made prior to 
deferring the claim will be used to determine the production to count; 
and
    (2) All harvested production from the insurable acreage.
    (3) The quantity of harvested production will be reduced if the 
following conditions apply:
    (i) The value of the damaged production is less than 75 percent of 
the marketable value of undamaged production due to an insured cause of 
loss; and
    (ii) For stonefruit insured as fresh fruit only, the stonefruit 
either is packed and sold as fresh fruit and meets only the utility 
grade requirements of the applicable grading standards, or fails to meet 
the applicable grading standards but is or could be sold for any use 
other than fresh packed stonefruit.
    (4) Harvested production of stonefruit that is eligible for quality 
adjustment as specified in section 11(c)(3) will be reduced as follows:
    (i) When packed and sold as fresh fruit or when insured as a 
processing crop, by dividing the marketable value per lug or ton by the 
highest price election (for the applicable coverage level) and 
multiplying the result (not to exceed 1.00) by the quantity of such 
production; or
    (ii) For all other fresh stonefruit, multiplying the number of tons 
that could be marketed by the value per ton (for the applicable coverage 
level) and dividing that result by the highest price election available 
for that type.

                     12. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
(Sec. 457.8) are not applicable.

[63 FR 29935, June 2, 1998]



Sec. 457.160  Processing tomato crop insurance provisions.

    The Processing Tomato Crop Insurance Provisions for the 1998 and 
succeeding crop years are as follows:

    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and reinsured polices:

                    Processing Tomato Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Acre. 43,560 square feet of land on which row widths do not exceed 6 
feet, or the land on which at least 7,260 linear feet rows are planted 
if row widths exceed 6 feet.
    Bypassed acreage. Land on which production is ready for harvest but 
the processor elects not to accept such production so it is not 
harvested.
    First fruit set. The reproductive stage of the plant at which 30 
percent of the plants have produced a fruit that has reached a minimum 
of one inch in diameter.
    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 required by the tomato processor contract with the 
processing company, and are those recognized by the Cooperative State

[[Page 541]]

Research, Education, and Extension Service as compatible with agronomic 
and weather conditions in the county.
    Harvest. The severance of tomatoes from the vines.
    Plant stand. The number of plants per acre considered to be normal 
for the applicable tomato variety and growing area.
    Planted acreage--In addition to the definition contained in the 
Basic Provisions, tomatoes must initially be placed in rows to be 
considered planted. 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, 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, marketing window, condition of the field, 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 unless the replanted 
acreage can produce at least 75% of the approved yield, and the 
processor agrees in writing that it will accept the production from the 
replanted acreage.
    Processor. Any business enterprise regularly engaged in processing 
tomatoes for human consumption, that possesses all licenses and permits 
for processing tomatoes required by the state in which it operates, and 
that possesses facilities, or has contractual access to such facilities, 
with enough equipment to accept and process contracted processing 
tomatoes within a reasonable amount of time after harvest.
    Processor contract. A written agreement between the producer and a 
processor, containing at a minimum:
    (a) The producer's commitment to plant and grow processing tomatoes, 
and to deliver the tomato production to the processor;
    (b) The processor's commitment to purchase all the production stated 
in the processor contract; and
    (c) A price per ton that will be paid for the production.
    Ton. Two thousand (2,000) pounds avoirdupois.

                            2. Unit Division

    (a) Notwithstanding the provisions of this section or any unit 
division provisions contained in the Basic Provisions, no indemnity will 
be paid for any loss of production on any unit if the insured produced a 
crop sufficient to fulfill the processor contracts forming the basis for 
the guarantee, and any indemnity will be limited to the amount necessary 
to compensate for loss in yield at the price elected between production 
to count and the contract requirements.
    (b) In California only, in addition to, or instead of, establishing 
optional units by section, section equivalent or FSA farm serial number 
and by irrigated and non-irrigated acreage as provided in the unit 
division provisions contained in the Basic Provisions, optional units 
may be established if acreage planted to tomatoes is separated by a 
field that is not planted to tomatoes, or by a permanent boundary such 
as a permanent waterway, fence, public road or woodland. Such optional 
unit must consist of the minimum number of acres stated in the Special 
Provisions. Acreage planted to tomatoes that is less than the minimum 
number of acres required will attach to the closest unit within the 
section, section equivalent, or FSA farm serial number.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions:
    (a) You may select only one price election for all the processing 
tomatoes in the county insured under this policy unless the Special 
Provisions provide different price elections by type. The percentage of 
the maximum price election you choose for one type will be applicable to 
all other types insured under this policy. 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) Liability under this policy will not exceed the number of tons 
required to be accepted by the processor under a processor contract in 
effect on or before:
    (1) The earlier of August 20 or the date of damage to the insured 
crop in all counties with an acreage reporting date of July 15; or
    (2) The earlier of the acreage reporting date or the date of damage 
in all other counties. (Exclude indemnities that occur in stage one and 
replant payments.)
    (c) The price election used to determine the amount of an indemnity 
is progressive by stage and increases, at specified intervals, to the 
price used for final stage losses. Stages will be determined on an acre 
basis. The stages and applicable price elections are:
    (1) First stage is from planting until first fruit set. If any 
acreage of the insured crop is destroyed in this stage, the price used 
to establish the amount of any indemnity owed for such acreage will be 
50 percent of your price election;
    (2) Second stage is from the first fruit set until harvest. If any 
acreage of the insured crop is destroyed in this stage, the price used 
to establish the amount of any indemnity owed for such acreage will be 
80 percent of your price election; and

[[Page 542]]

    (3) Third stage (final stage) is harvested acreage. The price 
election used in this stage to establish the amount of any indemnity 
owed will be 100 percent of your price election.
    (d) Any acreage of tomatoes damaged to the extent, that the majority 
of producers in the area would not normally further care for the 
tomatoes, will be deemed to have been destroyed even though you may 
continue to care for it. The price election used to determine the amount 
of an indemnity will be that applicable to the stage in which the 
tomatoes were destroyed.
    (e) The appraised production from bypassed acreage that could have 
been accepted by the processor will be included when determining your 
approved yield.
    (f) Acreage that is bypassed because it was damaged by an insurable 
cause of loss to the extent that the processor cannot use the product 
will be considered to have a zero yield when determining your approved 
yield.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is August 31 preceding the cancellation date for California 
and November 30 preceding the cancellation date for all other states.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are January 15 in California and 
March 15 in all other states.

                          6. Report of Acreage

    In addition to the provisions of section 6 of the Basic Provisions, 
you must provide a copy of all processor contracts to us on or before 
the acreage reporting date in all counties, unless otherwise specified 
in the Special Provisions.

                            7. Annual Premium

    In lieu of the premium amount determinations contained in section 7 
of the Basic Provisions, the annual premium amount per acre is 
determined by multiplying the production guarantee per acre by the price 
election for the third (final) stage; by the premium rate; by the 
insured acreage; by the applicable share at the time of planting; and 
ultimately by any applicable premium adjustment factors contained in the 
actuarial documents.

                             8. Insured Crop

    (a) In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the tomatoes in the county for which a premium rate 
is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That are planted for harvest as processing tomatoes;
    (3) That are grown under, and in accordance with, the requirements 
of a processor contract executed on or before August 20 in all counties 
with an acreage reporting date of July 15, or on or before the acreage 
reporting date in all other counties, and are not excluded from the 
processor contract for or during the crop year; and
    (4) That are not (unless allowed by the Special Provisions or by 
written agreement):
    (i) Grown on acreage on which tomatoes were grown in either of the 
two previous years, except in California;
    (ii) Interplanted with another crop; or
    (iii) Planted into an established grass or legume.
    (b) You will be considered to have a share in the insured crop if, 
under the processor contract, you retain control of the acreage on which 
the tomatoes are grown, you are at risk of loss, and the processor 
contract provides for delivery of processing tomatoes under specified 
conditions and at a stipulated price.
    (c) A tomato producer who is also a processor may establish an 
insurable interest if the following requirements are met:
    (1) The processor must comply with these Crop Provisions;
    (2) Prior to the sales closing date, the Board of Directors or 
officers of the processor must execute and adopt a resolution that 
contains the same terms as an acceptable processor contract. Such 
resolution will be considered a contract under this policy; and
    (3) Our inspection provides that the processing facilities comply 
with the definition of a processor contained in these Crop Provisions.

                           9. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions:
    (a) Any acreage of the insured crop that is damaged before the final 
planting date, to the extent that the majority of producers in the area 
would normally not further care for the crop, must be replanted unless 
we agree that it is not practical to replant; and
    (b) We will not insure any acreage that does not meet the rotation 
requirements, if applicable, contained in the Special Provisions.

                          10. Insurance Period

    In lieu of the provisions contained in section 11 of the Basic 
Provisions, regarding the end of the insurance period, insurance ceases 
at the earlier of the date:
    (a) You harvest sufficient production to fulfill your processor 
contract if the processor contract stipulates a specific amount of 
production to be delivered;

[[Page 543]]

    (b) The tomatoes should have been harvested but was not harvested;
    (c) The tomatoes were abandoned;
    (d) Harvest was completed;
    (e) Final adjustment of a loss was completed; or
    (f) The following calendar date for the end of the insurance period
    (1) October 20 in California; and
    (2) October 10 in all other states.

                           11. Causes of Loss

    In accordance with the provisions of section 12 of the Basic 
Provisions:
    (a) Insurance is provided only against the following causes of loss 
that occur during the insurance period:
    (1) Adverse weather conditions, including:
    (i) Excessive moisture that prevents the harvesting equipment from 
entering the field or that prevents the timely operation of harvesting 
equipment; and
    (ii) Abnormally hot or cold temperatures that cause an unexpected 
number of acres over a large producing area to be ready for harvest at 
the same time, affecting the timely harvest of a large number of such 
acres or the processing of such production being beyond the capacity of 
the processor, either of which causes the acreage to be bypassed;
    (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 due to a cause of 
loss contained in sections 11(a)(1) through (7) that occurs during the 
insurance period.
    (b) In addition to the causes of loss excluded by section 12 of the 
Basic Provisions, we will not insure against any loss of production due 
to:
    (1) Acreage being bypassed, if the acreage is bypassed because:
    (i) The breakdown or non-operation of equipment or facilities; or
    (ii) The availability of a crop insurance payment. We may deny any 
indemnity immediately in such circumstance or, if an indemnity has been 
paid, require you to repay it to us with interest at any time acreage 
was bypassed due to the availability of a crop insurance payment;
    (2) The processing tomatoes not being timely harvested, unless such 
delay in harvesting is solely and directly due to an insured cause of 
loss; or
    (3) Your failure to follow the requirements contained in the 
processor contract.

                         12. Replanting Payment

    (a) In accordance with section 13 of the Basic Provisions, a 
replanting payment is allowed if the crop sustained a loss exceeding 50 
percent of the plant stand and it is practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of 20 percent of the production guarantee or three tons, 
multiplied by your third stage (final) price election, multiplied by 
your share.

                13. Duties in the Event of Damage or Loss

    In addition to the notice required by section 14 of the Basic 
Provisions, you must give us notice:
    (a) Not later than 48 hours after:
    (1) Total destruction of the tomatoes in the unit; or
    (2) Discontinuance of harvest on a unit on which unharvested 
production remains;
    (b) Within 3 days after the date harvest should have started on any 
acreage that will not be harvested. You must also provide acceptable 
documentation of the reason the acreage was bypassed. Failure to provide 
such documentation will result in our determination that the acreage was 
bypassed due to an uninsured cause of loss. If the crop will not be 
harvested and you wish to destroy the crop, you must leave 
representative samples of the unharvested crop for our inspection. The 
samples must be at least 10 feet wide and extend the entire length of 
each field in the unit. The samples must not be destroyed until the 
earlier of our inspection or 15 days after notice is given to us; and
    (c) At least 15 days prior to the beginning of harvest if you intend 
to claim an indemnity on any unit, or immediately if damage is 
discovered during the 15 day period or during harvest, so that we may 
inspect the damaged production. If you fail to notify us and such 
failure results in our inability to inspect the damaged production, we 
will consider all such production to be undamaged and include it as 
production to count. You are not required to delay harvest.

                         14. 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 such 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, by type if applicable;

[[Page 544]]

    (2) Multiplying each result of section 14(b)(1) by the respective 
price election, by type if applicable;
    (3) Totaling the results of section 14(b)(2) if there are more than 
one type;
    (4) Multiplying the total production to counted (see section 14(c)), 
for each type if applicable, by its respective price election;
    (5) Totaling the results of section 14(b)(4) if there are more than 
one type;
    (6) Subtracting the result of section 14(b)(4) from the result of 
section 14(b)(2) if there is only one type or subtracting the result of 
section 14(b)(5) from the result of section 14(b)(3) if there are more 
than one type; and
    (7) Multiplying the result of section 14(b)(6) by your share.
For example:
    You have a 100 percent share in 50 acres of type A processing 
tomatoes in the unit, with a guarantee of 18.8 tons per acre and a price 
election of $50.00 per ton. You are only able to harvest 10.0 tons. Your 
indemnity would be calculated as follows:
    (1) 50.0 acres  x  18.8 tons = 940.0 tons guarantee;
    (2) 940.0 tons  x  $50.00 price election = $47,000.00 value 
guarantee;
    (4) 10.0 tons  x  $50.00 price election = $500.00 value of 
production to count;
    (6) $47,000.00-$500.00 = $46,500.00 loss; and
    (7) $46,500  x  100 percent = $46,500.00 indemnity payment.
    You also have a 100 percent share in 50 acres of type B processing 
tomatoes in the same unit, with a guarantee of 15.0 tons per acre and a 
price election of $35.00 per ton. You are only able to harvest 5.0 tons. 
Your total indemnity for both types A and B would be calculated as 
follows:
    (1) 50.0 acres  x  18.8 tons = 940.0 ton guarantee for type A and 
50.0 acres  x  15.0 tons = 750.0 ton guarantee for type B;
    (2) 940.0 ton guarantee  x  $50.00 price election = $47,000.00 value 
of guarantee for type A and 750.0 ton guarantee  x  $35.00 = $26,500.00 
value of guarantee for type B;
    (3) $47,000.00 + $26,500.00=$72,500.00 total value of guarantee;
    (4) 10.0 tons  x  $50.00 price election=$500.00 value of production 
to count for type A and 5.0 tons  x  $35.00 price election=$175.00 value 
of production to count for type B;
    (5) $500.00 + $175.00=$675.00 total value of production to count;
    (6) $72,500.00-$675.00=$71,575.00 loss; and
    (7) $71,575 loss  x  100 percent=$71,575.00 indemnity payment.
    (c) The total production to count, specified in tons, from all 
insurable acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide production records that are 
acceptable to us.
    (ii) Production lost due to uninsured causes;
    (iii) Production on acreage that is bypassed unless the acreage was 
bypassed due to an insured cause of loss which resulted in production 
which would not be acceptable under the terms of the processor contract;
    (iv) Potential production on insured acreage that you intend to put 
to another use or abandoned, 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 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 you 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;
    (2) All harvested production (in tons) delivered to the processor 
which meets the quality requirements of the processor contract 
(expressed as usable or payable weight).
    (3) All harvested tomato production delivered to processor which 
does not meet the quality requirements of the processor contract due to 
not being timely delivered.
    (d) Once harvest has begun on any acreage covered by a processor 
contract that specifies the number of tons to be delivered, the total 
indemnity payable will be limited to an amount based on the lesser of 
the guaranteed tons, or the tons remaining unfulfilled under the 
processor contract.

                     15. Late and Prevented Planting

    The late and prevented planting provisions of the Basic Provisions 
are not applicable.

[62 FR 54342, Oct. 20, 1997, as amended at 62 FR 65177, Dec. 10, 1997]

[[Page 545]]



Sec. 457.161  Canola and rapeseed crop insurance provisions.

    The Canola and Rapeseed 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:

                   Canola and Rapeseed Crop Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) the Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions, with (1) controlling (2), etc.

                             1. Definitions

    Canola. A crop of the genus Brassica as defined in accordance with 
the Official United States Standards for Grain--Subpart C--U.S. 
Standards for Canola.
    Harvest. Combining or threshing for seed. A crop that is swathed 
prior to combining is not considered harvested.
    Local market price (Canola). The cash price per pound for U.S. No. 2 
grade canola that reflects the maximum limits of quality deficiencies 
allowable for the U.S. No. 2 grade canola.
    Planted acreage. In addition to the definition contained in the 
Basic Provisions, land on which seed is initially spread onto the soil 
surface by any method and subsequently is mechanically incorporated into 
the soil in a timely manner and at the proper depth will be considered 
planted. Acreage planted in any other manner will not be insurable 
unless otherwise provided by the Special Provisions, actuarial 
documents, or by written agreement.
    Price of damaged production. The cash price per pound available if 
the production were sold for canola that qualifies for quality 
adjustment in accordance with section 12 of these crop provisions.
    Rapeseed. A crop of the genus Brassica that contains at least 30 
percent of an industrial type of oil as shown on the Special Provisions 
and that is measured on a basis free from foreign material.
    Swathed. Severance of the stem and seed pods from the ground and 
placing into windrows without removal of the seed from the pod.

                            2. Unit Division

    In addition to optional units by section, section equivalent or FSA 
farm serial number and by irrigated and non-irrigated practices, 
optional units may be by type if the type is designated on the Special 
Provisions.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    In addition to the requirements of section 3 of the Basic 
Provisions, you may select only one price election for all the canola 
and rapeseed 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 canola and rapeseed 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 a specific type, you must also 
choose 100 percent of the maximum price election for all other types.

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is November 30 preceding the cancellation date for counties 
with a March 15 cancellation date, and June 30 preceding the 
cancellation date for all other counties.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are:

------------------------------------------------------------------------
                                                   Cancellation and
              State and county                    Termination dates
------------------------------------------------------------------------
All counties in Georgia....................  Sept. 30.
All other counties without fall planted      Mar. 15.
 types specified on the actuarial table.
All other counties with fall planted types   Aug. 31.
 specified on the actuarial table.
------------------------------------------------------------------------

                             6. Insured Crop

    In accordance with section 8 of the Basic Provisions, the crop 
insured will be all canola and rapeseed in the county for which a 
premium rate is provided by the actuarial table:
    (a) In which you have a share;
    (b) That is planted for harvest as seed; and
    (c) That is not, unless allowed by Special Provisions or by written 
agreement:
    (1) Interplanted with another crop; or
    (2) Planted into an established grass or legume.

                          7. Insurable Acreage

    In addition to the provisions of section 9 of the Basic Provisions,
    (a) Any acreage of the insured crop that is damaged before the final 
planting date, to the extent that most producers producing crops on 
similarly situated acreage in the

[[Page 546]]

area would not normally further care for the crop, must be replanted 
unless we agree that it is not practical to replant; and
    (b) We will not insure any acreage that does not meet the rotation 
requirements contained in the Special Provisions.

                           8. Insurance Period

    In accordance with the provisions of section 11 of the Basic 
Provisions, the end of the insurance period is October 31 of the 
calendar year in which the crop is normally harvested.

                            9. Causes of Loss

    In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss which occur during the insurance period:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Volcanic eruption; or
    (h) Failure of the irrigation water supply, if applicable, caused by 
an insured cause of loss that occurs during the insurance period.

                         10. Replanting Payment

    (a) In accordance with section 13 of the Basic Provisions, a 
replanting payment is allowed if the insured crop is damaged by an 
insurable cause of loss to the extent that most producers producing the 
crop on similarly situated acreage in the area, would not continue to 
care for the crop and it is practical to replant.
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of 20 percent of the production guarantee or 175 pounds, 
multiplied by your price election, multiplied by your insured share.
    (c) When the canola or rapeseed is replanted using a practice or 
type that is uninsurable as an original planting, the liability for the 
unit will be reduced by the amount of the replanting payment that is 
attributable to your share. The premium amount will not be reduced.

                11. Duties in the Event of Damage or Loss

    In accordance with the requirements of section 14 of the Basic 
Provisions, the representative samples of the unharvested crop that we 
may require must be at least 10 feet wide and extend the entire length 
of each field in the unit. If you intend to put the acreage to another 
use or not harvest the acreage, the samples must not be harvested or 
destroyed until our inspection.

                         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 for each type, if applicable;
    (3) If there are more than one type, totaling the results in section 
12(b)(2);
    (4) Multiplying the total production to be counted of each type, if 
applicable, (see section 12(c)) by the respective price election;
    (5) If there are more than one type, totaling the results in section 
12(b)(4);
    (6) If there are more than one type, subtracting the total in 
section 12(b)(5) from the total in section 12(b)(3);
    (7) If there is only one type, subtracting the total in section 
12(b)(4) from the total in section 12(b)(2); and
    (8) Multiplying the result in section 12(b)(6) and 12(b)(7), as 
applicable, by your share.
    (c) The total production to count (pounds) from all insurable 
acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee for acreage:
    (A) That is abandoned;
    (B) That is put to another use without our consent;
    (C) That is damaged solely by uninsured causes; or
    (D) For which you fail to provide acceptable production records;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies and excess moisture in accordance with 
section 12(d)); and
    (iv) 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,

[[Page 547]]

representative samples of the crop in locations acceptable to us (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 you 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.
    (d) Mature canola may be adjusted for excess moisture and quality 
deficiencies. Mature rapeseed may be adjusted for excess moisture only. 
If moisture adjustment is applicable, it will be made prior to any 
adjustment for quality.
    (1) Canola and rapeseed production will be reduced by 0.12 percent 
for each 0.1 percentage point of moisture in excess of 8.5 percent. We 
must be permitted to obtain samples of the production to determine the 
moisture content.
    (2) Canola production will be eligible for quality adjustment if:
    (i) Deficiencies in quality, in accordance with the Official United 
States Standards for Grain, result in the canola not meeting the grade 
requirements for U.S. No. 3 or better (U.S. Sample grade) because of 
kernel damage (excluding heat damage), or a musty, sour, or commercially 
objectionable foreign odor; or
    (ii) Substances or conditions are present that are identified by the 
Food and Drug Administration or other public health organizations of the 
United States as being injurious to human or animal health.
    (3) Quality will be a factor in determining your loss in canola 
production only if:
    (i) The deficiencies, substances, or conditions resulted from a 
cause of loss against which insurance is provided under these Crop 
Provisions and which occurs within the insurance period;
    (ii) The deficiencies, substances, or conditions result in a net 
price for the damaged production that is less than the local market 
price;
    (iii) All determinations of these deficiencies, substances, or 
conditions are made using samples of the production obtained by us or by 
a disinterested third party approved by us; and
    (iv) The samples are analyzed by a grader licensed to grade canola 
under the authority of the United States Grain Standards Act or the 
United States Warehouse Act with regard to deficiencies in quality, or 
by a laboratory approved by us with regard to substances or conditions 
injurious to human or animal health.
    (4) Canola production that is eligible for quality adjustment, as 
specified in sections 12(d)(2) and (3), will be reduced:
    (i) In accordance with the quality adjustment factors contained in 
the Special Provisions; or
    (ii) As follows if quality adjustment factors are not contained in 
the Special Provisions:
    (A) Divide the price of damaged production by the local market price 
to determine the quality adjustment factor.
    (B) The number of pounds remaining after any reduction due to 
excessive moisture (the moisture-adjusted gross pounds) of the damaged 
or conditioned production will then be multiplied by the quality 
adjustment factor to determine the net production to count.
    (5) For canola, the price of damaged production and the local market 
price will be determined at the earlier of the date such quality 
adjusted production is sold or the date of final inspection for the unit 
subject to the following conditions:
    (i) Discounts used to establish the price of damaged production will 
be limited to those that are usual, customary, and reasonable.
    (ii) The price of damaged production will not be reduced for:
    (A) Moisture content;
    (B) Damage due to uninsured causes;
    (C) Drying, handling, processing, or any other costs associated with 
normal harvesting, handling, and marketing of the canola; except, if the 
price of damaged production can be increased by conditioning, we may 
reduce the price of damaged production after the production has been 
conditioned by the cost of conditioning but not lower than the price of 
damaged production before conditioning. We may obtain prices of damaged 
production from any buyer of our choice. If we obtain prices of damaged 
production from one or more buyers located outside your local market 
area, we will reduce such price of damaged production by the additional 
costs required to deliver the canola to those buyers; or
    (D) Erucic acid or glucosinolates in excess of the amount allowed 
under the definition of canola contained in the Official United States 
Standards for Grain; and
    (iii) Factors not associated with grading under the Official United 
States Standards for Grain including, but not limited to protein and 
oil, will not be considered.
    (e) Any production harvested from plants growing in the insured crop 
may be counted as production of the insured crop on an unadjusted weight 
basis.
    For example:
    You have 100 percent share in 25 acres of Fall Oleic Canola in a 
unit with a 650 pound production guarantee and a price election of $0.11 
per pound. You are only able to harvest

[[Page 548]]

14,700 pounds and there is no appraised production. Your indemnity would 
be calculated as follows:

(1) 25 acres x 650 pounds = 16,250 pounds of Fall Oleic Canola;
(2) 16,250 pounds x $0.11 price election = $1,788 value of guarantee for 
          Fall Oleic Canola;
(3) 14,700 pounds x $0.11 price election = $1,617 total value of 
          production to count for Fall Oleic Canola;
(4) $1,788 value of guarantee-$1,617 value of production to count = $171 
          value of loss; and
(5) $171 value of loss x 100 percent = $171 indemnity payment.

    You also have a 100 percent share in 50 acres of Fall High Erucic 
Rapeseed in the same unit with a production guarantee of 750 pounds per 
acre and a price election of $0.15 per pound. You are only able to 
harvest 14,000 pounds and there is no appraised production. Your total 
indemnity for both Fall Oleic Canola and Fall High Erucic Rapeseed would 
be calculated as follows:

(1) 25 acres x 650 pounds = 16,250 pounds guarantee for the Fall Oleic 
          Canola, and
    50 acres x 750 pounds = 37,500 pounds guarantee for the Fall High 
Erucic Rapeseed;
(2) 16,250 pounds guarantee x $0.11 price election = $1,788 value of the 
          guarantee for the Fall Oleic Canola, and
    37,500 pounds guarantee x $0.15 price election = $5,625 value of the 
guarantee for the Fall High Erucic Rapeseed;
(3) $1,788 + $5,625 = $7,413 total value of the guarantees;
(4) 14,700 pound x $0.11 price election = $1,617 value of production to 
          count for the Fall Oleic Canola, and
    14,000 pounds x $0.15 price election = $2,100 value of production to 
count for the Fall High Erucic Rapeseed;
(5) $1,617 + $2,100 = $3,717 total value of production to count;
(6) $7,413 value of guarantee-$3,717 value of production = $3,696 loss; 
          and
(7) $3,696 value of loss x 100 percent = $3,696 indemnity payment.

                            13. Late Planting

    In lieu of section 16(a) of the Basic Provisions, the production 
guarantee for each acre planted to the insured crop during the late 
planting period will be reduced by 1 percent per day for each day 
planted after the final planting date unless otherwise specified in the 
Special Provisions.

                         14. Prevented Planting

    In addition to the provisions contained in section 17 of the Basic 
Provisions, your prevented planting coverage will be 60 percent of your 
production guarantee for timely planted acreage. If you have limited or 
additional levels of coverage, as specified in 7 CFR part 400, subpart 
T, and pay an additional premium, you may increase your prevented 
planting coverage to the levels specified in the actuarial documents.

[62 FR 65997, Dec. 17, 1997]



Sec. 457.162  Nursery crop insurance provisions.

    The Nursery Crop Insurance Provisions for the 1999 and succeeding 
crop years are as follows:
    FCIC Policies

                 United States Department of Agriculture

                   Federal Crop Insurance Corporation

                           Reinsured Policies

(Appropriate title for insurance provider)
    Both FCIC and Reinsured Policies

                    Nursery Crop Insurance Provisions

    If a conflict exists among the policy provisions, the order of 
priority is as follows: (1) The Catastrophic Risk Protection 
Endorsement, if applicable; (2) the Special Provisions; (3) these Crop 
Provisions; and (4) the Basic Provisions with (1) controlling (2), etc.

                             1. Definitions

    Act. The Federal Crop Insurance Act, 7 U.S.C. 1501 et seq.
    Amount of insurance. For each basic unit, your practice value 
multiplied by the coverage level percentage you elect, multiplied by 
your price election, and multiplied by your share. Your accumulated paid 
losses during the crop year for each basic unit or the optional units 
will not exceed your amount of insurance.
    Crop year. The period beginning the day insurance attaches and 
extending until 11:59 p.m. of the following September 30. Crop year is 
designated by the calendar year in which it ends.
    Crop year deductible. The deductible percentage multiplied by the 
sum of all plant inventory values for each basic unit. The crop year 
deductible will be increased for any increases in the inventory value on 
the plant inventory value report or through the purchase of a peak 
inventory endorsement, if in effect at the time of loss. The crop year 
deductible will be reduced by any previously incurred deductible if you 
timely report each loss to us.
    Deductible percentage. An amount equal to 100 percent minus the 
percent of coverage you select.
    Eligible plant list. A list published by FCIC in electronic format 
and available from your agent that includes the botanical and common 
names of insurable plants, the winter protection requirements for 
container material and the areas in which they apply, the

[[Page 549]]

hardiness zone to which field grown material is insurable, the 
designated hardiness zones for each county, and the unit classification 
for each plant on the list. A paper copy of the eligible plant list is 
also available from your agent.
    Field grown. Nursery plants planted and grown in the ground without 
the use of any artificial root containment device. In-ground fabric bags 
are not considered an artificial root containment device.
    Field market value A. The value of undamaged insurable plants, based 
on the prices contained in the plant price schedule, in the basic or 
optional unit, as applicable, immediately prior to the occurrence of any 
loss as determined by our appraisal. This allows the amount of insurance 
under the policy to be divided among the individual units in accordance 
with the actual value of the plants in the unit at the time of loss for 
the purpose of determining whether you are entitled to an indemnity for 
insured losses in the unit, optional or basic, as applicable.
    Field market value B. The value of the insurable plants, based on 
the prices contained in the plant price schedule, in the basic or 
optional unit, as applicable, following the occurrence of a loss as 
determined by our appraisal plus any reduction in value due to uninsured 
causes. This is used to determine the loss of value for each individual 
unit so that losses can be paid on an individual unit basis, optional or 
basic, as applicable.
    Field market value C. The value of undamaged insurable plants based 
on the prices contained in the plant price schedule for all types within 
the basic unit immediately prior to the occurrence of any loss as 
determined by our appraisal. This value is used to calculate the actual 
value of the plants in the basic unit at the time of loss to ensure that 
you have not underreported your plant values.
    In-ground fabric bag. (Also called a grow bag or a root control 
bag). A porous fabric bag made of a non-biodegradable material such as 
polypropylene that typically has a plastic bottom, and is used for 
growing woody plants in the ground.
    Irrigated practice. In lieu of the definition in the Basic 
Provisions, the application of water, using appropriate systems and at 
the proper times, to provide the quantity of water needed to sustain 
normal growth of your insured plant inventory and provide cold 
protection for applicable plants as specified in the eligible plant 
list.
    Loss. Field market value A minus field market value B.
    Marketable. Of a condition that it may be offered for sale in the 
market.
    Nursery. A business enterprise that derives at least 50 percent of 
its gross income from the wholesale marketing of plants.
    Occurrence deductible. This deductible allows a smaller deductible 
than the crop year deductible to be used when; (1) Inventory values are 
less than the reported practice value, or (2) you have elected optional 
units. The occurrence deductible is the lesser of: (a) The deductible 
percentage multiplied by field market value A multiplied by the under 
report factor; or (b) the crop year deductible.
    Plant inventory value report. Your report that declares the value of 
insurable plants in accordance with section 6.
    Plant price schedule. A schedule of insurable plant prices published 
by FCIC in electronic format that establishes the value of undamaged 
insurable plants and the maximum amount we will pay for damaged 
insurable plants. A paper copy is available from your crop insurance 
agent.
    Practice. A cultural method of producing plants. Standard nursery 
containers grown and field grown are considered separate insurable 
practices.
    Practice value. The full value of all insurable plants in each basic 
unit on your plant inventory value report including any report that 
increases the value of your insurable plant inventory. This will be used 
to determine the amount of insurance under this policy.
    Price election. The allowable percentage, as specified in the 
actuarial documents, of the prices shown in the plant price schedule 
that you elect and that is used to determine the amount of insurance and 
any indemnity.
    Standard nursery containers. Rigid containers not less than 3 inches 
in diameter at the widest point of the container interior and that are 
appropriate in size and have drainage holes appropriate for the plant. 
In-ground fabric bags, trays, cellpacks with individual cells less than 
3 inches in diameter at the widest point of the container interior, and 
burlap are not considered standard nursery containers under these Crop 
Provisions.
    Stock plants. Plants used solely for propagation during the 
insurance period.
    Under report factor. The factor which adjusts your indemnity for 
underreporting of inventory values. The factor is always used in 
determining any indemnity. For each practice, the under report factor is 
the lesser of: (a) 1.000 or; (b) the sum of all practice values reported 
on all plant inventory value reports, including any peak inventory value 
reports during the coverage term of the Peak Inventory Endorsement minus 
the total of all previous losses, as adjusted by any previous under 
report factor, divided by field market value C.

                            2. Unit Division

    (a) In lieu of the definition of ``basic unit'' contained in section 
1 of the Basic Provisions, a basic unit consists of all insurable plants 
in which you have a share in the county for each practice for which a 
separate rate is established in the actuarial documents. Although the 
basic unit may be divided into

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optional units in accordance with sections 2(b) and 2(c), you will still 
be considered to have a basic unit that will be used to establish the 
amount of insurance, crop year deductible, under report factor, premium, 
and the total amount of indemnity payable under this policy.
    (b) In lieu of the optional unit provisions in the Basic Provisions, 
if you elect either limited or additional levels of coverage, for an 
additional premium, inventory that would otherwise be one basic unit may 
be divided into optional units by plant type as specified in section 
2(c). If you elect optional units, your amount of insurance will be 
divided among optional units in relation to the actual value of plants 
in each optional unit. If, at the time of loss, the aggregate value of 
the plants in all your optional units exceeds your practice value, you 
will be subject to the under report factor provisions.
    (c) Plant Types contained on the eligible plant list.
    1. Deciduous Trees (Shade and Flower);
    2. Broad-leaf Evergreen Trees;
    3. Coniferous Evergreen Trees;
    4. Fruit and Nut Trees;
    5. Deciduous Shrubs;
    6. Broad-leaf Evergreen Shrubs;
    7. Coniferous Evergreen Shrubs;
    8. Small Fruits;
    9. Herbaceous Perennials;
    10. Roses;
    11. Ground Cover and Vines;
    12. Annuals;
    13. Foliage; and
    14. Other plant types listed in the Special Provisions.
    (d) You must elect either basic units or optional units.

  3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
                               Indemnities

    (a) The production reporting requirements contained in section 3 of 
the Basic Provisions are not applicable.
    (b) In addition to the requirements of section 3 of the Basic 
Provisions, you must select one price election for all plants, 
regardless of type, insured under this policy.
    (c) Your amount of insurance will be reduced by the amount of any 
indemnity paid under this policy. For losses occurring when a Peak 
Inventory Endorsement is in effect, to determine the amount of insurance 
remaining after the loss you must subtract the amount of the indemnity 
from the peak amount of insurance, then subtract any remaining amount of 
indemnity from the amount of insurance.
    (d) If you restock your nursery plant inventory, you may increase 
your amount of insurance in accordance with section 6(f).

                           4. Contract Changes

    In accordance with section 4 of the Basic Provisions, the contract 
change date is June 30 of each year.

                  5. Cancellation and Termination Dates

    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are September 30 preceding the crop 
year.

                     6. Plant Inventory Value Report

    (a) Section 6 of the Basic Provisions is not applicable.
    (b) You must submit a plant inventory value report to us with your 
application and for each subsequent crop year, not later than September 
1. If you do not submit a plant inventory value report by September 1, 
your policy will continue using the reported inventory values in effect 
as of August 31.
    (c) The plant inventory value report must include all growing 
locations, the practice value, and your share. At our option, you will 
be required to provide documentation in support of your plant inventory 
value report, including, but not limited to, a detailed plant inventory 
listing that includes the name, the number, and the size of each plant; 
sales and purchases of plants for the 3 previous crop years in the 
amount of detail we require, and your ability to properly obtain and 
maintain nursery stock. For catastrophic level policies only, you must 
report your previous plant sales on the plant inventory value report. 
You may be required to provide documentation to support such sales.
    (d) Your plant inventory value report, including any revised report, 
and your peak inventory value report will be used to determine your 
premium and amount of insurance.
    (e) Your plant inventory value report must reflect your insurable 
nursery plant inventory value according to prices contained in the plant 
price schedule. In no instance will we be liable for plant values 
greater than those contained in the plant price schedule.
    (f) You may revise your plant inventory value report to increase the 
reported inventory value. Any revision must be made in writing before 
May 31st of the crop year. We may inspect the inventory. Your revised 
plant inventory value report will be considered accepted by us and 
insurance will attach on any proposed increase in inventory value 30 
days after your written request is received unless we reject the 
proposed increase in your plant inventory value in writing. We will 
reject any requested increase if a loss occurs within 30 days of the 
date the request is made.
    (g) You must report the full value of your practice value in 
accordance with section 6(e). Failure to report the full value of your

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practice value will result in the reduction of any claim in accordance 
with section 12(d).
    (h) For catastrophic insurance coverage only: (1) Your plant 
inventory value report for container grown nursery plants cannot exceed 
the lesser of the actual value from section 6(e) or 150 percent of your 
previous year's sales of container grown nursery plants; (2) Your plant 
inventory value report for field grown nursery plants cannot exceed the 
lesser of the actual value from section 6(e) or 250 percent of your 
previous years' sale of field grown nursery plants, and if the above 
restrictions cause you to under report the value of your inventory, you 
must present records acceptable to us to prove your actual inventory 
value to receive a waiver of these restrictions.

                               7. Premium

    (a) In lieu of section 7(c) of the Basic Provisions, we will 
determine your premium by multiplying the amount of insurance by the 
appropriate premium rate and by the premium adjustment factors listed on 
the actuarial documents that may apply.
    (b) In addition to the provisions in section 7 of the Basic 
Provisions, the premium will be adjusted for partial crop years. Premium 
will be charged for the entire month for any calendar month during which 
any amount of coverage is provided under these provisions or the peak 
inventory endorsement.
    (c) Additional premium from an increase in the plant inventory value 
report is due and payable when the revised plant inventory value report 
is accepted by us.

                            8. Insured Plants

    In lieu of the provisions of sections 8 and 9 of the Basic 
Provisions, the insured nursery plant inventory will be all the nursery 
plants in the county that:
    (a) Are shown on the Eligible Plant List and meet all the 
requirements for insurability (plant types, species and cultivars not 
insurable under the eligible plant list may be insured by written 
agreement, subject to FCIC's determination that the proper storage 
requirements and an accurate insurable price for the plant can be 
determined, and provided all other requirements, such as plant and 
container size, are met);
    (b) Are determined by us to be acceptable;
    (c) Are grown in a county for which a premium rate is provided in 
the actuarial documents;
    (d) Are grown in a nursery inspected by us and determined to be 
acceptable;
    (e) Are irrigated unless otherwise provided by the Special 
Provisions (You must have adequate irrigation equipment and water to 
irrigate all insurable nursery plants at the time coverage begins and 
throughout the insurance period);
    (f) Are grown in accordance with the production practices for which 
premium rates have been established;
    (g) Are grown in an appropriate medium;
    (h) Are not grown for sale as Christmas trees;
    (i) Are not stock plants; and
    (j) Produce edible fruits or nuts provided the fruit or nuts are not 
intended for harvest while the plant is located in the nursery.

                           9. Insurance Period

    (a) In lieu of the provisions of section 11 of the Basic Provision: 
(1) For the year of application, coverage begins 30 days after your crop 
insurance agent receives an application signed by you, unless we notify 
you that your inventory is not acceptable; (2) For subsequent crop 
years, the insurance period begins at 12:01 a.m. each October 1st; (3) 
No application for insurance for any current crop year will be accepted 
after May 31st of the crop year; (4) If you apply for coverage after May 
31st, coverage will not begin prior to October 1st; and (5) For the 1999 
crop year only, if you insured your nursery under 7 CFR 457.114 and you 
elect to cancel such policy by November 30, 1998, and obtain insurance 
under these Crop Provisions by November 30, 1998, by simultaneous 
cancellation and application, and if you select the same coverage level, 
the 30 day delay in coverage will not apply to your container grown 
nursery crop, and coverage for your container grown nursery crop will 
begin on the date of application. If you change coverage levels, the 30 
day delay in coverage on your container grown nursery crop specified in 
section 9(a)(1) will apply and coverage under 7 CFR 457.114 will 
continue until coverage under this policy begins.
    (b) Insurance ends at the earliest of:
    (1) The date of final adjustment of a loss when the total 
indemnities due equal the amount of insurance;
    (2) Removal of bare root nursery plant material from the field;
    (3) Removal of all other insured plant material from the nursery; or
    (4) 11:59 p.m. on September 30.

                           10. Causes of Loss

    (a) In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided for unavoidable damage caused only by 
the following causes of loss that occur within the insurance period:
    (1) Adverse weather conditions, except as specified in section 10(b) 
or the Special Provisions;
    (2) Fire, provided weeds and undergrowth in the vicinity of the 
plants or buildings on your insured site are controlled by chemical or 
mechanical means;
    (3) Wildlife;
    (4) Earthquake;

[[Page 552]]

    (5) Volcanic eruption; or
    (6) Failure of the irrigation water supply due to a cause of loss 
specified in sections 10(a)(1) through (5) that occurs within the 
insurance period; or
    (7) Delay in marketability of the plants, if such delay results in a 
reduction in the value of the plants, due to a cause of loss specified 
in section 10(a)(1) through (6) that occurs within the insurance period.
    (b) In addition to the causes of loss excluded in section 12 of the 
Basic Provisions, we do not insure against any loss caused by:
    (1) Disease or insect infestation, unless:
    (i) A disease or insect infestation occurs for which no effective 
control measure exists; or
    (ii) Coverage is specifically provided by the Special Provisions.
    (2) A failure of, or a reduction in, the power supply, unless such 
failure or reduction is due to an insurable cause of loss specified in 
section 10(a);
    (3) The inability to market the nursery plants as a direct result of 
quarantine, boycott, or refusal of a buyer to accept production;
    (4) Cold temperatures, if cold protection is required in the 
eligible plant list, unless:
    (i) You have installed adequate cold protection equipment or 
facilities and there is a failure or breakdown of the cold protection 
equipment or facilities resulting from an insurable cause of loss 
specified in section 10(a) (the insured plants must be damaged by cold 
temperatures and the damage must occur within 72 hours of the failure of 
such equipment or facilities unless we establish that repair or 
replacement was not possible between the time of failure or breakdown 
and the time the damaging temperatures occurred); or
    (ii) The lowest temperature or its duration exceeded the ability of 
the required cold protection equipment to keep the insured plants from 
sustaining cold damage;
    (5) Collapse or failure of buildings or structures, unless the 
damage to the building or structures results from a cause of loss 
specified in section 10(a); or
    (6) Failure of plants to grow to an expected size due to drought.

                11. Duties in the Event of Damage or Loss

    (a) In addition to your duties contained in section 14 of the Basic 
Provisions,
    (1) You must obtain our written consent prior to:
    (i) Destroying, selling or otherwise disposing of any plant 
inventory that is damaged; or
    (ii) Changing or discontinuing your normal growing practices with 
respect to care and maintenance of the insured plants.
    (2) You must submit a claim for indemnity to us on our form, not 
later than 60 days after the date of your loss, but in no event later 
than 60 days after the end of the insurance period.
    (b) Failure to obtain our written consent as required by section 
11(a)(1) will result in the denial of your claim.

                         12. Settlement of Claim

    We will determine indemnities for any unit as follows:
    (a) Determine the under report factor for the basic unit;
    (b) Determine the occurrence deductible;
    (c) Subtract field market value B from field market value A;
    (d) Multiply the result of 12(c) by the under report factor;
    (e) Subtract the occurrence deductible from the result in section 
12(d); and
    (f) If the result of section 12(e) is greater than zero, and subject 
to the limit of section 12(g), your indemnity equals the result of 
section 12(e), multiplied by your price election, and multiplied by your 
share.
    (g) The total of all indemnities for the crop year will not exceed 
the amount of insurance including any peak amount of insurance during 
the coverage term of the peak inventory endorsement.

                     13. Late and Prevented Planting

    The late and prevented planting provisions in the Basic Provisions 
are not applicable.

                         14. Written Agreements

    (a) In lieu of section 18(a) of the Basic Provisions, for the year 
of application you must request a written agreement in writing with the 
application and not later than the cancellation date for each subsequent 
crop year;
    (b) In addition to the requirements of section 18 of the Basic 
Provisions any written agreement is valid only until the end of the 
insurance period; and
    (c) In lieu of section 18(e) of the Basic Provisions, an application 
for a written agreement submitted after the date of application for the 
initial year and the cancellation date for all subsequent crop years may 
be approved if you demonstrate your physical inability to have applied 
timely and, after physical examination of the nursery plant inventory, 
we determine the inventory will be marketable at the value shown on the 
plant value inventory report.

                              15. Examples

                           Single Unit Example

    Assume you have a 100 percent share and the plant inventory value 
reported by you is $100,000, your coverage level is 75 percent, and your 
price election is 75 percent. Your amount of insurance is $56,250 
($100,000  x  .75  x  .75). At the time of loss, field market value A is 
$125,000, field market value B is $80,000, and field market value C is 
$125,000. The

[[Page 553]]

under report factor is .80 ($100,000 divided by $125,000). The 
deductible percentage is 25 percent (100-75), the crop year deductible 
is $25,000 (.25  x  $100,000) and the occurrence deductible is $25,000 
(.25  x  $125,000  x  .80). Your indemnity would be calculated as 
follows:

Step (1) Determine the under report factor
    $100,000  $125,000 =.80;
Step (2) Field market value A minus field market value B
    $125,000 - $80,000 = $45,000;
Step (3) Result of step 2 multiplied by the under report factor (step 1)
    $45,000  x  .80 = $36,000;
Step (4) Result of step 3 minus the occurrence deductible
    $36,000-$25,000 = $11,000;
Step (5) Result of step 4 multiplied by your price election
    $11,000  x  .75 = $8,250;
Step (6) Result of step 5 multiplied by your share
    $8,250  x  1.000 = $8,250 indemnity payment.

                      Peak Inventory Report Example

    Assume you have a second loss on the same basic unit. Your amount of 
insurance has been reduced by subtracting your previous indemnity 
payment or $8,250 from your amount of insurance ($56,250- $8,250 = 
$48,000). Your crop year deductible has been reduced to zero by the 
previous loss ($25,000--$36,000, but not less than zero). You purchase a 
Peak Inventory Endorsement and report $60,000 in inventory. Your peak 
amount of insurance is your reported inventory times your coverage level 
times your price election ($60,000  x  .75  x  .75 = $33,750). The 
combined amount of insurance for the coverage term of the peak 
endorsement is $48,000 + $33,750 = $81,750. Your crop year deductible is 
increased by $15,000 ($60,000  x  .25). At the time of loss, field 
market value A is $124,000, field market value B is $58,000, and field 
market value C is $124,000. The under report factor is 1.00 
[($160,000-$36,000)  $124,000]. The crop year deductible is 
$15,000 (.25  x  $60,000) and the occurrence deductible is $15,000 (the 
lesser of field market value A  x  .25 or the crop year deductible). 
Your indemnity would be calculated as follows:

Step (1) Determine the under report factor
    ($160,000-$36,000)  $124,000 = 1.00;
Step (2) Field market value A minus field market value B
    $124,000-$58,000 = $66,000;
Step (3) Result of step 2 multiplied by the under report factor (step 1)
    $66,000  x  1.00 = $66,000;
Step (4) Result of step 3 minus the occurrence deductible
    $66,000-$15,000 = $51,000;
Step (5) Result of step 4 multiplied by your price election
    $51,000  x  .75 = $38,250;
Step (6) Result of step 5 multiplied by your share
    $38,250  x  1.000 = $38,250 indemnity payment.

    Your peak amount of insurance is reduced to zero. Your amount of 
insurance is reduced by the amount the indemnity exceeds the peak amount 
of insurance. $48,000-($38,250-$33,750) = $48,000-$4,500 = $43,500

                   Multiple Unit Multiple Loss Example

    Assume you have a 100 percent share and the plant inventory value 
reported by you is $100,000, your coverage level is 75 percent, and your 
price election is 75 percent. You have elected optional units and have 
two optional units, unit 1 and unit 2. Your amount of insurance is 
$56,250 ($100,000  x  .75  x  .75). You have a loss on unit 1 and no 
loss on unit 2. At the time of loss, field market value A on unit 1 is 
$60,000, field market value B on unit 1 is $18,000, and field market 
value C is $125,000. The under report factor is .80 ($100,000  
$125,000). The deductible percentage is 25 percent (100-75), the crop 
year deductible is $25,000 (.25  x  $100,000) and the occurrence 
deductible is $12,000 (.25  x  $60,000  x  .80). Your indemnity would be 
calculated as follows:

Step (1) Determine the under report factor
    $100,000  $125,000 = .80;
Step (2) Field market value A minus field market value B
    $60,000-$18,000 = $42,000;
Step (3) Result of step 2 multiplied by the under report factor (step 1)
    $42,000  x  .80 = $33,600;
Step (4) Result of step 3 minus the occurrence deductible
    $33,600-$12,000 = $21,600;
Step (5) Result of step 4 multiplied by your price election
    $21,600  x  .75 = $16,200;
Step (6) Result of step 5 multiplied by your share
    $16,200  x  1.000 = $16,200 indemnity payment.

    Your crop year deductible is reduced to $13,000 ($25,000-$12,000). 
Your amount of insurance is reduced to $40,050 ($56,250-$16,200). You do 
not restock unit 1 after the first loss. Values on unit 2 do not change 
from the those measured at the time of the loss on unit 1. Assume you 
have a second loss during the crop year but this time on unit 2. Field 
market value A on unit 2 is $65,000, Field market value B on unit 2 is $ 
0.00 and field market value C on the basic unit is $83,000. Your loss 
would be determined as follows:

Step (1)  Determine the under report factor
    $66,400  $83,000 =.80;
Step (2) Field market value A minus field market value B
    $65,000-$0.00 = $65,000;
Step (3) Result of step 2 multiplied by the under report factor (step 1)

[[Page 554]]

    $65,000  x  .80 = $52,000;
Step (4) Result of step 3 minus the occurrence deductible
    $52,000-$13,000 = $39,000;
Step (5) Result of step 4 multiplied by your price election
    $39,000  x  .75 = $29,250;
Step (6) Result of step 5 multiplied by your share
    $29,250  x  1.000 = $29,250 indemnity payment.

[63 FR 50975, Sept. 24, 1998; 63 FR 57046, Oct. 26, 1998]



Sec. 457.163  Nursery peak inventory endorsement.

                         Nursery Crop Insurance

                       Peak Inventory Endorsement

    This endorsement is not continuous and must be purchased for each 
crop year to be effective for that crop year.

    In return for payment of premium for the coverage contained herein, 
this endorsement will be attached to and made part of the Nursery Crop 
Insurance Provisions, subject to the terms and conditions described 
herein.

                             1. Definitions

    Coverage commencement date. The later of the date you declare as the 
beginning of the coverage or 30 days after a properly completed peak 
inventory value report is received by us.
    Coverage term. A period of time that begins on the coverage 
commencement date and ends on the coverage termination date.
    Coverage termination date. The date you declare that the peak amount 
of insurance will cease. This date cannot be after the end of the crop 
year.
    Peak amount of insurance. The additional inventory value reported on 
the peak inventory value report for each basic unit multiplied by the 
coverage level, price election you elected for the crop and county, and 
by your share.
    Peak inventory value report. A report that increases the value of 
insurable plants over the value reported on the plant inventory value 
report, declares the coverage commencement and coverage termination 
dates, and the other requirements of section 6 of the Nursery Crop 
Insurance Provisions.
    Restock. Replacement of lost or damaged plants that increase the 
value of your insurable inventory to an amount greater than your 
remaining amount of insurance.

                             2. Eligibility

    (a) You must have insurance under the Nursery Crop Insurance 
Provision, 7 CFR 457.162, in effect for the crop year that this 
endorsement applies;
    (b) You must have elected either the limited or additional level of 
coverage.
    (c) You must submit a peak inventory value report which will serve 
as the application for coverage under this endorsement. We may reject 
the peak inventory value report if all requirements in this endorsement 
and the Nursery Crop Insurance Provisions are not met.
    (d) You may purchase no more than two Peak Inventory Endorsements 
for each practice during the crop year unless you have suffered insured 
losses and have restocked your nursery.

                               3. Coverage

    (a) The amount of insurance provided under the Nursery Crop 
Insurance Provisions is increased by the peak amount of insurance for 
the coverage term.
    (b) Except as provided herein, this endorsement does not change, 
amend or otherwise modify any other provision of your Nursery Crop 
Insurance Policy.

                        4. Peak Insurance Period

    Coverage begins at 12:01 a.m. on the coverage commencement date and 
ends at 11:59 p.m. on the coverage termination date.

                               5. Premium

    (a) The premium for this endorsement is determined by multiplying 
the peak amount of insurance by the appropriate premium rate and by any 
premium adjustment factors listed in the actuarial documents that may 
apply.
    (b) The premium for this endorsement is due and payable in 
accordance with section 7 of the Nursery Crop Insurance Provisions.

                        6. Reporting Requirements

    In addition to the reporting requirements of section 6 of the 
Nursery Crop Insurance Provisions, you must submit a peak inventory 
value report on our form.

                           7. Liability Limit

    The peak amount of insurance is limited to the practice value you 
declare under the Nursery Crop Insurance Provisions.

[63 FR 50979, Sept. 24, 1998; 63 FR 57047, Oct. 26, 1998]



PART 458--SPECIAL CALIFORNIA CROP INSURANCE REGULATIONS--Table of Contents




        Subpart--Regulations for the 1992 through 1994 Crop Years

Sec.
458.1  Availability of Special California citrus crop insurance.

[[Page 555]]

458.2  Premium rates, production guarantees, coverage levels, and prices 
          at which indemnities shall be computed.
458.3  OMB control numbers.
458.4  Creditors.
458.5  Good faith reliance on misrepresentation.
458.6  The contract.
458.7  The application and policy.

    Authority: 7 U.S.C. 1506, 1516.

    Source: 56 FR 30490, July 3, 1991, unless otherwise noted.



        Subpart--Regulations for the 1992 through 1994 Crop Years



Sec. 458.1  Availability of Special California citrus crop insurance.

    Insurance shall be offered under the provisions of this subpart on 
citrus in California counties within limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended. The counties shall be designated by the Manager of the 
Corporation from those approved by the Board of Directors of the 
Corporation.



Sec. 458.2  Premium rates, production guarantees, coverage levels, and prices at which indemnities shall be computed.

    (a) The Manager shall establish premium rates, production 
guarantees, coverage levels, and prices at which indemnities shall be 
computed for California citrus which will be included in the actuarial 
table on file in the applicable service offices for the county.
    (b) At the time of application, the applicant will select the 
coverage level (50%, 65%, or 75%) for the 1993 and 1994 crop years. The 
coverage level for the 1992 crop year will be level 1 (50%). The price 
selection for the 1992 crop year will be established by the actuarial 
tables for the applicable type for the crop year.



Sec. 458.3  OMB control numbers.

    The OMB control numbers are contained in subpart H of part 400, 
Title 7 CFR.



Sec. 458.4  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to my benefit under the contract.



Sec. 458.5  Good faith reliance on misrepresentation.

    Notwithstanding any other provision of the Special California citrus 
insurance contract, whenever:
    (a) An insured under a contract of crop insurance entered into under 
these regulations, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation:
    (1) Is indebted to the Corporation for additional premiums; or
    (2) Has suffered a loss to a crop which is not insured or for which 
the insured is not entitled to an indemnity because of failure to comply 
with the terms of the insurance contract, but which the insured believed 
to be insured, or believed the terms of the insurance contract to have 
been complied with or waived; and
    (b) the Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00 finds that:
    (1) An agent or employee of the Corporation did in fact make such 
misrepresentation or take other erroneous action or give erroneous 
advice;
    (2) Said insured relied thereon in good faith; and
    (3) To require the payment of the additional premiums or to deny 
such insured's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if otherwise 
entitled thereto. Requests for relief under this section must be 
submitted to the Corporation in writing.



Sec. 458.6  The contract.

    The insurance contract shall become effective upon the written 
acceptance on the Corporation's form by the insured of the Corporation's 
insurance offer. Said offer will be extended only after receipt by the 
corporation of an application for insurance on a form prescribed by the 
Corporation and inspection of the grove by the Corporation. The 
applicant will have 15 calendar days from the date the insurance

[[Page 556]]

offer is tendered to accept such offer. The offer will be withdrawn 
thereafter if not accepted. The contract shall cover the citrus crop as 
provided in the policy. The contract shall consist of the application, 
the insurance offer, the acceptance, the policy, an annual field 
inspection report, and the county actuarial table. Any changes made in 
the contract shall not affect its continuity from year to year. The 
forms referred to in the contract are available at the applicable 
services offices.



Sec. 458.7  The application and policy.

    (a) Application for insurance on a form prescribed by the 
Corporation may be made by any person to cover such person's share in 
the citrus crop as landlord, owner-operator, or tenant. The application 
shall be submitted to the Corporation at any designated service office 
on or before the applicable sales closing date.
    (b) The Corporation may discontinue the acceptance of applications 
in any county upon its determination that the insurance risk is 
excessive, and also, for the same reason, may reject any individual 
application. The Manager of the Corporation is authorized in any crop 
year to extend the closing date for submitting applications in any 
county, by placing the extended date on file in the applicable service 
offices and publishing a notice in the Federal Register upon the 
Manager's determination that no adverse selectivity will result during 
the extended period.
    However, if adverse conditions should develop during such period, 
the Corporation may discontinue the acceptance of applications.
    The provision of the Special California Insurance Policy for the 
1992 through 1994 crop years are as follows:

             Special California Citrus Crop Insurance Policy

    (This is a three (3) year term contract. Refer to Section 15.)
    Agreement to Insure: We will provide the insurance described in this 
policy in return for the premium and your compliance with all applicable 
provisions.
    Throughout this policy, ``you'' and ``your'' refer to the insured 
shown on the accepted Application and ``we,'' ``us,'' ``our'' refer to 
the Federal Crop Insurance Corporation.

    Note:  This is a three year policy of insurance. The Corporation, 
after inspection of the grove, will extend to the applicant, an offer of 
insurance. Upon acceptance of that offer a contract of insurance will be 
in existence. The first year's premium and the estimated premium for the 
remaining two years are due and payable to the Corporation within 45 
days of acceptance of the insurance offer. The amount of production used 
to compute the insurance offer each year will be determined only after 
the Corporation's annual inspection of the insured's grove. The amount 
of premium for each of the remaining two years will be determined as a 
result of the corporation's inspection.

                          Terms and Conditions

                            1. Causes of Loss

    (a) For the 1992 crop year the insurance provided is against 
unavoidable loss of production resulting from the following causes 
occurring within the insurance period:
    (1) Frost;
    (2) Freeze;
    (3) Excess moisture; and
    (4) Hail.
    (b) For the 1993 and 1994 crop years the insurance provided is 
against those causes listed in subsection 1.(a) above, and the following 
causes occurring within the insurance period:
    (1) Fire;
    (2) Wildlife;
    (3) Excess heat;
    (4) Excess wind;
    (5) Tornado;
    (6) Earthquake;
    (7) Volcanic eruption;
    (8) Failure of the irrigation water supply due to an unavoidable 
cause occurring after insurance attaches; or
    (9) Direct Mediterranean Fruit Fly damage; unless those causes are 
expected, excluded, or limited by the actuarial table or subsection 
9.(f)(7).
    (c) We will not insure against any loss of production due to:
    (1) Fire, where weeds and other forms of undergrowth have not been 
controlled or tree-pruning debris has not been removed from the grove;
    (2) The neglect, mismanagement, abandonment, or wrongdoing of you, 
any member of your household, your tenants, or employees;
    (3) The failure to follow recognized good citrus grove practices;
    (4) The failure or breakdown of irrigation equipment or facilities;
    (5) The failure to carry out a good citrus irrigation practice;
    (6) The impoundment of water by any governmental, public, or private 
dam or reservoir project; or
    (7) Any cause not specified in section 1.(a) or 1.(b), as 
applicable, as an insured loss.

[[Page 557]]

                   2. Crop, Acreage, and Share Insured

    (a) The crop insured will be all of the following citrus types you 
elect, which are grown in the country on insured acreage and for which a 
premium rate is provided by the actuarial table:
    Type I--Navel oranges;
    Type II--Sweet oranges;
    Type III--Valencia oranges;
    Type IV--Grapefruit;
    Type V--Lemons;
    Type VI--Kinnow mandarins;
    Type VII--Minneola tangelos; or
    Type VIII--Orlando tangelos.
    (b) The acreage insured for each crop year will include all acreage 
of citrus of the type(s) elected pursuant to section 2.(a), located on 
insurable acreage as designated by the actuarial table and in which you 
have a share at the time insurance attaches for the 1992 crop year.
    (c) The insured share is your share as landlord, owner-operator, or 
tenant in the insured citrus on the date insurance attaches.
    (d) We do not insure any acreage:
    (1) Which is not irrigated; and
    (2) On which the trees have not reached the sixth growing season 
after being set out.
    (e) Insurance will not attach or be considered to have attached to 
any acreage of the crop, for each crop year, until the acreage has been 
inspected and accepted by us. Tree damage occurring prior to the insured 
crop year will result in a commensurate reduction in yield guarantee for 
a subsequent years insurance coverage.
    (f) We may limit the insured acreage to any acreage limitation 
established under any Act of Congress if we advise you of the limit 
prior to the date insurance attaches.

       3. Report of Acreage, Share, Number of Trees, and Practice

    You must report on our form:
    (a) All of the acreage of citrus in the county in which you have a 
share;
    (b) The practice;
    (c) Your share on the date insurance attaches; and
    (d) The number of bearing trees.
    You must designate separately any acreage in which you have an 
interest that is not insurable. The 1992 crop year acreage report must 
accompany your application for insurance coverage under this contract.
    For the 1993 and 1994 crop years, the designated acreage will remain 
the same as that noted for 1992 unless, as a result of a subsequent 
field inspection, we determine that some covered acreage has suffered 
structural damage sufficient to make it uninsurable. This report must be 
submitted annually thereafter on or before January 10.

  4. Production Guarantees, Coverage Levels, and Prices for Computing 
                               Indemnities

    (a) The coverage levels and prices for computing indemnities are 
contained in the actuarial table.
    (b) Coverage level 1 will apply for the 1992 crop year.
    (c) You may select any coverage level for the 1993 and 1994 crop 
years at the time of application.
    (d) The price election for the 1992 crop year will be the maximum 
available for the 1992 crop year as shown on the actuarial table. The 
price election for the 1993 and 1994 crop years will be the maximum 
available as shown on the 1993 crop year actuarial table.
    (e) You must report production and acreage to us for at least the 
four-year period 1987 through 1990 when the application is submitted. 
However, if the trees had not reached the sixth growing season in 1987, 
only those years in which the trees were six years or older must be 
reported. Your guarantee for each crop year will be based on your 
production history and our appraisal of current crop potential.
    In no case will the insurance yield on which the guarantee is based 
be greater than can be supported by the production history.

                               5. Premium

    (a) The premium amount for each crop year is computed by multiplying 
the applicable production guarantee as determined in section 4.(e) times 
the price election, times the premium rate, times the insured acreage, 
times your share at the time insurance attaches for the 1992 crop year.
    (b)(1) The premium for the 1992 crop year is earned at the time the 
insurance attaches and must be paid within 45 days of acceptance of the 
Corporation's insurance offer by the applicant. The insurance will be 
considered accepted when you agree, in writing, to the insurance offer. 
In addition, a premium deposit for the 1993 and 1994 crop years, 
calculated as in subsection 5.(a) above, must be submitted within 45 
days of the acceptance of the insurance offer. The premium deposit 
amount will be calculated based on the factors selected for the 1993 and 
1994 crop years.
    (2) Failure to pay the premium within 45 days of the acceptance of 
the insurance offer will result in:
    (i) The insured being charged interest at a rate of fifteen (15%) 
percent annum, from the due date of the premium payment to the date 
actually paid;
    (ii) The elimination of the discount permitted under subsection (c) 
below;
    (iii) The withholding of any indemnities payable under the policy 
until payment is made in full; and
    (iv) Legal action to collect the required premium payment.

[[Page 558]]

    (c) The 1993 and 1994 crop year premium deposits will be adjusted as 
follows to reflect the present value of the premium (based on an average 
annual interest rate of seven percent (7%):
    (1) The premium deposit amount for the 1993 crop year will be 
multiplied by 0.935; and
    (2) The premium deposit amount for the 1994 crop year will be 
multiplied by 0.873.
    (d) A portion of the premium deposit may be refunded if, upon 
subsequent annual field inspections, it is determined that the trees on 
insured acreage have been damaged in a manner that will result in 
subsequent production losses. Adjustments will be made to eliminate that 
portion of guaranteed production relating to tree damage and a pro-rata 
portion of the premium deposit will be returned to you.

                         6. Deductions for Debt

    Any unpaid amount due us may be deducted from any indemnity payable 
to you, or from any loan or payment due you under any Act of Congress or 
program administered by the United States Department of Agriculture or 
its Agencies.

                           7. Insurance Period

    For the 1992 crop year, insurance attaches at the time the 
Corporation's insurance offer is accepted by the insured. For the 1993 
and 1994 crop years, insurance attaches on the December 1 prior to the 
calendar year of normal bloom, and ends at the earliest of:
    (a) Total destruction of the citrus;
    (b) Harvest of the citrus;
    (c) Final adjustment of a loss; or
    (d) The date following the year in which the bloom is normally set 
as follows:
    (1) August 31 for Navel oranges and Southern California lemons;
    (2) November 30 for Valencia oranges; or
    (3) July 31 for all other types of citrus.

                       8. Notice of Damage or Loss

    (a) In case of damage or probable loss:
    (1) You must give us prompt written notice:
    (i) After insured damage to the citrus becomes apparent, giving the 
dates and causes of such damage; or
    (ii) If you decide not to further care for or harvest any part of 
the insured citrus crop.
    (2) You must give us notice of probable loss at least 15 days before 
the beginning of harvest if you anticipate a loss on any unit.
    (3) If probable loss is later determined, immediate notice must be 
given. If harvest will begin after the end of the insurance period, 
notice must be given on or before the calendar date for the end of the 
insurance period.
    (b) You must obtain written consent from us before you destroy any 
of the citrus which is not to be harvested.
    (c) We may reject any claim for indemnity if any of the requirements 
of this section or section 9 are not complied with.

                         9. Claim for Indemnity

    (a) Any claim for indemnity on a unit must be submitted to us on our 
form not later than 60 days after the earliest of:
    (1) Total destruction of the citrus on the unit:
    (2) Harvest of the unit; or
    (3) The calendar date for the end of the insurance period.
    (b) We will not pay any indemnity unless you:
    (1) Establish the total production of citrus on the unit and that 
any loss of production has been directly caused by one or more of the 
insured causes during the insurance period; and
    (2) Furnish all information we require concerning the loss.
    (c) The indemnity will be determined on each unit by:
    (1) Multiplying the insured acreage by the production guarantee;
    (2) Subtracting therefrom the total production of citrus to be 
counted (see section 9.(f));
    (3) Multiplying the remainder by the price election; and
    (4) Multiplying this result by your share.
    (d) If the information reported by you under section 3 of the policy 
results in a lower premium than the actual premium determined to be due, 
the production guarantee on the unit will be computed on the information 
reported, but all the production from insurable acreage, whether or not 
reported as insurable, will count against the production guarantee.
    (e) If a determination is made that frost protection equipment was 
not properly utilized or not properly reported, the indemnity for the 
unit will be reduced by the percentage of premium reduction allowed for 
frost protection equipment. You must, at our request, provide us records 
showing the start-stop times by date for each period the equipment was 
used.
    (f) The total production (cartons) to be counted for each unit will 
include all harvested production marketed as fresh packed fruit and all 
appraised production determined to be marketable as fresh packed fruit.
    (1) Any production will be considered marketed or marketable as 
fresh packed fruit unless, due to insurable causes, such production was 
not marketed or marketable as fresh packed fruit.
    (2) In the absence of acceptable records to determine the 
disposition of harvested citrus, an amount of citrus equal to the 
guarantee will be treated as production to count.
    (3) Appraised production to be counted will include:

[[Page 559]]

    (i) Unharvested production, and potential production lost due to 
uninsured causes and failure to follow recognized good citrus grove 
practices;
    (ii) Not less than the guarantee for any acreage which is abandoned, 
damaged solely by an uninsured cause or destroyed by you without our 
consent.
    (4) Any appraisal we have made on insured acreage will be considered 
production to count unless such appraised production is:
    (i) Harvested; or
    (ii) Further damaged by an insured cause and reappraised by us.
    (5) Citrus which cannot be marketed due to insurable causes will not 
be considered production.
    (6) The amount of production of any unharvested citrus may be 
determined on the basis of field appraisals conducted after the end of 
the insurance period.
    (7) If you elect to exclude hail and fire as insured causes of loss 
and the citrus is damaged by hail or fire, appraisals will be made in 
accordance with Form FCI-78, ``Request to Exclude Hail and Fire.''
    (g) You must not abandon any acreage to us.
    (h) You may not sue us unless you have complied with all policy 
provisions. If a claim is denied, you may sue us in the United States 
District Court under the provisions of 7 U.S.C. 1508(c). You must bring 
suit within 12 months of the date notice of denial is received by you.
    (i) We have a policy for paying your indemnity within 30 days of our 
approval of your claim, or entry of a final judgment against us. We 
will, in no instance, be liable for the payment of damages, attorney's 
fees, or other charges in connection with any claim for indemnity, 
whether we approve or disapprove such claim. We will, however, pay 
simple interest computed on the net indemnity ultimately found to be due 
by us or by a final judgment from and including the 61st day after the 
date you sign, date, and submit to us the properly completed claim for 
indemnity form, if the reason for our failure to timely pay is not due 
to your failure to provide information or other material necessary for 
the computation or payment of the indemnity.
    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. The interest rate to be paid on any 
indemnity will vary with the rate announced by the Secretary of the 
Treasury.
    (j) If you die, disappear, or are judicially declared incompetent, 
or if you are an entity other than an individual and such entity is 
dissolved after the date insurance attaches for any crop year, any 
indemnity will be paid to the person determined to be beneficially 
entitled thereto.
    (k) If you have other fire insurance, fire damage occurs during the 
insurance period, and you have not elected to exclude fire insurance 
from this policy, we will be liable for loss due to fire only for the 
smaller of the amount:
    (1) Of indemnity determined pursuant to this contract without regard 
to any other insurance; or
    (2) By which the loss from fire exceeds the indemnity paid or 
payable under such other insurance.
    For the purpose of this section, the amount of loss from fire will 
be the difference between the fair market value of the production on the 
unit before the fire and after the fire.

                        10. Concealment or Fraud

    We may void the contract on all crops insured without affecting your 
liability for premiums or waiving any right, including the right to 
collect any amount due us if, at any time, you have concealed or 
misrepresented any material fact or committed any fraud relating to the 
contract. Such voidance will be effective as of the beginning of the 
crop year with respect to which such act or omission occurred.

           11. Transfer of Right to Indemnity on Insured Share

    If you transfer any part of your share during the crop year, you may 
transfer your right to an indemnity. The transfer must be on our form 
and approved by us. We may collect the premium from either you or your 
transferee or both. The transferee will have all rights and 
responsibilities under the contract.

                       12. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year, only on our form and with our approval. The assignee will 
have the right to submit the loss notices and forms required by the 
contract.

         13. Subrogation. (Recovery of Loss From a Third Party)

    Because you may be able to recover all or part of your loss from 
someone other than us, you must do all you can to preserve any such 
right. If we pay you for your loss, then your right of recovery will at 
our option belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

                     14. Records and Access To Grove

    You must keep, for 3 years after the time of loss, records of the 
harvesting, storage, shipment, sale, or other disposition of all citrus 
produced on each unit including separate

[[Page 560]]

records showing the same information for production from any uninsured 
acreage. Failure to keep and maintain such records may, at our option, 
result in cancellation of the contract prior to the crop year to which 
the records apply, assignment of production to units by us, or a 
determination that no indemnity is due. Any person designated by us will 
have access to such records and the grove for purposes related to the 
contract.

                   15. Life of Contract: Cancellation

    (a) This contract will be in effect for the crop years 1992, 1993 
and 1994, and may not be canceled by you.
    (b) If you die or are judicially declared incompetent, or if you are 
an entity other than an individual and such entity is dissolved, the 
contract will continue in force through the end of the insurance period 
(1994 crop year).

                          16. Meaning of Terms

    For the purposes of California citrus crop insurance:
    (a) Actuarial table--means the forms and related material for the 
crop year approved by us and which show the coverage levels, premium 
rates, prices for computing indemnities, practices, insurable and 
uninsurable acreage, and related information regarding citrus insurance 
in the county.
    (b) Carton--as to each insured citrus type, means the standard 
container for marketing fresh packed fruit as shown below by citrus 
type. In the absence of marketing records on such a carton basis, 
production will be converted to cartons on the basis of the following 
average net pounds of packed fruit in a standard packed carton:

------------------------------------------------------------------------
        Container Size                 Types of Fruit            Pounds
------------------------------------------------------------------------
Container 58................  Navel oranges, Valencia                38
                                oranges & Sweet oranges.
Container 58................  Lemons........................         40
Container 59................  Grapefruit....................         32
Container 63................  Tangerines (including                  25
                                Tangelos) & Mandarin oranges.
------------------------------------------------------------------------

    (c) Contiguous land--means land which is touching at any point, 
except that land which is separated by only a public or private right-
of-way will be considered contiguous.
    (d) County--means the county shown on the application and any 
additional land located in a local producing area bordering on the 
county as shown by the actuarial table.
    (e) Crop year--means the period beginning with the date insurance 
attaches to the citrus crop and extending through normal harvest time, 
and will be designated by the calendar year following the year in which 
the bloom is normally set.
    (f) Direct Mediterranean fruit fly damage--means the actual physical 
damage to the citrus on the unit which causes such citrus to be 
unmarketable and will not include unmarketability of such citrus as a 
direct result of a quarantine, boycott, or refusal to accept the citrus 
by any entity without regard to actual physical damage to such citrus.
    (g) Harvest--means the severance of mature citrus from the tree 
either by pulling, picking, or by mechanical or chemical means.
    (h) Insurable acreage--means the land classified as insurable by us 
and shown as such by the actuarial table.
    (i) Insured--means the person who submitted the application accepted 
by us.
    (j) Person--means an individual, partnership, association, 
corporation, estate, trust, or other business enterprise or legal 
entity, and wherever applicable, a State, a political subdivision of a 
State, or any agency thereof.
    (k) Service office--means the office servicing your contract as 
shown on the application for insurance or such other approved office as 
may be selected by you or designated by us.
    (l) Tenant--means a person who rents land from another person for a 
share of the citrus or a share of the proceeds therefrom.
    (m) Unit--means all insurable acreage in the county of any one of 
the citrus types referred to in section 2 of this policy, located on 
contiguous land on the date insurance attaches for the crop year: (1) In 
which you have a 100 percent share; or
    (2) Which is owned by one entity and operated by another entity on a 
share basis.
    Land rented for cash, a fixed commodity payment, or any 
consideration other than a share in the citrus on such land will be 
considered as owned by the lessee. Land which would otherwise be one 
unit may be divided according to applicable guidelines on file in your 
service office. Units will be determined when the acreage is reported. 
Errors in reporting units may be corrected by us to conform to 
applicable guidelines when adjusting a loss. We may consider any acreage 
and share thereof reported by or for your spouse or child or any member 
of your household to be your bona fide share or the bona fide share of 
any other person having an interest therein.

[[Page 561]]

                        17. Descriptive Headings

    The descriptive headings of the various policy terms and conditions 
are formulated for convenience only and are not intended to affect the 
construction or meaning of any of the provisions of the contract.

                           18. Determinations

    All determinations required by the policy will be made by us. If you 
disagree with our determinations, you may obtain reconsideration of or 
appeal those determinations in accordance with Appeal Regulations (7 CFR 
400, Subpart J).

                               19. Notices

    All notices required to be given by you must be in writing and 
received by your service office within the designated time unless 
othewise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice.

[[Page 563]]



   CHAPTER V--AGRICULTURAL RESEARCH SERVICE, DEPARTMENT OF AGRICULTURE




  --------------------------------------------------------------------
Part                                                                Page
500             National Arboretum..........................         565
501             Conduct on U.S. Meat Animal Research Center, 
                    Clay Center, Nebraska...................         570
502             Conduct on Beltsville Agriculture Research 
                    Center Property, Beltsville, Maryland...         572
503             Conduct on Plum Island Animal Disease Center         574
504             User fees...................................         576
510             Public information..........................         577
520             Procedures for implementing National 
                    Environmental Policy Act................         577

[[Page 565]]



PART 500--NATIONAL ARBORETUM--Table of Contents




         Subpart A--Conduct on U.S. National Arboretum Property

Sec.
500.1  General.
500.2  Recording presence.
500.3  Preservation of property.
500.4  Conformity with signs and emergency directions.
500.5  Nuisances.
500.6  Gambling.
500.7  Intoxicating beverages and narcotics.
500.8  Soliciting, vending, debt collection, and distribution of 
          handbills.
500.9  Photographs for news, advertising, or commercial purposes.
500.10  Pets.
500.11  Vehicular and pedestrian traffic.
500.12  Weapons and explosives.
500.13  Nondiscrimination.
500.14  Exceptions.
500.15  Penalties and other law.

     Subpart B--Fee Schedule for Certain Uses of National Arboretum 
                         Facilities and Grounds

500.20  Scope.
500.21  Fee schedule for tram.
500.22  Fee schedule for use of facilities and grounds.
500.23  Fee schedule for photography and cinematography on grounds.
500.24  Payment of fees.

    Authority: 20 U.S.C. 196; secs. 2, 4, 62 Stat. 281; sec. 103, 63 
Stat. 380; sec 205(d), 63 Stat. 389; 40 U.S.C. 318a, 318c, 486(d), 753, 
34 FR 6406; 34 FR 7389.

    Source: 34 FR 12939, Aug. 9, 1969, unless otherwise noted. 
Redesignated at 36 FR 22807, Dec. 1, 1971.



         Subpart A--Conduct on U.S. National Arboretum Property



Sec. 500.1  General.

    The rules and regulations in this part apply to the buildings and 
grounds of the U.S. National Arboretum, Washington, D.C., and to all 
persons entering in or on such property. The Administrator, General 
Services Administration, has delegated to the Secretary of Agriculture, 
with authority to redelegate, the authority to make all the needful 
rules and regulations for the protection of the buildings and grounds of 
the U.S. National Arboretum (34 FR 6406). The Secretary of Agriculture 
has in turn delegated such authority to the Administrator, Agricultural 
Research Service (34 FR 7389). The rules and regulations in this part 
are issued pursuant to such delegations.

[61 FR 65302, Dec. 11, 1996]



Sec. 500.2  Recording presence.

    Admission to the U.S. National Arboretum during periods when it is 
closed to the public will be limited to authorized individuals who may 
be required to sign the register and/or display identification documents 
when requested by the Security Staff, or other authorized individuals.

[61 FR 65302, Dec. 11, 1996]



Sec. 500.3  Preservation of property.

    It is unlawful to willfully destroy, damage, or remove property or 
any part thereof.



Sec. 500.4  Conformity with signs and emergency directions.

    Persons in and on property of the U.S. National Arboretum shall 
comply with official signs of prohibitory or director nature and with 
the directions of authorized individuals.

[61 FR 65302, Dec. 11, 1996]



Sec. 500.5  Nuisances.

    The use of loud, abusive, or otherwise improper language, 
unwarranted loitering, sleeping, or assembly, the creation of any hazard 
to persons or things, improper disposal of rubbish, spitting, prurient 
prying, the commission of any obscene or indecent act, or any other 
unseemly or disorderly conduct, throwing articles of any kind from a 
building, and climbing upon any part of a building, is prohibited.



Sec. 500.6  Gambling.

    Participating in games for money or other personal property, or the 
operation of gambling devices, the conduct of a lottery or pool, or the 
selling or purchasing of numbers tickets, in or on U.S. National 
Arboretum property, is prohibited.

[61 FR 65302, Dec. 11, 1996]

[[Page 566]]



Sec. 500.7  Intoxicating beverages and narcotics.

    Entering U.S. National Arboretum property or the operation of a 
motor vehicle thereon, by a person under the influence of intoxicating 
beverages or narcotic drug, or the consumption of such beverages or the 
use of such drug in or on U.S. National Arboretum property, is 
prohibited.

[61 FR 65302, Dec. 11, 1996]



Sec. 500.8  Soliciting, vending, debt collection, and distribution of handbills.

    The soliciting of contributions, display or distribution of 
commercial advertising and the collection of private debts, is 
prohibited. This section does not apply to national or local drives for 
funds for welfare, health, and other purposes sponsored or approved by 
the Agricultural Research Service, concessions, or personal notices 
posted by employees on authorized bulletin boards. Distribution of 
material such as pamphlets, handbills, and flyers is prohibited without 
prior approval of the Director, U.S. National Arboretum.

[61 FR 65302, Dec. 11, 1996]



Sec. 500.9  Photographs for news, advertising, or commercial purposes.

    Photographs for news purposes may be taken at the U.S. National 
Arboretum without prior permission. Photographs for advertising and 
commercial purposes may be taken, but only with the prior approval of 
the Director, U.S. National Arboretum and fees may be charged.

[61 FR 65302, Dec. 11, 1996]



Sec. 500.10  Pets.

    Pets, except assistance trained animals, brought upon U.S. National 
Arboretum property must be kept on leash and have proper vaccinations. 
The abandonment of unwanted animals on USNA grounds is prohibited.

[61 FR 65302, Dec. 11, 1996]



Sec. 500.11  Vehicular and pedestrian traffic.

    (a) Drivers of all vehicles in or on U.S. National Arboretum 
property shall drive in a careful and safe manner at all times and shall 
comply with the signals and directions of the Security Staff and all 
posted traffic signs;
    (b) The blocking of entrances, driveways, walks, loading platforms, 
or fire hydrants in or on U.S. National Arboretum property is 
prohibited;
    (c) Except in emergencies, parking in or on U.S. National Arboretum 
property in other than designated areas is not allowed without a permit. 
Parking without authority, parking in unauthorized locations or in 
locations reserved for other persons, or contrary to the direction of 
posted signs is prohibited. This section may be supplemented from time 
to time, by the issuance and posting of specific traffic directives as 
may be required, and when so issued and posted such directives shall 
have the same force and effect as if incorporated in this part.

[61 FR 65302, Dec. 11, 1996]



Sec. 500.12  Weapons and explosives.

    No person while in or on U.S. National Arboretum property shall 
carry firearms, other dangerous or deadly weapons, or explosives, either 
openly or concealed, except for official purposes.

[61 FR 65303, Dec. 11, 1996]



Sec. 500.13  Nondiscrimination.

    There shall be no discrimination by segregation or otherwise against 
any person or persons because of race, religion, color, age, sex, 
disability or national origin, in furnishing, or by refusing to furnish 
to such person or persons the use of any facility of a public nature, 
including all services, privileges, accommodations, and activities 
provided thereby on U.S. National Arboretum property.

[61 FR 65303, Dec. 11, 1996]



Sec. 500.14  Exceptions.

    The Administrator, Agricultural Research Service, may in individual 
cases make prior, written exceptions to the rules and regulations in 
this part if he determines it to be not adverse to the public interest.



Sec. 500.15  Penalties and other law.

    Whoever shall be found guilty of violating the rules and regulations 
in this

[[Page 567]]

part is subject to fine of not more than $50 or imprisonment of not more 
than 30 days, or both (see 40 U.S.C. 318c). Nothing contained in the 
rules and regulations in this part shall be construed as abrogating or 
authorizing the abrogation of any other regulations or any Federal law 
or any laws and regulations of the District of Columbia which may be 
applicable.



     Subpart B--Fee Schedule for Certain Uses of National Arboretum 
                         Facilities and Grounds

    Source: 62 FR 46432, Sept. 3, 1997, unless otherwise noted.



Sec. 500.20  Scope.

    The subpart sets forth schedules of fees for temporary use by 
individuals or groups of United States National Arboretum (USNA) 
facilities and grounds for any purpose that is consistent with the 
mission of the USNA. This part also sets forth schedules of fees for the 
use of the USNA for commercial photography and cinematography. Fees 
generated will be used to offset costs of services or for the purposes 
of promoting the mission of the USNA. All rules and regulations noted in 
7 CFR 500, subpart A--Conduct on the U.S. National Arboretum Property, 
will apply to individuals or groups granted approval to use the 
facilities and grounds for the purposes specified in this subpart.



Sec. 500.21  Fee schedule for tram.

    The USNA provides tours of the USNA grounds in a 48-passenger tram 
(accommodating 2 wheelchairs) for a fee as follows: $3.00 per adult; 
$2.00 per senior citizen or Friend of the National Arboretum; $1.00 per 
child ages 4 through 16. Children under 4 sharing a seat with an adult 
will not be charged.



Sec. 500.22  Fee schedule for use of facilities and grounds.

    The USNA will charge a fee for temporary use by individuals or 
groups of USNA facilities and grounds. Facilities and grounds are 
available by reservation at the discretion of the USNA and may be 
available to individuals or groups whose purpose is consistent with the 
mission of the USNA. Agency initiatives may be granted first priority. 
Non profit organizations that substantially support the mission and 
purpose of the USNA may be exempted from the requirements of this part 
by the Director. Reservation requests should be made as far in advance 
of the need as possible to ensure consideration. The fees for use of 
USNA buildings listed in the following fee schedule are for times when 
the building is open. ``Half Day'' usage is defined as 4 hours or less; 
``Whole Day'' is defined as more than 4 hours in a day. For after hours 
usage of such buildings, an additional $25/hour will be added for 
supervision/security.

----------------------------------------------------------------------------------------------------------------
                                                                                             Per day charge
                Area                                      Includes                     -------------------------
                                                                                          Half day    Whole day
----------------------------------------------------------------------------------------------------------------
Auditorium..........................  Basic audience-style set-up for 125 people or             N/A         $250
                                       classroom set-up for 40-50 people. Includes
                                       microphone/lectern, screen, projection stand,
                                       (2) flip charts (no paper) and (2) trash cans.
                                       Also includes the use of the Kitchen space,
                                       Upstairs Conference Room, and Coat Room.
                                      Extra tables are $10 each.......................
Upstairs Conference Room............  (Only if Auditorium is not in use)..............          $50          100
                                      Includes use of telephone for local calls. Also
                                       includes the use of the Kitchen space and Coat
                                       Room.
Lobby...............................  As is (with furniture in place).................          N/A          100
                                      Furniture removed...............................  ...........          150
Classroom...........................  Standard set-up with 40 chairs. Includes                   50          125
                                       microphone/lectern, screen, projection stand,
                                       (2) flip charts (no paper) and trash can.
Classroom-Multiple..................  3 hour limit; 5 sessions........................  ...........          225
                                      3 hour limit; 10 sessions.......................  ...........          450
Yoshimura Center....................  For use from 10:00 a.m. to 3:30 p.m. weekends              50          125
                                       only.
Grounds--1-301 people...............  No Public Invited--Patio, Meadow, Triangle, NY            N/A          500
                                       Avenue, etc. Cost includes scheduling time,
                                       extra mowing, and site preparation..
                                      Guest organization responsible for everything
                                       related to their event, including portable
                                       toilets.
300-600 people......................  Same as above...................................          N/A          750

[[Page 568]]

 
Grounds.............................  Public Invited (i.e., show or sale)--Cost                 N/A          750
                                       includes scheduling time, extra mowing, and
                                       site preparation. Guest organization
                                       responsible for everything related to their
                                       event, including portable toilets..
Damages.............................
Damages to plants, grounds,             ..............................................  ...........
 facilities or equipment will be
 assessed on a value based on
 replacement cost (including labor)
 plus 10% (administrative fee)..
----------------------------------------------------------------------------------------------------------------



Sec. 500.23  Fee schedule for photography and cinematography on grounds.

    The USNA will charge a fee for the use of the facility or grounds 
for purposes of commercial photography or cinematography. Facilities and 
grounds are available for use for commercial photography or 
cinematography at the discretion of the USNA Director. Requests for use 
should be made a minimum of two weeks in advance of the required date. 
In addition to the fees listed below, supervision costs of $25.00 per 
hour will be charged. The USNA Director may waive fees for photography 
or cinematography conducted for the purpose of disseminating information 
to the public regarding the USNA and its mission or for the purpose of 
other noncommercial, First Amendment activity.

[[Page 569]]



--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                 Per day charge
            Category                         Type                       Notes          -----------------------------------------------------------------
                                                                                                Half day                        Whole day
--------------------------------------------------------------------------------------------------------------------------------------------------------
Still Photography..............  Individual..................  For personal use only.   No Charge..............  No Charge
                                                                Includes hand-held
                                                                cameras, recorders,
                                                                small non-commercial
                                                                tripods.
                                 Commercial..................  Includes all             $250 plus Supervisor...  $500 plus Supervisor
                                                                photography which uses
                                                                professional
                                                                photographer and/or
                                                                involves receiving a
                                                                fee for the use or
                                                                production of the
                                                                photography. Note:
                                                                This includes 5 people
                                                                or less with carry on
                                                                (video) equipment.
Cinematography.................  Set Preparation.............  Set up sets; no filming  N/A....................  $250 plus Supervision
                                                                performed.
                                 Filming.....................  Sliding scale based on   .......................  $1,200 to $3,900
                                                                number of people in
                                                                cast and crew and
                                                                number of pieces of
                                                                equipment. 45 people
                                                                and 6 pieces of
                                                                equipment=$1,500. 200
                                                                people=$3,900. Note: 5
                                                                people with carry on
                                                                equipment=same as
                                                                still photography.
                                 Strike Set..................  Take down sets, remove   N/A....................  $250 plus Supervision
                                                                equipment; no filming.
                                 Music Videos................  No sound involved;       N/A....................  $1,000 plus Supervision
                                                                smaller operation.
Slide Production...............  ............................  Providing USNA photos/   .......................  $100 per image to reproduce
                                                                slides for use in
                                                                promotions/
                                                                advertisements. Fee is
                                                                for one-time rights.
Damages........................  All.........................  Damages to plants,         .....................  .......................................
                                                                grounds, facilities or
                                                                equipment will be
                                                                assessed on a value
                                                                based on replacement
                                                                cost (Including labor)
                                                                plus 10%
                                                                (administrative fee).
                                                                Half Day=4 hours or
                                                                less. Full Day=more
                                                                than 4 hours.
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 570]]



Sec. 500.24  Payment of fees.

    Payment for use of tram will be made by cash or money order (in U.S. 
funds) and is due at the time of ticket purchase. Fee payments for use 
of facilities or grounds or for photography and cinematography must be 
made in advance of services being rendered. These payments are to the 
made in the form of a check or money order. Checks and money orders are 
to be made payable, in U.S. funds, to the ``U.S. National Arboretum.'' 
The National Arboretum will provide receipts to requestors for their 
records or billing purposes.



PART 501--CONDUCT ON U.S. MEAT ANIMAL RESEARCH CENTER, CLAY CENTER, NEBRASKA--Table of Contents




Sec.
501.1  General.
501.2  Admission.
501.3  Preservation of property.
501.4  Conformity with signs and emergency directions.
501.5  Nuisances.
501.6  Gambling.
501.7  Intoxicating beverages and narcotics.
501.8  Soliciting, vending, debt collection, and distribution of 
          handbills.
501.9  Photographs for news, advertising, or commercial purposes.
501.10  Pets.
501.11  Mobile equipment and pedestrian traffic.
501.12  Weapons and explosives.
501.13  Nondiscrimination.
501.14  Non-Federal law enforcement.
501.15  Exceptions.
501.16  Penalties and other law.

    Authority: Secs. 2, 4, 62 Stat. 281; 40 U.S.C. 318(a), (c); sec. 
103, 63 Stat. 380; 40 U.S.C. 753; sec. 205(d), 63 Stat. 389; 40 U.S.C. 
486(d); 36 FR 1293 and 36 FR 21706.

    Source: 37 FR 2423, Feb. 1, 1972, unless otherwise noted.



Sec. 501.1  General.

    The rules and regulations in this part apply to all property of or 
under the charge or control of the U.S. Meat Animal Research Center, 
Clay Center, Nebr. (hereinafter referred to as the Research Center), and 
to all persons entering in or on such property. The Administrator, 
General Services Administration, has delegated to the Secretary of 
Agriculture, with authority to redelegate, the authority to make all the 
needful rules and regulations for the protection of the Research Center 
(36 FR 1293). The Secretary of Agriculture has delegated this authority 
to the Director of Science and Education (36 FR 21706) who in turn has 
delegated such authority to the Administrator, Agricultural Research 
Service (36 FR 21706). The rules and regulations in this part are issued 
pursuant to such delegations. It is the responsibility of occupant or 
cooperating agency to require observance of these rules and regulations.



Sec. 501.2  Admission.

    Admission to the Research Center during ``off duty'' hours shall be 
restricted to the main arteries and any deviation therefrom by 
individuals shall be limited to authorized individuals who may be 
required to sign a register and display identification documents when 
requested by a guard or other authorized individuals. ``Off duty'' hours 
will be posted at the Research Center. Admission during ``duty'' hours 
when the Center is closed to the public in emergency situations will be 
limited to authorized individuals who may be required to sign a register 
and display identification documents when requested by a guard or other 
authorized individual.



Sec. 501.3  Preservation of property.

    It is unlawful to willfully destroy, damage, or remove property or 
any part thereof. Hunting, fishing, motorcycling, using snowmobiles, and 
other disturbances or encroachment activities are prohibited except for 
official purposes.



Sec. 501.4  Conformity with signs and emergency directions.

    Persons in and on property of the Research Center shall comply with 
official signs of a prohibitory or directory nature, and with the 
directions of authorized individuals.



Sec. 501.5  Nuisances.

    The use of loud, abusive, or otherwise improper language, 
unwarranted loitering, sleeping, or assembly, the creation of any hazard 
to persons or things, improper disposal of rubbish, spitting, prurient 
prying, the commission of any

[[Page 571]]

obscene or indecent act, or any other unseemly or disorderly conduct, 
throwing articles of any kind from a building, or climbing upon any part 
of a building is prohibited. Further, conduct which obstructs the usual 
use of entrances, foyers, corridors, offices, elevators, stairways and 
parking lots, or which otherwise tends to impede or disturb Center 
employees in the performance of their duties or which otherwise impedes 
the general public from obtaining the administrative services provided 
by the Research Center is prohibited.



Sec. 501.6  Gambling.

    Participating in games for money or other personal property, or the 
operation of gambling devices, the conduct of a lottery or pool, or the 
selling or purchasing of numbers tickets, in or on Research Center 
property, is prohibited.



Sec. 501.7  Intoxicating beverages and narcotics.

    Entering Research Center property or the operating of a motor 
vehicle thereon, by a person under the influence of intoxicating 
beverages or narcotic drug, hallucinogen, marijuana, barbiturate, or 
amphetamine (unless prescribed by a physician) or the consumption of 
such beverages, or the use of any such drug or substance in or on the 
Research Center property, is prohibited.



Sec. 501.8  Soliciting, vending, debt collection, and distribution of handbills.

    The soliciting of alms and contributions, commercial soliciting and 
vending of all kinds, the display or distribution of commercial 
advertising, or the collecting of private debts, in or on Research 
Center property, is prohibited. This section does not apply to national 
or local drives for funds for welfare, health, and other purposes 
sponsored or approved by the Agricultural Research Service, concessions, 
or personal notices posted by employees on authorized bulletin boards. 
Distribution of material such as pamphlets, handbills, and flyers or the 
posting of mateirals on bulletin boards or elsewhere, is prohibited 
without prior approval of authorized individuals.



Sec. 501.9  Photographs for news, advertising, or commercial purposes.

    Except where security regulations apply, or a Federal court order or 
rules prohibit it, photographs for news purposes may be taken in 
entrances, lobbies, foyers or auditoriums when used for public meetings 
without prior permission. Photographs for advertising and commercial 
purposes may be taken only with the prior written permission of the 
Director, Research Center. Photographs for news, advertising, or 
commercial purposes may be taken in space or areas occupied by a 
cooperator only with the consent of the cooperator concerned and the 
Director, Research Center.



Sec. 501.10  Pets.

    Animals shall be brought or allowed, as applicable, upon the 
Research Center only with the prior written approval of the Director, 
Research Center, except seeing eye dogs may be brought to the reception 
area serving the offices of the Director, Research Center, without prior 
approval.



Sec. 501.11  Mobile equipment and pedestrian traffic.

    (a) Drivers, operators, or pilots of all equipment whether or not 
motorized in or on Research Center property, or within the scope of 
Research Center activity, shall operate in a careful and safe manner at 
all times and shall comply with the signals and directions of guards, 
special policemen, or other authorized individuals, and all posted 
traffic signs;
    (b) The blocking of entrances, driveways, walks, railways, runways, 
loading platforms, or fire hydrants in or on Research Center property is 
prohibited;
    (c) Except in emergencies, parking or landing in or on Research 
Center property in other than designated areas is not allowed without a 
permit. Parking without authority, parking in unauthorized locations or 
in locations reserved for other persons, or parking continuously in 
excess of ten hours without permission, or contrary to the direction of 
posted signs is prohibited. This section may be supplemented from time 
to time by the issuance and posting of specific traffic directives as 
may be required, and when so issued

[[Page 572]]

and posted such directives shall have the same force and effect as if 
made a part hereof;
    (d) The operation of unlicensed gasoline powered vehicles is 
prohibited.



Sec. 501.12  Weapons and explosives.

    No person while in or on Research Center property shall carry 
firearms, bows and arrows, darts, other dangerous or deadly weapons, or 
explosives, either openly or concealed, except as officially authorized, 
for official purposes.



Sec. 501.13  Nondiscrimination.

    There shall be no discrimination by segregation or otherwise against 
any person or persons because of race, sex, religion, color, or national 
origin, in furnishing, or by refusing to furnish to such person or 
persons the use of any facility of a public nature, including all 
service, privileges, accommodations, and activities provided thereby on 
Research Center property.



Sec. 501.14  Non-Federal law enforcement.

    Research Center special policemen may be deputized by State or local 
law enforcement agencies to exercise police power on property outside 
the Research Center. With the consent of any State or local law 
enforcement agency, the facilities or services of such State or local 
law enforcement agency may be utilized by the Research Center.



Sec. 501.15  Exceptions.

    The Administrator, Agricultural Research Service, may in individual 
cases make prior, written exceptions to the rules and regulations in 
this part if he determines it to be not adverse to the public interest.



Sec. 501.16  Penalties and other law.

    Whoever shall be found guilty of violating the rules and regulations 
in this part where the United States has and exercises exclusive or 
concurrent legislative jurisdiction, is subject to fine of not more than 
$50 or imprisonment or not more than 30 days, or both (see 40 U.S.C. 
318c). Nothing contained in the rules, regulations, or penalties in this 
part shall be construed as abrogating or authorizing the abrogation of 
any other rules, regulations, penalties, or any Federal law, or any 
State and local laws and regulations which may be applicable.



PART 502--CONDUCT ON BELTSVILLE AGRICULTURE RESEARCH CENTER PROPERTY, BELTSVILLE, MARYLAND--Table of Contents




Sec.
502.1  General.
502.2  Admission.
502.3  Preservation of property.
502.4  Conformity with signs and emergency directions.
502.5  Nuisances.
502.6  Hunting, fishing, camping, horseback riding.
502.7  Gambling.
502.8  Intoxicating beverages and narcotics.
502.9  Soliciting, vending, debt collection, and distribution of 
          handbills.
502.10  Photographs by visitors or for news, advertising, or commercial 
          purposes.
502.11  Pets.
502.12  Vehicular and pedestrian traffic.
502.13  Weapons and explosives.
502.14  Nondiscrimination.
502.15  Exceptions.
502.16  Penalties and other law.

    Authority: Secs. 2, 4, 62 Stat. 281; 40 U.S.C. 318 (a), (c); sec. 
103, 63 Stat. 380; 40 U.S.C. 753; sec. 205(d), 63 Stat. 389; 40 U.S.C. 
486(d); 36 FR 18440 and 60 FR 56392.

    Source: 37 FR 2424, Feb. 1, 1972, unless otherwise noted.



Sec. 502.1  General.

    The rules and regulations in this part apply to the buildings and 
grounds of the Beltsville Agricultural Research Center (BARC), 
Beltsville, MD, and to any persons entering in or on such property. The 
Administrator, General Services Administration, has delegated to the 
Secretary of Agriculture, with authority to redelegate, the authority to 
make all the needful rules and regulations for the protection of the 
buildings, grounds, equipment, and experimental plants and animals of 
BARC (36 FR 18440). The Secretary of Agriculture has delegated this 
authority to the Under Secretary for Research, Education, and Economics 
(60 FR 56392) who in turn has delegated such authority to the 
Administrator, Agricultural Research Service (60 FR 56392). The

[[Page 573]]

rules and regulations in this part are issued pursuant to such 
delegations.

[61 FR 51211, Oct. 1, 1996]



Sec. 502.2  Admission.

    Admission to BARC during ``off duty'' hours shall be restricted to 
the main arteries and any deviation therefrom by individuals shall be 
limited to authorized individuals who may be required to sign a register 
and display identification documents when requested by BARC Security or 
other authorized individual. ``Off duty'' hours will be posted at BARC. 
Admission during ``duty'' hours when BARC is closed to the public in 
emergency situations will be limited to authorized individuals who may 
be required to sign a register and display identification documents when 
requested by BARC Security or other authorized individual.

[61 FR 51211, Oct. 1, 1996]



Sec. 502.3  Preservation of property.

    It is unlawful to willfully destroy, damage, or remove property or 
any part thereof.



Sec. 502.4  Conformity with signs and emergency directions.

    Persons in and on property of BARC shall comply with official signs 
of a prohibitory or directory nature, and with the directions of 
authorized individuals.

[61 FR 51211, Oct. 1, 1996]



Sec. 502.5  Nuisances.

    The use of loud, abusive or otherwise improper language, unwarranted 
loitering, sleeping, or assembly, the creating of any hazard to persons 
or things, improper disposal of rubbish, spitting, prurient prying, the 
commission of any obscene or indecent act, or any other unseemly or 
disorderly conduct, throwing articles of any kind from a building, or 
climbing upon any part of a building is prohibited. Further, conduct 
which obstructs the usual use of entrances, foyers, corridors, office 
elevators, stairways and parking lots, or which otherwise tends to 
impede or disturb BARC employees in the performance of their duties or 
which otherwise impedes the general public from obtaining the 
administrative services provided by BARC is prohibited.

[61 FR 51211, Oct. 1, 1996]



Sec. 502.6  Hunting, fishing, camping, horseback riding.

    The use of BARC grounds for any form of hunting, fishing, camping, 
or horseback riding is prohibited. Further, the use of these grounds for 
unauthorized picnicking is also prohibited.

[61 FR 51211, Oct. 1, 1996]



Sec. 502.7  Gambling.

    Participating in games for money or other personal property, or the 
operation of gambling devices, the conduct of a lottery or pool, or the 
selling or purchasing of numbers tickets, in or on BARC property, is 
prohibited.

[61 FR 51211, Oct. 1, 1996]



Sec. 502.8  Intoxicating beverages and narcotics.

    Entering BARC property or the operation of a motor vehicle thereon, 
by a person under the influence of intoxicating beverages or narcotic 
drug, hallucinogen, marihuana, barbiturate, or amphetamine (unless 
prescribed by a physician) or the consumption of such beverages, or the 
use of any such drug or substance in or on BARC property, is prohibited.

[61 FR 51211, Oct. 1, 1996]



Sec. 502.9  Soliciting, vending, debt collection, and distribution of handbills.

    The soliciting of alms and contributions, commercial soliciting and 
vending of all kinds or the display or distribution of commercial 
advertising, or the collecting of private debts, in or on BARC property, 
is prohibited. This section does not apply to national or local drives 
for funds for welfare, health, and other purposes sponsored or approved 
by the Agricultural Research Service, concessions, or personal notices 
posted by employees on authorized bulletin boards. Distribution of 
material such as pamphlets, handbills, and flyers or the posting of 
materials on bulletin boards or elsewhere is prohibited without prior 
approval of the Director, Beltsville Area.

[61 FR 51211, Oct. 1, 1996]

[[Page 574]]



Sec. 502.10  Photographs by visitors or for news, advertising, or commercial purposes.

    Photographs may be taken by visitors or for news purposes without 
prior permission. Photographs for advertising and commercial purposes 
may be taken at BARC only with the prior written approval of the 
Director, Beltsville Area.

[61 FR 51212, Oct. 1, 1996]



Sec. 502.11  Pets.

    Pets, except assistance trained animals, brought upon BARC property 
must be kept on a leash and have proper vaccinations. Pets that are the 
property of employees residing on BARC must be up to date on their 
vaccinations, in accordance with State or local laws, and be kept on a 
leash or similarly restrained. The abandonment of unwanted animals on 
BARC grounds is prohibited.

[61 FR 51212, Oct. 1, 1996]



Sec. 502.12  Vehicular and pedestrian traffic.

    (a) Drivers of all vehicles whether or not motorized in or on BARC 
property shall drive in a careful and safe manner at all times and shall 
comply with the signals and directions of the security staff and all 
posted traffic signs;
    (b) The blocking of entrances, driveways, walks, loading platforms, 
or fire hydrants in or on BARC property is prohibited;
    (c) Except in emergencies, parking in or on BARC property in other 
than designated areas is not allowed without a permit. Parking without 
authority, parking in unauthorized locations or in locations reserved 
for other persons, or contrary to the direction of posted signs is 
prohibited. This section may be supplemented from time to time, by the 
issuance and posting of specific traffic directives as may be required, 
and when so issued and posted such directives shall have the same force 
and effect as if made a part hereof.
    (d) The operation of unlicensed gasoline powered vehicles is 
prohibited.

[37 FR 2424, Feb. 1, 1972, as amended at 61 FR 51212, Oct. 1, 1996]



Sec. 502.13  Weapons and explosives.

    No person while in or on BARC property shall carry firearms, other 
dangerous or deadly weapons, or explosives, either openly or concealed, 
except as officially authorized for official purposes.

[61 FR 51212, Oct. 1, 1996]



Sec. 502.14  Nondiscrimination.

    There shall be no discrimination by segregation or otherwise against 
any person or persons because of race, religion, color, sex, age, 
disability or national origin, in furnishing, or by refusing to furnish 
to such person or persons the use of any facility of a public nature, 
including all services, privileges, accommodations, and activities 
provided thereby on BARC property.

[61 FR 51212, Oct. 1, 1996]



Sec. 502.15  Exceptions.

    The Administrator, Agricultural Research Service, may in individual 
cases, make prior, written exceptions to the rules and regulations in 
this part, if a determination is made that the exception is not adverse 
to the public interest.

[61 FR 51212, Oct. 1, 1996]



Sec. 502.16  Penalties and other law.

    Whoever shall be found guilty of violating the rules and regulations 
in this part is subject to fine of not more than $50 or imprisonment of 
not more than 30 days, or both (see 40 U.S.C. 318c). Nothing contained 
in the rules and regulations in this part shall be construed as 
abrogating or authorizing the abrogation of any other regulations or any 
Federal law or any laws and regulations of the State of Maryland.

[37 FR 2424, Feb. 1, 1972. Redesignated at 61 FR 51212, Oct. 1, 1996]



PART 503--CONDUCT ON PLUM ISLAND ANIMAL DISEASE CENTER--Table of Contents




Sec.
503.1  General.
503.2  Admission.
503.3  Preservation of property.
503.4  Conformity with Plum Island regulations.
503.5  Nuisances.

[[Page 575]]

503.6  Camping, boating, and fishing.
503.7  Gambling.
503.8  Intoxicating beverages and narcotics.
503.9  Soliciting, vending, debt collection, and distribution of 
          handbills.
503.10  Photographs for news, advertising, commercial purposes or for 
          personal use.
503.11  Pets.
503.12  Vehicular and pedestrian traffic.
503.13  Weapons and explosives.
503.14  Nondiscrimination.
503.15  Exceptions.
503.16  Penalties and other law.

    Authority: Secs. 2, 4, 62 Stat. 281; 40 U.S.C. 318(a), (c); sec. 
103, 63 Stat. 380; 40 U.S.C. 486(d); 38 FR 31165 and 38 FR 31166.

    Source: 39 FR 36563, Oct. 11, 1974, unless otherwise noted.



Sec. 503.1  General.

    The rules and regulations in this part cover the buildings, grounds, 
and vessels of the Plum Island Animal Disease Center (PIADC), United 
States Department of Agriculture, Orient Point, New York, and apply to 
all persons entering in or on such properties both on the mainland, 
Orient Point, New York, and on Plum Island. The Administrator, General 
Services Administration, has delegated to the Secretary of Agriculture 
authority to make all needful rules and regulations, and to annex to 
such rules and regulations such reasonable penalties (not to exceed 
those prescribed in 40 U.S.C. 318c) as will ensure their enforcement for 
the protection of persons and property at Plum Island, New York. The 
Secretary of Agriculture has redelegated this authority to the Assistant 
Secretary for Conservation, Research, and Education, who in turn has 
delegated it to the Administrator, Agricultural Research Service (38 FR 
31166).



Sec. 503.2  Admission.

    No person will be admitted to PIADC, into animal holding areas, 
specified restricted areas, laboratory compounds, or into laboratories 
without having in his or her possession a specific approved pass or 
permit authorized by the Director, PIADC, to enter such areas. The pass 
must be presented at the request of the guard or other authorized PIADC 
safety representative.



Sec. 503.3  Preservation of property.

    The willful destruction, damage to or removal of property or any 
part thereof from the Government-owned buildings, grounds, and vessels 
in or on the PIADC is prohibited.



Sec. 503.4  Conformity with Plum Island regulations.

    Persons in and on PIADC shall at all times comply with official 
signs of a prohibitory or directory nature and with the directions of 
law enforcement or other authorized officials.



Sec. 503.5  Nuisances.

    The use of loud, abusive or otherwise improper language, unwarranted 
loitering, sleeping or assembly, the creation of any hazard to persons 
or things, improper disposal of rubbish, spitting, prurient prying, or 
the commission of any obscene or indecent act in or on the PIADC is 
prohibited.



Sec. 503.6  Camping, boating, and fishing.

    The use of PIADC as a recreational area for camping, boating, 
fishing, and picnicking is prohibited. The use of Plum Island beaches 
for unauthorized landings and sightseeing is prohibited.



Sec. 503.7  Gambling.

    Participating in games for money or other personal property, or the 
operation of gambling devices, the conduct of a lottery or pool, or the 
selling or purchasing of numbers tickets in or on the PIADC is 
prohibited.



Sec. 503.8  Intoxicating beverages and narcotics.

    Entering the PIADC or operating a motor vehicle thereon by a person 
under the influence of intoxicating beverages or narcotic drugs, or the 
consumption of such beverages or the use of such drugs in or on the 
PIADC, is prohibited.



Sec. 503.9  Soliciting, vending, debt collection, and distribution of handbills.

    The soliciting of alms and contributions, commercial soliciting and 
vending of all kinds, the display or distribution of commercial 
advertising, or the collecting of private debts, in or on PIADC is 
prohibited. This section does

[[Page 576]]

not apply to national or local drives for funds for welfare, health, and 
other purposes, sponsored or approved by the PIADC, or concessions or 
personal notices posted by employees on authorized bulletin boards. 
Unauthorized distribution of materials such as pamphlets, handbills, and 
flyers is prohibited.



Sec. 503.10  Photographs for news, advertising, commercial purposes or for personal use.

    Photographs on the PIADC for news, advertising, commercial purposes, 
or personal use may be taken only with prior written permission of 
Director, PIADC.



Sec. 503.11  Pets.

    No pets or animals of any kind may be brought to the PIADC.



Sec. 503.12  Vehicular and pedestrian traffic.

    Drivers of all vehicles on the PIADC Government-owned parking areas 
in PIADC shall drive in a careful and safe manner at all times and shall 
comply with the signals and directions of guards and all posted traffic 
signs. Pedestrians will also observe specific safety directives as may 
be issued and posted from time to time by the Director, PIADC, or his 
authorized representative.



Sec. 503.13  Weapons and explosives.

    No person while in or on the PIADC shall carry firearms or other 
dangerous or deadly weapons or explosives either openly or concealed, 
except when authorized to do so for official purposes by the Director, 
PIADC, or his authorized representative.



Sec. 503.14  Nondiscrimination.

    There shall be no discrimination by segregation or otherwise against 
any person or persons because of race, religion, sex, color, or national 
origin in furnishing or refusing to furnish to such person or persons 
the use of any facility of a public nature, including all services, 
privileges, accommodations and activities provided by the PIADC.



Sec. 503.15  Exceptions.

    The Director, PIADC, may, in specific cases, make prior written 
exceptions to the rules and regulations in this part if he determines it 
to be in the best interest of the Government.



Sec. 503.16  Penalties and other law.

    Whoever shall be found guilty of violating any rule or regulation in 
this part while in or on the PIADC is subject to a fine of not more than 
$50 or imprisonment of not more than 30 days, or both. (See 40 U.S.C. 
318c.) Nothing contained in these rules and regulations shall be 
construed to abrogate any other Federal laws or regulations, or any 
State and local laws and regulations, applicable to the PIADC.



PART 504--USER FEES--Table of Contents




Sec.
504.1  General statement.
504.2  Fees for deposit and requisition of microbial cultures.
504.3  Payment of fees.
504.4  Exemptions from user fee charges.
504.5  Address.

    Authority: 31 U.S.C. 9701.

    Source: 50 FR 5365, Feb. 8, 1985, unless otherwise noted.



Sec. 504.1  General statement.

    This part sets forth fees to be charged for the deposit and 
distribution of microbial patent cultures. The fees set forth in this 
part are applicable to the Agricultural Research Service (ARS) Patent 
Culture Collection, Northern Regional Research Center, Peoria, Illinois.



Sec. 504.2  Fees for deposit and requisition of microbial cultures.

    (a) Depositors of microbial cultures must pay a one-time $500 user 
fee for each culture deposited on or after November 1, 1983.
    (b) For cultures deposited on or after November 1, 1983, requesters 
must pay a $20 user fee for each culture distributed. Cultures which 
were deposited on or after November 1, 1983 have an identification 
number greater than 15,722.

[[Page 577]]



Sec. 504.3  Payment of fees.

    (a) Payment of user fees must accompany a culture deposit or 
request.
    (b) Payment shall be made by check, draft, or money order payable to 
USDA, National Finance Center.



Sec. 504.4  Exemptions from user fee charges.

    (a) USDA laboratories and ARS cooperators designated by the Curator 
of the ARS Patent Culture Collection are exempt from fee assessments.
    (b) The Curator of the ARS Patent Culture Collection is delegated 
the authority to approve and revoke exemptions from fee assessments.



Sec. 504.5  Address.

    Deposits of and requests for microbial patent cultures should be 
directed to the Curator, ARS Patent Culture Collection, Northern 
Regional Research Center, USDA-ARS, 1815 N. University St., Peoria, 
Illinois 61604; (309) 685-4011.



PART 510--PUBLIC INFORMATION--Table of Contents




Sec.
510.1  General statement.
510.2  Public inspection, copying, and indexing.
510.3  Requests for records.
510.4  Denials.
510.5  Appeals.

    Authority: 5 U.S.C. 301, 552; 7 CFR Part 1, Subpart A and Appendix A 
thereto.

    Source: 60 FR 66062, Dec. 21, 1995, unless otherwise noted.



Sec. 510.1  General statement.

    This part is issued in accordance with the regulations of the 
Secretary of Agriculture in Part 1, Subpart A of this title and Appendix 
A thereto, implementing the Freedom of Information Act (FOIA) (5 U.S.C. 
552). The Secretary's regulations, as implemented by the regulations in 
this part, govern the availability of records of the Agricultural 
Research Service (ARS) to the public.



Sec. 510.2  Public inspection, copying, and indexing.

    5 U.S.C. 552(a)(2) requires that certain materials be made available 
for public inspection and copying and that a current index of these 
materials be published quarterly or otherwise be made available. Members 
of the public may request access to such materials maintained by ARS at 
the following office: Information Staff, ARS, USDA, 6303 Ivy Lane, Room 
456, Greenbelt, MD 20770; Telephone (301) 344-2207. Office hours are 
8:00 a.m. to 4:30 p.m.



Sec. 510.3  Requests for records.

    Requests for records of ARS under 5 U.S.C. 552(a)(3) shall be made 
in accordance with Sec. 1.6 of this title and submitted to the FOIA 
Coordinator, Agricultural Research Service, USDA, 6303 Ivy Lane, Room 
456, Greenbelt, MD 20770; Telephone (301) 344-2207; Facsimile (301) 344-
2325; TDD (301) 344-2435. The FOIA Coordinator is delegated authority to 
make determinations regarding such requests in accordance with 
Sec. 1.3(a)(3) of this title.



Sec. 510.4  Denials.

    If the FOIA Coordinator determines that a requested record is exempt 
from mandatory disclosure and that discretionary release would be 
improper, the FOIA Coordinator shall give written notice of denial in 
accordance with Sec. 1.8(a) of this title.



Sec. 510.5  Appeals.

    Any person whose request is denied shall have the right to appeal 
such denial. Appeals shall be made in accordance with Sec. 1.6(e) of 
this title and should be addressed as follows: Administrator, 
Agricultural Research Service, U.S. Department of Agriculture, 
Washington, DC 20250.



PART 520--PROCEDURES FOR IMPLEMENTING NATIONAL ENVIRONMENTAL POLICY ACT--Table of Contents




Sec.
520.1  General statement.
520.2  Definition.
520.3  Policy.
520.4  Responsibilities.
520.5  Categorical exclusions.
520.6  Preparation of an Environmental Assessment (EA).
520.7  Preparation of an Environmental Impact Statement (EIS).

    Authority: National Environmental Policy Act (NEPA) as amended, 42 
U.S.C. 4321 et

[[Page 578]]

seq.; E.O. 11514, 34 FR 4247, as amended by E.O. 11991, 42 FR 26927; 
E.O. 12144, 44 FR 11957; 5 U.S.C. 301; 40 CFR 1500-1508.

    Source: 51 FR 34191, Sept. 25, 1986, unless otherwise noted.



Sec. 520.1  General statement.

    These procedures assure that research and other activities of the 
Agricultural Research Service (ARS) comply with the intent of the 
National Environmental Policy Act of 1969 (NEPA) and appropriate 
regulations implementing this Act. These procedures incorporate and 
supplement, and are not a substitute for, CEQ regulations under 40 CFR 
parts 1500-1508, and Department of Agriculture NEPA Policies and 
Procedures under 7 CFR part 1b. ARS conducts and supports research as 
authorized by legislation to support one of the USDA goals of assuring 
adequate supplies of high quality food and fiber. Information generated 
through such research often forms the basic data needed to assess the 
impact of a new technology upon the environment. Large scale projects 
simulating commercial practices are normally implemented in cooperation 
with other agencies of the Federal or State Governments.



Sec. 520.2  Definition.

    Control Agents mean biological material or chemicals which are 
intended to enhance the production efficiency of an agricultural crop or 
animal such as through elimination of a pest.



Sec. 520.3  Policy.

    (a) It is ARS policy to comply with the provisions of NEPA and 
related laws and policies.
    (b) Environmental documents should be concise, written in plain 
language, and address the issues pertinent to the decision being made.
    (c) Environmental documents may be substituted or combined with 
other reports which serve to facilitate decisionmaking.
    (d) Costs of analyses and environmental documents are to be planned 
for during the budgetary process for the plan, program, or project. 
Special provisions for financing NEPA process activities which are 
unanticipated and extraordinary may be made in the Office of the 
Administrator of ARS.
    (e) ARS personnel will cooperate with other agencies, States, 
contractors, or other entities proposing to undertake activities 
involving the ARS to assure that NEPA considerations are addressed early 
in the planning process to avoid delays and conflicts as required by 40 
CFR 1501.2.
    (f) For some activities, project participants outside ARS may be 
required to provide data and documentation. When an applicant or 
contractor prepares an environmental assessment (EA) or a contractor 
prepares an environmental impact statement (EIS), the activities shall 
be carried out according to 40 CFR 1506.5.
    (g) Environmental documents, decision notices, and records of 
decision must be made available for review by the public. There shall be 
an early and open process for determining the scope of issues to be 
addressed in the environmental analysis process (40 CFR 1501.7).
    (h) The concepts of tiering to eliminate repetitive discussions 
applicable to EIS's (40 CFR Part 1502) are also applicable to EA's.
    (i) ARS personnel may adopt an existing EA or EIS when a proposed 
action is substantially the same as the action for which the existing EA 
or EIS was prepared (40 CFR 1506.3 (b)).
    (j) ARS personnel may incorporate by reference any existing 
documents in order to reduce the bulk of an EA or EIS (40 CFR 1502.21).
    (k) After prior consultation with the Council on Environmental 
Quality, ARS personnel may forego preparation of an EA or EIS in 
emergency situations (40 CFR 1506.11).



Sec. 520.4  Responsibilities.

    (a) Administrator. The Administrator is responsible for 
environmental analysis and documentation required for compliance with 
the provisions of NEPA and related laws, policies, plans, programs, and 
projects. The ARS Assistant Administrator for Cooperative Interactions 
has been delegated responsibility for the establishment of procedures 
and coordination necessary to carry out the policies and provisions of 
NEPA.

[[Page 579]]

    (b) Deputy Administrators and Area Directors. The Deputy 
Administrators and Area Directors are responsible to the Administrator 
for assuring that ARS programs are in compliance with the policies and 
procedures of NEPA.



Sec. 520.5  Categorical exclusions.

    For the following categories of actions, the preparation of an EA or 
EIS is not required:
    (a) Department of Agriculture categorical exclusions (7 CFR 1b.3).
    (1) Policy development, planning and implementation which are 
related to routine activities such as personnel, organizational changes 
or similar administrative functions;
    (2) Activities which deal solely with the functions of programs, 
such as program budget proposals, disbursement, transfer or 
reprogramming of funds;
    (3) Inventories, research activities and studies, such as resource 
inventories and routine data collection when such actions are clearly 
limited in context and intensity;
    (4) Educational and information programs and activities;
    (5) Activities which are advisory and consultative to other 
agencies, public and private entities, and
    (6) Activities related to trade representation and market 
development activities overseas.
    (b) ARS categorical exclusions. ARS actions which, based on previous 
experience, have been found to have limited scope and intensity and 
produce little or no individual or cumulative impacts to the human 
environment. Some examples are:
    (1) Repair, replacement of structural components or equipment, or 
other routine maintenance of facilities controlled in whole or in part 
by ARS;
    (2) Research programs or projects of limited size and magnitude or 
with only short-term effects on the environment. Examples are:
    (i) Research operations conducted within any laboratory, greenhouse 
or other contained facility where research practices and safeguards 
prevent environment impacts such as the release of hazardous materials 
into the environment;
    (ii) Inventories, studies or other such activities that have limited 
context and minimal intensity in terms of changes in the environment;
    (iii) Testing outside of the laboratory, such as in small isolated 
field plots, which does not involve the use of control agents requiring 
containment or a special license or a permit from a regulatory agency.
    (c) Exceptions to categorical exclusions. An environmental 
assessment shall be prepared for an activity which is normally within 
the purview of categorical exclusion if there are extraordinary 
circumstances which may cause such activity to have a significant 
environmental effect.



Sec. 520.6  Preparation of an Environmental Assessment (EA).

    (a) Actions requiring EA. The following actions would normally 
require an EA:
    (1) Programs, supported in the majority by ARS, which may assist in 
the transition of a particular technology from field evaluation stage to 
large-scale demonstration or simulated commercial phase;
    (2) Field work having an impact on the local environment such as 
earth excavation, explosives, weather modifications, or other such 
techniques; and
    (3) The testing outside the laboratory, such as small isolated field 
plots, of control agents which require containment precautions or either 
a special license or a permit from a regulatory agency.
    (b) Multiple agencies actions. If more than one Federal agency 
participates in a program activity, the EA shall be prepared by the lead 
agency as provided in 40 CFR 1501.5.
    (c) Format and conclusion. An EA can be in any format provided it 
covers in a logical and succinct fashion the information necessary for 
determining whether a proposed Federal action may have a significant 
environmental impact and thus warrant preparation of an EIS. The EA will 
contain the information required by 40 CFR 1508.9. This information will 
include brief discussions of the need for the project or other proposal, 
alternatives, environmental impacts of the proposed action and 
alternatives and a listing of agencies and persons consulted.

[[Page 580]]

    (d) Decision notice. Upon completion of an EA, the responsible 
official will consider the information it contains, decide whether an 
EIS is required or that no significant environmental impact will occur, 
and will document the decision and the reasons for it. The decision and 
the EA shall be available to the public in a manner appropriate to the 
situation. If there is a finding of no significant impact, the EA may be 
combined with the decision notice.



Sec. 520.7  Preparation of an Environmental Impact Statement (EIS).

    (a) Actions requiring EIS. An EIS will normally be prepared for:
    (1) Proposals for legislation which are determined to be a major 
Federal action significantly affecting the quality of the human 
environment; or,
    (2) Other major Federal actions significantly affecting the quality 
of the human environment. In the experience of ARS, an environmental 
impact statement shall normally be required in situations when a 
research project has advanced beyond the laboratory and small plot 
testing to full scale field testing over a very large area and involving 
the introduction of control agents.
    (b) Notice of intent. If the responsible official recommends the 
preparation of an EIS, then the public shall be apprised of the 
decision. This notice shall be prepared according to 40 CFR 1508.22.
    (c) Draft and final EIS. The process of preparing the draft and 
final EIS, as well as the format, shall be according to 40 CFR parts 
1502-1506.
    (d) Decisionmaking and implementation. The responsible official may 
make a decision no sooner than thirty days after the notice of 
availability of the final EIS has been published in the Federal Register 
by the Environmental Protection Agency (40 CFR 1506.10). The decision 
will be documented in a Record of Decision required by 40 CFR 1502.2, 
and monitoring and mitigation activities will be implemented as required 
by 40 CFR 1505.3.

[[Page 581]]



           CHAPTER VI--NATURAL RESOURCES CONSERVATION SERVICE,






                        DEPARTMENT OF AGRICULTURE




  --------------------------------------------------------------------


  Editorial Note: Nomenclature changes to Chapter VI appear at 60 FR 
28514, June 1, 1995.

                          SUBCHAPTER A--GENERAL
Part                                                                Page
600             Organization................................         583
601             Functions...................................         585
                  SUBCHAPTER B--CONSERVATION OPERATIONS
610             Technical assistance........................         589
611             Soil surveys................................         592
612             Snow surveys and water supply forecasts.....         594
613             Plant materials centers.....................         596
614             Appeal procedures...........................         598
                      SUBCHAPTER C--WATER RESOURCES
621             River basin investigations and surveys......         603
622             Watershed projects..........................         607
623             Emergency wetlands reserve program..........         610
624             Emergency watershed protection..............         618
                   SUBCHAPTER D--LONG TERM CONTRACTING
630             Long term contracting.......................         623
631             Great Plains Conservation Program...........         623
632             Rural Abandoned Mine Program................         627
633             Water Bank Program..........................         639
634             Rural Clean Water Program...................         645
636             Wildlife Habitat Incentives Program.........         665
                        SUBCHAPTER E--[RESERVED]
                    SUBCHAPTER F--SUPPORT ACTIVITIES
650             Compliance with NEPA........................         671
651-652

[Reserved]

[[Page 582]]

653             Technical standards.........................         693
654             Operation and maintenance...................         693
655

[Reserved]

656             Procedures for the protection of 
                    archeological and historical properties 
                    encountered in NRCS-assisted programs...         698
657             Prime and unique farmlands..................         699
658             Farmland Protection Policy Act..............         702
                       SUBCHAPTER G--MISCELLANEOUS
660

[Reserved]

661             Public information and right to privacy.....         709
662-699

[Reserved]

[[Page 583]]



                          SUBCHAPTER A--GENERAL





PART 600--ORGANIZATION--Table of Contents




Sec.
600.1  General.
600.2  National headquarters.
600.3  Regional offices.
600.4  State offices.
600.5  Area offices.
600.6  Field offices.
600.7  Specialized field offices.
600.8  Plant materials centers.

    Authority: 7 U.S.C. 6962.

    Source: 62 FR 16659, Apr. 8, 1997, unless otherwise noted.



Sec. 600.1  General.

    (a) The Natural Resources Conservation Service (NRCS) was authorized 
by the Federal Crop Insurance Reform and Department of Agriculture 
Reorganization Act of 1994 (Pub. L. 103-354, 7 U.S.C. 6901 note) and 
established by Secretary's Memorandum 1010-1 (2.b.6), Reorganization of 
the Department of Agriculture, to provide national leadership in the 
conservation, development, and productive use of the Nation's natural 
resources. Such leadership encompasses soil, water, air, plant, and 
wildlife conservation with consideration of the many human (economic and 
sociological) interactions with these resources. NRCS is the Federal 
agency that works with landowners on private lands to help them conserve 
their natural resources. NRCS employees are highly skilled in many 
scientific and technical specialities, including soil science, soil 
conservation, agronomy, biology, agroecology, range conservation, 
forestry, engineering, geology, hydrology, wetlands science, cultural 
resources, and economics. NRCS was formerly the Soil Conservation 
Service (SCS) which was established by the Soil Conservation Act of 1935 
(Pub. L. 74-46, 49 Stat. 163 (16 U.S.C. 590 (a-f))). NRCS has 
responsibility for the three major areas covered by SCS--soil and water 
conservation, natural resource surveys (soil surveys, resources 
inventory, snow surveys, and water supply forecasting), and community 
resource protection and management (watershed projects, river basin 
studies and investigations, resource conservation and development areas, 
land evaluation and site assessment, and emergency watershed 
protection)--the Wetland Reserve Program, Environmental Quality 
Incentives Program, Grazing Lands Conservation Initiative, Farmland 
Protection Program, Wildlife Habitat Incentives Program, and Forestry 
Incentives Program.
    (b) The NRCS organization consists of a National Headquarters 
located in Washington, D.C.; six regional offices; 50 state offices and 
equivalent offices in the Caribbean Area and the U.S. Trust Territories 
of the Pacific Basin Area; approximately 2,500 field offices and 300 
specialized offices; 28 plant materials centers; eight national centers; 
and eight natural resources institutes. NRCS is headed by a Chief who 
reports to the USDA Under Secretary for Natural Resources and 
Environment.



Sec. 600.2   National headquarters.

    (a) Chief. The Chief, with assistance of the Associate Chief, is 
responsible for administering a coordinated national program of natural 
resource conservation; planning, directing, and coordinating all 
program, technical, and administrative activities of NRCS; developing 
policies and procedures; correlating NRCS conservation programs with 
other agencies; accepting departmental leadership for programs for other 
activities assigned by the Secretary of Agriculture; and serving as 
Equal Employment Opportunity Officer for NRCS.
    (b) Deputy Chiefs. Four deputy chiefs assist the Chief as follows:
    (1) Deputy Chief for Management. The Deputy Chief for Management is 
responsible for management services, operations management and 
oversight, human resources management, civil rights employment, 
financial management, information technology, administrative support 
(providing a coordinated administrative management program for National 
Headquarters activities), special projects, and controlled 
correspondence. This deputy chief is also responsible for the activities 
of

[[Page 584]]

three national centers: Business management, information technology, and 
employee development.
    (2) Deputy Chief for Programs. The Deputy Chief for Programs is 
responsible for conservation operations, watershed planning, wetlands 
restoration, community assistance, resource conservation and 
development, USDA program outreach, civil rights program compliance, 
budget formulation and analysis, and international conservation.
    (3) Deputy Chief for Soil Survey and Resource Assessment. The Deputy 
Chief for Soil Survey and Resource Assessment is responsible for soil 
survey, resource inventory, and resource assessment and strategic 
planning. This deputy chief is also responsible for the activities of 
two national centers: soil survey and cartography and geospatial.
    (4) Deputy Chief for Science and Technology. The Deputy Chief for 
Science and Technology is responsible for the ecological sciences, 
conservation engineering, institutes, and resource economics and social 
sciences division. This deputy chief is also responsible for the 
activities of three nation centers (water and climate, soil mechanics, 
and plant data) and eight institutes. This deputy chief, working closely 
with the deputy chiefs for Management and Soil Survey and Resource 
Assessment, provides overall direction for the National Science and 
Technology Consortium.
    (c) National Science and Technology Consortium. The consortium 
consists of four divisions, three centers, eight technical institutes, 
and several cooperating scientists under the Deputy Chief for Science 
and Technology; two divisions and two centers under the Deputy Chief for 
Soil Survey and Resource Assessment; and three centers under the Deputy 
Chief for Management.
    (1) Centers. The eight centers provide specific products and 
services that maintain and enhance the technical quality of the agency. 
The centers are: water and climate, soil mechanics, plant data, soil 
survey, cartography and geospatial, information technology, business 
management, and employee development.
    (2) Institutes. The eight institutes are: soil quality, natural 
resources inventory and analysis, grazing lands technology, social 
sciences, watershed science, wetlands science, wildlife habitat 
management, and information technology. The institutes acquire, develop, 
and transfer needed technology in special emphasis areas so field 
employees can better serve their customers. The institutes often 
establish partnerships with other Federal agencies, universities, and 
public and private organizations.
    (3) Cooperating Scientists. Cooperating scientists work in the areas 
of soil erosion and sedimentation, air quality, and agroforestry. These 
scientists are located at various universities and research centers.
    (d) Legislative Affairs. The Legislative Affairs Staff provides 
coordination and assistance to the Chief on legislative affairs issues 
and activities.
    (e) Conservation Communication. The Conservation Communication Staff 
is responsible for communications, volunteer programs, conservation 
education, and public affairs activities.
    (f) Strategic Natural Resource Issues. The Strategic Natural 
Resource Issues Staff is responsible for coordinating priority strategic 
issues as determined by the Chief.



Sec. 600.3  Regional offices.

    Each regional office is under the direction and supervision of a 
regional conservationist. Regional offices direct, coordinate, and 
integrate all phases of NRCS programs and activities, and address the 
total natural resource needs of the region. Regional offices are located 
in Beltsville, Maryland; Atlanta, Georgia; Fort Worth, Texas; Madison, 
Wisconsin; Lincoln, Nebraska; and Sacramento, California.



Sec. 600.4  State offices.

    Each office is under the direction and supervision of a State 
conservationist. Each State conservationist is responsible for NRCS 
programs in a State. The Pacific Basin Area Office, under the direction 
and supervision of a director, serves the U.S. Trust Territories in that 
area. The Caribbean Area Office, under the direction and supervision of 
a director, serves the Commonwealth of Puerto Rico and the U.S. Virgin 
Islands. Directors of the Pacific

[[Page 585]]

Basin and Caribbean areas have the same responsibility and authority as 
a State conservationist. All references to State conservationist in this 
chapter include the directors of the Pacific Basin and Caribbean areas.



Sec. 600.5   Area offices.

    Each area office is under the direction and supervision of an area 
conservationist or assistant State conservationist for field operations 
who is responsible for NRCS activities in the geographical area served 
by the area office. Usually the geographical area includes multiple 
field offices and counties. Many area offices now consist of teams 
working on a watershed or other geopolitical basis.



Sec. 600.6   Field offices.

    Each field office is under the direction and supervision of a 
district conservationist who is responsible for NRCS activities in the 
geographical area served by the field office. Usually the geographical 
area of a field office includes one or more conservation districts and 
one or more counties. Field offices are generally collocated with other 
USDA agencies in USDA Service Centers.



Sec. 600.7   Specialized field offices.

    Other field offices serve specialized activities, such as watershed 
protection and flood reduction projects, construction projects, resource 
conservation and development areas, and soil survey activities. 
Direction and supervision of these offices are designated by State 
conservationists.



Sec. 600.8   Plant materials centers.

    Plant materials centers (PMC) assemble and test plant species for 
conservation uses. Usually a PMC serves two or more States, and is under 
the jurisdiction of the State conservationist where the center is 
located. Each PMC is directed and supervised by a manager who is 
responsible to a State office specialist/manager who is responsible to a 
State office specialist/manager as designated by the State 
conservationist.



PART 601--FUNCTIONS--Table of Contents




Sec.
601.1  Functions assigned.
601.2  Functions reserved to the Secretary of Agriculture.
601.3  Natural disaster assistance.
601.4  Defense responsibilities.

    Authority: 7 U.S.C. 1010-1011; 16 U.S.C. 590a-590f, 1001-1008, 2001-
2009, 2203-2205, 3801 et seq.; 33 U.S.C. 701b-1.

    Source: 62 FR 16660, Apr. 8, 1997, unless otherwise noted.



Sec. 601.1   Functions assigned.

    The Natural Resources conservation Service (NRCS) is the Federal 
agency that works with private landowners to conserve their natural 
resources. NRCS employees help land users and communities approach 
conservation planning and implementation with an understanding of how 
natural resources relate to each other and to people--and how human 
activities affect those resources. The agency emphasizes voluntary, 
science-based assistance, partnerships, and cooperative problem solving 
at the community level. The mission of NRCS is to work on the Nation's 
non-Federal lands to conserve, improve, and sustain natural resources. 
The following functions support the mission.
    (a) NRCS facilitates and provides conservation technical assistance 
at the local level that helps people assess their natural resource 
conditions and needs, set goals, identify programs and other resources 
to address those needs, develop proposals and recommendations, implement 
solutions, and measure their success. The agency's role is to assist 
with:
    (1) Resource inventories,
    (2) Resource assessments,
    (3) Planning assistance, and/or
    (4) Technical assistance.
    (b) NRCS provides technical assistance through local conservation 
districts to land users, communities, watershed groups, Federal and 
State agencies, other partners, and customers.
    (c) NRCS provides assistance on a voluntary basis.
    (d) The agency's work focuses on soil, water, air, plant, and animal 
conservation including erosion reduction, water

[[Page 586]]

quality improvement, wetland restoration and protection, fish and 
wildlife habitat improvement, range management, stream restoration, 
water management, and other natural resource issues.
    (e) NRCS has general responsibility for administration of the 
following programs:
    (1) Conservation operations, authorized by the Soil Conservation Act 
of 1935 and the Soil and Water Resources Conservation Act of 1977. 
Activities include:
    (i) Conservation technical assistance to land users, communities, 
units of State and local government, and other Federal agencies in 
planning and implementing natural resource solutions to reduce erosion, 
improve soil and water quantity and quality, improve and conserve 
wetlands, enhance fish and wildlife habitat, improve air quality, 
improve pasture and range conditions, reduce upstream flooding, and 
improve woodlands. Assistance is also provided to implement the highly 
erodible land (HEL) and wetland conservation (Swampbuster) provisions, 
Wetlands Reserve Program (WRP), and Conservation Reserve Program (CRP) 
in the 1985 Food Security Act, as amended by the Food, Agriculture, 
Conservation and Trade Act of 1990 and Federal Agriculture Improvement 
and Reform Act of 1996. NRCS technical field staff make HEL and wetland 
determinations and assist land users to develop and implement 
conservation plans needed to ensure compliance with the law. NRCS is 
also the lead Federal agency for delineating wetlands on agricultural 
lands for purposes of implementing both the provisions of the Food 
Security Act and Section 404 of the Clean Water Act.
    (ii) Soil surveys which provide the public with local information on 
the uses and capabilities of their soil resource. Soil surveys are based 
on scientific analysis and classification of the soils and are used to 
determine land capabilities and conservation treatment needs. Surveys 
are conducted cooperatively with other Federal agencies, land grant 
universities, State agencies, and local units of government. NRCS is the 
world leader in soil classification and soil mapping, and is expanding 
into soil quality.
    (iii) Snow survey and water supply forecasts that provide western 
States and Alaska with vital information and forecasts of seasonable 
variable water supplies. NRCS field staff in cooperation with partnering 
organizations manually collect data from 850 remote high mountain sites. 
Data is electronically collected from an additional 600 SNOTEL 
(automated snowpack telemetry network) sites. In cooperation with the 
National Weather Service, the data is assembled and analyzed. Then, NRCS 
staff develop seasonal water supply forecasts.
    (iv) Plant Material Centers assemble, test, and encourage increased 
plant propagation and usefulness of plant species for biomass 
production, carbon sequestration, erosion reduction, wetland 
restoration, water quality improvement, streambank and riparian area 
protection, coastal dune stabilization, and to meet other special 
conservation treatment needs. The work is carried out cooperatively with 
State and Federal agencies, private organizations, commercial 
businesses, and seed and nursery associations. After species are proven, 
they are released to the private sector for commercial production.
    (2) Conservation programs in the Federal Agriculture Improvement and 
Reform Act of 1996, most of which are funded by the Commodity Credit 
Corporation (CCC). NRCS provides leadership and technical assistance for 
the following programs:
    (i) Environmental Quality Incentives Program (EQIP). EQIP provides a 
single, voluntary conservation program for farmers and ranchers who face 
serious threats to soil, water, and related natural resources. 
Nationally, it provides technical, financial, and educational 
assistance, half of it targeted to livestock-related natural resource 
problems and half to more general conservation priorities.
    (ii) Wetlands Reserve Program (WRP). WRP is a voluntary program to 
restore and protect wetlands on private property. It provides an 
opportunity

[[Page 587]]

for landowners to receive financial incentives to enhance wetlands in 
exchange for retiring marginal agricultural land.
    (iii) Wildlife Habitat Incentives Program (WHIP). WHIP is a 
voluntary program for people who want to develop and improve wildlife 
habitat on private lands. It provides both technical assistance and cost 
sharing to help establish and improve fish and wildlife habitat.
    (iv) Farmland Protection Program (FFP). This program provides funds 
to help purchase development rights to keep productive farmland in 
agricultural use. Working through existing programs, USDA joins with 
State, tribal, or local governments to acquire voluntary conservation 
easements or other interests from landowners.
    (v) Forestry Incentives Programs (FIP). FIP supports good forest 
management practices on privately owned, non-industrial forest lands 
nationwide. FIP is designed to benefit the environment while meeting 
future demands for wood products. Although not funded by CCC, Section 
373 of the Federal Agriculture Improvement and Reform Act of 1996 
extended the program under discretionary appropriations.
    (3) Resource Conservation and Development (RC&D) Program, authorized 
by Section 102 of the Flood and Agriculture Act of 1962 (Pub. L. 87-702) 
and Sections 1528-1538 of the Agriculture and Food Act of 1981 (Pub. L. 
97-98). This program is initiated and directed at the local level by 
volunteers who involve multiple communities, various units of 
government, municipalities, and grassroots organizations. RC&D is a 
catalyst for civic-oriented groups to share knowledge and resources in a 
collective attempt to solve common problems. The program offers aid in 
balancing the environmental, economic, and social needs of an area.
    (4) Rural Abandoned Mine Program (RAMP) and other responsibilities 
assigned under the Surface Mining Control and Reclamation Act of 1977 
(Pub. L. 95-87). Under RAMP, NRCS provides technical and financial 
assistance to landowners to reclaim certain abandoned coal-mined lands. 
This assistance can be used to reclaim these lands for approved uses, 
which include pasture, range, woodland, cropland, noncommercial 
recreation, and wildlife habitat. The program's first priority is to 
protect public health, welfare, safety, and property from hazards caused 
by past surface coal mining or by surface effects of deep mining.
    (5) Watershed surveys and planning, authorized by the Watershed 
Protection and Flood Prevention Act (Pub. L. 83-566, Section 6 (16 
U.S.C. 1001-1008)). This 1996 appropriations act combined the Small 
Watershed Planning and the River Basin Surveys and Investigations 
programs into a new program called the Watershed Surveys and Planning 
Program. The program involves cooperation with other Federal, State, and 
local agencies to conduct watershed planning, river basin surveys and 
investigations, flood hazard analysis, and flood plain management 
assistance, which aid in the development of coordinated water resource 
programs, including the development of guiding principles and 
procedures.
    (6) Watershed and flood prevention operations include the following 
activities:
    (i) Watershed operations authorized by the Flood Control Act of 
1944. Flood prevention operations include: Planning and installing works 
of improvement and land treatment measures; conservation, development, 
utilization, and disposal of water; and reduction of sedimentation and 
erosion damages. This may also include the development of recreational 
facilities and the improvement of fish and wildlife habitat.
    (ii) The Emergency Watershed Protection (EWP) Program, authorized by 
Section 216 of the Flood Control Act of 1950 (Pub. L. 81-516) and 
Section 403 of Title IV of the Agricultural Credit Act of 1978 (Pub. L. 
95-334). EWP provides assistance to reduce hazards to life and property 
in watersheds damaged by severe natural events. Emergency work includes 
establishing quick vegetative cover on denuded land, sloping steep land, 
and eroding banks; opening dangerously restricted channels; repairing 
diversions and levees; and other emergency work. NRCS provides technical 
and financial assistance for disaster cleanup; stream corridor, wetland, 
and riparian area restoration; and urban planning and site location 
assistance to the Federal Emergency Management

[[Page 588]]

Agency (FEMA) when relocating communities out of flood plains.
    (iii) The Watershed Protection and Flood Prevention Act (Pub. L. 83-
566), also known as the Small Watersheds Program. This program provides 
for cooperation with local sponsors, State, and other public agencies in 
the installation of planned works of improvement and land treatment 
measures in approved watershed projects. Eligible measures include flood 
prevention, water conservation, recreation, agricultural water 
management, flood plain easements, municipal and industrial water, and 
rural water supply.



Sec. 601.2   Functions reserved to the Secretary of Agriculture.

    (a) Designation of new Resource Conservation and Development (RC&D) 
areas. Once designated, these areas may receive RC&D Program assistance 
from NRCS.
    (b) Administration of the Soil and Water Resources Conservation Act 
of 1977 (Pub. L. 95-192) to conduct an appraisal and develop a national 
conservation program every 5 years.



Sec. 601.3   Natural disaster assistance.

    (a) To assist in emergencies caused by natural disasters, NRCS may:
    (1) Provide technical and financial assistance under authority of 
Section 216 of the Flood Control Act of 1950 (Pub. L. 81-516, Stat. 184, 
33 U.S.C. 701b) and Section 403 of Title IV of the Agricultural Credit 
Act of 1978 (Pub. L. 95-334).
    (2) Provide technical assistance for rehabilitation of land and 
conservation systems for which other U.S. Department of Agriculture 
agencies provide cost sharing.
    (3) Provide technical assistance on rehabilitation of rural lands 
damaged by natural disaster.
    (4) Provide assistance in evaluating the severity of the disaster, 
assessing problems created, and determining the amount and kind of 
emergency work needed for restoration.
    (5) Provide available information, maps, and reports on projects 
described in Parts 621, 622, 623, and 640 of Section 216 of the Flood 
Control Act of 1950.
    (6) Provide assistance in locating heavy earthmoving equipment.
    (7) Make light trucks and other types of NRCS transportation 
equipment available for emergency use.
    (8) Provide technical assistance in locating alternate routes when 
existing roads and highways cannot be used.
    (b) In a disaster, it is the responsibility of the state 
conservationist to determine the extent of NRCS assistance. In 
presidentially-declared disasters, NRCS coordinates emergency assistance 
with the Federal Emergency Management Agency (FEMA).



Sec. 601.4   Defense responsibilities.

    In the event of nuclear attack, NRCS is responsible for providing:
    (a) Technical guidance, based upon results of radiological 
monitoring and the extent of radiological contamination to farmers, 
ranchers, and others relating to:
    (1) The selection and use of land for agricultural production.
    (2) The harvesting of crops.
    (3) The use of crops stored on the farm.
    (4) The use, conservation, disposal, and control of water to insure 
adequate usable water for agricultural purposes and to prevent floods.
    (5) The safety of livestock.
    (b) Basic soil information, land use guides, and onsite technical 
assistance in selecting land for production and in applying practices to 
increase production of food and fiber with maximum efficiency.

[[Page 589]]



                  SUBCHAPTER B--CONSERVATION OPERATIONS





PART 610--TECHNICAL ASSISTANCE--Table of Contents




                   Subpart A--Conservation Operations

Sec.
610.1  Purpose.
610.2  Scope.
610.3  Assistance through conservation districts.
610.4  Technical assistance furnished.
610.5  Interdisciplinary assistance.

              Subpart B--Soil Erosion Prediction Equations

610.11  Purpose and scope.
610.12  Equations for predicting soil loss due to water erosion.
610.13  Equations for predicting soil loss due to wind erosion.
610.14  Use of USLE, RUSLE, and WEQ.

    Authority: 16 U.S.C. 590a-590f, 590q, 3801(a)(9).

    Source: 42 FR 38169, July 27, 1977, unless otherwise noted.



                   Subpart A--Conservation Operations



Sec. 610.1  Purpose.

    This subpart sets forth Natural Resource Conservation Service (NRCS) 
policies and procedures for furnishing technical assistance in 
conservation operations.

[61 FR 27999, June 4, 1996]



Sec. 610.2  Scope.

    Conservation operations, including technical assistance, is the 
basic soil and water conservation program of NRCS. This program is 
designed to provide assistance to (a) reduce soil losses from erosion; 
(b) help solve soil, water, and agricultural waste management problems; 
(c) bring about adjustments in land use as needed; and (d) reduce damage 
caused by excess water and sedimentation. The Natural Resources 
Conservation Service is the technical agency of the U.S. Department of 
Agriculture for providing assistance to conservation districts and other 
organizations in planning and carrying out their conservation programs. 
NRCS works with individuals, groups, and units of government to help 
them plan and carry out conservation decisions to meet their objectives.



Sec. 610.3  Assistance through conservation districts.

    (a) Technical assistance is provided through and in cooperation with 
conservation districts in the 50 States, the Commonwealth of Puerto 
Rico, and the U.S. Virgin Islands. These districts, formed under 
authority of State laws, are operated and controlled by local citizens. 
They provide the leadership and the program needed to meet the 
conservation objectives of the district.
    (b) NRCS furnishes technical assistance to conservation districts as 
specified in memorandums of understanding. Soil conservationists 
assigned to conservation districts work directly with land users and 
others according to the program needs and the priorities established by 
the conservation districts.
    (c) The practical experience of land users is combined with the 
scientific knowledge and skills of professional conservationists to plan 
and carry out locally formulated conservation programs.
    (d) When requested, technical assistance may be provided to owners, 
operators, or groups using land that is under the jurisdiction of the 
United States Department of the Interior if such land is included in a 
conservation district or if assistance is in accordance with memorandums 
of understanding identifying the coordination of agency activities.



Sec. 610.4  Technical assistance furnished.

    The Natural Resources Conservation Service provides technical 
assistance to land users and others who are responsible for making 
decisions and setting policies that influence land use, conservation 
treatment, and resource management. Technical assistance furnished by 
NRCS consists of program assistance, planning assistance, application of 
conservation practices, and assistance in the technical phases of USDA 
cost-share programs.

[[Page 590]]

    (a) Program assistance is provided to conservation districts and 
other organizations concerned with the conservation of soil, water, 
plant, and wildlife resources. This assistance includes providing 
resource inventory data and identifying conservation problems and needs 
in order for districts to develop long-range soil and water conservation 
programs. Individuals, groups, and organizations requesting NRCS 
assistance through conservation districts include:
    (1) Farmers, ranchers, and other land users concerned with the 
conservation of land and water resources.
    (2) County and other local government units such as park 
authorities, departments of public works, planning, zoning (rural, 
urban, and flood plain), school, and institution boards, highway 
departments, and tax assessors.
    (3) Citizen groups, youth groups, recreation groups, and garden 
clubs.
    (4) State and local units of government (highway, health, 
recreation, water resources, and regional planning) involved in 
establishing public policy regarding the use of resources.
    (5) Federal departments and agencies such as Defense, Housing and 
Urban Development, Public Roads, Health and Human Services; and 
Interior.
    (6) Professional consultants who provide services such as 
engineering, planning, environmental assessment, tax assessment, and 
forest management.
    (b) Planning assistance includes evaluation of soil, water, 
vegetation, and other resource data needed for making land use, 
environmental and conservation treatment decisions. NRCS helps land 
users make conservation plans for farms, ranches, and other land units. 
This help includes onsite planning assistance in making conservation 
plans. The plans are based on a soil survey and interpretations for the 
intended land uses and conservation treatment. Plans may also include 
other inventories of soil, water, plant, and related resources needed in 
the planning process. Information about the responses of each kind of 
soil and the conservation practices and resource management needed for 
different land uses is provided. The land user's decisions recorded in 
the plan are based on his conservation objectives. Conservation plans 
provide for the orderly installation of conservation practices. 
Conservation plans reflect changing conditions.
    (c) Application assistance is provided to help land users apply and 
maintain planned conservation work. NRCS assistance for applying the 
conservation practices in the plan may include:
    (1) Designing, constructing, and maintaining conservation practices;
    (2) Selecting management alternatives and cultural practices needed 
to establish and maintain vegetation; and
    (3) Other conservation practices needed to protect land and water 
resources.
    (d) The Natural Resources Conservation Service assists in carrying 
out certain phases of USDA soil and water conservation cost-share 
programs. NRCS assists individual program participants with conservation 
plans needed for long-term cost-share agreements. NRCS is assigned 
responsibility by the Secretary of Agriculture for technical phases of 
applying conservation practices on the land. This assignment includes:
    (1) Determining what practices are needed and feasible to install, 
(2) selecting sites and planning and designing practices, (3) providing 
assistance for installing practices, and (4) certifying that the work 
done is in accordance with NRCS standards and specifications.

[42 FR 38169, July 27, 1977, as amended at 47 FR 56473, Dec. 17, 1982]



Sec. 610.5  Interdisciplinary assistance.

    Technical assistance is based on the principle that soil, water, 
plant, and related resources are interdependent and must be managed 
accordingly. Soil conservationists integrate the various technical 
fields in providing for the conservation of land and water resources. 
Staff scientists and specialists develop conservation standards, prepare 
necessary specifications, provide training, and review work performance, 
NRCS uses consultants for conservation problems that require special 
expertise.

[[Page 591]]



              Subpart B--Soil Erosion Prediction Equations

    Source: 61 FR 27999, June 4, 1996, unless otherwise noted.



Sec. 610.11  Purpose and scope.

    This subpart sets forth the equations and rules for utilizing the 
equations that are used by the Natural Resources Conservation Service 
(NRCS) to predict soil erosion due to water and wind. Section 301 of the 
Federal Agriculture Improvement and Reform Act of 1996 (FAIRA) and the 
Food Security Act, as amended, 16 U.S.C. 3801-3813 specified that the 
Secretary would publish the universal soil loss equation (USLE) and wind 
erosion equation (WEQ) used by the Department within 60 days of the 
enactment of FAIRA. This subpart sets forth the equations, definition of 
factors, and provides the rules under which NRCS will utilize the USLE, 
the revised universal soil loss equation (RUSLE), and the WEQ.



Sec. 610.12  Equations for predicting soil loss due to water erosion.

    (a) The equation for predicting soil loss due to erosion for both 
the USLE and the RUSLE is A=R x K x LS x C x P. (For further information 
about USLE see the U.S. Department of Agriculture Handbook 537, 
``Predicting Rainfall Erosion Losses--A Guide to Conservation 
Planning,'' dated 1978. Copies of this document are available from the 
Natural Resources Conservation Service, P.O. Box 2890, Washington, DC 
20013. For further information about RUSLE see the U.S. Department of 
Agriculture Handbook 703, ``Predicting Soil Erosion by Water: A Guide to 
Conservation Planning with the Revised Universal Soil Loss Equation 
(RUSLE).'' Copies may be purchased from the National Technical 
Information Service, 5285 Port Royal Road, Springfield, VA 22161.)
    (b) The factors in the USLE equation are:
    (1) A is the estimation of average annual soil loss in tons per acre 
caused by sheet and rill erosion.
    (2) R is the rainfall erosivity factor. Accounts for the energy and 
intensity of rainstorms.
    (3) K is the soil erodibility factor. Measures the susceptibility of 
a soil to erode under a standard condition.
    (4) LS is the slope length and steepness factor. Accounts for the 
effect of length and steepness of slope on erosion.
    (5) C is the cover and management factor. Estimates the soil loss 
ratio for each of 4 or 5 crop stage periods throughout the year, 
accounting for the combined effect of all the interrelated cover and 
management variables.
    (6) P is the support practice factor. Accounts for the effect of 
conservation support practices, such as contouring, contour 
stripcropping, and terraces on soil erosion.
    (c) The factors in the RUSLE equation are defined as follows:
    (1) A is the estimation of average annual soil loss in tons per acre 
caused by sheet and rill erosion.
    (2) R is the rainfall erosivity factor. Accounts for the energy and 
intensity of rainstorms.
    (3) K is the soil erodibility factor. Measures the susceptibility of 
a soil to erode under a standard condition and adjusts it bi-monthly for 
the effects of freezing and thawing, and soil moisture.
    (4) LS is the slope length and steepness factor. Accounts for the 
effect of length and steepness of slope on erosion based on 4 tables 
reflecting the relationship of rill to interrill erosion.
    (5) C is the cover and management factor. Estimates the soil loss 
ratio at one-half month intervals throughout the year, accounting for 
the individual effects of prior land use, crop canopy, surface cover, 
surface roughness, and soil moisture.
    (6) P is the support practice factor. Accounts for the effect of 
conservation support practices, such as cross-slope farming, 
stripcropping, buffer strips, and terraces on soil erosion.



Sec. 610.13  Equations For Predicting Soil Loss Due To Wind Erosion.

    (a) The equation for predicting soil loss due to wind in the Wind 
Erosion Equation (WEQ) is E=f(IKCLV). (For further information on WEQ 
see the paper by N.P. Woodruff and F.H.

[[Page 592]]

Siddaway, 1965. ``A Wind Erosion Equation,'' Soil Science Society of 
America Proceedings, Vol. 29, No. 5, pages 602-608, which is available 
from the American Society of Agronomy, Madison, Wisconsin. In addition, 
the use of the WEQ in NRCS is explained in the Natural Resources 
Conservation Service (NRCS) National Agronomy Manual, 190-V-NAM, second 
ed., Part 502, March, 1988, which is available from the NRCS, P.O. Box 
2890, Washington, DC 20013.)
    (b) [Reserved]
    (c) The factors in the WEQ equation are defined as follows:
    (1) E is the estimation of the average annual soil loss in tons per 
acre.
    (2) f indicates the equation includes functional relationships that 
are not straight-line mathematical calculations.
    (3) I is the soil erodibility index. It is the potential for soil 
loss from a wide, level, unsheltered, isolated field with a bare, 
smooth, loose and uncrusted surface. Soil erodibility is based on soil 
surface texture, calcium carbonate content, and percent day.
    (4) K is the ridge roughness factor. It is a measure of the effect 
of ridges formed by tillage and planting implements on wind erosion. The 
ridge roughness is based on ridge spacing, height, and erosive wind 
directions in relation to the ridge direction
    (5) C is the climatic factor. It is a measure of the erosive 
potential of the wind speed and surface moisture at a given location 
compared with the same factors at Garden City, Kansas. The annual 
climatic factor at Garden City is arbitrarily set at 100. All climatic 
factor values are expressed as a percentage of that at Garden City.
    (6) L is the unsheltered distance. It is the unsheltered distance 
across an erodible field, measured along the prevailing wind erosion 
direction. This distance is measured beginning at a stable border on the 
upwind side and continuing downward to the nonerodible or stable area, 
or to the downwind edge of the area being evaluated.
    (7) V is the vegetative cover factor. It accounts for the kind, 
amount, and orientation of growing plants or plant residue on the soil 
surface.



Sec. 610.14  Use of USLE, RUSLE, and WEQ.

    (a) All Highly Erodible Land (HEL) determinations are based on the 
formulas set forth in 7 CFR Sec. 12.21 using some of the factors from 
the USLE and WEQ and the factor values that were contained in the local 
Field Office Technical Guide (FOTG) as of January 1, 1990. In addition, 
this includes the soil loss tolerance values used in those formulas for 
determining HEL. The soil loss tolerance value is used as one of the 
criteria for planning soil conservation systems. These values are 
available in the FOTG in the local field office of the Natural Resources 
Conservation Service.
    (b) RUSLE will be used to:
    (1)(i) Evaluate the soil loss estimates of conservation systems 
contained in the FOTG.
    (ii) Evaluate the soil loss estimates of systems actually applied, 
where those systems were applied differently than specified in the 
conservation plan adopted by the producer or where a conservation plan 
was not developed, in determining whether a producer has complied with 
the HEL conservation provisions of the Food Security Act of 1985, as 
amended, 16 U.S.C. Sec. 3801 et seq., set forth in 7 CFR Part 12; and
    (2) Develop new or revised conservation plans.



PART 611--SOIL SURVEYS--Table of Contents




                           Subpart A--General

Sec.
611.1  Purpose and scope.
611.2  Cooperative relationships.

                    Subpart B--Soil Survey Operations

611.10  Standards, guidelines, and plans.
611.11  Reproduction and distribution of soil survey information.

                   Subpart C--Cartographic Operations

611.20  Function.
611.21  Availability of aerial photography.
611.22  Availability of satellite imagery.

    Authority: Pub. L. 74-46, 49 Stat. 163 (16 U.S.C. 590(a-f); Pub. L. 
89-560, 80 Stat. 706 (42 U.S.C. 3271-3274).

    Source: 39 FR 7415, Feb. 26, 1974, unless otherwise noted.

[[Page 593]]



                           Subpart A--General



Sec. 611.1  Purpose and scope.

    (a) This part sets forth policy on soil survey operations of the 
Natural Resources Conservation Service (NRCS).
    (b) NRCS is responsible for soil survey activities of the U.S. 
Department of Agriculture (USDA). A soil survey provides (1) an orderly, 
on-the-ground, scientific inventory of soil resources according to their 
potentialities and problems of use, and (2) information about each kind 
of soil in sufficient detail to meet all reasonable needs of farmers, 
agricultural technicians, community planners, engineers, and scientists 
in planning and transferring the findings of research and experience to 
specific land areas.



Sec. 611.2  Cooperative relationships.

    (a) Soil surveys on nonfederal lands are carried out cooperatively 
with state agricultural experiment stations and other state agencies. 
The cooperative effort is evidenced in a memorandum of understanding 
setting forth guidelines for actions to be taken by each cooperating 
party in the performance of soil surveys. Similar cooperative 
arrangements exist between NRCS and other federal agencies for soil 
surveys on federal lands.
    (b) Arrangements for nonfederal financial participation in the cost 
of soil surveys may be made with states, counties, soil conservation 
districts, planning agencies, and other local groups.



                    Subpart B--Soil Survey Operations



Sec. 611.10  Standards, guidelines, and plans.

    (a) NRCS conducts soil surveys under national standards and 
guidelines for naming, classifying, and interpreting soils and for 
publishing soil surveys in the USDA series.
    (b) A soil survey work plan of a county or area of similar size that 
is to be completed for publication is prepared prior to the start of 
each soil survey. The work plan provides information relevant to the 
conduct and publication of the soil survey. The plan is signed by 
representatives of NRCS, land grant universities, and in some states 
representatives of other state agencies. Federal land administering 
agencies also sign the work plan if federal lands are included in the 
survey.



Sec. 611.11  Reproduction and distribution of soil survey information.

    (a) Published soil surveys. (1) When soil survey field work is 
completed on a designated area, NRCS publishes the soil survey as soon 
as possible so that the information will be available to the public The 
published soil survey includes soil maps, soil descriptions, and soil 
interpretations for appropriate uses such as farming, engineering, 
range, woodland, recreation, and wildlife.
    (2) Each party cooperating with NRCS in a soil survey will receive 
without cost 50 copies of the published soil survey. Prior to 
publication each may order additional copies at printing cost by 
preparing a special amendment to the soil survey work plan.
    (3) The number of copies to be published and the distribution of a 
published soil survey are coordinated by NRCS with those cooperating in 
the survey and with the U.S. Senators from the state and the U.S. 
Representative from the congressional district in which the survey was 
made.
    (4) Copies of published soil surveys are sent by the Superintendent 
of Documents, U.S. Government Printing Office, to depository libraries 
that have requested them. Copies also are sent to interested agencies 
that have requested them.
    (5) Published soil surveys may be obtained without charge if 
available, from NRCS field and state offices, and from respective 
members of the United States Senate and House of Representatives. Land 
grant universities also may have copies. When the supply is exhausted, 
reference copies generally are available from libraries or on inter-
library loan.
    (b) Interim soil reports. (1) State and local units of government 
and others may need soil survey information for subdivision, town, or 
county planning, tax assessment, and other uses prior to the time a soil 
survey is published. NRCS may prepare interim reports to provide soil 
survey information to meet these needs.

[[Page 594]]

    (2) Interim soil reports may include copies of soil survey field 
sheets, soil descriptions, and soil interpretive maps and tables showing 
the general rating of each kind of soil for various uses such as 
farming, range, woodland, engineering, recreation, and wildlife.
    (c) Resource conservation plan data. Information prepared 
specifically for use in developing resource conservation plans for soil 
conservation district cooperators is considered confidential. Soil maps 
and interpretations prepared for this use will not be made available to 
others without the consent of the landowner as well as the district 
governing body. However, copies of soil survey field sheets and related 
data from which the conservation plan was developed may be purchased 
from the local NRCS field office with prior approval from the NRCS state 
office. The purchase is subject to the fee schedule cited in Sec. 1.2(b) 
of this title.
    (d) Identity of advance reproductions. Advance reproductions of 
individual soil survey field sheets include the name of the soil survey 
area, the state, the names of the parties cooperating in the survey, 
date of survey, map scale, and necessary precautionary notes.

[39 FR 7415, Feb. 26, 1974, as amended at 39 FR 27553, July 29, 1974]



                   Subpart C--Cartographic Operations



Sec. 611.20  Function.

    The NRCS Cartographic Division provides cartographic services needed 
to carry out NRCS functions. Cartographic services include general 
cartography, photogrammetry, aerial photography, planimetric and 
topographic mapping, drafting, and specialized types of reproduction.



Sec. 611.21  Availability of aerial photography.

    The Cartographic Division obtains necessary clearnace for all aerial 
photography for NRCS. New aerial photography of designated areas in the 
United States is obtained yearly by NRCS through competitive 
contracting. This photography is obtained only after it is determined 
that imagery of these areas available from other sources does not meet 
NRCS scale and quality requirements. Orders for reproductions of NRCS 
aerial photography are subject to the fee schedule cited in Sec. 1.2(b) 
of this title. Order reproductions from the Cartographic Division, 
USDA--Natural Resources Conservation Service, Federal Center Building, 
No. 1, Hyattsville, Maryland 20782.



Sec. 611.22  Availability of satellite imagery.

    Cloud-free maps of the United States based on imagery received from 
a satellite are prepared and released to the public by NRCS. The maps 
offer the first image of the United States not obscured by clouds or 
distortions. Orders or requests for information should be directed to 
the Cartographic Division, USDA--Natural Resources Conservation Service, 
Federal Center Buildings, No. 1, Hyattsville, Maryland 20782. Orders are 
subject to the fee schedule cited in Sec. 1.2(b) of this title.



PART 612--SNOW SURVEYS AND WATER SUPPLY FORECASTS--Table of Contents




Sec.
612.1  Purpose and scope.
612.2  Snow survey and water supply forecast activities.
612.3  Data collected and forecasts.
612.4  Eligible individuals or groups.
612.5  Dissemination of water supply forecasts and basic data.
612.6  Application for water supply forecast service.
612.7  Forecast user responsibility.

    Authority: 26 Stat. 653; Sec. 8, Reorg. Plan No. IV of 1940, 54 
Stat. 1234 (5 U.S.C. App. II); 5 FR 2421, 3 CFR 1938-1943 Comp. P. 1288.

    Source: 40 FR 12067, Mar. 17, 1975, unless otherwise noted.



Sec. 612.1  Purpose and scope.

    This part sets forth Natural Resources Conservation Service (NRCS) 
policy and procedure for the administration of a cooperative snow survey 
and water supply forecast program. The program provides agricultural 
water users and other water management groups in the western states area 
with water supply forecasts to enable them to plan for efficient water 
management. The program also provides the public and the scientific 
community with a data base that can be used

[[Page 595]]

to accurately determine the extent of the now resource. The western 
states area comprises Alaska, Arizona, California (east side of the 
Sierra Nevada mountain range only), Colorado, Idaho, Montana, Nevada, 
New Mexico, Oregon, Utah, Washington, and Wyoming.



Sec. 612.2  Snow survey and water supply forecast activities.

    To carry out the cooperative snow survey and water supply forecast 
program, NRCS:
    (a) Establishes, maintains, and operates manual and automated snow 
course and related hydro meteorological networks. Planning for such 
networks is carried out in accordance with OMB Circular A-62.
    (b) Determines and provides information on the expected water 
supply, including seasonal streamflow data. If pertinent and appropriate 
to the needs of cooperators and not otherwise available to them, may 
provide necessary interpretative analyses and forecasts required for 
operation of water-control structures and/or agricultural operations.
    (c) On request and to the extent NRCS resources and any required 
cooperator contributions are available, establishes hydrometeorological 
stations to cllect and provide data and necessary interpretive analyses 
to the requesting party. By written agreement NRCS may accept 
cooperators' funds, materials, equipment, and services for this purpose.
    (d) Develops and encourages use of new techniques and improving data 
collection and processing.
    (e) Cooperates with other federal, state, and local agencies, 
organizations, and Canadian provinces and agencies.



Sec. 612.3  Data collected and forecasts.

    (a) Basic data are currently collected at numerous sites in the 
western states area. Data sites generally include a snow course where 
both snow depth and water equivalent of snow are measured. However, 
special sites may measure only snow depth or water equivalent. Many of 
these sites also provide related drometeorological data, such as 
precipitation, temperature, humidity, solar tradiation, and wind.
    (b) Water supply forecasts in the western states area are generally 
made monthly from January through June. Forecasts may be made more 
frequently for an established need when data are available to NRCS.



Sec. 612.4  Eligible individuals or groups.

    (a) Any individual or group who is a significant water user and who 
would benefit from a water supply forecast may obtain forecasts from 
NRCS on a regular basis provided data are available to NRCS to develop a 
forecast at the desired location.
    (b) The program collects and interprets data as a service and an aid 
to agricultural interests, particularly those served by or affiliated 
with soil, water, and other conservation districts. Information 
collected by NRCS for these agricutural users is also made available to 
other Federal, State, and private agencies and to the general public 
without charge. Cooperator financial contribution is usually required 
for special measurements or interpretations beyond the scope of the 
regular program.



Sec. 612.5  Dissemination of water supply forecasts and basic data.

    Water supply outlook reports prepared by NRCS and its cooperators 
containing water supply forecasts and basic data are usually issued 
monthly by each NRCS state office in the western states area for the 
months of January through June. Other reports jointly issued by NRCS and 
its cooperators include a fall water supply summary, annual and 
accumulative summaries of data, and a western states area report 
covering water supply outlook.



Sec. 612.6  Application for water supply forecast service.

    Requests for obtaining water supply forecasts or related assistance 
may be directed to any NRCS office in the western states areas. NRCS 
offices are described in part 600 of this chapter.



Sec. 612.7  Forecast user responsibility.

    The forecast user's obligation to the federal government is to give 
appropriate credit and recognition to NRCS for information furnished. 
The Federal

[[Page 596]]

Government does not assume any responsibility for management decisions 
the user makes which may be based in whole or part on information 
provided by NRCS.



PART 613--PLANT MATERIALS CENTERS--Table of Contents




Sec.
613.1  Purpose.
613.2  Policy and objectives.
613.3  NRCS responsibilities in plant materials.
613.4  Special production of plant materials.
613.5  Plant materials centers.

    Authority: Pub. L. 74-46, 49 Stat. 163 (16 U.S.C. 590a-f); Pub. L. 
74-210, 50 Stat. 525 (7 U.S.C. 1010-1011)

    Source: 49 FR 12188, Mar. 29, 1984, unless otherwise noted.



Sec. 613.1  Purpose.

    This part provides Natural Resources Conservation Service (NRCS) 
policy on the operations of plant materials centers. The centers have 
responsibilities for assembling, testing, releasing, and providing for 
the commercial production and use of plant materials for programs of 
soil, water, and related resource conservation and development.



Sec. 613.2  Policy and objectives.

    (a) It is NRCS policy to assemble, comparatively evaluate, release, 
and distribute for commercial increase new or improved plant materials 
needed for broad programs of resource conservation and development for 
agriculture, wildlife, urban, recreation, and other land uses and 
environmental needs. It is NRCS policy to conduct plant materials work 
in cooperation with other agencies of the U.S. Department of 
Agriculture, such as the Agricultural Research Service, and with other 
federal and state research agencies including state agricultural 
experiment stations. The emphasis of the NRCS plant materials work is to 
find suitable plants for erosion control adapted to soil and site 
conditions where vegetation is difficult to establish. In contrast, the 
emphasis of research agencies and organizations in plant development is 
to improve economically important crops. The NRCS program of testing and 
releasing new seed-propagated plant materials follows the guidelines in 
``Statement of Responsibilities and Policies Relating to the 
Development, Release, and Multiplication of Publicly Developed Varieties 
of Seed-Propagated Crops,'' which was adopted in June 1972 by land grant 
colleges and interested federal agencies. NRCS releases improved 
conservation plant materials requiring vegetative multiplication in ways 
appropriate for particular states and particular species by working with 
experiment stations, crop improvement associations, and other state and 
federal agencies.
    (b) The objective of the plant materials activity is to select or 
develop special and improved plants, and techniques for their successful 
establishment and maintenance to solve conservation problems and needs 
related to:
    (1) Controlling soil erosion on all lands.
    (2) Conserving water.
    (3) Protecting upstream watersheds.
    (4) Reducing sediment movement into waterways and reservoirs through 
the stabilization of critical sediment sources such as surface mined 
lands, highway slopes, recreation sites, and urban and industrial 
development areas.
    (5) Stabilizing disposal areas for liquid and solid wastes.
    (6) Improving plant diversity and lengthening grazing season on 
dryland pastures and rangelands.
    (7) Replacing brush on mountain slopes with fire-retarding plant 
cover to reduce the possibility of fires that threaten life and property 
or result in serious sediment sources.
    (8) Improving the effectiveness of windbreaks and shelterbelts for 
reducing airborne sediment, controlling snow drifting, and preventing 
crop damage from wind erosion.
    (9) Protecting streambank, pond, and lake waterlines from erosion by 
scouring and wave action.
    (10) Improving wildlife food and cover.
    (11) Selecting special-purpose plants to meet specific needs for 
environment protection and enhancement.
    (12) Selecting plants that tolerate air pollution agents and toxic 
soil chemicals.

[[Page 597]]



Sec. 613.3  NRCS responsibilities in plant materials.

    NRCS operates or enters into agreements with state universities or 
other state organizations to operate plant materials centers. NRCS 
employs specialists for selecting and using plant materials. NRCS 
responsibilities are to:
    (a) Identify the need for suitable plant materials and cultural and 
management methods in resource conservation and for environmental 
protection and enhancement.
    (b) Assemble and comparatively evaluate plant materials at the plant 
materials centers and on sites where soil, climate, or other conditions 
differ significantly from those at the centers.
    (c) Make comparative field plantings for final testing of promising 
plants and techniques in cooperation with conservation districts and 
other interested cooperators.
    (d) Release cooperatively improved conservation plants and maintain 
the breeder or foundation stocks in ways appropriate for particular 
state and plant species by working with experiment stations, crop 
improvement associations, and other state and federal agencies.
    (e) Produce limited amounts of foundation or foundation-quality seed 
and plants available by grant to or by exchange with conservation 
districts, experiment stations, other federal and state research 
agencies, and state seed certifying organizations that will use the 
material to establish seed fields, seed orchards or plantings for 
vegetative increase.
    (f) Encourage conservation districts, commercial seed producers, and 
commercial and state nurseries to produce needed plant materials for 
conservation uses and to assist them in this production.
    (g) Encourage the use of improved plant materials in resource 
conservation and environmental improvement programs.



Sec. 613.4  Special production of plant materials.

    NRCS can produce plant materials in the quantity required to do a 
specific conservation job if this production will serve the public 
welfare and only if the plant materials are not available commercially. 
This function will be performed only until the plant materials are 
available commercially. Specific production of plant materials by NRCS 
requires the approval of the Chief.



Sec. 613.5  Plant materials centers.

    (a) The National Plant Materials Center. The National Plant 
Materials Center at Beltsville, Maryland, serves as the central facility 
for assembling, increasing, and determining the characteristics of plant 
materials from foreign and domestic sources. Plant materials with 
potential value for conservation and related uses are distributed to 
other plant materials centers.
    (b) Other Plant Materials Centers. There are 23 other plant 
materials centers. Each serves several major land resource areas. 
Seventeen of these other centers are operated by NRCS, and six by 
cooperating agencies, as follows:
    (1) Operated by NRCS:

Tucson, Arizona
Lockeford, California
Brooksville, Florida
Americus, Georgia
Molokai, Hawaii
Aberdeen, Idaho
Manhattan, Kansas
Quicksand, Kentucky
East Lansing, Michigan
Coffeeville, Mississippi
Elsberry, Missouri
Bridger, Montana
Cape May Courthouse, New Jersey
Big Flats, New York
Corvallis, Oregon
Knox City, Texas
Pullman, Washington

    (2) Operated by cooperating agencies with financial and technical 
assistance from NRCS:

Los Lunas, New Mexico (New Mexico State University)
Bismarck, North Dakota (North Dakota Association of Soil Conservation 
Districts)
Meeker, Colorado (White River and Douglas Creek Soil Conservation 
Districts with partial funding from NRCS)

    (3) Operated by cooperating agencies with technical assistance from 
NRCS:

Palmer, Alaska (State of Alaska)
Kingsville, Texas (Caesar Kleberg Wildlife Research Institute, Texas 
Agricultural and Industrial University, and South Texas Association of 
Conservation Districts)

[[Page 598]]

Nacogdoches, Texas (Stephen F. Austin University and the East Texas 
Association of Conservation Districts)



PART 614--APPEAL PROCEDURES--Table of Contents




                      Subpart A--General Provisions

Sec.
614.1  Purpose and scope.
614.2  Definitions.
614.3  Applicability.
614.4  Reservation of authority.
614.5  Decisions not subject to appeal.

     Subpart B--Appeals of Technical Determinations Related to the 
  Conservation Title (Title XII) of the Food Security Act of 1985, as 
                                 Amended

614.100  Applicability.
614.101  Notice of preliminary technical determinations.
614.102  Mediation of preliminary technical determinations.
614.103  Final determinations.
614.104  Appeals of technical determinations.

  Subpart C--Appeals of Decision Related to Conservation Programs (non-
                               Title XII)

614.200  Applicability.
614.201  Notice of final decisions.
614.202  Time frames for filing requests for informal hearings.
614.203  Mediation of adverse final decisions.
614.204  Appeals of adverse final decisions.

    Authority: 5 U.S.C. 301, sections 226 and 275 of Pub. L. 103-354 (7 
U.S.C. 6932 and 6995); 16 U.S.C. 3843(a).

    Source: 60 FR 67313, Dec. 29, 1995, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 614.1  Purpose and scope.

    This part sets forth the informal procedures under which a landowner 
or program participant may appeal adverse technical determinations or 
decisions made by officials of the Natural Resources Conservation 
Service (NRCS) or its successor agency.



Sec. 614.2  Definitions.

    Adverse technical determination or decision includes, in addition to 
the definition of adverse decision in 7 CFR part 11, an NRCS technical 
determination or decision that affects the legal substantive status of 
the land, though it may not necessarily be adverse.
    Chief means the Chief of NRCS. For the purposes of this part, the 
term ``Chief'' includes an official of NRCS national headquarters 
designated by the Chief to act for the Chief in making decisions under 
this part.
    Conservation district means any district or unit of State or local 
government formed under State law or territorial law for the express 
purpose of developing and carrying out a local soil and water 
conservation program. Such district or unit of government may be 
referred to as a conservation district, soil conservation district, soil 
and water conservation district, natural resource district, land 
conservation committee, or a similar name.
    County committee means a Farm Service Agency (FSA) county or area 
committee established in accordance with section 8(b) of the Soil 
Conservation and Domestic Allotment Act (16 U.S.C. 590h(b)).
    Decision means a conclusion reached by an NRCS official based on 
applicable regulations and program instructions which relates to 
eligibility for program benefits, including a technical determination 
used as a basis for the decision.
    Designated conservationist means the NRCS official, usually the 
district conservationist, whom the State Conservationist designates to 
be responsible for the program or compliance requirement to which this 
part is applicable.
    Mediation means a process in which a neutral third party, the 
mediator, meets with the disputing parties (e.g., the landowner or 
program participant and the agency), facilitates discussions, and works 
with the parties to resolve their disputes, narrow areas of 
disagreement, and improve communications and relationships. A mediator 
has no authority to render a decision or determination.
    Preliminary technical determination means the initial written 
technical determination provided to a client which will become final 
after 30 days unless the client takes action in accordance with 
Sec. 614.101 to stay the preliminary technical determination from 
becoming final.
    State Conservationist means the NRCS official in charge of NRCS 
operations

[[Page 599]]

within a State, as set forth in part 600 of this chapter.
    Technical determination means a conclusion concerning the status and 
condition of the natural resources and cultural practices based on 
science and best professional judgment of natural resource professionals 
concerning the soils, water, air, plants, and animals.
    Refer to 7 CFR 11.1 for other definitions applicable to appeals of 
adverse technical determinations and decisions covered by this part.



Sec. 614.3  Applicability.

    (a) Appeals of adverse technical determinations and adverse 
decisions covered by this part are also governed by National Appeals 
Division (NAD) regulations at 7 CFR part 11.
    (b) Decisions which are subject to this part include any decision 
under one or more NRCS programs; and technical determinations or 
decisions that affect the status of the land even though they may not 
affect the landowner's or program participant's eligibility for USDA 
program benefits.
    (c) The failure of an official of NRCS to issue a technical 
determination or decision is subject to this part.
    (d) Complaints involving discrimination in program delivery will be 
handled under the existing USDA civil rights rules and regulations.
    (e) Appeals on contractual issues that are subject to the 
jurisdiction of the Agriculture Board of Contract Appeals are not 
appealable under the procedures within this part.



Sec. 614.4  Reservation of authority.

    Nothing contained in the regulations of this part shall preclude the 
Secretary of Agriculture or the Chief from determining at any time any 
question arising under the programs to which the regulations of this 
part apply, or from reversing or modifying in writing, with sufficient 
reason given therefore, any technical determination or decision made by 
an NRCS official.



Sec. 614.5  Decisions not subject to appeal.

    The following are examples of decisions which are not appealable:
    (a) General program requirements that apply to all participants;
    (b) Science-based formulas and criteria;
    (c) Procedural decisions relating to administration of the programs; 
and
    (d) Denials of assistance due to lack of funds or authority.



     Subpart B--Appeals of Technical Determinations Related to the 
  Conservation Title (Title XII) of the Food Security Act of 1985, as 
                                 Amended



Sec. 614.100  Applicability.

    The provisions of this subpart set forth the procedures under which 
a landowner or program participant may seek mediation of a preliminary 
technical determination or appeal from technical determinations made by 
NRCS officials on or after January 16, 1996 regarding technical 
determinations within the following programs:
    (1) Highly Erodible Land Conservation;
    (2) Wetland Conservation, including wetland technical determinations 
made by NRCS officials not related to a request for USDA program 
benefits;
    (3) Conservation Reserve Program;
    (4) Wetlands Reserve Program;
    (5) Agricultural Water Quality Incentives Program; and
    (6) Environmental Easement Program.



Sec. 614.101  Notice of preliminary technical determinations.

    (a) All preliminary technical determinations related to programs 
provided for in Sec. 614.100 shall be in writing and shall inform the 
landowner or program participant of the following:
    (1) The preliminary technical determination will become final after 
30 days if the landowner or program participant does not arrange with 
the designated conservationist for either or both of the following 
options:
    (i) A field visit to the site to gather additional information and 
to discuss the facts concerning the preliminary technical determination, 
together with, at the option of the conservation district, a district 
representative; and
    (ii) Mediation.

[[Page 600]]

    (2) Once the technical determination is final, the landowner or 
program participant may appeal the technical determination to the FSA 
county or area committee pursuant to 7 CFR part 780. Landowners or 
program participants wishing to appeal must exhaust any available appeal 
procedures through the FSA county committee prior to appealing to NAD. 
Judicial review is available only as specified in 7 CFR part 11.
    (b) The document containing the preliminary technical determination 
shall be mailed or hand delivered to the landowner or program 
participant.



Sec. 614.102  Mediation of preliminary technical determinations.

    (a)(1) Any dispute with respect to a preliminary technical 
determination related to the programs provided in Sec. 614.100 shall, at 
the request of the landowner or program participant, be mediated:
    (i) Through certified individuals in those States where a State 
mediation program certified by the United States Department of 
Agriculture (USDA) has been established. Conservation district officials 
in certified State Mediation Program States may become certified by the 
State and utilized for mediation, if they choose to participate.
    (ii) In States with no certified mediation program in effect, 
through mediation by a qualified representative of a local conservation 
district, if a local conservation district chooses to participate. Upon 
mutual agreement of the parties, other individuals may serve as 
mediators.
    (2) Upon receiving a request for mediation, NRCS shall notify other 
USDA and Federal agencies, as appropriate.
    (b) The parties shall have not more than 30 days to reach an 
agreement following a mediation session. The mediator shall notify the 
designated conservationist in writing at the end of this period whether 
the parties reached an agreement. Any agreement reached during, or as a 
result of, the mediation process shall conform to the statutory, 
regulatory, and manual provisions governing the program.



Sec. 614.103  Final determinations.

    (a) Preliminary technical determinations shall become final:
    (1) 30 days after receipt by the landowner or program participant of 
the notice of a preliminary technical determination issued pursuant to 
Sec. 614.101, unless a field visit or mediation is requested;
    (2) After the earlier of 30 days after the field visit provided for 
under Sec. 614.101(a) or receipt by the landowner or program participant 
of a final determination from the designated conservationist; or
    (3) 30 days after a mediation session if a mutual agreement has not 
been reached by the parties.
    (b) The final technical determination shall set forth the decision, 
the basis for the decision, including all factors, technical criteria, 
and facts relied upon in making the decision, and shall inform the 
landowner or program participant of the procedure for requesting and 
pursuing further review.



Sec. 614.104  Appeals of technical determinations.

    (a) Technical determinations related to the programs in Sec. 614.100 
may only be appealed, pursuant to the provisions of 7 CFR part 780, to 
the FSA county committee with jurisdiction.
    (b) In cases where a field visit has not already been completed in 
accordance with Sec. 614.101(a), a field visit shall be completed by the 
designated conservationist before the FSA county committee considers the 
appeal.
    (c) If the FSA county committee hearing the appeal requests review 
of the technical determination by the applicable State Conservationist 
prior to issuing their decision, the State Conservationist may:
    (1) Designate an appropriate NRCS official to gather any additional 
information necessary for review of the technical determination;
    (2) Obtain additional oral and documentary evidence from any party 
with personal or expert knowledge about the facts under review; and
    (3) Conduct a field visit to review and obtain additional 
information and to

[[Page 601]]

discuss the facts concerning the technical determination. The State 
Conservationist shall provide the applicable FSA county committee with a 
written technical determination, including all factors, technical 
criteria, and facts relied upon in making the technical determination.
    (d) Any landowner or program participant who is adversely affected 
by a decision of the FSA county committee may appeal to NAD in 
accordance with 7 CFR part 11.



 Subpart C--Appeals of Decisions Related to Conservation Programs (non-
                               Title XII)



Sec. 614.200  Applicability.

    The provisions of this subpart set forth the procedures under which 
a landowner or program participant may seek an informal hearing on 
adverse decisions made by NRCS officials (exclusive of those decisions 
that are appealable to the USDA Board of Contract Appeals) after January 
16, 1996 in the following program areas:
    (1) Great Plains Conservation Program;
    (2) Rural Abandoned Mine Program;
    (3) Emergency Watershed Projects;
    (4) Rural Clean Water Program;
    (5) Colorado River Basin Salinity Control Program;
    (6) Forestry Incentive Program;
    (7) Water Bank Program;
    (8) Flood Prevention and Watershed Protection Programs;
    (9) Any other program which subsequently incorporates these 
procedures through reference to this subpart within the program 
regulations.



Sec. 614.201  Notice of final decisions.

    (a) All final decisions related to programs provided for in 
Sec. 614.200 that are made by the designated conservationist shall be in 
writing and shall inform the landowner or program participant of their 
right to request any or all of the following:
    (1) An informal hearing before NRCS;
    (2) Mediation; or
    (3) A hearing before NAD in accordance with 7 CFR part 11.
    (b) The document containing the decision shall be mailed or hand 
delivered to the landowner or program participant.



Sec. 614.202  Time frames for filing requests for informal hearings.

    (a) A request for an informal hearing before NRCS shall be filed 
within 30 days after written notice of the final decision, which is the 
subject of the request, is mailed or otherwise made available to the 
landowner or program participant. A request for an informal hearing 
shall be considered ``filed'' when personally delivered in writing to 
the appropriate reviewing authority or when the properly addressed 
request, postage paid, is postmarked.
    (b) A request for appeal may be accepted and acted upon even though 
it is not filed within the time prescribed in paragraph (a) of this 
section if, in the judgment of the reviewing authority with whom such 
request is filed, the circumstances warrant such action.



Sec. 614.203  Mediation of adverse final decisions.

    (a) Any dispute with respect to an adverse final decision related to 
the programs provided in Sec. 614.200 shall, at the request of the 
landowner or program, be mediated:
    (1) Through certified individual in those States where a State 
Mediation Program has been established. Conservation district officials 
in certified State Mediation Program States may become certified by the 
State and utilized for mediation, if they choose to participate.
    (2) In States where no certified mediation program is in effect, 
through mediation by a qualified representative of a local conservation 
district, if a local conservation district chooses to participate. Upon 
mutual agreement of the parties, other individuals may serve as 
mediators.
    (b)(1) The parties shall have not more than 30 days to reach an 
agreement following a mediation session. The mediator shall notify the 
designated conservationist in writing at the end of this period whether 
the parties reached an agreement.
    (2) Any agreement reached during, or as a result of, the mediation 
process

[[Page 602]]

shall conform to the statutory, regulatory, and manual provisions 
governing the program.
    (3) If the parties fail to reach an agreement within the specified 
period, the designated conservationist shall have up to 30 days after 
the conclusion of mediation to issue a final decision.



Sec. 614.204  Appeals of adverse final decisions.

    (a) Any landowner or program participant, who is adversely affected 
by a decision made by a designated conservationist related to the 
programs in Sec. 614.200, may appeal the decision to the State 
Conservationist in the applicable State for an informal hearing or to 
NAD in accordance with 7 CFR part 11.
    (b) The State Conservationist may designate a NRCS official to 
gather information and conduct the informal hearing before making a 
decision.
    (c) Any landowner or program participant who is adversely affected 
by a decision of the State Conservationist may appeal to NAD in 
accordance with 7 CFR part 11.

[[Page 603]]



                      SUBCHAPTER C--WATER RESOURCES





PART 621--RIVER BASIN INVESTIGATIONS AND SURVEYS--Table of Contents




                           Subpart A--General

Sec.
621.1  Purpose.
621.2  Scope.

                   Subpart B--USDA Cooperative Studies

621.10  Description.
621.11  Who may obtain assistance.
621.12  How to request assistance.
621.13  Conditions for approval.
621.14  Recipient responsibility.

               Subpart C--Floodplain Management Assistance

621.20  Description.
621.21  Who may obtain assistance.
621.22  How to request assistance.
621.23  Conditions for approval.
621.24  NRCS responsibility.
621.25  Recipient responsibility.

 Subpart D--Joint Investigations and Reports With the Department of the 
                                  Army

621.30  Description.
621.31  Who may request assistance.
621.32  How to request assistance.
621.33  Conditions for approval.
621.34  Recipient responsibility.

                   Subpart E--Interagency Coordination

621.40  Participation in Federal interagency policy activities at the 
          national level.
621.41  Participation in Federal-State policy and planning activities at 
          the regional level.
621.42  Federal-State compacts.
621.43  Interstate compacts and commissions.
621.44  Special studies.
621.45  Flood insurance studies.

    Authority: Sec. 6 (Pub. L. 83-566) 68 Stat. 666 (16 U.S.C. 1006).

    Source: 48 FR 18788, Apr. 26, 1983, unless otherwise noted.



                           Subpart A--General



Sec. 621.1  Purpose.

    This part describes policies, requirements, and procedures governing 
the Department of Agriculture's (USDA's) investigations and surveys of 
watersheds of rivers and other waterways as a basis for developing 
coordinated programs. These activities are undertaken in cooperation 
with other Federal, State, and local agencies. The delegation of 
authority to the Natural Resources Conservation Service (NRCS) to 
provide national leadership for the conservation, development, and 
productive use of the Nation's soil, water, and related resources, 
including the activities treated in this part is found at Sec. 2.62 of 
this title.



Sec. 621.2  Scope.

    USDA river basin activities include:
    (a) Cooperative river basin surveys in coordination with Federal, 
State, and local agencies;
    (b) Floodplain management assistance in coordination with the 
responsible State agency and involved local governments;
    (c) Joint investigations and reports with the Department of the Army 
under Pub. L. 87-639, 76 Statute 438 (16 U.S.C. 1009); and
    (d) Interagency coordination of water resources activities.



                   Subpart B--USDA Cooperative Studies



Sec. 621.10  Description.

    Cooperative river basin studies provide USDA planning assistance to 
Federal, State, and local governments. The purpose of these studies is 
to assist in appraising water and related land resources; defining and 
determining the extent of the problems; and formulating alternative 
plans, including land treatment, nonstructural or structural measures, 
or combinations thereof, that would solve existing problems or meet 
existing and projected needs. These studies concentrate on specific 
objectives identified by the requesting agencies and citizen groups that 
are consistent with USDA authorities and responsibilities and current 
NRCS priorities. The objectives ordinarily include the formulation of a 
plan but may require only inventories of available resources and 
associated problems to be used by other agencies in plan

[[Page 604]]

formulation. USDA assistance is provided through field advisory 
committees composed of representatives of the Economic Research Service, 
Forest Service, and NRCS. The NRCS representative chairs the field 
advisory committee.



Sec. 621.11  Who may obtain assistance.

    Assistance is available to conservation districts, communities. 
county governments, regional planning boards, other planning groups, and 
State and Federal agencies. Local groups express their desires for a 
cooperative study to the governor or appropriate State agency.



Sec. 621.12  How to request assistance.

    For a cooperative study a governor, or a Federal, State, or local 
government agency must submit a written request and a Proposal to Study 
(PTS) through the NRCS State Conservationist to the Chief. Assistance in 
preparing the proposal may be obtained by contacting the State 
Conservationist. The State Conservationist sends the request and 
proposal with comments to the Chief for consideration. The proposal 
should:
    (a) Describe the basin or study area, including a map of the study 
area;
    (b) Explain the need for the study;
    (c) Explain the need for USDA participation;
    (d) State the responsibility and authority of the requesting agency 
in the study;
    (e) Estimate the extent of participation of other Federal and State 
agencies;
    (f) Discuss views and priorities of affected soil conservation 
districts regarding the proposed study;
    (g) Briefly describe the intended management organization of the 
study;
    (h) Specifically describe the expected results of the study;
    (i) Identify primary users of the study results and the manner in 
which the results will be used;
    (j) State the relationship of the study to ongoing and completed 
river basin studies;
    (k) State that procedures for informing clearinghouses and for 
eliciting public participation will be followed;
    (l) Estimate the duration and scope of the study; and
    (m) Estimate the study costs by year and agency.



Sec. 621.13  Conditions for approval.

    The Chief may authorize requested cooperative studies recommended by 
the State Conservationist. Priority for starting cooperative studies is 
based on the date of application, the readiness of the requesting agency 
to begin participation, the importance and significance of problems to 
be studied, the monetary or in-kind contributions toward the study, the 
sequence of ongoing and future studies, the type of study, the duration 
of study, the cost of study, the potential for implementation and other 
factors affecting the effectiveness and efficiency of the study. The 
number and location of cooperative studies started each year are 
governed by the availability of USDA funds and personnel.



Sec. 621.14  Recipient responsibility.

    Leadership in arrangements for other needed Federal, State, and 
local agency participation is responsibility of the requesting agency. 
Consistent with national objectives and NRCS policy and procedures, the 
requesting agency has leadership responsibility for developing specific 
study objectives, providing the necessary study organization, and 
ensuring public participation in the planning process.



               Subpart C--Floodplain Management Assistance



Sec. 621.20  Description.

    Floodplain management studies provide needed information and 
assistance to local and State entities so that they can implement 
programs for reducing existing and future flood damages in rural and 
urban communities. Assistance is targeted to communities where flood 
damage is a serious concern and local governments are sincerely 
interested in taking action to reduce damage.



Sec. 621.21  Who may obtain assistance.

    Assistance is available to conservation districts, communities, 
county

[[Page 605]]

governments, regional planning boards, other planning groups, and State 
and Federal agencies.



Sec. 621.22  How to request assistance.

    (a) A conservation district, local community or other jurisdiction 
may request floodplain management assistance for a local area for which 
they are responsible, by letter to the governor or the agency of State 
government responsible for floodplain management activities. Assistance 
in making application may be obtained by contacting any NRCS office.
    (b) The governor or his designee may request floodplain management 
assistance for the State by submitting a written request to the State 
Conservationist.



Sec. 621.23  Conditions for approval.

    (a) USDA floodplain management studies are authorized by the 
Director of the Basin and Area Planning Division. Priority for starting 
floodplain management studies is based on the same factors as for USDA 
Cooperative Studies as described in Sec. 621.13.
    (b) A study for an individual community may be started upon 
completion of a plan of work in which the Director of the Basin and Area 
Planning Division concurs and for which funds are available. Preparation 
of the plan of work is the responsibility of and must be approved by the 
applicant, the responsible State agency, and the State Conservationist. 
The plan sets forth the responsibilities of the applicant, the State, 
and USDA in carrying out the study and interpreting and using the data 
in a local floodplain management program. The State agency responsible 
for floodplain management activities may establish priorities on which 
to base the sequence of approval of floodplain management studies within 
its State. The number of studies started each Federal fiscal year is 
governed by the availability of funds and personnel and the amount of 
State and local assistance available.
    (c) States and communities are encouraged to make monetary or in-
kind contributions toward the floodplain management study. The State and 
local share may reflect in-kind contributions in lieu of fund transfers.



Sec. 621.24  NRCS responsibility.

    NRCS is responsible for providing leadership for scheduling and 
implementing the technical phases of the studies and preparing the 
reports. NRCS assists in interpreting the study results.



Sec. 621.25  Recipient responsibility.

    The State agency is responsible for developing State priorities for 
floodplain management studies and coordinating this work with related 
activities in the State. The cooperating local government entity is 
responsible for obtaining permission for carrying out field surveys. The 
State and local participants assist in distributing and interpreting the 
report and providing public information and educational services.



 Subpart D--Joint Investigations and Reports With the Department of the 
                                  Army



Sec. 621.30  Description.

    (a) As provided by Pub. L. 87-639, joint investigations and reports 
by USDA and the Department of the Army may be authorized by resolutions 
adopted by the Committee on Environment and Public Works of the U.S. 
Senate or the Committee on Public Works and Transportation of the U.S. 
House of Representatives for any watershed area in the 50 States, the 
Commonwealth of Puerto Rico, and the U.S. Virgin Islands if the nature 
of the watershed area problems dictates need for a joint effort by the 
two Departments.
    (b) Authorized joint investigations and reports are made to 
determine works of improvement needed in the study area for flood 
prevention; for the conservation, development, use, and disposal of 
water; for flood control; for the conservation and proper use of land; 
and for allied purposes. The joint report to Congress may include a 
water and related land resources plan recommended for implementation. 
Such an implementation plan must be accompanied by an environmental 
impact statement (EIS) and must be in sufficient detail to permit its 
implementation.

[[Page 606]]

    (c) As mutually agreed by USDA and the Department of the Army Corps 
of Engineers, the report and EIS are forwarded to Congress through 
appropriate channels after technical, public, and interagency reviews in 
accordance with NRCS policy as described in Sec. 622.34, or in 
accordance with the Corps of Engineers' policy concerning technical and 
public review. Implementation of these plans is contingent on 
congressional action.



Sec. 621.31  Who may request assistance.

    Any organization, group, or State or local government may request 
assistance.



Sec. 621.32  How to request assistance.

    Applicants for a joint investigation and report should request their 
congressional representative(s) to initiate appropriate action under 
Pub. L. 87-639.



Sec. 621.33  Conditions for approval.

    A joint investigation and report is authorized by a resolution of 
the Committee on Environment and Public Works of the U.S. Senate or the 
Committee on Public Works and Transportation of the U.S. House of 
Representatives. Studies are initiated when funds for them are 
appropriated by the Congress.



Sec. 621.34  Recipient responsibility.

    Participating local and State governments work with USDA and the 
Department of the Army representatives in developing objectives, 
collecting data, analyzing problems, planning and formulating proposals, 
and considering financial plans. Active public participation is 
solicited in the planning process through means such as questionnaires, 
public meetings, citizen advisory boards, and technical committees.



                   Subpart E--Interagency Coordination



Sec. 621.40  Participation in Federal interagency policy activities at the national level.

    (a) Policy development in water and related land resources is 
coordinated at the Federal level through the Cabinet Council on Natural 
Resources and Environment. NRCS provides staff support and 
representation in these activities as requested.
    (b) Within the Department, all interested USDA agencies participate 
in water policy development through the USDA Committee on Natural 
Resources and Environment and the Water Issues Work Group.
    (c) NRCS provides appropriate staff support when requested for 
committees, work groups, and task forces established for interagency 
coordination of water resources related activities of Federal agencies.



Sec. 621.41  Participation in Federal-State policy and planning activities at the regional level.

    (a) NRCS has a responsibility to represent the Department when 
needed to assist regional water planning entities and interagency 
committees which coordinate water resources planning activities.
    (b) For the Arkansas-White-Red Basin Interagency Committee (AWRBIAC) 
and the Pacific Southwest Interagency Committee (PSIAC), the USDA member 
periodically serves as chairperson and provides an executive secretary. 
For the Southeast Basin Interagency Committee (SEBIAC), NRCS 
periodically provides an executive secretary for the chairperson, who is 
a State government official.
    (c) Under the leadership of NRCS, other USDA agencies, principally 
the Forest Service and Economic Research Service, also participate.



Sec. 621.42  Federal-State compacts.

    NRCS is designated to represent USDA in assisting the U.S. 
Commissioners of the Delaware River Basin Commission and the Susquehanna 
River Basin Commission. In carrying out this responsibility, NRCS 
provides a liaison officer to work with the U.S. Commissioners on policy 
level matters, as well as providing the USDA representatives on the 
Federal field committees to assist the Commissioners.



Sec. 621.43  Interstate compacts and commissions.

    As assigned, an NRCS State Conservationist is the USDA point of 
contact for governing bodies of interstate compacts and commissions 
concerned

[[Page 607]]

with the conservation, development, and proper use of water, soil, and 
related resources.



Sec. 621.44  Special studies.

    As designated, NRCS represents USDA on special study groups such as 
for the Colorado River Basin Salinity Control Program Studies.



Sec. 621.45  Flood insurance studies.

    As requested by the Federal Emergency Management Agency (FEMA), and 
within the limits of available resources, NRCS carries out flood 
insurance studies of various types under the National Flood Insurance 
Program (Pub. L. 90-448, 82 Statute, 574 (42 U.S.C. 4012)), as amended. 
In this activity, NRCS performs detailed technical studies to determine 
the extent and frequency of flooding. The flood insurance program is 
administered by FEMA. NRCS is reimbursed by that agency for actual costs 
incurred in carrying out the studies. Local entities desiring flood 
insurance coverage should contact the responsible State agency or FEMA 
and apply in accordance with procedures of that agency.



PART 622--WATERSHED PROJECTS--Table of Contents




                           Subpart A--General

Sec.
622.1  Purpose.
622.2  Scope.
622.3  Relationship to the Pub. L. 78-534 Program.
622.4  Relationship to other agencies.
622.5  Guidelines.
622.6  Equal opportunity.
622.7  Notification under Executive Order 12372.

                        Subpart B--Qualifications

622.10  Sponsors.
622.11  Eligible watershed projects.

                    Subpart C--Application Procedure

622.20  Application.
622.21  State agency approval.

                           Subpart D--Planning

622.30  General.
622.31  Basic planning efforts.
622.32  Reviews and approvals.

    Authority: Pub. L. 83-566, 68 Stat. 666 as amended (16 U.S.C. 1001, 
et seq.); Pub. L. 78-534, 58 Stat. 889, 33 U.S.C. 701b-1.

    Source: 49 FR 6078, Feb. 17, 1984, unless otherwise noted.



                           Subpart A--General



Sec. 622.1  Purpose.

    This part sets forth the general policies for planning and carrying 
out watershed projects under Pub. L. 83-566, 68 Stat. 666 (16 U.S.C. 
1001 et seq.) and flood prevention projects under Pub. L. 78-534, 58 
Stat. 889 (33 U.S.C. 701b-1).



Sec. 622.2  Scope.

    (a) To assist sponsors in preparing and carrying out watershed 
plans, the Natural Resources Conservation Service (NRCS) shall conduct 
investigations and surveys, with the cooperation and assistance of other 
Federal agencies, to:
    (1) Determine the extent of watershed problems and needs, and
    (2) Set forth viable alternative solutions consistent with local, 
regional, and national objectives, including an alternative solution 
which makes the greatest net contribution to national economic 
development.
    (b) Alternatives will consist of either land treatment, 
nonstructural or structural measures, or combinations thereof that will 
help accomplish one or more of the authorized project purposes.
    (c) Authorized project purposes are watershed protection, 
conservation and proper utilization of land, flood prevention, 
agricultural water management including irrigation and drainage, public 
recreation, public fish and wildlife, municipal and industrial water 
supply, hydropower, water quality management, ground water supply, 
agricultural pollution control, and other water management.
    (d) After a final plan for works of improvement is agreed upon 
between NRCS and the sponsors and the approval processes are completed, 
NRCS will provide technical and financial assistance to install the 
project, subject to the availability of funds and the budgeting and 
fiscal policies of the President.

[[Page 608]]



Sec. 622.3  Relationship to the Pub. L. 78-534 Program.

    (a) General. The purposes and objectives of the programs under Pub. 
L. 83-566 and Pub. L. 78-534 are the same in most cases. Planning 
criteria, economic justification, local sponsorship, agency 
participation, financial assistance, eligible measures, operation and 
maintenance arrangements for the Pub. L. 78-534 program are consistent 
with those of the Pub. L. 83-566 program. The differences with the Pub. 
L. 78-534 program are outlined below.
    (b) Initiation. Flood prevention projects are individually 
authorized by Federal legislation. The state conservationist and the 
sponsors agree on a plan of action and notify interested parties to 
solicit their participation. The sponsors keep the public informed and 
solicit their views and comments.
    (c) Subwatershed plans. These plans are administratively approved by 
the state conservationist. If the plan involves purposes other than 
flood prevention, clearance must be obtained from the Office of 
Management and Budget before approval. Financial assistance available 
differs only in that program funds may be used for the purchase of land 
rights for single-purpose flood prevention structures and installing 
land treatment on Federal lands.
    (d) Installation. NRCS shall award and administer contracts for the 
installation of project measures unless the sponsors agree to perform 
the work. Project agreements between the sponsors and NRCS are not 
required if the work consists of flood prevention structures built and 
funded by NRCS.



Sec. 622.4  Relationship to other agencies.

    NRCS will coordinate responsibilities with other water and land 
resource development agencies on projects that may come under the 
jurisdictions of various authorities. This will include any land 
management agencies which may have land which would be affected by 
project measures. Coordination with the U.S. Department of the 
Interior's Fish and Wildlife Service will be in accordance with section 
12 of Pub. L. 83-566 (as amended).



Sec. 622.5  Guidelines.

    Guidelines for carrying out programs authorized under Pub. L. 83-566 
and Pub. L. 78-534 are contained in miscellaneous instructions, manuals, 
and handbooks issued by the Natural Resources Conservation Service, 
Regulations for Implementing NEPA (40 CFR Parts 1500-1508) issued by the 
Council on Environmental Quality, and in Economic and Environmental 
Principles and Guidelines for Water and Related Land Resources 
Implementation Studies issued by the Water Resources Council. Watershed 
projects are to be planned and carried out in a way that will conform to 
conditions mandated by the above and other applicable laws, Executive 
orders, and codified rules.



Sec. 622.6  Equal opportunity.

    The Pub. L. 83-566 and Pub. L. 78-534 programs will be conducted in 
compliance with all requirements respecting nondiscrimination as 
contained in the Civil Rights Act of 1964, as amended, and in the 
regulations of the Secretary of Agriculture (7 CFR Part 15), which 
provide that no person in the United States shall, on the grounds of 
race, color, national origin, sex, age, handicap, or religion be 
excluded from participation in, be denied the benefits of, or be 
otherwise subjected to discrimination under any program or activity 
conducted or assisted by the Department of Agriculture.



Sec. 622.7  Notification under Executive Order 12372.

    This program is covered under Executive Order 12372, 
``Intergovernmental Review of Federal Programs'' and 7 CFR Part 3015, 
Subpart V, ``Intergovernmental Review of the Department of Agriculture 
Programs and Activities.'' State processes or directly affected State, 
areawide, regional and local officials and entities have 60 days for 
comment starting from the date of submission of the application to the 
State Single Point of Contact.



                        Subpart B--Qualifications



Sec. 622.10  Sponsors.

    (a) Watershed projects are sponsored by one or more local 
organizations

[[Page 609]]

qualifying as sponsors. All watershed plans shall be sponsored by 
entities legally organized under State law or by any Indian tribe or 
tribal organization having the authority to carry out, operate and 
maintain works of improvement. Those plans that incorporate the use of 
nonstructural or structural measures shall be sponsored by organizations 
that, individually or collectively, have:
    (1) The power of eminent domain,
    (2) The authority to levy taxes or use other adequate funding 
sources, including state, regional, or local appropriations, to finance 
their share of the project cost and all operation and maintenance costs.
    (b) To receive Federal assistance for project installation, sponsors 
must commit themselves to use their powers and authority to carry out 
and maintain the project as planned.



Sec. 622.11  Eligible watershed projects.

    (a) To be eligible for Federal assistance, a watershed project must:
    (1) Meet the definition of a watershed area as defined in NRCS's 
National Watersheds Manual.
    (2) Not exceed 250,000 acres in size.
    (3) Not include any single structure that provides more than 12,500 
acre-feet of floodwater detention capacity nor more than 25,000 acre-
feet of total capacity.
    (4) Have significant land or water management problems that can be 
solved or alleviated by measures for watershed protection, flood 
prevention, drainage, irrigation, recreation, fish and wildlife, 
municipal or industrial water supply, or other water management.
    (5) Produce substantial benefits to the general public, to 
communities, and to groups of landowners.
    (6) Cannot be installed by individual or collective landowners under 
alternative cost-sharing assistance.
    (7) Have strong local citizen and sponsor support through agreement 
to obtain land rights, contribute the local cost of construction, and 
carry out operation and maintenance.
    (b) Works and improvement that may be included in a watershed 
project are those that:
    (1) Contribute to reducing floodwater, erosion, and sediment 
damages.
    (2) Further the conservation, development, utilization, and disposal 
of water and the conservation and proper utilization of land.
    (3) Have the greatest net national economic benefits consistent with 
protecting the Nation's environment (for structural water resource 
projects) relative to alternative works, unless an exception is granted 
by the Secretary.



                    Subpart C--Application Procedure



Sec. 622.20  Application.

    Sponsors shall follow State developed procedures (based on Executive 
Order 12372) for coordination of proposed Federal financial assistance 
and also USDA's 7 CFR part 3015 in applying for Pub. L. 83-566 
assistance. Standard forms for Federal assistance or other approved 
forms may be obtained from NRCS State, area, or field offices. These 
forms should be submitted to the Single Point of Contact in accordance 
with the State developed procedures.



Sec. 622.21  State agency approval.

    The governor or designated State agency will approve or disapprove 
the application. If disapproved, no further action is required of NRCS. 
If approved or not disapproved within 45 days, the application shall be 
sent to the NRCS state conservationist. After the state conservationist 
has determined that the application is legally valid, he will notify the 
sponsor of receipt of the application. If found not legally valid, the 
state conservationist will return it to the originator with an opinion.



                           Subpart D--Planning



Sec. 622.30  General.

    (a) Watershed projects are to be planned and carried out in a way 
that will (1) minimize all adverse impacts, and (2) mitigate unavoidable 
losses to the maximum practicable degree. Projects must comply with the 
requirements of the National Environmental Policy Act of 1969 (Pub. L. 
91-190, 83 Stat. 852) (42 U.S.C. 4321 et seq.).
    (b) Fish and Wildlife enhancement measures proposed by Federal or 
State

[[Page 610]]

fish and wildlife agencies will be included if they are technically and 
economically feasible and are acceptable to the sponsors and the NRCS. 
If additional sponsors are needed to carry out the recommended fish and 
wildlife measures, NRCS will assist fish and wildlife agencies in 
attempting to obtain such sponsors.
    (c) All planning efforts by NRCS and the sponsors must include well 
publicized public meetings to obtain public input and views on the 
project.



Sec. 622.31  Basic planning efforts.

    Upon receipt of an application, the NRCS will make any necessary 
field studies and develop a report to justify the need for planning 
effort. Once planning is authorized by the Chief of NRCS, a watershed 
plan-environmental impact statement (plan-EIS) or a watershed plan-
environmental assessment (plan-EA) will be prepared by NRCS to request 
funding. This effort must be coordinated with other State and Federal 
agencies.



Sec. 622.32  Reviews and approvals.

    (a) The watershed plan-environmental impact statement (or 
assessment) will be subject to internal technical reviews, sponsor and 
other local party review, interagency review by other Federal, state, 
and concerned groups, and a final review as stated in NRCS's National 
Watersheds Manual.
    (b) After thorough review by NRCS and other agencies, the NRCS and 
the sponsors shall accept the plan-EIS or plan-EA by signing the 
watershed agreement. The watershed plan must be approved by the 
Committees of Congress or the Chief of NRCS. Funding for installation 
can then be granted by the Chief of NRCS.



PART 623--EMERGENCY WETLANDS RESERVE PROGRAM--Table of Contents




Sec.
623.1  Purpose and scope.
623.2  Definitions.
623.3  Eligible person.
623.4  Eligible land.
623.5  Ineligible land.
623.6  Transfer of lands from the CRP to the EWRP.
623.7  Terms of the easement.
623.8  Easement value.
623.9  Easement priority.
623.10  Application to participate.
623.11  Obligations of the landowner.
623.12  Payments to landowners by NRCS.
623.13  Wetland Reserve Plan of Operations.
623.14  Easement modifications.
623.15  Transfer of land.
623.16  Monitoring and enforcement of easement terms and conditions.
623.17  Violations and Remedies.
623.18  Access to land.
623.19  Assignments.
623.20  Appeals.
623.21  Scheme and device.
623.22  Filing of false claims.

    Authority: 16 U.S.C. 3837-3837f; Pub. L. 103-75, Chapter 1, 107 
Stat. 739, 742.

    Source: 58 FR 62497, Nov. 29, 1993, unless otherwise noted.



Sec. 623.1  Purpose and scope.

    (a) The regulations in this part set forth the policies, procedures, 
and requirements for the Emergency Wetlands Reserve Program (EWRP). 
Under the EWRP, NRCS will make offers to purchase wetland conservation 
easements from persons owning croplands that were damaged by the 1993 
Midwest floods if those lands have the potential for restoration to 
wetland conditions and if the owner voluntarily agrees to restore and 
maintain those conditions. The easements are to be purchased to promote 
the restoration and maintenance of wetland characteristics, such as 
hydrologic conditions of inundation or saturation of the soil and 
hydrophytic vegetation. The functions and values of the wetlands for 
wildlife habitat, water quality improvement, flood water retention, 
floodway enhancement, ground water recharge, open space, aesthetic 
values, and environmental education will thus be promoted. The wetland 
conservation easements will permanently prohibit use of the affected 
land as cropland. Additionally, the easement shall require permanent 
maintenance of the wetland conditions, except in the case of natural 
disaster.
    (b) The EWRP is available only in the following States: Illinois, 
Iowa, Kansas, Minnesota, Missouri, Nebraska, South Dakota, and 
Wisconsin. Certain cropland areas within these States have been 
determined to have been inundated by the Midwest floods of 1993. As more 
fully defined and described in

[[Page 611]]

this part, eligible land may include farmed wetlands or prior converted 
wetlands (wetlands converted prior to December 23, 1985), together with 
adjacent lands on which the wetlands are functionally dependent so long 
as the likelihood of successful restoration of such land and the 
potential wetland values merit inclusion in the program with reasonable 
costs.



Sec. 623.2  Definitions.

    The following definitions shall be applicable for the purposes of 
this part:
    (a) Agricultural commodity--means any crop planted and produced by 
annual tilling of the soil, or on an annual basis by one trip planters, 
or alfalfa and other multiyear grasses and legumes in rotation as 
approved by the Secretary. For purposes of determining crop history, as 
relevant to eligibility to enroll land in the program, land shall be 
``considered planted to an agricultural commodity'' during a crop year 
if, as determined by ASCS, as action of the Secretary prevented land 
from being planted to the commodity during the crop year.
    (b) Applicant--means a person who submits to NRCS an application to 
participate in the EWRP.
    (c) Commodity Credit Corporation--a wholly owned government 
corporation within the U.S. Department of Agriculture.
    (d) Conservation District (CD)--means a subdivision of a State or 
local government organized pursuant to applicable State law to promote 
soil and water conservation practices.
    (e) Conservation Reserve Program--means the program under which 
long-term payments and cost-share assistance is provided to individuals 
to establish permanent vegetative cover on cropland that is highly 
erodible or environmentally sensitive.
    (f) Prior converted wetland--means wetland that has been drained, 
dredged, filled, leveled, or otherwise manipulated (including any 
activity that results in impairing or reducing the flow, circulation, or 
reach of water) prior to December 23, 1985, for the purpose, or that has 
the effect, of making the production of agricultural commodities 
possible if such production would not have been possible but for such 
action.
    (g) Cost-share payment--means the payment made by NRCS to assist 
program participants in establishing the practices required in a WRPO.
    (h) Chief--means the Chief of the Natural Resources Conservation 
Service, or the Chief's designee.
    (i) Easement--means the real property interest acquired by NRCS 
under this part for wetland restoration and maintenance and which is 
properly filed with the appropriate local or State government official.
    (j) Easement area--means the land to which the approved wetland 
restoration practices and wetland conservation restrictions are to be 
applied.
    (k) Fair market value (FMV)--means the price that a willing seller 
would accept and a willing buyer would pay in an open, informed 
transaction.
    (l) Farmed wetland--means wetland that was drained, dredged, filled, 
or otherwise manipulated prior to December 23, 1985 to the extent that 
the production of agricultural commodities was made possible, but which 
continues to meet wetland criteria [refer to 7 CFR 12.32(a)(3) for 
descriptions of farmed wetlands].
    (m) Floodwater control systems--means dikes, levees, or other 
similar structural measures for the protection of cropland from 
flooding.
    (n) FWS--means the Fish and Wildlife Service of the United States 
Department of the Interior.
    (o) Local NRCS office--means the office of the Natural Resources 
Conservation Service serving the county or combination of counties in 
which the landowner's farm or ranch is located.
    (p) Participant--means a person(s) owning land subject to a 
perfected easement purchased by the Natural Resources Conservation 
Service under this part.
    (q) Offer--means the total payment NRCS will make to a landowner to 
purchase an easement.
    (r) Permanent easement--means an easement in perpetuity.
    (s) Substantially altered lands--means lands which have not been and 
are not now wetlands but could likely develop wetland characteristics in 
the future,

[[Page 612]]

as a result of the Midwest floods of 1993.
    (t) Practice--means the wetland and easement area development 
restoration measures agreed to in the WRPO to accomplish the desired 
program objectives.
    (u) Technical assistance--means the assistance provided to land 
owners to facilitate implementation of the WRPO.
    (v) Wetland--means land that (1) has a predominance of hydric soils; 
(2) is inundated or saturated by surface or groundwater at a frequency 
and duration sufficient to support a prevalence of hydrophytic 
vegetation typically adapted for life in saturated soil conditions; and 
(3) does support a prevalence of such vegetation under normal 
circumstances.



Sec. 623.3  Eligible person.

    To be eligible to participate in the EWRP, a person must be the 
owner of eligible land for which enrollment is sought and must have been 
the owner of such land for at least the preceding 12 months prior to the 
time the enrollment offer is declared by NRCS, as provided in this part. 
The person shall provide to NRCS adequate proof of ownership of the 
land. NRCS may waive the 12 month ownership requirement if:
    (a) The land was acquired by will or succession as a result of the 
death of the previous owner; or
    (b) Adequate assurances have been presented that the new owner of 
such land did not acquire such land for the purpose of placing it in the 
EWRP.



Sec. 623.4  Eligible land.

    (a) Except as otherwise provided in this section, land is eligible 
for enrollment in the EWRP only if NRCS determines that the land:
    (1) Was inundated by the Midwest floods of 1993;
    (2) If restored to productive condition, would have a fair market 
value that is less than the estimated costs of restoring the land to 
productive condition and repairing related floodwater control systems;
    (3) Is likely to have its wetland value restored with minimal costs; 
and
    (4) Is wetland farmed under natural conditions, a farmed wetland or 
prior converted wetland, or substantially altered lands which are 
cropland; or
    (5) Is wetland that has been restored on the land under a CRP 
contract, or under a Federal or State wetland restoration program with 
an easement for a period of less than 30 years.
    (b) To be eligible for enrollment in the EWRP, land must also:
    (1) Be determined by ASCS to have been annually planted or 
considered planted to an agricultural commodity in at least 1 of the 5 
previous crop years; or
    (2) Be land under a CRP contract, in which case, the land need only 
to have been planted to an agricultural commodity during 2 of the 1981 
through 1985 crop years.
    (c) Other lands may be considered eligible if the inclusion of such 
lands in the EWRP easement would significantly add to the functions and 
values of the wetlands to be restored under this part, as determined by 
NRCS.
    (d) The criteria and procedures contained in 7 CFR part 12 will be 
used to identify wetlands, converted wetlands, and farmed wetlands.



Sec. 623.5  Ineligible land.

    Notwithstanding any other provisions of this part, the following 
land is not eligible for enrollment in the EWRP:
    (a) Land that contains either timber stands or trees established in 
connection with a CRP contract;
    (b) Lands owned or acquired by an agency of the Federal Government;
    (c) Land already subject to a deed restriction prohibiting the 
production of agricultural commodities or the alternation of existing 
wetland hydrologic conditions;
    (d) Land located between the pre-flood mainstem levees and the 
river; or
    (e) Land that was restored to wetland conditions, as required under 
Part 12 of this title, to mitigate the conversion of wetland to cropland 
use.



Sec. 623.6  Transfer of lands from the CRP to the EWRP.

    Land that is subject to an existing CRP contract administered under 
7 CFR parts 704 and 1410 may be transferred into the EWRP only if:

[[Page 613]]

    (a) The land and landowner(s) meet the requirements of this part; 
and
    (b) The application for transfer into the EWRP is approved by 
Commodity Credit Corporation (CCC), if found to be in the interest of 
the program. If such transfer is requested by the owner and approved by 
CCC, the CRP contract for the property will be terminated or otherwise 
modified subject to such terms and conditions as are mutually agreed by 
the landowner, CCC, and NRCS.



Sec. 623.7  Terms of the easement.

    Landowners will grant to NRCS an easement which shall run with the 
land and be in favor of NRCS and its assigns or delegates. The easement 
shall require the land to be monitored as specified by the WRPO to 
promote the purposes of this part, including but not limited to 
maintenance of the restored wetland for entire length of the easement. 
Such easement shall: (a) be a permanent reserve interest easement; (b) 
require that the maintenance of the land be in accordance with the terms 
of the easement and with the terms of the WRPO and shall be the 
responsibility of the owners of the property and their successors of any 
kind, including, but not limited to, the owners' heirs and assigns; (c) 
grant to NRCS a right of access in favor of NRCS and its delegates, 
assigns and successors of any kind, to the portion of the property which 
is subject to the provisions of the easement. Maintenance of such access 
shall be the responsibility of the owner and their successors of any 
kind; (d) reserve to NRCS the right to permit such compatible uses of 
the easement area as may be identified in the WRPO; (e) reserve to the 
landowner those compatible uses identified in the WRPO that are 
permitted to be pursued by the landowner; (f) be signed by each person 
with an interest of any kind in the land covered by the easement; (g) 
permanently prohibit use of the easement area for cropland, except to 
harvest an agricultural commodity planted before the easement is 
perfected; and (h) require permanent maintenance of the wetland 
conditions, except in the case of natural disaster.



Sec. 623.8  Easement value.

    NRCS offers for easements will be based on the fair market value, as 
determined by the NRCS State Conservationist, of the land covered by the 
easements. Fair market value will be based on post-flood conditions as 
if reclaimed. Land easement values will be determined by the State 
Conservationist in consultation with a technical committee. A technical 
committee shall included representatives of: ASCS, Extension Service, 
and FWS. Additionally, the State Conservationist may collect information 
from other sources as he deems necessary. Coordination between States 
will be provided by the Chief, NRCS.



Sec. 623.9  Easement priority.

    The State Conservationist, in consultation with the FWS and with 
input from a technical committee and other interested Federal agencies, 
will establish a ranking process to establish the priority of parcels 
offered into the EWRP. This process will rank the floodway enhancement 
and environmental benefits per dollar of government expenditure on 
restoration and easement purchase. The factors for determining the 
priority for selection will consider the following:
    (a) Protection and enhancement of habitat for migratory birds and 
wildlife, including the contribution the restoration may make to the 
recovery of threatened and endangered species,
    (b) Floodway expansion,
    (c) Proximity to other protected wetlands,
    (d) Level of hydrology restored,
    (e) Wetland function or values,
    (f) Likelihood of successful restoration of wetland values,
    (g) Cost of restoration and easement purchase, and
    (h) Other factors as determined appropriate by NRCS.



Sec. 623.10  Application to participate.

    (a) A person seeking to enroll land in the EWRP must apply for 
enrollment on an approved NRCS form. The application to participate must 
be filed with the local NRCS field office during an announced period for 
such submissions.

[[Page 614]]

    (b) A person submitting an application to participate shall not be 
obligated to accept an NRCS offer to purchase an easement if one is 
forthcoming.
    (c) An application to participate must be signed by all owners of 
the property or their duly authorized representative(s).



Sec. 623.11  Obligations of the landowner.

    (a) All owners of land who accept an EWRP offer from NRCS shall:
    (1) Comply with the terms of the easement.
    (2) Comply with all terms and conditions of the WRPO for the full 
life of the easement.
    (3) Ensure that the easement granted to NRCS is superior to the 
interest of all other parties who may have an interest in the easement 
area, except as authorized by NRCS. Such action shall include, but not 
be limited to, obtaining a written statement of consent to such a 
superior easement from those holding a security interest or any other 
encumbrance or the land covered by the easement. Additionally, the 
landowner shall perfect the easement with superior NRCS interest in 
accordance with State law.
    (4) Agree to the permanent retirement of the aggregate total of crop 
acreage bases, and allotment and mandatory quota on the farm or ranch in 
order to maintain the base allotment on quota acres at or below the 
number of acres of cropland after the easement has been perfected.
    (5) Not allow grazing or commercial use of the land covered by an 
easement except as provided for in the WRPO, or harvesting of any 
agricultural commodity produced on the land subject to the EWRP 
easement.
    (6) Comply with Federal or State noxious week laws in the manner 
specified in the WRPO.
    (7) Control other identified weed and pest species, in the manner 
specified in the WRPO.
    (8) Be responsible for repairs, improvements, and inspections of the 
WRPO practices as necessary to maintain existing public drainage systems 
when the land is restored to the condition required by the terms of the 
easement, the contract, and the easement.
    (9) Be permitted to control public access, in accordance with the 
WRPO, on the land enrolled in the program.
    (10) Implement any additional provisions that are required by NRCS 
in consultation with FWS in the contract, WRPO, or easement, in order 
to, as determined by NRCS, facilitate the administration of the EWRP.
    (11) Not alter the vegetation, except to harvest already planted 
crops or forage, or hydrology on such acres subsequent to perfection of 
the easement by the landowner, except as provided for in the easement or 
WRPO.
    (12) Be responsible for the long-term management of the easement in 
accordance with the terms of the easement and related agreements 
including the WRPO. Owners may enter into agreements with Federal or 
State agencies or private organizations to assist in the management of 
the easement area. No NRCS funds will be provided to these agencies or 
organizations for management expenses. Responsibility for management of 
the easement shall in all cases remain with the owner and the owner's 
successors of any kind regardless of whether arrangements are made for 
third-party management.
    (13) Agree that each person with an interest in the land covered by 
an easement under EWRP shall be jointly and severally responsible for 
compliance with the WRPO, the easement, the provisions of this part, and 
for any refunds or payment adjustment which may be required for 
violation of any terms or conditions of the WRPO, the easement, or 
provisions of this part.
    (14) Refrain from taking any action on the easement area unless 
specifically authorized in the reserve interest easement or the WRPO; 
and
    (15) Secure any necessary local, State and Federal permits prior to 
commencing restoration of the designated area.
    (b) In addition, program participants and their successors of any 
kind may:
    (1) Not alter wildlife habitat and other natural land features of 
the enrolled land unless authorized by the WRPO.
    (2) Apply pesticides or fertilizers on enrolled land or mow such 
land, only as provided for in the WRPO.

[[Page 615]]

    (3) Not engage in any activities on other land on the farm on which 
the easement exists that will, as determined by NRCS; (i) alter the flow 
of surface or subsurface water into or out of the easement area except 
as specified in the WRPO; or (ii) be otherwise inconsistent with the 
terms of the easement.
    (c) The activities of any person on the property shall be considered 
for purposes of this section to be the actions of the program 
participant. However, if the NRCS determines that the activities of the 
person were beyond the control of the program participants, NRCS may 
adjust the remedies provided for in this part to the extent determined 
consistent with program goals. Obligations created by the easement shall 
run with the land and shall bind all persons having an interest in the 
property at any time whether such interest is created by death of the 
owner, sale, assignment, or otherwise.



Sec. 623.12  Payments to landowners by NRCS.

    (a) NRCS will share the cost with landowners of rehabilitating the 
enrolled land in the EWRP as provided in the WRPO. The amount of the 
cost-share assistance shall be specified in the contract. Eligible costs 
for such cost-share assistance by NRCS shall only include those costs 
which NRCS determines are appropriate and shall be subject to the 
following restrictions:
    (1) The State Conservationist will establish cost-share rates of 
between 75 to 100 percent of the historical cost of establishing or 
installing the practices specified in the WRPO; or pay the average cost 
of establishing the practices specified in the WRPO, based on the 
historical cost of establishing the practices in the State;
    (2) Cost-share payments may be made only upon a determination that 
an approved practice or an identifiable unit of the practice has been 
completed in compliance with NRCS approved standards and specifications; 
and
    (3) Cost-share payments may not be made for the maintenance of the 
practice except as specifically permitted in writing by the State 
Conservationist.
    (b) Notwithstanding paragraph (a)(3) of this section, cost share 
payments may be authorized for the replacement or restoration of 
practices for which cost share assistance has been previously allowed 
under the EWRP, but only if:
    (1) Replacement or restoration of the practice is needed to meet the 
objectives for which the easement was established; and
    (2) The failure of the original practice was due to reasons beyond 
the control of the participant.
    (c)(1) NRCS shall pay the amount agreed upon by NRCS and the 
landowner for the purchase of the easement in a lump-sum amount after 
the easement is perfected in compliance with State law, except in the 
case of paragraph (c)(2) of this section.
    (2) For all easements, NRCS shall pay no more than 75 percent of the 
total easement price pending completion of the practices to restore the 
wetlands as provided under the WRPO. The remaining amount shall be paid 
when NRCS determines the restoration is complete.
    (d) After an easement is perfected, NRCS will reimburse landowners 
for fair and reasonable expenses incurred for title searches, filing 
expenses, and related costs, as determined by NRCS.



Sec. 623.13  Wetlands reserve plan of operations.

    (a) After NRCS has accepted the applicant for enrollment in the 
program, a WRPO will be developed by the landowner and NRCS, in 
consultation with FWS.
    (b) The WRPO shall:
    (1) Include an aerial photo displaying the land offered for 
enrollment;
    (2) Specify the manner in which the eligible land shall be restored, 
operated, and maintained to accomplish the goal of the program, 
including, but not limited to: (i) measures to control noxious weeds and 
insect pests in order to comply with applicable Federal, or State 
noxious weed and pest control laws; and (ii) measures to control other 
specified species of weeds, insects or pests;
    (3) Specify compatible land uses for personal enjoyment for which 
the landowner may be compensated. These compatible land uses shall be 
reserved to the landowner in the easement. Such uses may include, among 
others:

[[Page 616]]

(1) recreational use, hunting and fishing; (ii) manage timber production 
including harvesting; and (iii) managed haying or grazing consistent 
with the goals of the program;
    (4) Set out cost estimates of the practices required by the WRPO, 
the offer for the easement, and other reimbursement costs;
    (5) Identify access routes to be maintained for wetland restoration 
activities and future management and easement monitoring in connection 
with the land to be enrolled;
    (6) Make provisions deemed necessary for maintaining public drainage 
systems if present on lands subject to the WRPO;
    (7) Contain scheduled implementation dates for restoration 
practices;
    (8) Contain other provisions or limitations as NRCS, in consultation 
with the FWS, determines to be necessary.
    (c) NRCS in consultation with FWS will collect from State or Federal 
agencies whatever additional information is deemed necessary for the 
development of the WRPO with the landowner.
    (d) The WRPO must be signed by NRCS, FWS, Conservation District 
(CD), and the landowner(s). However, if agreement between NRCS and FWS, 
or CD at the local level is not reached within 20 calendar days, the 
WRPO shall be developed by the State Conservationist of NRCS in 
consultation with FWS or CD.
    (e) The WRPO may require that a temporary vegetative or water cover 
be established on the property if immediate establishment of a permanent 
cover is not practicable or otherwise desirable.
    (f) The terms of an approved WRPO shall not relieve the program 
participant of any obligation or term imposed or provided for in the 
contract, the easement, or this part.
    (g) WRPO, where appropriate, will provide for the development of a 
tree planting plan with the assistance of the FS or State forestry 
agency.
    (h) The WRPO, where appropriate, will provide for the development by 
NRCS of detailed plans for weed control, structural measures and their 
operation, vegetation establishment and management, and other measures 
as needed.
    (i) Revisions of the WRPO to enhance or protect the value for which 
the easement was established may be made at any time at the request of 
either NRCS, FWS, the owner and upon the concurrence of all three 
parties.



Sec. 623.14  Easement modifications.

    After the easement has been perfected, no change will be made in the 
easement without a written request by the participant and the written 
consent of the Chief. Approval may be granted to achieve the goals of 
EWRP or facilitate the practical administration and management of the 
easement area or the program and the approval will not adversely affect 
the functions and values for which the easement was established. A 
modified easement shall be perfected in accordance with State law and 
NRCS superior interest shall be reserved by the landowner in accordance 
with Secs. 623.7 and 623.11(a)(3).



Sec. 623.15  Transfer of land.

    (a) If a new owner purchases or obtains the right and interest in, 
or right to occupancy of, the land subject to a EWRP easement, such new 
owner shall be subject to the terms and conditions of the easement. The 
participant who is the signatory to the easement shall be entitled to 
receive all remaining payments, if any, for the purchase of the 
easement. Eligible cost-share payments shall be made to the 
participants. with respect to costs actually incurred.
    (b) Upon the transfer of the property subject to an EWRP easement, 
any remaining cost-share payments shall be paid to the new owner or 
purchaser only if the new owner or purchaser becomes a party to the WRPO 
within 60 days of the perfection of the deed transferring title to the 
new owner. Such payments shall be paid in the manner agreed to by the 
participant and the buyer. The new owner or purchaser shall be 
responsible for assuring completion of all measures and practices 
required by the contract and the WRPO.
    (c) Any transfer of the property prior to the perfection of the 
easement shall void any NRCS offer or WRPO unless

[[Page 617]]

the new owner agrees to accept the offer within 60 days of the 
perfection of the deed transferring the land to the new owner.



Sec. 623.16  Monitoring and enforcement of easement terms and conditions.

    (a) NRCS or its representative shall be permitted to inspect each 
easement area at any and all times determined necessary by NRCS to 
ensure that:
    (1) Structural and vegetative restoration work are properly 
maintained;
    (2) The wetlands and adjacent upland habitat of the easement area is 
being managed as required in the WRPO and the terms of the easement; and
    (3) Uses of the area are consistent with the terms and conditions of 
the easement and the WRPO.
    (b) If an owner or other interested party is unwilling to 
voluntarily correct, in a timely manner, deficiencies in compliance with 
the terms of the WRPO, the EWRP easement, or any related agreements, 
NRCS may at the expense of any person who is subject to the EWRP 
easement correct such deficiency. Such NRCS action shall be in addition 
to other remedies available to NRCS.
    (c) Monitoring and enforcement responsibilities may be delegated by 
NRCS at any time to other Federal or State agencies. Landowners may 
transfer management responsibilities only to Federal, State, or local 
agencies or private organizations that have been approved by NRCS in 
advance as having the appropriate authority, expertise, and resources 
necessary to carry out such delegated responsibilities.



Sec. 623.17  Violations and remedies.

    (a) If a violation of the terms and conditions of the contract, the 
WRPO, or the recorded EWRP easement occurs, the easement shall remain in 
force and NRCS may:
    (1) Require the owner to fully restore the easement area to fulfill 
the terms and conditions of the easement and WRPO; and
    (2) Require the owner, who received payments from NRCS for any 
purpose under this part, to refund all or part of such payments received 
together with interest, as determined appropriate by NRCS.
    (b) If an owner fails to carry out the terms and conditions of an 
easement, appropriate legal action may be initiated. The owner of the 
property shall reimburse NRCS for all costs incurred including, but not 
limited to, legal fees.



Sec. 623.18  Access to land.

    In order to determine eligibility and compliance with respect to 
this part, representatives of the Department, or designee thereof, shall 
have the right of access to:
    (a) Land which is the subject of an application made in accordance 
with this part,
    (b) Land which is subject to an easement made in accordance with 
this part, and
    (c) Records of the participant showing status of all ownership 
interest in lands subject to this part.



Sec. 623.19  Assignments.

    Any participant entitled to any cash payment under this program may 
assign the right to receive such cash payments, in whole or in part.



Sec. 623.20  Appeals.

    A participant in the EWRP may obtain a review of any administrative 
determination concerning land eligibility, development of a WRPO, or any 
adverse determination under this part in accordance with the 
administrative appeal regulations provided in part 614 of this title.

[60 FR 67316, Dec. 29, 1995]



Sec. 623.21  Scheme and device.

    (a) If it is determined by NRCS that a landowner has employed a 
scheme or device to defeat the purposes of this part, any part of any 
program payment otherwise due or paid such landowner during the 
applicable period may be withheld or be required to be refunded with 
interest thereon, as determined appropriate by NRCS, and the contract 
with the landowner may be terminated. In such a case, NRCS may also 
continue to hold the easement interest acquired under this part.
    (b) A scheme or device includes, but is not limited to, coercion, 
fraud, misrepresentation, depriving any other

[[Page 618]]

person of payments for cost-share practices or easements for the purpose 
of obtaining a payment to which a person would otherwise not be 
entitled.
    (c) An owner of land subject to this part who succeeds to the 
responsibilities under this part shall report in writing to NRCS any 
interest of any kind in the land subject to this part that is retained 
by a previous participant. Such interest includes a present, future or 
conditional interest, reversionary interest or any option, future or 
present, with respect to such land and any interest of any lender in 
such land where the lender has, will, or can obtain, a right of 
occupancy to such land or an interest in the equity in such land other 
than an interest in the appreciation in the value of such land occurring 
after the loan was made. A failure of full disclosure will be considered 
a scheme or device under this section.



Sec. 623.22  Filing of false claims.

    If it is determined by NRCS that any participant has knowingly 
supplied false information or has knowingly filed a false claim, such 
participant shall be ineligible for any payment under this part. False 
information or false claims include claims for payment for practices 
which do not meet the specifications of the applicable WRPO. Any amounts 
paid under these circumstances shall be refunded, together with interest 
as determined by NRCS, and any amounts otherwise due such participant 
shall be withheld.



PART 624--EMERGENCY WATERSHED PROTECTION--Table of Contents




Sec.
624.1  Purpose.
624.2  Objective.
624.3  Scope.
624.4  Administration.
624.5  Eligible emergencies, recipients, and assistance.
624.6  Eligible measures.
624.7  Limitations on use of emergency funds.
624.8  Environment.
624.9  Application.
624.10  Investigation and request for funds.

    Authority: Sec. 216, Pub. L. 81-516, 33 U.S.C. 701b-1; and sec. 403, 
Pub. L. 95-334, 16 U.S.C. 2203, 5 U.S.C. 301.

    Source: 46 FR 56577, Nov. 17, 1981, unless otherwise noted.



Sec. 624.1  Purpose.

    This part sets forth the requirements and procedures for Federal 
assistance administered by the Natural Resources Conservation Service 
(NRCS) under section 216, Pub. L. 81-516 and section 403 of Title IV of 
the Agricultural Credit Act of 1978, Pub. L. 95-334.



Sec. 624.2  Objective.

    The objective of the Emergency Watershed Protection (EWP) program is 
to assist in relieving imminent hazards to life and property from floods 
and the products of erosion created by natural disasters that cause a 
sudden impairment of a watershed.



Sec. 624.3  Scope.

    (a) Authorized EWP technical and financial assistance may be made 
available when an emergency exists. Emergency water shed protection 
consists of emergency measures for runoff retardation and soil erosion 
prevention as needed to reduce hazards to life and property from floods, 
drought, and the products of erosion on any watershed imparied by a 
natural disaster.
    (b) Technical assistance includes engineering and other technical 
expertise necessary for planning and installing emergency measures. 
Emergency watershed protection is authorized in the 50 States, the 
District of Columbia, the Commonwealth of Puerto Rico, and the U.S. 
Virgin Islands.



Sec. 624.4  Administration.

    NRCS shall provide overall administrative directive and guidance for 
EWP. NRCS will transfer funds to the Forest Service (FS) of the U.S. 
Department of Agriculture (USDA) at the national level for work to be 
installed by FS or its cooperators. Under general program criteria and 
procedures established by NRCS, FS is responsible for administering EWP 
measures on National Forests and National Grasslands. FS is also 
responsible for emergency measures on all forested lands or rangelands 
within the National Forests, on adjacent rangelands that are 
administered under formal agreement with FS, and on other forest lands. 
On

[[Page 619]]

these lands, emergency work is done by either NRCS or FS as mutually 
agreed. In carrying out their responsibilities, FS and NRCS work 
cooperatively with other Federal, State, and local government agencies.



Sec. 624.5  Eligible emergencies, recipients, and assistance.

    (a) Conditions of eligibility. Emergency watershed protection 
assistance is made available when the following conditions of 
eligibility are determined to exist by the state conservationist. 
Procedures for providing emergency assistance vary according to whether 
the watershed emergency constitutes an exigency or a nonexigency 
situation. Emergency measures for both types of situations are those 
undertaken to remove or reduce hazards created by the disaster to 
safeguard life and property from flooding, drought, or the products of 
erosion.
    (1) Watershed emergency. A watershed emergency exists when a natural 
occurrence causes a sudden impairment of a watershed that creates an 
imminent threat to life or property. To be eligible for assistance, the 
imminent threat to life or property must significantly exceed that which 
existed before the impairment.
    (i) Natural occurrence includes but is not limited to floods, fires, 
windstorms, earthquakes, volcanic actions, and drought.
    (ii) A watershed impairment exists when the ability of a watershed 
to carry out its natural functions is reduced to the extent of creating 
an imminent threat to life or property.
    (iii) A sudden watershed impairment results from a single natural 
occurrence or a short-term combination of occurrences. Watershed 
impairments resulting from long-term combinations or series of natural 
or other occurrences are not considered sudden watershed impairments.
    (iv) Exigency and nonexigency situations. Watershed emergencies are 
classified as either exigency or nonexigency situations.
    (A) An exigency exists when the near-term probability of damage to 
life or property is high enough to demand immediate Federal action. An 
exigency continues to exist as long as the probability of damage 
continues at a high enough level.
    (B) A nonexigency situation exists when the near-term probability of 
damage to life or property is high enought to constitute an emergency 
but not sufficiently high to be considered an exigency. A nonexigency 
situation continues to exist as long as the probability of damage 
remains high enough to be considered an emergency.
    (v) Changes in emergency situations. Changes in the near-term 
probability of threat to life or property will be reflected by changes 
in the classification of emergencies. As the near-term probability that 
the threats will be realized is reduced because of emergency assistance 
or other factors, exigency and nonexigency situations will be 
appropriately reclassified. Similarly, as occurrences increase the 
probability of threats to life or property, situations previously 
considered nonemergencies will be appropriately reclassified as 
nonexigencies and previous nonexigency emergency situations will be 
appropriately reclassified as exigencies.
    (vi) Drought emergencies. Assistance is available in drought 
emergencies when the eligibility criteria specified in this rule are met 
and the Agricultural Stabilization and Conservation Service (ASCS) 
determines that a drought emergency exists under regulations promulgated 
to carry out sections 401 and 402 of the Agriculture Credit Act of 1978 
(Pub. L. 95-334).
    (b) Eligible recipients. Include those public or private landowners, 
land managers, land users, or others who--
    (1) Have a legal interest in or responsibility for the values 
threatened by a watershed emergency; and
    (2) Have exhausted or have insufficient funds or other resources 
available to provide adequate relief from the applicable hazards. 
Interested persons other than Federal agencies must be represented by a 
project sponsor. Project sponsors must:
    (i) Be a State or political subdivision of a State or a qualified 
Indian tribe or tribal organization;
    (ii) Have legal authority and agree to use such authority to obtain 
needed landrights, water rights, and permits; and

[[Page 620]]

    (iii) Agree to provide for the operation and maintenance of 
completed emergency measures.
    (c) Eligible assistance. (1) In an exigency--
    (i) Federal emergency funds may bear up to 100 percent of the 
construction costs of emergency measures.
    (ii) Funds must be obligated within 10 days after receipt of the 
emergency funds or after the date of the disaster event when conditions 
permit beginning construction activities, whichever is later.
    (iii) Emergency work must be completed within 30 days after funds 
are obligated.

The NRCS Chief retains discretion to grant extensions for good cause. 
Documentation must support requests for extensions. Extensions may 
extend an additional 10 days for the obligation of funds and an 
additional 30 days for the completion of work.
    (2) In a nonexigency--
    (i) Federal emergency funds may bear up to 80 percent of the 
construction costs for emergency measures.
    (ii) Funds must be obligated and construction completed within 220 
consecutive calendar days after the date of receipt of funds. Extensions 
are permitted at the discretion of the NRCS Chief if unforeseen or 
uncontrollable events cause delays. A request for such an extension must 
be documented.
    (3) Sponsors may provide their share of construction costs in the 
form of cash; inkind services such as labor, equipment, etc.; or a 
combination of cash and inkind services. Cost sharing is waived for 
measures to be installed on Federal lands such as national forests or 
national grasslands.

[46 FR 56577, Nov. 17, 1981, as amended at 48 FR 4448, Feb. 1, 1983]



Sec. 624.6  Eligible measures.

    (a) Eligibility. To be eligible for assistance a measure must--
    (1) Retard runoff, prevent flooding, or prevent soil erosion;
    (2) Reduce threats to life or property resulting from a watershed 
emergency;
    (3) Be economically and environmentally defensible and sound from an 
engineering standpoint;
    (4) Be limited to the minimum that will reduce applicable threats to 
a level not to exceed that which existed before the impairment of the 
watershed;
    (5) Yield beneficial effects to more than one individual except in 
an exigency; and
    (6) Conform to rules and regulations published by NRCS for complying 
with Executive Order 11990, Protection of Wetlands, and Executive Order 
11988, Floodplain Management.
    (b) Documentation. (1) When an exigency does not exist, the economic 
rationale of proposed measures must be submitted in appropriate detail 
with the request for funds. Generally, the expected value of imminent 
damages (amount of damages multiplied by the near-term probability of 
their occurrence) must exceed the cost of emergency measures. 
Information provided in the request for emergency funds to support 
economic defensibility of the measures must include but is not limited 
to--
    (i) Number and extent of values at risk because of the watershed 
impairment;
    (ii) Estimated damages to the values at risk if the threat is 
realized;
    (iii) Events that must occur for the threat to be realized and the 
estimated probability of their occurrence both individually and 
collectively; and
    (iv) Estimates of the nature, extent, and cost of emergency measures 
to be constructed to relieve the threat.
    (2) In nonexigency situations, the state conservationist shall also 
submit adequate information to substantiate the environmental 
defensibility the emergency measures proposed for installation. This 
must include but is not limited to--
    (i) Thorough descriptions of beneficial and adverse effects on 
environmental resources including fish and wildlife habitat;
    (ii) Descriptions of water quality and water conservation impacts as 
appropriate; and
    (iii) Analysis of effects on downstream water rights.

The Chief shall issue instructions as are necessary to determine the 
economic and environmental defensibility of measures proposed for 
installation consistent with this rule.
    (c) Implementation. (1) When planning emergency measures, emphasis 
should

[[Page 621]]

be placed on measures that are the least expensive and most 
environmentally sound. The measures are to be accomplished by using the 
least damaging construction techniques and equipment that will retain as 
much of the existing characteristics of the channel and riparian habitat 
as possible. Emergency measure construction practices may include but 
are not limited to such things as seasonal construction, minimum 
clearing, reshaping soil, limiting excavation to one bank (on 
alternating sides where appropriate), and prompt revegetation of 
disturbed areas.
    (2) Measures needed to offset adverse impacts should be planned for 
installation concurrent with installation of the emergency measures. If 
they cannot be installed then, plans should be included to ensure their 
installation within 30 days. Cost sharing for these measures is at the 
same rate as for the original emergency construction.
    (3) An EWP team consisting of NRCS personnel from the National 
Office and the technical service center shall determine the eligibility 
of all permanent, enduring, or long-life measures or practices proposed 
for construction. The team shall determine the need for funds before any 
commitments are made.
    (4) Where lands under jurisdiction of FS are involved, the team will 
be assisted by FS representatives of the National Office and area or 
regional offices. The team shall also be available, at the request of 
the state conservationists, regional foresters, and area directors, to 
help determine the eligibility of other EWP measures or practices and to 
assist with administrative details.

[46 FR 56577, Nov. 17, 1981, as amended at 48 FR 4448, Feb. 1, 1983]



Sec. 624.7  Limitations on use of emergency funds.

    Emergency watershed protection funds may not be used to:
    (a) Perform operation or maintenance (periodic work that is 
necessary to maintain the efficiency and effectiveness of a measure to 
perform as originally designed and installed).
    (b) Solve watershed problems that existed before the disaster.
    (c) Repair, rebuild, or maintain private or public transportation 
facilities, public utilities, or similar facilities.
    (d) Perform work on features of projects installed under the 
authority of Pub. L. 83-566, Pub. L. 78-534, Resource Conservation and 
Development, or measures installed by other Federal agencies. Exceptions 
may be made at the discretion of the Chief of NRCS.
    (e) Construct works that would adversely affect downstream water 
rights.
    (f) Make improvements to public or private property not essential to 
the reduction of threats caused by watershed improvement.
    (g) Perform any work not determined to be economically and 
environmentally defensible under the provisions of this rule.

[46 FR 56577, Nov. 17, 1981, as amended at 48 FR 4448, Feb. 1, 1983]



Sec. 624.8  Environment.

    Environmental aspects of emergency work are to be given careful 
consideration. A program environmental impact statement (EIS) for EWP 
work has been developed in compliance with section 102(2)(C) of the 
National Environmental Policy Act of 1969 (Pub. L. 91-190, 83 Stat. 852 
(42 U.S.C. 4321 et seq.)). An environmental evaluation is to be prepared 
for all nonexigency situations. State conservationists shall notify 
concerned area and field offices of the Fish and Wildlife Service, the 
Environmental Protection Agency, and, through existing coordination 
mechanisms of State clearinghouses, the State fish and game and other 
appropriate agencies of anticipated EWP work. They shall invite the 
assistance of these agencies in preparing the environmental evaluation 
and in planning and implementing the emergency work. Archeological, 
historical, or other special expertise needed is to be solicited from 
appropriate agencies and groups. Environmental and other considerations 
are to be integrated into emergency work by using an interagency and 
interdisciplinary planning approach.

[48 FR 4448, Feb. 1, 1983]

[[Page 622]]



Sec. 624.9  Application.

    Sponsors may apply to any NRCS office for EWP assistance. NRCS shall 
help sponsors prepare their applications. The NRCS offices are defined 
in part 600 of this chapter. Information supplied should include the 
nature, location, and scope of the problems and the assistance needed.



Sec. 624.10  Investigation and request for funds.

    (a) On receipt of an application for EWP, the State conservationist 
and regional forester or area director, where appropriate, shall 
immediately investigate the emergency situation to determine if EWP is 
applicable. In carrying out EWP work, State conservationists shall take 
into consideration two broad types or degrees of emergency situations:
    (1) An imminent situation of unusual urgency--and exigency--and (2) 
an emergency requiring action but of less urgency than an imminent 
situation. (See Sec. 624.5)
    (b) Prompt remedial action to eliminate an imminent threat to loss 
of life is to be provided when an exigency exists. The State 
conservationist shall notify Project Development and Maintenance and 
indicate the nature of the emergency and the estimated amount of funds 
needed. If funds are made available, the state conservationist may 
authorize actions necessary to remedy the emergency. The state 
conservationist shall confirm the situation in a memorandum to the Chief 
that explains the nature of the emergency, the location of the 
emergency, the kind of remedial work and funds needed, sponsors, 
description of potential damage, etc. In these situations, the 
memorandum from the State conservationist with its brief information 
constitutes the request for funds.
    (c) If an exigency does not exist but the impairment justifies 
emergency assistance, the state conservationist shall submit a request 
for funds to the Chief within 60 days after the disaster event. Neither 
NRCS nor FS may commit funds until notified by the National Office of 
the availability of funds.

[[Page 623]]



                   SUBCHAPTER D--LONG TERM CONTRACTING





PART 630--LONG TERM CONTRACTING--Table of Contents




    Authority: Pub. L. 75-430, 49 Stat. 1151 (16 U.S.C. 590d); Pub. L. 
84-1021, 70 Stat. 1115 (16 U.S.C. 590p(b); Pub. L. 91-118, 83 Stat. 194 
(16 U.S.C. 590d).



Sec. 630.1  Purpose.

    The purpose of this subchapter is to provide for programs to extend 
cost sharing and technical assistance through long term contracts to 
landowners and others for making land use changes and to install 
measures to conserve, develop, and utilize the soil, water, and related 
natural resources on their lands.

[40 FR 53370, Nov. 18, 1975]



PART 631--GREAT PLAINS CONSERVATION PROGRAM--Table of Contents




                      Subpart A--General Provisions

Sec.
631.1  Purpose.
631.2  Definitions.
631.3  Administration.
631.4  Program applicability.
631.5  Land user eligibility.
631.6  Land eligible for the program.
631.7  Conservation treatment eligible for cost sharing.
631.8  Cost-share rates.
631.9  Conservation plan.

                          Subpart B--Contracts

631.10  Contracts.
631.11  Conservation practice maintenance.
631.12  Cost-share payments.
631.13  Disputes and appeals for matters other than contract violations.
631.14  Contract violations.

                        Subpart C--Miscellaneous

631.20  Setoffs.
631.21  Compliance with regulatory measures.
631.22  Access to operating unit.
631.23  State conservationist's authority.

    Authority: 16 U.S.C. 590p(b).

    Source: 49 FR 11142, Mar. 27, 1984, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 631.1  Purpose.

    (a) The Great Plains Conservation Program (GPCP) is a special 
program targeted to the total conservation treatment of farm or ranch 
units with the most severe soil and water resources problems. The 
purpose of the program is to assist farm, ranch and other land users to 
make changes in their cropping systems and land uses which are needed to 
conserve, develop, protect, and utilize the soil and water resources of 
their lands. This purpose is achieved by controlling erosion, conserving 
water, and adjusting land use to mitigate climatic, soil, topographic, 
flood, saline and other natural hazards.
    (b) Program participation is voluntary and is carried out by 
applying a conservation plan encompassing an entire operating unit. A 
conservation plan is developed with the land user in consultation with 
the local conservation district and is used to establish a GPCP 
contract. This contract provides for cost sharing between the land user 
and the Secretary of Agriculture for applying needed land use 
adjustments and conservation treatment within a specified time schedule. 
The program is supplemental to, not a substitution for, other programs 
in the Great Plains area.



Sec. 631.2  Definitions.

    The terms defined shall have the following meaning in this part and 
in all contracts, forms, documents, instructions, and procedures in 
connection therewith, unless the contract or subject matter requires 
otherwise.
    Applicant. A land user who has requested in writing to participate 
in the GPCP.
    Area conservationist. The NRCS employee who is the supervisor with 
primary responsibility for quality control. This person serves as 
contracting officer if designated by the state conservationist.
    Chief. The Chief of the Natural Resources Conservation Service 
(NRCS), USDA.

[[Page 624]]

    Conservation district (CD). A conservation district, soil 
conservation district, soil and water conservation district, natural 
resource district, or similar legally constituted body with which the 
Secretary of Agriculture cooperates pursuant to the Soil Conservation 
and Domestic Allotment Act. The members of governing bodies of these 
organizations may be known as supervisors, directors, or commissioners.
    Conservation plan. A written record of the land user's decisions 
regarding planned land use and treatment, including estimates of extent 
and cost. The timing of applications for each practice and/or 
identifiable unit is scheduled in the conservation plan.
    Conservation practice. A specific treatment which is planned and 
applied according to NRCS standards and specifications as a part of a 
resource management system for land, water, and related resources.
    Contract. A legal document that binds both the participants and the 
federal government to carry out the terms and conditions of the 
conservation plan. The contract forms the basis for GPCP sharing the 
costs of implementing the conservation plan.
    Contracting officer. The NRCS employee authorized to sign GPCP 
contracts on behalf of NRCS.
    County program committee. A group of Federal, State, and local 
officials selected by the designated conservationist. The committee 
provides ideas to the designated conservationist regarding program 
development and interagency program coordination.
    Designated county. A county within a Great Plains state that the 
Chief has designated for participation.
    Designated conservationist. A district conservationist or other NRCS 
employee who the state conservationist has designated to be responsible 
for administration of the GPCP in a designated county.
    District conservationist. The NRCS employee assigned to direct and 
supervise NRCS activities in one or more conservation districts.
    Great Plains area. The area comprising those counties within the 
Great Plains states designated for GPCP participation.
    Great Plains states. Colorado, Kansas, Montana, Nebraska, New 
Mexico, North Dakota, Oklahoma, South Dakota, Texas, and Wyoming.
    Identifiable unit. A discernibly distinct component of a 
conservation practice.
    Land user. An individual, partnership, firm, joint-stock company, 
corporation, association, trust, estate, or other nonpublic legal entity 
having control of a unit of land. This definition includes two or more 
persons having a joint or common interest.
    Life span. The period of time specified in the contract and/or 
operation and maintenance agreement during which the resource management 
systems of component practices are to be maintained and used for the 
intended purpose. Most practices will have a useful life beyond the 
specified life span.
    Operation and maintenance agreement. A document signed by both the 
participant and the contracting officer outlining the operation and 
maintenance requirements for applied conservation treatment.
    Operating unit. A parcel or parcels of land, whether contiguous or 
noncontiguous, constituting a single management unit for agricultural 
purposes.
    Other land. Nonagricultural land on which erosion must be controlled 
to protect agricultural land and which can be covered by contract.
    Participant. A land user who is a party to a GPCP contract.
    Resource management system. A combination of conservation practices 
identified by the land or water use that, if installed, will protect or 
improve the soil or water resource base.
    Specifications. Minimum guantity or quality requirements established 
by NRCS to meet the standard for a specific conservation practice.
    State conservationist. The NRCS employee authorized to direct and 
supervise NRCS activities within the state.
    State program committee. A group of Federal, state, and local 
officials selected by the state conservationist. The committee provides 
ideas to the state conservationist regarding program development, 
coordination, general policies, and operating procedures of GPCP in the 
state.

[[Page 625]]

    Technical assistance. Guidance provided to land users regarding the 
use and treatment of soil, water, plant, animal, and related resources. 
This assistance may include conservation plan formulation, application, 
and maintenance and is usually confined to those activities which the 
recipient could not reasonably be expected to do without specialized 
assistance.
    Technical guide. A document containing detailed information on the 
conservation of soil, water, plant, animal, and related resources 
applicable specifically to the area for which it is prepared.



Sec. 631.3  Administration.

    (a) NRCS is responsible for the administration of the Great Plains 
Conservation Program (GPCP).
    (b) The program shall be carried out in close cooperation with 
interested Federal, state, and local government units and organizations. 
The program in designated counties shall be coordinated with the long-
range program of conservation districts operating in such counties and 
with other USDA activities.
    (c) Applicants who have USDA-Farmers Home Administration (FmHA) 
loans must furnish to NRCS satisfactory evidence that the conservation 
plan used as a basis for the GPCP contract is compatible with assistance 
provided by FmHA. Such evidence may consist of written acknowledgement 
by the authorized FmHA official that the GPCP conservation plan is 
compatible with the farm management plan prepared for FmHA program 
purposes.



Sec. 631.4  Program applicability.

    The program is applicable only to designated counties within the 
Great Plains states. County designation is a responsibility of the NRCS 
Chief.



Sec. 631.5  Land user eligibility.

    Any land user in a designated county may file an application for 
participation in the GPCP with the NRCS field office. A land user who 
develops an acceptable conservation plan in cooperation with NRCS and 
the conservation district that is in compliance with the terms and 
conditions of the program is eligible to sign a contract.



Sec. 631.6  Land eligible for the program.

    The program is applicable to: (a) Privately owned land, (b) 
nonfederally owned public land under private control for the contract 
period and included in the participant's operating unit, and (c) 
federally owned land, if installation of conservation practices would 
directly benefit nearby or adjoining privately owned land of persons who 
maintain and use the Federal land.



Sec. 631.7  Conservation treatment eligible for cost sharing.

    (a) The state conservationist, in consultation with the state 
program committee, shall select the resource management systems, 
conservation practices, or identifiable units eligible for GPCP cost 
sharing in the state.
    (b) The designated conservationist, in consultation with the county 
program committee, shall select from the state list the eligible 
conservation systems, practices, or identifiable units eligible for GPCP 
cost sharing in the county.



Sec. 631.8  Cost-share rates.

    (a) The Federal rate may not exceed 80 percent.
    (b) The maximum Federal rate (percentage) within each state for each 
practice or identifiable unit shall be established by the state 
conservationist.
    (c) The maximum rate (percentage) for each county is established by 
the designated conservationist not to exceed the state rate 
(percentage).
    (d) The rate (percentage) established by a state conservationist or 
a designated conservationist shall not exceed the amount necessary and 
appropriate to apply conservation treatment.



Sec. 631.9  Conservation plan.

    (a) An applicant is responsible for developing a conservation plan, 
in cooperation with the conservation district, that protects the 
resource base in a manner acceptable to NRCS. This plan will be used as 
a basis for developing a contract. Conservation treatment is to be 
planned and implemented as a resource management system.
    (b) The applicant decides how the land will be used and selects the 
resource management systems that will achieve the applicant's objectives 
and

[[Page 626]]

provide protection of soil, water, and related resources acceptable to 
NRCS. Eligible practices may be included in the conservation plan to 
enhance fish and wildlife and recreation resources, promote the economic 
use of land, and reduce or control agriculture-related pollution.
    (c) Technical assistance will be provided by NRCS, as needed by the 
land user. NRCS may utilize the services of private, local, state, and 
other Federal agencies in discharging its responsibilities for technical 
assistance.
    (d) Participants are responsible for accomplishing the conservation 
plan and may use all available sources of assistance, including other 
USDA programs that are consistent with the conservation plan.
    (e) All conservation practices scheduled in the conservation plan 
are to be carried out in accordance with the applicable NRCS technical 
guide.



                          Subpart B--Contracts



Sec. 631.10  Contracts.

    (a) To participate in the program, an applicant must enter into a 
contract agreeing to implement a conservation plan. All persons who 
control or share control of the operating unit for the proposed contract 
period must sign the contract or one person with power-of-attorney may 
sign the contract for all persons. The applicant must provide the 
contracting officer with satisfactory evidence of control of the 
operating unit for the life of the proposed contract.
    (b) Contracts may be entered into not later than September 30, 1991. 
The contract shall be for a period needed to establish the conservation 
treatment scheduled in the conservation plan and must extend at least 3 
years but not more than 10 years.
    (c) Contracts may be transferred or modified by mutual consent. The 
transferee assumes full responsibility for the contract including 
operation and maintenance of all land treatment installed under the 
contract. Also included are payments made under the contract to the 
participant or preceding participants before and after the transfer.
    (d) Contracts may be terminated by mutual consent or by NRCS for 
cause.



Sec. 631.11  Conservation practice maintenance.

    (a) Each participant is obligated to maintain the resource 
management systems or conservation practices applied under the contract 
for the duration of the contract. Practices installed before execution 
of the contract are to be maintained as specified in the contract.
    (b) If the life span of the practices or resource management systems 
extends beyond the period of the contract, state conservationists may 
make the operation and maintenance of those practices or systems a 
condition of the contract. The length of such operation and maintenance 
shall extend for the expected life span.



Sec. 631.12  Cost-share payments.

    (a) Federal cost sharing shall be adjusted so that the combined cost 
share by Federal and state government or subdivision of a state shall 
not exceed 100 percent of the cost.
    (b) Cost-share payments for completing resource management systems 
or a practice or an identifiable unit according to specifications will 
be made by NRCS as specified in the contract or as adjusted according to 
Sec. 631.12(a).



Sec. 631.13  Disputes and appeals for matters other than contract violations.

    Applicants or participants may appeal decisions regarding matters 
other than contract disputes under this part in accordance with part 614 
of this title.

[60 FR 67316, Dec. 29, 1995]



Sec. 631.14  Contract violations.

    Contract violations, determinations and appeals will be handled in 
accordance with the terms of the contract and attachments thereto. 
Violations involving fraud are to be handled in accordance with current 
USDA regulations.

[[Page 627]]



                        Subpart C--Miscellaneous



Sec. 631.20  Setoffs.

    (a) If any participant to whom compensation is payable under the 
program is indebted to U.S. Department of Agriculture (USDA), or any 
agency thereof, or is indebted to any other agency of the United States, 
and such indebtedness is listed on the county claim control record 
maintained in the office of the county ASC committee, the compensation 
due the participant shall be set off against the indebtedness. 
Indebtedness owing to USDA, or any agency thereof, shall be given first 
consideration. Setoffs made pursuant to this section shall not deprive 
the participant of any right to contest the justness of the indebtedness 
involved either by administrative appeal or by legal action.
    (b) Participants who are indebted to this program for any reason 
will be placed on the USDA claim control record promptly by the state 
conservationist after the participant has been given opportunity to pay 
the debt.



Sec. 631.21  Compliance with regulatory measures.

    Participants who carry out conservation practices shall be 
responsible for obtaining the authorities, rights, easements, or other 
approvals necessary for the implementation and maintenance of the 
conservation practices in keeping with applicable laws and regulations. 
Participants shall save the United States harmless from any 
infringements upon the rights of others or from any failure to comply 
with applicable laws or regulations.



Sec. 631.22  Access to operating unit.

    Any authorized NRCS representative shall have the right to enter an 
operating unit for the purpose of ascertaining the accuracy of any 
representations made in a contract or leading up to a contract, and as 
to the performance of the terms and conditions of the contract. Access 
shall include the right to measure acreages, render technical 
assistance, and inspect any work undertaken under the contract.



Sec. 631.23  State conservationist's authority.

    The state conservationist may take the initiative to revise or 
require revision of any determination made by the contracting officer or 
the district conservationist in connection with the program, except that 
the state conservationist may not revise any executed contract other 
than as may specifically be authorized herein.



PART 632--RURAL ABANDONED MINE PROGRAM--Table of Contents




                           Subpart A--General

Sec.
632.1  Purpose and scope.
632.2  Objectives.
632.3  Responsibilities.
632.4  Definitions.

                        Subpart B--Qualifications

632.10  Applicability.
632.11  Availability of funds.
632.12  Funding priorities.
632.13  Eligible lands and water.
632.14  Eligible land users.
632.15  Eligible uses and treatment of reclaimed lands.
632.16  Methods of applying planned land use and treatment.
632.17  Cost-share rates.
632.18  Special projects.
632.19  Crop history and allotments.

                        Subpart C--Participation

632.20  Application for assistance.
632.21  Reclamation plan.
632.22  Contracts.
632.23  Access to land unit and records.

                    Subpart D--Cost-Share Procedures

632.30  Applicability.
632.31  Cost-share payment.

                    Subpart E--Appeals and Violations

632.40  Appeals.
632.41  Violations.
632.42  Violation procedures.

                         Subpart F--Environment

632.50  Environmental evaluation.
632.51  Accord with environmental laws and orders.
632.52  Identifying typical classes of action.

    Authority: Sec. 406, Pub. L. 95-87; 91 Stat. 460 (30 U.S.C. 1236).

[[Page 628]]


    Source: 43 FR 44749, Sept. 28, 1978, unless otherwise noted.



                           Subpart A--General



Sec. 632.1  Purpose and scope.

    (a) The purpose of this part is to set forth the Natural Resources 
Conservation Service (NRCS) rules and regulations to carry out the Rural 
Abandoned Mine Program under section 406, Pub. L. 95-87; 91 Stat. 460 
(30 U.S.C. 1236).
    (b) The Rural Abandoned Mine Program:
    (1) Through the NRCS delivery system, assists land users to 
voluntarily develop reclamation plans and apply conservation treatment 
for the reclamation, conservation, and development of eligible coal-
mined lands and water, and
    (2) Provides cost sharing through long-term contracts according to 
an approved reclamation plan, to land users for establishing land use 
and conservation treatment on these lands.



Sec. 632.2  Objectives.

    (a) The objectives of the program are to protect people and the 
environment from the adverse effects of past coal-mining practices and 
to promote the development of the soil and water resources of 
unreclaimed mined lands by:
    (1) Stabilizing mined lands.
    (2) Controlling erosion and sediment on mined areas and areas 
affected by mining.
    (3) Reclaiming lands and water for useful purposes.
    (4) Enhancing water quality or quantity where it has been disturbed 
by past coal-mining practices.



Sec. 632.3  Responsibilities.

    (a) The Rural Abandoned Mine Program is administered by the U.S. 
Department of Agriculture (USDA) through NRCS in accordance with the 
delegation of responsibility contained in Sec. 601.1(h) of this chapter.
    (1) The Chief of NRCS is responsible for national program management 
and administration and for coordinating program operations with the 
Office of Surface Mining (OSM), U.S. Department of the Interior.
    (2) State conservationists (Responsible Federal Officials) are 
responsible for program operations within a State including program 
coordination with the State reclamation agency and the representatives 
of OSM.
    (b) The primary public contacts for program assistance are the 
district conservationists located in local NRCS field offices.
    (c) NRCS is assisted by other USDA agencies in accordance with 
existing authorities and agreements in carrying out the program.
    (d) NRCS is to coordinate Rural Abandoned Mine Program activities 
with NRCS programs and the other reclamation programs authorized by Pub. 
L. 95-87 that are carried out by the Office of Surface Mining of the 
U.S. Department of the Interior, State reclamation agencies, and Indian 
tribes. Coordination includes program development, development of 
reclamation standards, preparation of special reports, requests for 
funding, and related actions required to achieve coordination between 
programs.
    (e) NRCS is to consult with State and local reclamation committees 
to obtain recommendations on program operation, evaluation of 
applications for reclamation assistance, and public participation. The 
NRCS State Conservationist is to use existing reclamation committees or 
encourage the organization of a new State committee for this purpose. 
The State Conservationist is to serve as a member when the committee is 
functioning for the purposes of this program. Representatives of the 
Office of Surface Mining, State reclamation agency, State water quality 
agency, State conservation agency, and other agencies or groups are to 
be invited to participate as members. Individual citizens may 
participate through the State committee. Local committees, if needed, 
are to be organized on a multicounty, county, conservation district, or 
other appropriate area with a local membership structure similar to the 
State committee. The district conservationist is to be a member of a 
local reclamation committee organized to provide program guidance.

[43 FR 44749, Sept. 28, 1978, as amended at 45 FR 65181, Oct. 2, 1980]

[[Page 629]]



Sec. 632.4  Definitions.

    Abandoned mined lands. Unreclaimed coal-mined lands that existed 
before August 3, 1977, and for which there is no continuing reclamation 
responsibility on the part of a mine operator, permittee, or agent under 
State or Federal law or on the part of the State as a result of a bond 
forfeiture. See Sec. 632.13.
    Average costs. The calculated cost, determined by recent actual 
costs and current cost estimates, considered necessary for a land user 
to carry out a conservation practice or an identifiable unit of a 
conservation practice.
    Conservation district. A legal subdivision of State government 
responsible for developing and carrying out programs of soil and water 
conservation with which the Secretary of Agriculture cooperates under 
the Soil Conservation and Domestic Allotment Act of 1935.
    Conservation treatment. Specific conservation or reclamation 
practices applied to the land according to current standards and 
specifications in NRCS technical guides.
    Contract. A binding agreement between NRCS and the land user that 
includes the reclamation plan and provides for cost sharing the 
conservation treatment.
    Contracting officer. The NRCS official authorized to enter into and 
administer contracts for the Rural Abandoned Mine Program.
    Cost. The monetary amount actually paid or obligated to be paid by 
the land user for equipment use, materials, and services for carrying 
out a conservation practice or identifiable unit. If the land user uses 
his own resources, it includes the computed value of his labor, 
equipment use, and materials.
    Cost-share payments. Payments made to or on behalf of land users at 
established rates as specified in contracts for carrying out a 
conservation practice or an identifiable unit of such practices 
according to the contract.
    Financial burden. The land user's cost of reclamation that cannot be 
expected to be recovered within the contract period and that would 
probably prevent participation in the program. The land user must sign a 
statement to substantiate financial burden.
    Identifiable unit. A component of a conservation practice that can 
be clearly identified as a step in carrying out the conservation 
practice.
    Inadequately reclaimed. Lands or water that are mined for coal or 
are affected by mining conducted before August 3, 1977, which continue 
in their present condition to substantially degrade the quality of the 
environment, prevent or damage beneficial use of land or water 
resources, or endanger the health or safety of the public.
    Landrights. An interest acquired by fee simple title, easements, and 
rights-of-way to occupy or use land, buildings, structures, or other 
improvements.
    Land user. Any person, partnership, firm, company, corporation, 
association, trust, estate, other entity, or agent that owns or has 
management control of the surface rights of the land during the contract 
period or owns water rights on eligible lands. Also included are State 
or local public entities that own or control eligible land and water.
    Main benefits. The principal values or benefits that can be 
identified and/or quantified as a result of reclamation. Main offsite 
benefits are those values that accrue to surrounding land users or the 
public in general as a result of the reclamation. Main onsite benefits 
are those that accrue to the participant. Examples of principal values 
or benefits include but are not limited to human lives and property 
protected, reduction of erosion or sediment damage, elimination of 
public safety or health hazards, improvement of water quality, improved 
visual quality, improved fish or wildlife habitat, or restoration of 
beneficial uses of reclaimed areas.
    Reclamation committee. A committee on a local or State level 
consisting of representatives of Federal and State agencies and other 
organizations or individuals that have responsibilities or interest in 
abandoned mine reclamation. The committee provides guidance to NRCS on 
the operation of the Rural Abandoned Mine Program.
    Reclamation plan. A conservation and development plan as referred to 
in Pub. L. 95-87, consisting of a written record of land user decisions 
on proposed use,

[[Page 630]]

conservation treatment, and maintenance of eligible lands and water that 
will protect, enhance, and maintain the resource base. A reclamation 
plan contains pertinent soils data, a planned land use map or drawing, a 
record of use and treatment decisions including a schedule of 
conservation treatment, and other resource data as appropriate.
    Specified maximum costs. The maximum amount of cost-share money that 
is to be paid to a land user for carrying out a conservation practice or 
an identifiable unit of a conservation practice.
    Standards and specifications. Requirements that establish the 
acceptable quality level for planning, designing, and installing a 
conservation practice so it achieves its intended purpose. NRCS 
standards and specifications are contained in the NRCS field office 
technical guides and are designed to be sound and practicable under 
local conditions. Technical guides are on file in local NRCS field 
offices.
    Water rights. Any interest acquired in, priority established for, or 
permission obtained for the use of water.

[43 FR 44749, Sept. 28, 1978; 45 FR 65181, Oct. 2, 1980]



                        Subpart B--Qualifications



Sec. 632.10  Applicability.

    This program applies to any county or other designated area within a 
State that had abandoned or inadequately reclaimed coal-mined lands 
within its borders before August 3, 1977.



Sec. 632.11  Availability of funds.

    (a) The provisions of the program are subject to the annual 
appropriation by Congress of funds from the Abandoned Mine Reclamation 
Fund and the transfer of as much as 20 percent of these funds from the 
Office to Surface Mining to NRCS for program operation.
    (b) Allotments of Rural Abandoned Mine Program funds to state 
conservationists are to reflect the national program needs, the 
geographic areas from which the funds were derived, the funding priority 
assigned to applications for program assistance, including benefits 
expected to be derived, and the practicability and feasibility of the 
reclamation work proposed.



Sec. 632.12  Funding priorities.

    (a) All eligible applications within a State are to be assigned a 
funding priority and subpriority. Assignment of a priority and 
subpriority establishes the order in which the proposed reclamation work 
will be selected and evaluated for funding. (See Sec. 632.20(b) for 
additional selection criteria.) Applications for individual, joint, or 
special projects (See Sec. 632.18) for areas of different priorities or 
subpriorities are to be assigned the highest applicable priority or 
subpriority. The funding priorities are as follows:
    (1) Priority 1. Protection of public health, safety, general 
welfare, and property from extreme danger of adverse effects of coal-
mining practices. Extreme danger means a condition that could be 
expected to cause substantial physical harm to persons, property, or the 
environment and to which persons or improvements on real property are 
exposed.
    (2) Priority 2. Protection of public health, safety, and general 
welfare from the adverse effects of coal-mining practices that do not 
constitute an extreme danger.
    (3) Priority 3. Restoration of the land and water resources and the 
environment where previously degraded by the adverse effects of coal-
mining practices, including measures for the conservation and 
development of soil, water (excluding channelization), woodland, fish 
and wildlife, recreation resources, and agricultural productivity. First 
consideration in this priority is to be the reduction of offsite damage 
affecting the public. Second consideration is to be given to restoring 
to beneficial uses for the main benefit of the land user.
    (b) Eligible and feasible applications for program assistance within 
each priority category (Sec. 632.12(a)) are to be funded in the 
following order:
    (1) Individual persons or public entities who owned the eligible 
area before May 2, 1977, and who neither consented to nor exercised 
control over the mining operation.
    (2) Individual persons who would actively use the area, if 
reclaimed, for agricultural or silvicultural purposes.

[[Page 631]]

    (3) All other participants.

[43 FR 44749, Sept. 28, 1978; 45 FR 65181, Oct. 2, 1980]



Sec. 632.13  Eligible lands and water.

    Lands and water eligible for reclamation are those that were mined 
for coal or were affected by coal-mining processes and were abandoned or 
inadequately reclaimed before August 3, 1977. These lands and water are 
not eligible if:
    (a) There is continuing reclamation responsibility on the part of a 
mine operator, permittee, or agent under State or Federal law or on the 
part of the State as a result of bond forfeiture. However, if the amount 
of the bond forfeiture was insufficient to reclaim the area covered by 
the bond, the area will be considered eligible.
    (b) They are under Federal ownership and control.
    (c) The surface rights are under easement or lease to be remined for 
coal or other minerals.



Sec. 632.14  Eligible land users.

    Landowners holding surface land and water rights, residents, 
tenants, or their agents who own or have management control of eligible 
land and/or water are eligible to participate in the program. Residents 
or tenants who do not own the land must have control of the land for the 
period of the proposed contract and have the written consent of the 
landowner. Land users may participate by operating as persons, 
partnerships, associations, corporations, estates, trusts, or non-
Federal public entities, and by acting individually or jointly with 
other eligible land users. However, joint participation with other 
eligible land users is required if the primary purpose of reclamation is 
enhancement of water quality or quantity.



Sec. 632.15  Eligible uses and treatment of reclaimed lands.

    (a) Reclaimed lands and water may be used for cropland, hayland, 
pasture land, rangeland, woodland, wildlife land, natural areas, 
noncommercial recreation land, and the supporting uses associated with 
these land uses. Other land uses proposed by public entities for public 
use and benefit such as open space, conservation uses, natural areas, 
and recreation sites may be approved by the NRCS State conservationist 
in accordance with the priorities stated in Sec. 632.12. However, 
development of public sites, such as the installation of recreation 
facilities, is not eligible for cost sharing.
    (b) Reclaimed land use is determined by the objectives of the land 
user, compatibility of the land use with surrounding land use, and the 
practicability and feasibility of restoring the soil and water resources 
to support the use selected.
    (c) The maximum acreage of eligible lands and water that may be 
offered for contract under one ownership is 320 acres for the life of 
the program.
    (d) Conservation treatment eligible for Federal cost sharing 
includes the combination of practices needed and feasible to achieve:
    (1) Protection of life, property, and elimination of public health 
and safety hazards, including land stabilization.
    (2) Restoration of the environment where degraded by past mining, 
including water quality, visual quality, recreation resources, fish and 
wildlife habitat, and erosion and sediment control.
    (3) A site that can be developed for a beneficial use as specified 
in Sec. 632.15(a). Examples of eligible treatment that may be cost 
shared include but are not limited to: Land shaping and grading, 
critical area planting or other plantings for stabilization, improving 
visual quality, wildlife food and cover, diversions or terraces, 
waterways or lined ditches, grade stabilization structures, sediment 
basins, and special practices for sealing shafts and tunnels, correcting 
subsidence problems, or other unusual situations. Practices not eligible 
for cost sharing are those that are solely applied to develop a 
reclamation site (including sites developed by public entities for 
public use), increase the production of crops, or for the recurring 
maintenance of applied reclamation.
    (e) Applied conservation treatment is to meet the applicable Federal 
and State standards for the reclamation and conservation treatment of 
abandoned or inadequately reclaimed coal-mined lands and water. Where 
needed, these standards are incorporated in local NRCS technical guides 
as the

[[Page 632]]

NRCS standards and specifications applicable to the program. Special 
practices as specified in Sec. 632.15(d) are to be developed in 
cooperation with appropriate State or Federal agencies having the 
expertise or responsibility for the practices.
    (f) NRCS State conservationists, in consultation with the State 
reclamation committee, are to:
    (1) Develop a list of practices that are eligible for cost sharing, 
and
    (2) Maintain, as applicable, lists of average costs of applying 
conservation treatment to eligible lands and waters.



Sec. 632.16  Methods of applying planned land use and treatment.

    (a) Land users may arrange to apply the planned land uses and 
conservation treatment specified in the contract by one or more of the 
following methods:
    (1) By performing the required treatment with his own labor and 
equipment.
    (2) By hiring a qualified contractor to install the required 
treatment.
    (3) By requesting NRCS to award and administer a contract to perform 
the required treatment in accordance with 41 CFR chapters I and IV.
    (b) State conservationists are to develop criteria specifying the 
conditions for which NRCS will award and administer a contract. Criteria 
will consider: Type of equipment required, type and amount of 
conservation treatment required, costs of the required reclamation, 
needs of the land user, and the applicable cost-share rate. If the 
Federal share is less than 100 percent, a land user must put up his 
estimated share of the cost before NRCS awards the contract.



Sec. 632.17  Cost-share rates.

    (a) Cost-share rates paid by the Federal Government are to be 
established and issued as instructions by the NRCS Administrator in 
accordance with the following criteria:
    (1) For 120 acres or less, the cost-share rate is to provide up to 
80 percent of the costs of land use and conservation treatment depending 
on the income-producing potential of the land after reclamation. 
However, this rate may be increased to a level required to obtain 
participation if the main benefits of reclamation are offsite (in the 
public interest) and there is a declaration of financial burden by the 
participant.
    (2) The rate on acreage in excess of 120 acres up to 320 acres 
maximum is to be reduced by up to 0.5 percent per acre. This reduced 
rate applies to the entire acreage offered for contract.



Sec. 632.18  Special projects.

    (a) The NRCS State conservationist may approve the following types 
of special projects subject to the eligibility requirements, funding 
priorities, and cost-share rates as stated in Secs. 632.12, 632.13, 
632.14, 632.15, and 632.17:
    (1)  Field  trials  or  demonstration projects recommended by the 
State reclamation committee.
    (2) Projects to enhance water quality and quantity where past coal-
mining practices disturbed local water supplies and where joint action 
by a group of eligible land users in cooperation with Federal and State 
agencies is needed to restore the water resource.



Sec. 632.19  Crop history and allotments.

    (a) Most crop history and allotments on eligible lands were 
discontinued at the time of mining. However, if eligible lands are 
classified as cropland at the time the contract is signed, the cropland 
crop history and allotment, if any, may be:
    (1) Preserved for a period not to exceed twice the length of the 
contract as provided in 7 CFR part 719, or
    (2) Voluntarily surrendered by the land user.



                        Subpart C--Participation



Sec. 632.20  Application for assistance.

    (a) Land users must submit an application for program assistance 
through the local conservation district or NRCS field office. NRCS is to 
announce dates for receiving applications through local media. 
Applications are to be reviewed by the conservation district and/or 
local reclamation committee, which is to verify eligibility and 
recommend funding priorities to the NRCS district conservationist. The 
NRCS district conservationist is to assign funding priorities according 
to the recommendations unless he determines

[[Page 633]]

that applications are incomplete, ineligible, or unfeasible. Low 
priority applications that cannot be serviced within specific time 
periods established by the State conservationist are to be returned to 
the applicant with an appropriate explanation. These applicants may 
reapply at a later date if they are still interested.
    (b) Eligible applicants are serviced within each subpriority 
according to the following criteria:
    (1) The specific type, amount, and relative importance of benefits 
to be derived. (Public benefits and offsite environmental improvement 
will take precedence over onsite benefits.)
    (2) Feasibility and practicability of reclaiming for the proposed 
uses.
    (3) Land user's ability to proceed.
    (4) Date of the application.



Sec. 632.21  Reclamation plan.

    (a) Responsibility. Land users are responsible for developing a 
reclamation plan that will serve as a basis for a contract. Normally, a 
land user will need the technical services of NRCS and the conservation 
district or another professional to develop an acceptable plan.
    (b) Objectives and priorities. The reclamation plan is to provide 
for the appropriate program objectives and priorities as stated in 
Secs. 632.2 and 632.12 and meet the definition of a reclamation plan as 
defined in Sec. 632.4.
    (c) Review. (1) In areas served by conservation districts, 
reclamation plans are to be reviewed and signed by the district board to 
insure that planned land use and treatment is compatible with 
surrounding land uses and that proposed assistance is consistent with 
the district plan of work and priorities. In areas not served by 
conservation districts, the land use compatibility review may be 
performed by the local reclamation committee.
    (2) If reclamation plans include lands within or adjacent to Federal 
lands, the plan is to be reviewed with the appropriate Federal land 
management agency to insure that the planned land use is compatible with 
that of the surrounding area.
    (3) Land users are responsible for insuring that the proposed land 
use and treatment is compatible with local land use ordinances.
    (d) Approval. Proposed land use, conservation treatment, and 
sequence of application contained in the plan are to be agreed to by 
both NRCS and the land user. The district conservationist is to sign the 
reclamation plan to indicate technical approval.



Sec. 632.22  Contracts.

    (a) Cost-sharing contracts. A land user who has an approved 
reclamation plan may enter into a contract with NRCS to receive Federal 
cost-share assistance. All land users are to sign the contract. A land 
user is required to furnish evidence of management control, such as a 
long-term lease, recorded deed, or land contract, and must have the 
written consent of the landowner. The NRCS contracting officer is to 
sign the contract after determining that all documents meet program 
requirements.
    (b) Effect of contract. A land user who signs a contract is 
obligated to apply or arrange for the application of the land use and 
conservation treatment as scheduled in the reclamation plan according to 
approved standards and specifications. A land user may request NRCS to 
award and administer a contract to apply the conservation treatment as 
scheduled in the reclamation plan in accordance with Sec. 632.16(a)(3).
    (c) Permits, landrights, and water rights. The land user is 
responsible for obtaining the permits, surface land- rights, and water 
rights that may be required to perform the planned work. NRCS is to 
assist land users in identifying the specific permit, landright, or 
water right required.
    (d) Operation and maintenance. During the contract period the land 
user is responsible for the operation and maintenance of applied 
conservation treatment. Operation and maintenance requirements are to be 
included in the contract.
    (e) Period of contract. The contract period is to be no less than 5 
nor more than 10 years. A contract is to extend for at least 3 years 
after the application of the last cost-shared conservation treatment to 
insure adequate establishment of vegetation and other treatment. 
Exceptions to the 3-year

[[Page 634]]

provision may be granted by the state conservationist for unusual 
circumstances.
    (f) Transfer of contract. (1) If during the contract period all or 
part of the right and interest in the land is transferred by sale or 
other action, the contract is terminated on the land unit that was 
transferred and the land user:
    (i) Forfeits all right to any future cost-share payments on the 
transferred land unit, and
    (ii) Must refund cost-share payments that have been made on the 
transferred land unit not to exceed the difference between the estimated 
value of the land at the time of entering into the contract and at the 
time of transfer, unless the new land user becomes a party to the 
contract as provided in paragraph (f)(2) of this section.
    (2) If the new land user becomes a party to the contract:
    (i) He is to assume all obligations of the previous land user on the 
transferred land unit.
    (ii) The contract with the new land user is to remain in effect with 
the original terms and conditions.
    (iii) The contract is to be modified in writing to show the changes 
caused by the transfer. If the modification is not acceptable to the 
contracting officer, the provisions of paragraphs (f)(1) (i) and (ii) of 
this section apply.
    (3) The transfer of all or part of a land unit by a land user does 
not affect the rights and obligations of other land users who have 
signed the contract.
    (g) Modification of contract. (1) A contract previously entered into 
with a land user may be modified only with the approval of the State 
conservationist or as authorized under established policies. No contract 
may be modified unless it is determined that the modification is 
desirable to carry out the program.
    (2) Contracts may be modified to add, delete, substitute, or reapply 
conservation treatment if:
    (i) Applied conservation treatment failed to achieve the desired 
results through no fault of the land user,
    (ii) Applied treatment deteriorated because of conditions beyond the 
control of the land user, or
    (iii) Other treatment is substituted that will achieve the desired 
results.
    (h) Joint contract. A land user may enter a contract jointly with 
other land users subject to the 320 acres maximum limitation per 
landowner. However, joint participation is permitted only if it will 
result in better land use and treatment than individual participation or 
if it is required by Secs. 632.14 and 632.18(a)(2).
    (i) Termination of contract. Contracts may be terminated by mutual 
consent of the signatories only if the State conservationist determines 
that the termination is authorized under established policies and is in 
the public interest. In this case, the State conservationist is to 
determine the amount of refund.



Sec. 632.23  Access to land unit and records.

    Any authorized NRCS employee or agent is to have the right of access 
to land under application or contract and the right to examine any 
program records to ascertain the accuracy of any representations made in 
the application or contract. This includes the right to furnish 
technical assistance and to inspect work done under the contract.



                    Subpart D--Cost-Share Procedures



Sec. 632.30  Applicability.

    This subpart contains procedures for making cost-share payments to a 
land user when land use and conservation treatment is applied as 
specified in Sec. 632.16(a)(1) or (2).



Sec. 632.31  Cost-share payment.

    (a) Amount of cost-share payment. Cost-share payments are to be made 
at rates specified in the contract. The cost-share payment is to be 
determined by one of the following methods:
    (1) Average cost.
    (2) Actual cost but not more than the average cost.
    (3) Specified maximum cost. If the average cost or the specified 
maximum cost at the time of starting the installation of a conservation 
practice or identifiable unit is less than the cost specified in the 
contract, payment is to be made at the lower rate. If the cost at the 
start of installation is higher, payment may be made at the higher

[[Page 635]]

rate. A contract modification is necessary if NRCS determines that the 
higher cost is a significant increase in the total cost-share 
obligation. If costs are significant, cost-share payment is not to be 
made until the modification reflecting the increase is approved. If the 
higher costs are not significant, cost-share payments may be made if 
funds are available.
    (b) Time of payment. Cost-share payments are to be made to the land 
user after a practice or an identifiable unit has been satisfactorily 
applied. The land user is to submit claims for payment to the district 
conservationist no later than September 30 of the year after 
application. Late claims require approval of the State conservationist 
before payment can be made. A claim is to show the proportion of each 
land user's contribution to the applied practice or identifiable unit.
    (c) Approval. The district conservationist must certify that a 
practice or identifiable unit has been satisfactorily applied before 
NRCS can make cost-share payments.
    (d) Ineligible claim. A land user is not eligible to receive cost-
share payments for a practice or an identifiable unit that was not 
carried out under program requirements.
    (e) Authorization for payment. (1) Materials or services needed to 
carry out contracts are to be obtained by land users. Contracts may 
provide for part or all of the cost-share payment for a practice or 
identifiable unit to be made directly to suppliers of materials or 
services. The materials or services must be delivered or performed 
before payment is made.
    (2) The contracting officer is to authorize payment for materials or 
services not exceeding:
    (i) The cost share of the material or service used, or
    (ii) The total cost share of the practices or identifiable unit if 
requested by the land user.
    (3) The land user who purchases materials or services to carry out a 
contract is responsible for them until the district conservationist 
determines that the material or service was used for the intended 
purpose. If a material or service cost-shared by NRCS is used for a 
purpose other than to carry out the contract, the land user is indebted 
to the United States for the cost of the misused material or service. 
This indebtedness is to be repaid to NRCS as a refund or withheld from 
cost-share payments otherwise due the land user under the contract.
    (4) NRCS has the right to inspect materials or services and to take 
samples for testing. Inspections by NRCS will not be necessary if NRCS 
considers State inspection regulations adequate.
    (5) Materials or services must meet the quality standards as 
specified. NRCS may make exceptions for materials or services that do 
not meet the standards only if they will satisfactorily serve the 
intended purpose. NRCS is to deduct from the cost-share payment the 
difference between the price of the materials or services specified and 
the actual value of the different materials or services.
    (f) Division of cost-share payments. Federal cost-share payments 
made directly to suppliers of materials or services are credited to the 
land user who was issued the authorization. The remainder of the cost 
share is credited to the land user who carried out the remainder of the 
practice or identifiable unit. If more than one land user contributed to 
carrying out a practice or identifiable unit, the cost-share payment is 
to be divided proportionately according to the contribution made by each 
of the land users. Furnishing a landright or water right is not a 
contribution for cost-share payment purposes.
    (g) Other aid. Non-Federal public entities may furnish all or part 
of the land user's portion of the cost of applying a practice or 
identifiable unit with no reduction in the Federal cost share.
    (h) Assignments and claims. Land users may not assign cost-share 
payments except as provided under the authority of 31 U.S.C. 203, as 
amended by 41 U.S.C. 15. Federal cost-share payments due any land user 
are not subject to claims for advances except as provided in this 
section.

[[Page 636]]



                    Subpart E--Appeals and Violations



Sec. 632.40  Appeals.

    Land users may appeal decisions under this part in accordance with 
part 614 of this title.

[60 FR 67316, Dec. 29, 1995]



Sec. 632.41  Violations.

    (a) Actions causing violation. The following actions constitute 
violation of a contract by a land user:
    (1) Knowingly or negligently damaging or causing conservation 
treatment to be impaired.
    (2) Adopting land use or treatment that tends to defeat the program 
purposes during the period of the contract.
    (3) Failing to comply with the terms of the contract.
    (4) Filing a false claim.
    (5) Misusing an authorization.
    (b) Effect of violation--(1) Contract to be terminated. (i) By 
signing a contract, the land user agrees to forfeit all rights to 
further cost-share payments under a contract and to refund cost-share 
payments received not to exceed the difference between the estimated 
value of the land at time of entering into the contract and the value at 
time of termination, if the contracting officer, with approval of the 
State conservationist, determines that:
    (A) There was a violation of the contract during the time the land 
user had control of the land, and
    (B) The violation was of a nature as to warrant termination of the 
contract.
    (ii) The land user is to be obligated to refund cost-share payments 
and cost shares paid under authorizations not to exceed the difference 
between the estimated value of the land at time of entering into the 
contract and the value at time of termination.
    (2) Contract not terminated. (i) By signing a contract, the land 
user agrees to refund cost-share payments received under the contract or 
to accept payment adjustment if the contracting officer, with the 
approval of the State conservationist, determines that:
    (A) There was a violation of the contract during the time the land 
user had control of the land, and
    (B) The nature of the violation does not warrant termination of the 
contract.
    (ii) Payment adjustments may include decreasing the rate of a cost 
share, deleting a cost-share commitment from the contract, or 
withholding cost-share payments earned but not paid. The land user who 
signs the contract may be obligated to refund cost-share payments and 
cost shares paid under authorizations.



Sec. 632.42  Violation procedures.

    (a) Scope. This section prescribes the regulations dealing with 
contract violations. The Chief reserves the right to revise or 
supplement any of the provisions of this section at any time if the 
action does not adversely affect the land user, or if the land user has 
been officially notified before this action is taken. No cost-share 
payment shall be made pending the decision on whether a contract 
violation has occurred.
    (b) Determination by contracting officer. On notification that a 
contract violation may have occurred, the contracting officer is to:
    (1) Determine, with the approval of the State conservationist, that 
a violation did not occur or that the violation was of such a nature 
that no penalty of forfeiture, refund, or payment adjustment is 
necessary. No notice is issued to the land user, and no further action 
is to be taken; or
    (2) Determine that a violation did occur, but the land user agrees 
to accept the penalty. If the land user agrees in writing to accept a 
penalty of forfeiture, refund, payment adjustment or termination, no 
further action is to be taken. The land user's agreement to accept the 
penalty must be approved by the contracting officer and State 
conservationist.
    (c) Notice of possible violation. (1) When the State conservationist 
is notified that a contract violation may have occurred that may warrant 
a penalty of forfeiture, refund, payment adjustment, or termination, he 
is to notify, in writing, each land user who signed the agreement of the 
alleged violation. This notice may be personally delivered or sent by 
certified or registered mail. A land user is considered to have

[[Page 637]]

received the notice at the time of personal receipt acknowledged in 
writing, at the time of the delivery of a certified or registered 
letter, or at the time of the return of a certified or registered letter 
where delivery was refused.
    (2) The notice setting forth the nature of the alleged violation is 
to give the land user an opportunity to appear at a hearing before a 
hearing officer designated by the State conservationist. The land user's 
request for a hearing is to be submitted in writing and must be received 
in the NRCS field office within 30 days after receipt of the notice. The 
land user is to be notified in writing by the hearing officer of the 
time, date, and place for the hearing. The land user is to have no right 
to a hearing if he does not file a written request for a hearing, or if 
he or his representative does not appear at the appointed time, unless 
the hearing officer, at his discretion, permits an appearance. A request 
for a hearing filed by a land user is considered to be a request by all 
land users who signed the contract.
    (d) Hearing. A public hearing is to be conducted to obtain the facts 
about the alleged violation. The hearing officer is to limit the hearing 
to relevant facts and evidence and is not to be bound by the strict 
rules of evidence as required in courts of law. Witnesses may be sworn 
in at the discretion of the hearing officer.
    (1) The land user or his representative is to be given full 
opportunity to present oral or documentary evidence about the alleged 
violation. Likewise, the United States may submit statements and 
evidence. Individuals not otherwise represented at the hearing may be 
permitted, at the discretion of the hearing officer, to give information 
of evidence. The hearing officer, at his discretion, may permit 
witnesses to be cross-examined.
    (2) The hearing officer is to make a record of the hearing so that 
the testimony can be summarized. A summary of the testimony may be made 
if both the land user and the State conservationist agree. A transcript 
of the hearing is to be made if requested by either the State 
conservationist or the land user within 10 days of the hearing. If a 
transcript is requested by the land user, the land user may be assessed 
the cost of a copy of the transcript.
    (3) The hearing officer is to close the hearing after a reasonable 
period of time if the land user or his representative is not present at 
the scheduled time. The hearing officer may, at his discretion, accept 
information and evidence submitted by others present for the hearing.
    (4) The hearing officer is to furnish the State conservationist with 
a written report setting forth his findings, conclusions, and 
recommendations. The report is to include the summary of testimony or 
transcript made of the hearing and any other information that would aid 
the State conservationist in reaching his decision.
    (e) Decision by State conservationist. The State conservationist is 
to make a decision after considering the hearing officer's report, 
including recommendations of the conservation district board if any, and 
any other information available to him, including, if applicable, the 
amount of the forfeiture, refund, or payment adjustment. The decision is 
to state whether the violation is of such a nature as to warrant 
termination of the contract. The State conservationist is to notify, in 
writing, each land user who signed the contract of his decision. The 
State conservationist may authorize or require the reopening of any 
hearing before a hearing officer for any reason at any time before his 
decision.
    (f) Appeal to Chief. Any land user affected by a decision of the 
State conservationist has the right of appeal to the Chief. The appeal 
and any briefs or statements must be received in the Office of the Chief 
within 30 days after the land user has received notice of the State 
conservationist's decision. The State conservationist is to file a brief 
or statement in the Office of the Chief within 20 days after the land 
user's brief or statement is received there. The appeal is to be limited 
to the records and the issues made before the State conservationist. The 
Chief's decision is final. The decision is to be determined by the 
record before him and the issues presented in the appeal, and the land 
user is to be notified in writing.

[[Page 638]]

    (1) If the decision provides for termination of the contract, it is 
to state that the contract is terminated, that all rights to further 
cost-share payments under the contract are forfeited, and that cost-
share payments received under the contract are to be refunded, but the 
refund is not to exceed the difference between the estimated value of 
the land at time of entering into the contract and the value at time of 
termination. The decision is to state the amount of refund and method of 
payment.
    (2) If the decision does not provide for termination of the 
contract, the land user may be required to make a refund of cost-share 
payments or to accept payment adjustments. The decision is to state the 
amount of refunds of cost-share payments or payment adjustments. In 
determining amounts of refund or payment adjustments, the following are 
to be considered:
    (i) The extent of the violation.
    (ii) Whether the violation was deliberate or the result of 
negligence or was caused by circumstances beyond the control of the land 
user.
    (iii) The effect on the program if no refund or payment adjustment 
is required.
    (iv) The extent to which the land user benefited by the violation.
    (v) The effect of the violation on the contract as a whole.
    (vi) Other considerations including the appropriateness and 
reasonableness of the refund or payment adjustment.

[43 FR 44749, Sept. 28, 1978; 45 FR 65181, Oct. 2, 1980]



                         Subpart F--Environment



Sec. 632.50  Environmental evaluation.

    (a) Environmental evaluation is an integral part of planning used by 
NRCS in developing each reclamation plan under this program. Planning 
includes site inventory and analysis, evaluation of reasonable 
alternatives, and identification of significant environmental impacts. 
Major points in planning when NRCS or the land user can make decisions 
concerning further action are:
    (1) After an evaluation of the application for program assistance to 
verify eligibility, land user objectives, and priorities for funding.
    (2) After a site-specific inventory and analysis to evaluate 
feasible treatment alternatives, costs, and environmental impacts.
    (3) After development of an acceptable reclamation plan as a basis 
for contract.
    (4) Before the signing of a mutually acceptable contract for 
financial cost-share assistance.
    (b) The scope and complexity of the assessment is to be consistent 
with the scope and complexity of the proposed reclamation.
    (c) An interdisciplinary team, consisting of NRCS and/or other 
cooperating agency personnel as needed, is used in making the 
assessment.
    (d) The Responsible Federal Official (RFO) is to use the 
environmental evaluation to make a decision concerning the need to 
prepare an environmental impact statement (EIS) in accordance with 
Sec. 632.52.

[43 FR 44749, Sept. 28, 1978; 45 FR 65181, Oct. 2, 1980]



Sec. 632.51  Accord with environmental laws and orders.

    (a) A final program EIS is available in compliance with section 
102(2)(c) of the National Environmental Policy Act of 1969 (NEPA). This 
statement discloses the cumulative program impacts that significantly 
affect the quality of the human environment.
    (b) The program is to be conducted in accordance with other laws and 
Executive orders concerning environmental protection.
    (c) Channelization of streams is prohibited under this program. 
Channelization as used herein means the overall widening, deepening, 
realining, or constructing a nonvegetative protective lining over all or 
part of the perimeter of a perennial stream channel as described in NRCS 
Channel Modification Guidelines, Part B, Items 4, 5, 6, and 7, as 
published in the Federal Register on March 1, 1978 (43 FR 8278).

[[Page 639]]



Sec. 632.52  Identifying typical classes of action.

    (a) The RFO will analyze the environmental assessment of the 
proposed action to determine which of the following classes of action 
applies. This determination will be recorded and will be available to 
the public on request.
    (1) Actions not requiring a site-specific EIS. All proposed actions 
and their impacts that are determined to be adequately discussed in the 
program EIS or determined not to be major Federal actions will not 
require a site-specific EIS. However, if the assessment reveals that 
these proposed actions will have significant adverse effects on the 
quality of the human environment, the RFO will:
    (i) Modify the action to eliminate or mitigate the significant 
adverse impacts, or
    (ii) Withdraw further Federal assistance if significant adverse 
impacts cannot be eliminated or mitigated.
    (2) Actions requiring a site-specific EIS. A site-specific EIS is 
required for proposed actions if their impacts are not adequately 
discussed in the program EIS, and the proposal is determined to be a 
major Federal action significantly affecting the quality of the human 
environment in accordance with Sec. 650.7(b) of this chapter. When a 
decision is made to prepare an EIS, a Notice of Intent will be published 
in the Federal Register. The content and format of the EIS is to be 
consistent with the format of the program EIS and use scoping and 
tiering techniques to focus on the significant environmental issues.
    (3) Actions excluded from the EIS requirements. Those actions taken 
to prevent loss of life or property under the extreme danger provisions 
of priority 1 as described in Sec. 632.12. These actions are determined 
by a limited environmental assessment that reasonably identifies the 
possible loss of life or property.



PART 633--WATER BANK PROGRAM--Table of Contents




Sec.
633.1  Purpose and scope.
633.2  Definitions.
633.3  Administration.
633.4  Program requirements.
633.5  Application procedures.
633.6  Program participation requirements.
633.7  Annual payments.
633.8  Cost-share payments.
633.9  Conservation plan.
633.10  Modifications.
633.11  Transfer of an interest in an agreement.
633.12  Termination of agreements.
633.13  Violations and remedies.
633.14  Debt collection.
633.15  Payments not subject to claims.
633.16  Assignments.
633.17  Appeals.
633.18  Scheme and device.

    Authority: 16 U.S.C. 1301-1311.

    Source: 62 FR 48472, Sept. 16, 1997, unless otherwise noted.



Sec. 633.1  Purpose and scope.

    The regulations in this part set forth the policies, procedures, and 
requirements for the Water Bank Program (WBP) as administered by the 
Natural Resources Conservation Service (NRCS) for program 
implementation.



Sec. 633.2  Definitions.

    The following definitions shall be applicable to this part:
    Adjacent land means land on a farm which adjoins designated types 1 
through 7 wetlands and is considered essential for the protection of the 
wetland or for the nesting, breeding, or feeding of migratory waterfowl. 
Adjacent land need not be contiguous to the land designated as wetland, 
but cannot be located more than one quarter of a mile away.
    Agreement means the document that specifies the obligations and 
rights of any person who has been accepted for participation in the WBP.
    Annual payment means the consideration paid to a participant each 
year for entering an agreement with the NRCS under the WBP.
    Chief means the Chief of the Natural Resources Conservation Service 
or the person delegated authority to act for the Chief.
    Conservation District is a subdivision of a State government 
organized pursuant to applicable State law to promote and undertake 
actions for the conservation of soil, water, and other natural 
resources.

[[Page 640]]

    Conservation plan means a written record of the land user's decision 
on the use and management of the wetland and adjacent areas covered by 
the agreement.
    Cost-share payment means the payment made by the NRCS to achieve the 
protection of the wetland functions and values of the agreement area in 
accordance with the conservation plan.
    Landowner means a person or persons having legal ownership of 
farmland, including those who may be buying farmland under a purchase 
agreement. Landowner may include all forms of collective ownership 
including joint tenants, tenants in common, and life tenants and 
remaindermen in a farm property.
    Natural Resources Conservation Service (NRCS) is an agency of the 
United States Department of Agriculture, formerly called the Soil 
Conservation Service.
    Operator means the person who is in general control of the farming 
operations on the farm during the crop year.
    Person means one or more individuals, partnerships, associations, 
corporations, estates or trusts, or other business enterprises or other 
legal entities and, whenever applicable, a State, a political 
subdivision of a State, or any agency thereof.
    Practice means a measure necessary or desirable to accomplish the 
desired program objectives.
    State Technical Committee means a committee established by the 
Secretary of the United States Department of Agriculture in a State 
pursuant to 16 U.S.C. 3861. The State Conservationist will be the 
chairperson of the State Technical Committee.
    U.S. Fish and Wildlife Service is an agency of the United States 
Department of the Interior.
    Wetlands mean the inland fresh areas defined under 16 U.S.C. 1302 
and described as types 1 through 7 in Circular 39, Wetlands of the 
United States, as published by the United States Department of the 
Interior.
    Wetlands functions and values mean the hydrological and biological 
characteristics of wetlands and the social worth placed upon these 
characteristics, including:
    (1) Habitat for migratory birds and other wildlife, in particular at 
risk species;
    (2) Protection and improvement of water quality;
    (3) Attenuation of water flows due to flooding;
    (4) The recharge of ground water;
    (5) Protection and enhancement of open space and aesthetic quality;
    (6) Protection of flora and fauna which contributes to the Nation's 
natural heritage; and
    (7) Contribution to educational and scientific scholarship.
    WBP means the Water Bank Program.



Sec. 633.3  Administration.

    (a) The regulations in this part will be administered under the 
general supervision and direction of the Chief.
    (b) As determined by the Chief and the Administrator of the Farm 
Service Agency, the NRCS will seek the agreement of the Farm Service 
Agency in establishing policies, priorities, and guidelines related to 
the implementation of this part.
    (c) The State Conservationist will consultation with the State 
Technical Committee, on program administration and related policy 
matters. No determination by the State Technical Committee shall compel 
the NRCS to take any action which the NRCS determines will not serve the 
purposes of the program established by this part.
    (d) The NRCS may enter into cooperative agreements with Federal or 
State agencies and with private conservation organizations to assist the 
NRCS with educational efforts, agreement management and monitoring, 
program implementation assistance, and to assure a solid technical 
foundation for the program.
    (e) The NRCS shall consult with the U.S. Fish and Wildlife Service 
in the implementation of the program and in establishing program 
policies.
    (f) The Chief may allocate funds for such purposes related to 
special pilot programs for wetland management and monitoring, 
emergencies, cooperative agreements with other Federal or State agencies 
for program implementation, coordination of enrollment

[[Page 641]]

across State boundaries, or for other goals of the WBP found in this 
part.



Sec. 633.4  Program requirements.

    (a) General. Under the WBP, the NRCS will enter 10-year agreements 
with eligible persons who voluntarily cooperate in the protection of 
wetlands and associated lands. To participate in WBP, a person will 
agree to the implementation of a conservation plan, the effect of which 
is to protect, enhance, maintain, and manage the hydrologic conditions 
of inundation or saturation of the soil, native vegetation, and natural 
topography of eligible lands. The NRCS may provide cost-share assistance 
for the activities that promote the protection of wetland functions and 
values. Specific protection actions may be undertaken by the participant 
or other NRCS designee.
    (b) Participant eligibility. To be eligible to participate in the 
WBP, a person must:
    (1) Be the landowner of eligible land for which enrollment is 
sought; or
    (2) Have possession of the land by written lease over all designated 
acreage in the agreement for at least two years preceding the date of 
the agreement and will have possession over the all designated acreage 
for the agreement period.
    (c) Eligible land. (1) The NRCS shall determine whether land is 
eligible for enrollment and whether, once found eligible, the lands may 
be included in the program based on the likelihood of successful 
protection of wetland functions and values when considering the cost of 
entering the agreement and protection costs. Land placed under an 
agreement shall be specifically identified and designated for the period 
of the agreement.
    (2) The following land is eligible for enrollment in the WBP:
    (i) Privately owned inland fresh wetland areas of types 1 through 7.
    (ii) Privately owned inland fresh wetland areas of types 1 through 7 
which are under a drainage easement with the U.S. Department of the 
Interior or with a State government which permits agricultural use; or
    (iii) Other privately owned land which is adjacent to or within one 
quarter mile of designated types 1 through 7 wetlands and which is 
determined by the State Conservationist to be essential for the nesting, 
breeding, or feeding of migratory waterfowl, or for the protection of 
wetland.
    (d) Ineligible land. The following land is not eligible for 
enrollment in the WBP:
    (1) Converted wetlands if the conversion was in violation of 16 
U.S.C. 3821 et seq.;
    (2) Lands owned by an agency of the United States;
    (3) Land which is set aside or diverted under any other program 
administered by the Department of Agriculture;
    (4) Land which is harvested in the first year of the agreement 
period prior to being designated, except for land on which timber is 
harvested in accordance with a Forest Management Plan which is included 
in the conservation plan and is approved by the State forester or 
equivalent State official;
    (5) Lands where implementation of agreement practices would be 
futile due to on-site or off-site conditions; and
    (6) Land on which the ownership has changed during the 2-year period 
preceding the first year of the agreement period unless:
    (i) The new ownership was acquired by will or succession as a result 
of the death of the previous owner,
    (ii) The land was acquired by the owner or operator to replace 
eligible land from which he was displaced because of its acquisition by 
any Federal, State, or other agency having the right of eminent domain, 
or
    (iii) The new owner operated the land to be designated for as long 
as 2 years preceding the first year of the agreement and has control of 
such land for the agreement period.



Sec. 633.5  Application procedures.

    (a) Application for participation. To apply for enrollment, a person 
must submit an application for participation in the WBP.
    (b) Preliminary agency actions. The NRCS must certify that the 
designated acreage that would be placed under an agreement constitutes a 
viable wetland unit, contains sufficient adjacent land

[[Page 642]]

to protect the wetland, and provides essential habitat for the nesting, 
breeding or feeding of migratory waterfowl.
    (c) Where funds allocated to the State do not permit accepting all 
requests which are filed, the State Conservationist, in consultation 
with the State Technical Committee, may establish ranking criteria and 
limit the approval of requests for agreements in accordance with the 
ranking scheme. Any ranking scheme shall consider estimated costs of the 
agreement, costs of protection, availability of matching funds, 
significance of wetland functions and values, and estimated success of 
protection measures.
    (d) The NRCS may place higher priority on certain geographic regions 
of the State where the protection of wetlands may better achieve NRCS 
State and regional goals and objectives.
    (e) Notwithstanding any limitation of this part, the State 
Conservationist may enroll eligible lands at any time in order to 
encompass total wetland areas subject to multiple ownership or otherwise 
to achieve program objectives. Similarly, the State Conservationist may, 
at any time, exclude otherwise eligible lands if the participation of 
the adjacent landowners is essential to the successful protection of the 
wetlands and those adjacent landowners are unwilling to participate.



Sec. 633.6  Program participation requirements.

    (a) WBP Agreement. An agreement shall be executed for each 
participating farm. The agreement shall be signed by the owner of the 
designated acreage and any other person who, as landlord, tenant, or 
share cropper, will share in the payment or has an interest in the 
designated acreage. There may be more than one agreement for a farm.
    (b) Agreement period. The agreement period shall:
    (1) Be for a term of 10 years;
    (2) Become effective on January 1 of the year in which the agreement 
is approved except that the agreement shall become effective on January 
1 of the next succeeding year in cases where, at the time the agreement 
is approved, the NRCS determines that the agreement signers will be 
unable to comply with the provisions of paragraph (c) of this section in 
the year in which such agreement is approved.
    (c) Agreement terms and conditions. The acreage designated under an 
agreement shall:
    (1) Be maintained for the agreement period in a manner which will 
preserve, restore, or improve the wetland character of the land;
    (2) Not be drained, burned, filled, or otherwise used in a manner 
which would destroy the wetland character of the acreage, except that 
the provisions of this paragraph shall not prohibit the carrying out of 
management practices which are specified in a conservation plan for the 
farm;
    (3) Not be used as a dumping area for draining other wetlands, 
except where the State Conservationist determines that such use is 
consistent with the sound management of wetlands and is specified in the 
conservation plan;
    (4) Not be used as a source of irrigation water;
    (5) Not be used for the harvesting of a crop;
    (6) Not be hayed except for during periods of severe drought and 
only under conditions prescribed by the State Conservationist in 
consultation with the Secretary of the Interior or his designee; and
    (7) Not be grazed, except as may be specified in the conservation 
plan.



Sec. 633.7  Annual payments.

    (a) Person on the farm having an interest in the designated acreage, 
including tenants and sharecroppers, shall be eligible for an annual 
payment in the manner agreed upon by them as representing their 
respective contributions to compliance with the agreement. The State 
Conservationist shall not approve an agreement if it is determined that 
the proposed division of payment is not fair and equitable.
    (b) The annual per acre payment rates for wetlands and for adjacent 
land shall be determined for each county by the State Conservationist, 
based on recommendations of the State Technical Committee.
    (c) Maximum payments. In order to ensure that limited program funds 
are expended to maximize program benefits, the State Conservationist, in 
consultation with the State Technical

[[Page 643]]

Committee, may establish uniform maximum annual payment limits for 
agreements within a State or for geographic areas within a State.
    (d) Preliminary estimates of annual payments. Upon request prior to 
filing an application for enrollment, a person may be apprised of the 
maximum annual payment rates.
    (e) Adjustment of annual rates.
    (1) The State Conservationist, in consultation with the State 
Technical Committee, shall reexamine the payment rates with respect to 
each agreement at the beginning of the fifth year of any ten-year 
initial or renewal period and before the renewal expires.
    (2) An adjustment in the payment rates shall be made for any initial 
or renewal period taking into consideration the current land rental 
rates and crop values in the area. No adjustment shall be made in a 
payment rate which will result in a reduction of an annual payment rate 
from the rate which is specified in the initial or renewal agreement.
    (3) The rate or rates of annual payments may be increased if the 
program participant permits access by the general public to the 
designated acreage for hunting, trapping, fishing, and hiking, subject 
to applicable State and Federal regulations.



Sec. 633.8  Cost-share payments.

    (a) In addition to annual payments, the NRCS may share the cost with 
program participants of protecting the wetland functions and values of 
the enrolled land as provided in the conservation plan. The NRCS may pay 
up to 75 percent of such costs.
    (b) Cost-share payments may be made only upon a determination by the 
NRCS that an eligible practice or an identifiable unit of the practice 
has been established in compliance with appropriate standards and 
specifications. Identified practices may be implemented by the program 
participant or other designee.
    (c) A program participant may seek additional cost-share assistance 
from other public or private organizations as long as the activities 
funded are in compliance with this part. In no event shall the program 
participant receive an amount which exceeds 100 percent of the total 
actual cost of the practices.



Sec. 633.9  Conservation plan.

    (a) The program participant, with assistance from NRCS and in 
consultation with the Conservation District, shall prepare a 
conservation plan for the acreage designated under an agreement.
    (b) The conservation plan is the basis for the agreement and is 
incorporated therein. It includes a schedule of conservation treatment 
and management required to protect and to maintain the wetland and 
adjacent land as a functional wetland unit for the life of the 
agreement.
    (c) Conservation treatment and management of the vegetation for 
wetland protection, wildlife habitat, or other authorized objectives are 
consistent with the program objectives and priorities.



Sec. 633.10  Modifications.

    The NRCS may approve modifications to the agreement or associated 
conservation plan after consultation with the Conservation District. Any 
modification must meet WBP program objectives, and must be in compliance 
with this part.



Sec. 633.11  Transfer of interest in an agreement.

    (a) If the ownership or operation of a farm changes in such a manner 
that the agreement no longer contains the signatures of the persons 
required by Sec. 633.6(a) to sign the agreement, the agreement shall be 
modified to reflect the new interested persons and new divisions of 
payments.
    (b) If such persons are not willing to become parties to the 
modified agreement or for any other reason a modified agreement is not 
executed, the agreement shall be terminated and all unearned payments 
shall be forfeited or refunded.
    (c) The annual payment for the year in which the change of ownership 
or operation occurs shall not be considered to have been earned unless 
the designated acreage is continued in the program and there is 
compliance with the agreement for the full agreement year.

[[Page 644]]

    (d) The signatories to the agreement prior to the change of 
ownership or operation shall be jointly and severally responsible for 
refunding the unearned payments previously made.



Sec. 633.12  Termination of agreements.

    (a) The State Conservationist may, by mutual agreement with the 
parties to the agreement, consent to the termination of the agreement 
where:
    (1) The parties to the agreement are unable to comply with the terms 
of the agreement as the result of conditions beyond their control;
    (2) Compliance with the terms of the agreement would work a severe 
hardship on the parties to the agreement; or
    (3) Termination of the agreement would be in the public interest.
    (b) If an agreement is terminated in accordance with the provisions 
of this section, the annual payment for the year in which the agreement 
is terminated shall not be considered to have been earned unless there 
is compliance with the terms and conditions of the agreement for the 
entire calendar year.



Sec. 633.13  Violations and remedies.

    (a) In the event of a violation of an agreement or any associated 
conservation plan, the parties to the agreement shall be given 
reasonable notice and an opportunity to voluntarily correct the 
violation within 30 days of the date of the notice, or such additional 
time as the State Conservationist may allow.
    (b) In addition to any and all legal and equitable remedies as may 
be available to the NRCS under applicable law, the NRCS may withhold any 
annual or cost-share payments owing to the parties of the agreement at 
any time there is a material breach of the agreement or any conservation 
plan. Such withheld funds may be used to offset costs incurred by the 
NRCS in any remedial actions or retained as damages pursuant to court 
order or settlement agreement.
    (c) The NRCS shall be entitled to recover any and all administrative 
and legal costs, including attorney's fees or expenses, associated with 
any enforcement or remedial action.



Sec. 633.14  Debt collection.

    Any debts arising under this program are governed with respect to 
their collection by the Federal Claims Collection Act of 1966 (31 U.S.C. 
3701) and the regulations found in 4 CFR chapter II.



Sec. 633.15  Payments not subject to claims.

    (a) Any payments due any person shall be determined and allowed 
without regard to State land and without regard to any claim or lien 
against any crop, or proceeds thereof, which may be asserted by any 
creditor, except as provided in paragraph (b) of this section.
    (b) The regulations governing setoffs and withholdings, in part 13 
of this title, as amended, shall be applicable to this program.



Sec. 633.16  Assignments.

    Any person entitled to any cash payment under this program may 
assign the right to receive such cash payments, in whole or in part.



Sec. 633.17  Appeals.

    (a) Any person may obtain reconsideration and review of 
determinations affecting participation in this program in accordance 
with part 614 of this chapter.
    (b) Before a person may seek judicial review of any action taken 
under this part, the person must exhaust all administrative appeal 
procedures set forth in paragraph (a) of this section, and for purposes 
of judicial review, no decision shall be a final agency action except a 
decision of the Chief of NRCS under these procedures.



Sec. 633.18  Scheme and device.

    (a) If it is determined by the NRCS that a person has employed a 
scheme or device to defeat the purposes of this part, any part of any 
program payment otherwise due or paid such person during the applicable 
period may be withheld or be required to be refunded with interest 
thereon, as determined appropriate by the NRCS.
    (b) A scheme or device includes, but is not limited to, coercion, 
fraud, misrepresentation, depriving any other person of an annual 
payment or payments for cost-share practices for the

[[Page 645]]

purpose of obtaining a payment to which a person would otherwise not be 
entitled.
    (c) A program participant who succeeds to the responsibilities under 
this part shall report in writing to the NRCS any interest of any kind 
in enrolled land that is held by a predecessor or any lender. A failure 
of full disclosure will be considered a scheme or device under this 
section.



PART 634--RURAL CLEAN WATER PROGRAM--Table of Contents




                           Subpart A--General

Sec.
634.1  Purpose and scope.
634.2  Objective.
634.3  Administration.
634.4  Responsibilities.
634.5  Definitions.

              Subpart B--Project Authorization and Funding

634.10  Applicability.
634.11  Availability of funds.
634.12  Eligible project areas.
634.13  Project applications.
634.14  Review and approval of project applications.
634.15  Agreements.
634.16  Suspension of grants.
634.17  Termination of grant agreement.
634.18  Termination of project.
634.19  Project completion and closeout.

                  Subpart C--Participant RCWP Contracts

634.20  Eligible land.
634.21  Eligible participants.
634.22  Application for assistance.
634.23  Water quality plan.
634.24  Cost sharing.
634.25  Contracting.
634.26  Contract modifications.
634.27  Cost-share payment.
634.28  Appeals not related to contract violations.
634.29  Violations.
634.30  Appeals in USDA administered proj- ects.
634.31  Appeals of contract violations.

                     Subpart D--Financial Management

634.40  Financial management.

                  Subpart E--Monitoring and Evaluation

634.50  Program and project monitoring and evaluation.

    Authority: Sec. 35, Pub. L. 95-217, 91 Stat. 1579 (33 U.S.C. 1288).

    Source: 43 FR 50855, Nov. 1, 1978, unless otherwise noted.



                           Subpart A--General



Sec. 634.1  Purpose and scope.

    (a) The purpose of this part is for the U.S. Department of 
Agriculture (USDA), with the concurrence of the U.S. Environmental 
Protection Agency (EPA), to set forth regulations to carry out a Rural 
Clean Water Program (RCWP) under section 35, Pub. L. 95-217; 91 Stat. 
1579; 33 U.S.C. 1288.
    (b) The Rural Clean Water Program provides financial and technical 
assistance to private landowners and operators (participants) having 
control of rural land. The assistance is provided through long-term 
contracts (5 to 10 years) to install best management practices (BMP's) 
in project areas which have critical water quality problems resulting 
from agricultural activities. The proposed project area must be within a 
high priority area in an approved agricultural portion of a 208 water 
quality management plan. Participation in RCWP is voluntary.
    (c) The program is a new USDA program and an extension of existing 
water-quality management programs of EPA.



Sec. 634.2  Objective.

    The RCWP is designed to reduce agricultural nonpoint source 
pollutants to improve water quality in rural areas to meet water quality 
standards or water quality goals. The objective is to be achieved in the 
most cost-effective manner possible in keeping with the provision of 
adequate supplies of food and fiber and a quality environment.



Sec. 634.3  Administration.

    At the national level, the Secretary of Agriculture, with the 
concurrence of the Administrator, EPA, administers RCWP. The Secretary 
of Agiculture has delegated responsibility for administration of the 
program (43 FR 8252) to the Administrator, Natural Resources 
Conservation Service (NRCS). NRCS will be assisted by other USDA 
agencies in accordance with existing authorities.

[[Page 646]]

    (a) A National Rural Clean Water Coordinating Committee (NRCWCC), 
chaired by the Administrator, NRCS, is to assist in carrying out the 
Rural Clean Water Program.
    (b) At the State level, a State Rural Clean Water Coordinating 
Committee (SRCWCC) is to assist the State Conservationist, NRCS, in 
administering the program. The State Conservationist will chair the 
SRCWCC.
    (c) To assure coordination at the project level, a local Rural Clean 
Water Coordinating Committee is to be established at the time the 
application is developed. An existing local committee may be used, where 
practicable, to perform the functions of this committee.
    (d) The Administrator, NRCS, through the State Conservationists, 
NRCS, is to enter into agreements, where practicable, with soil 
conservation districts, State soil and water conservation agencies, or 
State water quality agencies to administer all or part of the program 
for a project area. That portion of program administration to be 
conducted by these agencies will be defined in the project application 
and grant agreement. Where this is not practicable, USDA will administer 
the program in a project area. In those instances where USDA retains 
administration of the program in a project area, NRCS will enter into 
agreements for the transfer of funds to the Agricultural Stabilization 
and Conservation Service (ASCS) for the administration of part of the 
program.



Sec. 634.4  Responsibilities.

    (a) Environmental Protection Agency (EPA) will--
    (1) Approve 208 water quality management plans,
    (2) Participate in the National and State Rural Clean Water 
Coordinating Committees,
    (3) Review and concur in project applications approved for funding 
in accordance with Sec. 634.14,
    (4) Advise the Secretary of Agriculture of practices which tend to 
defeat the purposes of contracts with rural landowners or operators in 
accordance with section 208(j)(1)(iv) of the act,
    (5) Assist USDA in evaluating the effectiveness of the program in 
improving water quality, and
    (6) Concur in the selection of project areas and the criteria for 
comprehensive, joint USDA-EPA water quality monitoring, evaluation, and 
analysis in accordance with Sec. 634.50.
    (b) U.S. Department of Agriculture (USDA) will--
    (1) With the concurrence of EPA, administer a program to enter into 
contracts to install and maintain best management practices to control 
agricultural nonpoint source pollution for improved water quality,
    (2) Act through NRCS and such other USDA agencies as the Secretary 
may designate,
    (3) Provide technical assistance and share the cost of carrying out 
best management practices that are set forth in the contracts,
    (4) Where practicable, enter into agreements with soil conservation 
districts, State soil and water conservation agencies, or State water 
quality agencies to administer all or part of the program for a project 
area,
    (5) Administer the program where it is not practicable for soil 
conservation districts, State soil and water conservation agencies, or 
State water quality agencies to administer all or part of the program 
for a project area,
    (6) Together with local soil conservation districts, determine the 
priorities for assistance to individual participants to assure that the 
most critical water quality problems are addressed,
    (7) Assist in evaluating the overall effectiveness of the program in 
improving water quality, and
    (8) Within the framework of the 208 planning process, make 
additional investigations or plans, where necessary, to supplement 
information contained in the approved agricultural portion of 208 water 
quality management plans for the purpose of selecting among projects to 
be funded.
    (c) Natural Resources Conservation Service (NRCS) will--
    (1) Provide RCWP leadership,
    (2) Retain major technical responsibility for RCWP, and provide 
leadership to assure the adequacy of standards and specifications for 
use by all administering agencies,

[[Page 647]]

    (3) Manage budgeting, accounting, and reporting,
    (4) Chair NRCWCC and assure that RCWP applications are distributed 
to the NRCWCC, including EPA, for review,
    (5) For the Secretary of Agriculture, with the concurrence of the 
Administrator, EPA, approve RCWP projects for funding,
    (6) For the Secretary of Agriculture, select and enter into 
agreements with either soil conservation districts, State soil and water 
conservation agencies, or State water quality agencies, where 
practicable, to adminster all or part of the program,
    (7) Enter into fund transfer agreements to transfer funds to ASCS in 
those instances where the administration of contracts is retained by 
USDA,
    (8) Enter into agreements with other USDA agencies, as appropriate, 
for support which they are to provide,
    (9) Chair SRCWCC,
    (10) For the Secretary of Agriculture, in coordination with NRCWCC, 
determine the maximum Federal contribution to the total cost of the 
project,
    (11) Provide technical assistance through soil conservation 
districts or arrange for other Federal, State, local agencies, or 
private individuals or firms to provide technical assistance as 
appropriate,
    (12) Provide technical assistance to soil conservation districts and 
County Agricultural Stabilization and Conservation (ASC) Committees to 
assist them in determining priorities of assistance among individual 
participants,
    (13) Develop appropriate technical and administrative training 
programs,
    (14) Provide leadership for USDA for comprehensive joint USDA-EPA 
water quality monitoring, evaluation, and analysis in selected project 
areas,
    (15) Provide leadership for USDA in evaluating the effectiveness of 
the program in improving water quality,
    (16) Carry out the function of soil conservation districts for 
approving water quality plans where no soil conservation district 
exists, and
    (17) Through the State Conservationist, after considering 
recommendations of the SRCWCC, reach agreement with the Governor on the 
recommended administering agency to be included in the project 
application.
    (d) The Agricultural Stabilization and Conservation Service (ASCS) 
will--
    (1) Participate on the National, State, and local coordinating 
committees.
    (2) Provide guidance to State and County ASC Committees and 
coordinate the Agricultural Conservation Program (ACP) and the Forestry 
Incentives Program (FIP) with RCWP,
    (3) Where the administration of contracts is retained by USDA, enter 
into agreements with NRCS for the transfer of funds to be allocated to 
County ASC Committees,
    (4) Consolidate reports of the annual cost-share disbursements made 
by the State ASC Committee, and report these disbursements to NRCS,
    (5) Furnish data on land use, crop history, and cost-shared 
conservation measures,
    (6) Review plans and contracts to assure coordination with other 
farm programs, and
    (e) The Forest Service (FS) will--
    (1) Retain technical responsibility for forestry,
    (2) Provide technical assistance through the State forestry agency 
(State Forester as appropriate) for planning, applying, and maintaining 
forestry best management practices, and
    (3) Participate on the National, and as appropriate, State, and 
local coordinating committees.
    (f) The Science and Education Administration (SEA) will--
    (1) Develop, implement, and coordinate educational programs for 
agricultural nonpoint source water pollution control,
    (2) Participate on the National, and as appropriate, State, and 
local coordinating committees, and
    (3) Provide technical assistance for appropriate BMP's.
    (g) The Economics, Statistics, and Cooperatives Service (ESCS) will: 
(1) Participate on the National coordinating committee and, as 
appropriate, particpate in State, and local coordinating committee 
activities,
    (2) Assist in the economic evaluation of best management practices 
and RCWP projects,

[[Page 648]]

    (3) Make data available from existing and planned ESCS surveys 
relating to water quality and related matters,
    (4) Assist in RCWP evaluation by making available the ESCS land and 
water resource economic modeling systems, and
    (5) Conduct socioeconomic research, within ESCS authorities and 
funds, on relevant policy and program issues pertinent to RCWP.
    (h) The Farmers Home Administration (FmHA) will--
    (1) Participate on the National, and as appropriate, State and local 
coordinating committees, and
    (2) Provide assistance and coordinate their farm loan and grant 
programs with RCWP.
    (i) The NRCWCC is chaired by the Administrator, NRCS. Other members 
of the National Committee are the Administrators of ASCS, FmHA, and 
ESCS; the Chief of FS; the Director of SEA; and the Assistant 
Administrator for Water and Waste Management, EPA. Non-Federal agencies 
such as conservation districts, State soil and water conservation 
agencies, State water quality agencies, and other organizations are 
invited to attend as observers. The duties of the Committee are to:
    (1) Coordinate individual agency programs with the Rural Clean Water 
Program,
    (2) Recommend to the Administrator, NRCS, the project applications 
to be funded,
    (3) Advise the Administrator, NRCS, on the maximum Federal 
contribution to the total cost of the project,
    (4) Assist the Administrator, NRCS, in mediating agency differences 
at the State level,
    (5) Periodically advise the Secretary and Assistant Secretary for 
Conservation, Research and Education of program and policy issues, and
    (6) Recommend project areas and criteria for comprehensive, joint 
USDA/EPA water quality monitoring, evaluation, and analyses.
    (j) The SRCWCC is chaired by the State Conservationist, NRCS. Other 
members of the State committee are the State 208 water quality agency, a 
designated representative of the areawide agencies, the State soil and 
water conservation agency, a designated representative of soil and water 
conservation districts, other State and local agencies or individuals as 
the Governor deems appropriate, and representatives of the agency 
members of the NRCWCC. The duties of the committee are to insure that a 
process exists:
    (1) To consult with the Governor or his designee on the Governor's 
determination of priority project areas,
    (2) To assure coordination of activities at the project level by 
assisting in determining the composition and responsibilities of the 
local rural clean water coordinating committee,
    (3) To prepare the RCWP applications for the Governor to submit to 
the State Conservationist, NRCS, based on priorities established by the 
Governor,
    (4) To incorporate adequate public participation, including public 
meeting(s), and appropriate environmental assessment in the preparation 
of RCWP applications,
    (5) To monitor and evaluate the RCWP in the State and to assist USDA 
and EPA in their comprehensive, joint water quality monitoring and 
evaluation of selected project areas in accordance with Sec. 634.50,
    (6) To develop procedures for coordination between conservation 
districts and county ASC committees and between RCWP and other water 
quality programs at the local level,
    (7) To assist the State Conservationist, NRCS, in mediating agency 
differences at the local level,
    (8) To initiate a written agreement setting forth any or all of the 
above activities when the Governor and the Secretary of Agriculture or 
his designee deem it appropriate, and
    (9) To make recommendations to the State Conservationist, NRCS, 
concerning the selection of the administering agency to be included in 
the project application.
    (k) The State soil and water conservation agency will, as 
appropriate:
    (1) Assist in preparing and submitting applications for RCWP,
    (2) Administer all or part of the RCWP for a project area,
    (3) Carry out the responsibilities of soil conservation districts 
for determining priority for assistance among

[[Page 649]]

individual participants where no soil conservation district exists, and
    (4) Participate on the State and local coordinating committees.
    (l) The State 208 water quality agency will, as appropriate:
    (1) Assist in preparing and submitting applications for rural clean 
water projects,
    (2) Administer all or part of the RCWP for a project area,
    (3) Participate on the State and local coordinating committees, and
    (4) Assist in monitoring and evaluating the water quality 
effectiveness of projects.
    (m) The soil conservation district will:
    (1) As appropriate, assist in the preparation and submission of 
applications for rural clean water projects,
    (2) As appropriate, administer all or part of the RCWP in a project 
area.
    (3) As appropriate, participate on the local coordinating 
committees,
    (4) Approve participants' water quality plans, and
    (5) Together with the county ASC Committee, determine the priority 
for assistance among individual participants to assure that the most 
critical water quality problems are addressed.
    (n) The county ASC committee will:
    (1) Together with the soil conservation district, determine the 
priorty for assistance among individual participants to assure that the 
most critical water quality problems are addressed,
    (2) Receive applications for assistance for individual participants 
where USDA retains administration of the program,
    (3) Make cost-share payments to individual participants where USDA 
retains administration of the program, and
    (4) As appropriate, participate on the local coordinating 
committees.
    (o) The designated management agency(s) for the agricultural portion 
of a 208 plan for the project area will:
    (1) Assist in preparing and submitting an application for a rural 
clean water project in an area for which they were designated,
    (2) Submit a letter, as part of the project application, certifying 
that the BMP's proposed for cost sharing are consistent with the BMP's 
in the approved 208 plan,
    (3) Submit a letter, including a schedule, giving assurance that an 
adequate level of participation in the project will be achieved within 5 
years, and
    (4) As appropriate, serve as the administering agency.
    (p) The administering agency will:
    (1) As appropriate, enter into a grant agreement or fund transfer 
agreement with the Natural Resources Conservation Service for:
    (i) Receiving funds from the Natural Resources Conservation Service 
for administrative costs, cost sharing, and technical assistance, as 
appropriate, associated with carrying out the project,
    (ii) Establishing detailed work schedules in accordance with the 
approved project application,
    (iii) Establishing the maximum amount of administrative costs 
chargeable to the grant,
    (iv) Establishing an adequate financial management system,
    (v) Preparing a cost allocation plan,
    (vi) Monitoring and reporting performance,
    (vii) Reviewing applications for assistance from landowners or 
operators,
    (viii) Certifying availability of funds, and
    (ix) Complying with OMB Circular A-102 and other appropriate 
regulations,
    (2) Enter into contracts with participants for the installation and 
maintenance of BMP's based on water quality plans developed by 
participants,
    (3) Make cost-share payments to participants upon receipt of 
certification by NRCS,
    (4) Issue modifications to participant RCWP contracts,
    (5) Develop average cost rates for each practice applicable in the 
project area.
    (6) Sample and inspect materials used in the installation of BMP's,
    (7) Establish a contract violations and appeals and collections 
process,
    (8) Provide for public involvement in the implementation of RCWP in 
a project area, and maintain a mailing list of interested individuals 
and organizations for informing the public

[[Page 650]]

about the activities contemplated and carried out in the project area, 
and
    (9) Maintain records, provide necessary facilities, personnel, and 
legal counsel for carrying out these responsibilities.
    (q) The Governor of each State will:
    (1) In order to qualify for assistance under RCWP:
    (i) Establish priorities for RCWP project areas in the State,
    (ii) Coordinate the development of RCWP project applications with 
the SRCWCC and local agencies,
    (iii) Submit, in order of priority, RCWP project applications to the 
Administrator, NRCS, through the State Conservationist, NRCS, and
    (iv) Recommend an eligible State or local agency to serve as the 
administering agency of the project, or request USDA to be the 
administering agency.
    (2) Where appropriate, with the State Conservationist, NRCS, set 
forth the activities of the SRCWCC in a written agreement,
    (3) Assign additional State and local agencies or individuals to 
membership on the SRCWCC, as appropriate, and
    (4) Reach agreement with the State Conservationist, NRCS, in 
selecting the administering agency.



Sec. 634.5  Definitions.

    (a) Adequate level of participation. An adequate level of 
participation is reached when participants, having control of 75 percent 
of the identified critical area or source of the pollution problem in 
the project area, are under contract. Exceptions may be made where the 
approved agricultural portion of the 208 plan provides data and analyses 
which indicate that a greater or lesser percentage of the critical area 
or source treated is needed to attain water quality standards or water 
quality goals. Fifty (50) percent of the adequate level of participation 
is to be achieved within 3 years; the remainder within 5 years.
    (b) Administering agency. A soil conservation district, State soil 
and water conservation agency, or State water quality agency that enters 
into an agreement with the State Conservationist, NRCS, to administer 
assigned responsibilities for RCWP projects; or ASCS, when USDA retains 
contract administration.
    (c) Administrative cost. Grant and fund transfer costs, including 
allowable costs incurred by the Administering agency in contract 
administration. These costs, indirect and direct, include charges for 
personnel, travel, materials, and supplies. The costs are limited to a 
maximum of 5 percent of the Federal share for BMP cost.
    (d) Agreement. A legal instrument reflecting the relationship 
between NRCS and the administering agency for performance of RCWP 
activities.
    (e) Agricultural nonpoint source pollution. Pollution originating 
from existing nonpoint sources that are (a) agriculturally related, 
including runoff from animal waste disposal areas and from land used for 
livestock and crop production, or (b) silviculturally related pollution.
    (f) Agricultural portion of a 208 plan. That portion of the 208 plan 
that deals with agriculture and those silvicultural activities related 
to farming and ranching enterprises.
    (g) Appeals board. A group of three or more individuals, including a 
hearing officer, established by the administering agency with the 
concurrence of the State conservationist, NRCS, to review asserted 
contract violations, hear associated appeals, and report its findings, 
conclusions, decisions, and recommendations in State or locally 
administered projects.
    (h) Average cost. The calculated cost, determined by recent actual 
local costs and current cost estimates, considered necessary for 
carrying out BMP's or an identifiable unit thereof.
    (i) Best Management Practice (BMP). A single practice or a system of 
practices included in the approved RCWP application that reduces or 
prevents agricultural nonpoint source pollution to improve water 
quality.
    (j) BMP cost. The amount of money actually paid or obligated to be 
paid by the participant for equipment use, materials, and services for 
carrying out BMP's or an identifiable unit of a BMP. If the participant 
uses his or her own resources, the cost includes the computed value of 
his or her own labor, equipment use, and materials.

[[Page 651]]

    (k) Contract. The legal document, that includes the water-quality 
plan and is executed by the participant and the administering agency. It 
details the agreement between parties for carrying out BMP's on the 
participant's land.
    (l) Cost-share level. The percentage of the total cost of installing 
BMP's included in the participant's contract that is paid by the 
administering agency.
    (m) Critical areas or sources. Those finite areas or sources of 
agricultural nonpoint source pollutants identified as having the most 
significant impact on the quality of the receiving waters.
    (n) Federal Management Circular FMC 74-4. ``Cost Principles 
Applicable to Grants and Contracts with State and Local Governments.''
    (o) Financal burden. The participant's contribution to the total 
cost of BMP's that would be inequitable or probably prevent 
participation in RCWP.
    (p) Identifiable unit. A component of a BMP that can be clearly 
identified in carrying out BMP's in the water quality plan.
    (q) Letter of Credit--Treasury Regional Disbursing Officer System. 
The system whereby the letters of credit are maintained and serviced by 
Treasury disbursing centers and Treasury regional disbursing officers.
    (r) Management agency. The Federal, State, interstate, regional, or 
local agency designated by the Governor to carry out the approved 
agricultural portion of the 208 water-quality management plan.
    (s) OMB Circular A-34. ``Instructions on Budget Execution.''
    (t) OMB Circular A-102 (Rev.) Office of Management and Budget 
Uniform Administrative Requirements for Grants-in-Aid to State and local 
governments.
    (u) Offsite benefits. Those favorable effects of BMP's that occur 
away from the land of the participant receiving RCWP assistance and 
accrue to the public as a result of improved water quality.
    (v) Participant. A landowner or operator who applies for and 
receives assistance under RCWP.
    (w) Participants water quality plan. The plan which identifies 
critical agricultural nonpoint source(s) of water quality problems and 
sets forth BMP's which contribute to meeting the water quality 
objectives of the project.
    (x) Privately owned rural land. Those lands not held by Federal, 
State, or local governments which include cropland, pastureland, forest 
land, rangeland, and other associated lands.
    (y) RCWP projects. The total system of BMP's, institutional 
arrangements, and technical, cost-sharing, and administrative assistance 
activities that are authorized in a RCWP project area.
    (z) Standards and specifications. Requirements that establish the 
minimum acceptable quality level for planning, designing, installing, 
and maintaining BMP's.
    (aa) State. Any of the several States of the United States, the 
District of Columbia, the Commonwealth of Puerto Rico, the U.S. Virgin 
Islands, Guam, American Samoa, the Commonwealth of the Northern 
Marianas, and the Trust Territory of the Pacific Islands.
    (bb) Technical assistance cost. Those direct and indirect costs 
associated with the preparation and review of participant water quality 
plans; design, layout and application of BMP's; and investigations 
associated with monitoring and evaluating progress toward meeting 
project objectives.
    (cc) Treasury Circular 1075 (Rev.). Uniform Administrative 
Requirements for Grants-in-Aid to State and local governments.



              Subpart B--Project Authorization and Funding



Sec. 634.10  Applicability.

    RCWP is applicable in project areas that meet the criteria for 
eligibility contained in Sec. 634.12 and are authorized for funding by 
the Administrator, NRCS.



Sec. 634.11  Availability of funds.

    (a) The provisions of the program are subject to the appropriation 
of funds by Congress to the U.S. Department of Agriculture.
    (b) The allocation of funds to the administering agencies is to be 
made on the basis of the total funds needed to carry out the project.
    (c) The obligation of Federal funds for RCWP contracts with 
participants

[[Page 652]]

is to be made on the basis of the total contract costs.



Sec. 634.12  Eligible project areas.

    (a) Only those project areas which are included in an approved 
agricultural portion of a 208 water quality management plan, or revised 
portions thereof, and have identified agricultural nonpoint source water 
quality problems are eligible for authorization under RCWP. Those 
critical areas or sources of pollutants significantly contributing to 
the water quality problems are eligible for financial and technical 
assistance.
    (b) The management agency designated by the Governor under section 
208(c)(1) of the Act to implement the agricultural portion of the 208 
plan must assure in writing in the project application that there will 
be an adequate level of participation by land owners or operators with 
critical areas or sources in a project area.
    (c) An RCWP project area is a hydrologically related land area. 
Exceptions may be made for ease of administration, or to focus on 
concentrated critical areas. To be designated as an RCWP project area 
eligible for authorization, the area's water quality problems must be 
related to agricultural nonpoint source pollutants, including sediment 
animal waste, irrigation return flows, runoff, or leachate that contain 
high concentrations of nitrogen, phosphorus, dissolved solids, toxics 
(pesticides and heavy metals), or high pathogen levels. Generally, the 
project areas will be less than 200,000 acres.



Sec. 634.13  Project applications.

    (a) The SRCWCC is to assure that a process exists to prepare the 
RCWP project applications for submission by the Governor in order of 
priority to the Administrator, NRCS, through the State Conservationst, 
NRCS. This process must include the opportunity for public 
participation, especially participation by potential RCWP participants. 
Applications will be submitted in conformance with OMB Circular A-95.
    (b) The preparation and submission of applications are to be based 
on the priorities established by the Governor and data and information 
in the approved agricultural portion of the State or areawide 208 water 
quality management plan.
    (c) Applications shall contain the following components. Additional 
material may be added when, in the judgment of the applicant, it is 
needed to fully support the application and/or would enhance the 
probability of project authorization. Information provided under each 
component shall be in sufficient detail to permit the NRCWCC to evaluate 
the application using priority criteria in Sec. 634.14.
    (1) Description of the project area,
    (2) Severity of the water quality problem,
    (3) Objectives and planned action,
    (4) Schedule for carrying out the plan, and
    (5) Estimated cost. This component is to identify and show the basis 
for those costs associated with completing the project. The project 
application shall include an estimate of the total cost of the project, 
the Federal contribution, and the non-Federal contribution. The Federal 
contribution shall not exceed 50 percent unless the application, based 
on offsite benefits and financial burden, show that a higher level is 
appropriate.
    (6) Estimated water quality benefits and effects.
    (7) Arrangements for project administration. This component is to 
set out the applicant's plan for carrying out the program in the project 
area. The plan should:
    (i) Identify the administering agency and document the capability of 
the agency to carry out the responsibilities described in Sec. 634.4(p). 
In addition, information should be included to describe the 
administering agency staff, the location of that staff relative to the 
project area, and the experience of the agency in administering 
comparable grant programs.
    (ii) Where appropriate, describe the specific arrangements that have 
been made, or that are anticipated, for local, State, and Federal agency 
participation such as technical assistance and other cost-sharing 
programs.
    (8) Attachments. The following attachments are the minimum required 
with each application:

[[Page 653]]

    (i) A letter from the water-quality management agency designated by 
the Governor to carry out the approved agricultural portion of the 208 
water quality management plan for the area or source certifying that the 
BMPs to be cost shared are consistent with the BMP's in the 208 plan,
    (ii) A letter from the designated management agency which assures 
and sets out a strategy for reaching an adequate level of participation 
(Sec. 634.5(a)).
    (iii) As appropriate, the preapplication for Federal assistance (OMB 
Circular A-102) from the identified administering agency, and
    (iv) A listing of the prevailing cost-share levels of other programs 
in the project area.



Sec. 634.14  Review and approval of project applications.

    (a) In reviewing applications and recommending priorities, the 
NRCWCC will consider the following:
    (1) Severity of the water quality problem caused by agricultural and 
silvicultural related pollutants, including:
    (i) State designated uses of the water affected,
    (ii) Kinds, sources, and effects of pollutants, and
    (iii) Miles of stream or acres of water bodies affected,
    (2) Demonstration of public benefits from the project, including:
    (i) Effects on human health,
    (ii) Population benefited by improved water quality,
    (iii) Effects on the natural environment, and
    (iv) Additional beneficial uses of the waters that result from 
improvement of the water quality,
    (3) Economic, and technical feasibility to control water quality 
problems within the life of the project, including:
    (i) Cost effectiveness of BMP's,
    (ii) Size of the area and BMP's needed, and
    (iii) Cost per participant and cost per acre for solution of 
problem,
    (4) State and local input in the project area, including:
    (i) Funds for cost-sharing, technical, and administrative costs. 
States or local governments with their own cost-share programs may 
receive greater consideration for the funding of RCWP projects,
    (ii) Commitment of local leadership to promote the program, and
    (5) The project area's contribution to meeting the national water 
quality goals.
    (b) Based on the project applications, the NRCWCC is to recommend an 
upper limit of the Federal contribution to the total cost of the 
project.
    (c) All project applications will be reviewed by EPA. Project 
applications approval for funding require written EPA concurrence, 
except that the Administrator, NRCS, may assume EPA's concurrence if EPA 
does not act within 45 days following receipt of the project 
application. EPA review of project applications will occur concurrently 
with review by the NRCWCC.
    (d) The Administrator, NRCS, will approve projects for funding. The 
NRCWCC acting through the Chairman will announce the approval of the 
project. The State Conservationist, NRCS, through the SRCWCC, will also 
inform the other involved Federal, State, and local agencies of the 
approval.



Sec. 634.15  Agreements.

    The State Conservationist, NRCS, upon receiving notice of an 
approved project, is to enter into a grant agreement with the 
administering agency, except in those cases where USDA is to administer 
the program. When USDA retains administration, the State 
Conservationist, NRCS, is to enter into a fund transfer agreement with 
the State Executive Director, ASCS.
    (a) Grant agreements. Grant agreements detail the working 
arrangements and applicable operating regulations between NRCS and the 
administering agency. A written grant agreement identifying the parties 
involved, their responsibilities for carrying out the program, and the 
amount of program funds to be encumbered by NRCS is to be executed by 
the parties. This agreement is the fund obligating document. It also 
sets out the necessary working arrangements between parties for 
determining and allocating the administering agency's costs. All grants 
to administering agencies are to be in

[[Page 654]]

accordance with OMB Circular No. A-102, Department of the Treasury 
Circular No. 1075, and Federal Management Circular No. 74-4. State or 
local administering agency grants will be funded under Letter-of-Credit 
serviced by the U.S. Treasury Regional Disbursing Office, or by NRCS 
approved advance/reimbursement financing arrangements subject to the 
terms and conditions of the grant agreement.
    (1) The grant agreement will provide for payment of cost-sharing for 
BMP (Sec. 634.5(j)) and administrative costs (Sec. 634.5(c)).
    (2) The grant agreement may provide for payment of technical 
assistance costs when the administering agency has the capability, and 
the NRCS designates that agency to provide this assistance to RCWP 
participants.
    (3) The administering agency is to monitor the performance of 
activities supported by RCWP grant funds to assure that time schedules 
and participant RCWP contract requirements are being met. Performance 
goals are to be measured against the terms of the grant agreement and 
program directives. When NRCS determines that onsite technical 
inspections, certified completion data, and financial status reports do 
not provide adequate grant evaluation data, the following information 
may be requested:
    (i) A comparison of actual accomplishments with the objectives 
established for the plan,
    (ii) Reasons why established objectives were not met, and
    (iii) Objectives established for the next reporting period.
    (4) Grant agreements may be amended by mutural agreement of the 
parties to the agreement. NRCS may unilaterally amend agreements when 
the sole consideration is a change in the cost and the Administrator, 
NRCS, based on NRCWCC recommendations, determines that such an 
adjustment is necessary to carry out the program efficiently and 
effectively.
    (b) Fund transfer agreements. When it is impractical for NRCS to 
enter into agreements with local soil conservation districts, State soil 
and water conservation agencies, or State water quality agencies to 
administer the program in a project area, USDA will retain program 
administration. In this case, the State Executive Director, ASCS, and 
the State Conservationist, NRCS, are to enter into an agreement for the 
transfer of funds to ASCS through county ASC committees for activities 
included in administrative cost (Sec. 634.5(c)) and BMP cost 
(Sec. 634.5(j)). The following general working arrangements are to 
apply:
    (1) Administering contracts, making cost-share payment, and program 
reporting are to be provided by ASCS as the administering agency.
    (2) NRCS, or its designee, with appropriate Federal or State agency 
support, will provide technical assistance to participants in preparing 
RCWP contracts and in carrying out their water-quality plans.
    (c) Agreements for services. NRCS may enter into an agreement for 
services with a State or local agency. The designee must meet the 
requirements of OMB Circular No. A-102.
    (d) Contracts for services. NRCS may enter into contracts for 
services with individuals or firms for providing technical assistance.



Sec. 634.16  Suspension of grants.

    (a) Suspension orders. Work on a project or on a portion or phase of 
a project for which a grant has been awarded, may be suspended by order 
of the State Conservationist, NRCS. Suspension does not affect RCWP 
contracts existing at the time the suspension order is issued, or the 
administering agency's responsibility to make payments under such 
contracts unless specifically provided for in the suspend order. In no 
event will the participant's right to cost-share payment be diminished 
by action taken under this section.
    (b) Use of suspension orders. Suspension may be required for good 
cause, such as default by the administering agency, failure to comply 
with the terms and conditions of the grant, realignment of programs, or 
advancements in the state of the art.
    (c) Contents of suspension orders. Prior to issuance, suspension 
orders will be discussed with the administering agency and may be 
appropriately modified, in the light of such discussions. Suspension 
orders are to include:

[[Page 655]]

    (1) A clear description of the work to be suspended,
    (2) Instructions as to the issuance of further orders by the 
administering agency for materials or services,
    (3) Instructions as to the administering agency entering into new 
RCWP contracts in the project area,
    (4) Instructions as to the administering agency servicing existing 
RCWP contracts in the project area, and
    (5) Other instructions to the administering agency for minimizing 
Federal costs.
    (d) Issuance of suspension order. Suspension orders are issued by 
the State Conservationist, NRCS, by letter to the administering agency 
(certified mail, return receipt requested). A suspension order may not 
exceed forty-five (45) calendar days.
    (e) Effect of suspension order. (1) Upon receipt of a suspension 
order, the administering agency shall promptly comply with its terms and 
take all reasonable steps to minimize costs allocable to the work 
covered by the order during the period of work suspension. During the 
suspension period, NRCS shall either:
    (i) Cancel the suspension order, in full or in part, and authorize 
resumption of work, or
    (ii) Take action to terminate the work covered by such order as 
provided by Sec. 634.17.
    (2) If a suspension order is canceled, or the period of the order 
expires, the administering agency shall promptly resume the suspended 
work. An equitable adjustment shall be made in the grant period, the 
project period, or grant amount, or all of these, and the grant 
agreement may be amended:
    (i) The suspension order results in an increase in the time, or cost 
properly allocable to, the performance of any part of the project; and
    (ii) The administering agency asserts a written claim for such 
adjustment within thirty (30) days after the end of the period of work 
suspension. If no written claim is made, NRCS may unilaterally make such 
adjustments.
    (iii) Reasonable costs resulting from the suspension order shall be 
allowed in arriving at any terminations settlement.
    (3) Costs incurred by the administering agency after a suspension 
order is delivered that are not authorized by this section or 
specifically authorized in writing by the State Conservationist, NRCS, 
shall not be allowable costs.



Sec. 634.17  Termination of grant agreement.

    (a) Termination agreement or notice. (1) The State Conservationist, 
NRCS, may, based on evidence of failure to comply with the terms of the 
grant agreement, issue a notice of intent to terminate the grant 
agreement. The notice of intent to terminate has the force and effect of 
extending or modifying the conditions of the suspend order. Any 
modification of the conditions of the suspend order shall be shown in 
the notice and discussed with the administering agency. The State 
Conservationist shall give not less than ten (10) days written notice to 
the administering agency (certified mail, return receipt requested) of 
intent to terminate the grant in whole or in part.
    (2) After the administering agency has been afforded an opportunity 
for consultation, the State Conservationist, NRCS, may request 
authorization from the Administrator, NRCS, to terminate the grant in 
whole or in part. If the Administrator, NRCS, concurs in the termination 
action, the proposed termination notice will be forwarded to the 
Administrator, EPA, for concurrence.
    (3) After the Administrators, NRCS and EPA, have been informed of 
any expressed views of the administering agency and concurred in the 
proposed termination, the State Conservationist, NRCS, may, in writing 
(certified mail, return receipt requested), terminate the grant in whole 
or in part.
    (4) Termination of all or part of the grant agreement may be carried 
out by either execution of a termination agreement by the State 
Conservationist, NRCS, or issuance of a grant termination notice by the 
State Conservationist, NRCS. The agreement or notice shall establish the 
effective date of termination of the grant, the basis for settlement of 
grant termination costs, and the amount and date of payment of any sums 
due either party.

[[Page 656]]

    (b) Basis for termination. A grant may be terminated by NRCS for 
good cause subject to negotiation and payment of appropriate termination 
settlement costs. Cause for termination by NRCS includes:
    (1) Failure by the administering agency to make satisfactory 
progress toward achieving an adequate level of participation; or other 
evidence satisfactory to the NRCWCC, Administrator, EPA, and the 
Administrator, NRCS, that the administering agency has failed or is 
unable to perform in accordance with the provisions of the grant 
agreement; or
    (2) Failure through no fault of the administering agency to achieve 
an adequate level of participation; or other evidence satisfactory to 
the NRCWCC, Administrator, EPA, and the Administrator, NRCS, that the 
planned actions approved in the project application cannot be achieved.
    (c) Effect of grant termination. (1)(i) In those cases where cause 
for grant termination is based on the administering agency's failure or 
inability to perform (Sec. 634.17(b)(1)), upon termination, the 
administering agency must refund or credit to the United States that 
portion of the grant funds paid or owed to the administering agency and 
allocable to the terminated project work. Funds needed to meet 
unavoidable commitments may be retained. All other funds, including 
unexpended cost-sharing monies for existing RCWP contracts executed 
prior to the termination date, shall be refunded to the United States. 
The administering agency shall not make any new commitments or enter 
into any new RCWP contracts. The administering agency shall reduce the 
amount of other outstanding commitments insofar as possible and report 
to the State Conservationist, NRCS, the uncommitted balance of funds 
awarded under the grant. The allowability of termination costs will be 
determined in conformance with applicable Federal cost principles.
    (ii) Upon termination of a grant agreement, existing RCWP contracts 
and their related obligations will immediately, and in no case later 
than 5 calendar days be transferred to the ASCS county office to assure 
continuity in payments to participants. The State Conservationist, NRCS, 
will immediately initiate action under Sec. 634.15 to establish a new 
administering agency for completion of the project.
    (2) In those cases where cause for grant termination is based on 
failure to achieve the planned actions through no fault of the 
administering agency, the termination agreement and amended grant 
agreement are to permit the administering agency to fulfill the 
obligations of its existing RCWP contracts. The administering agency 
shall not make any new commitments or enter into any new RCWP contracts 
without NRCS approval.



Sec. 634.18  Termination of project.

    (a) An RCWP project is terminated by the State Conservationist 
because an adequate level of participation cannot be achieved. Upon this 
determination, the State Conservationist shall publish in a newspaper of 
public record in the project area a notice of intent to terminate all or 
part of the grant agreement and the project (Sec. 634.7(c)), and an 
announcement of the time and place of a public hearing.
    (b) No sooner than 15 days from the publication of the notice of 
intent to terminate all or part of the project and grant agreement, the 
State Conservationist will conduct a public hearing in the project area.
    (c) If, based on the hearing record, the performance record of the 
administering agency, and the recommendations of the SRCWCC, the State 
Conservationist determines that the project will be terminated pursuant 
to Sec. 634.17(c), the State Conservationist will enter into a grant 
termination agreement or issue a grant termination notice.
    (d) The existing RCWP contracts will be transferred to the ASCS 
county office pursuant to Sec. 634.17(c)(1)(ii).
    (e) The State Conservationist will prepare a project close-out 
report summarizing the actions accomplished.



Sec. 634.19  Project completion and closeout.

    (a) The maximum total life of a project shall be fifteen (15) years 
or less.
    (b) The allowable contracting period may be increased if an adequate 
level

[[Page 657]]

of participation has been achieved and the designated management agency 
assures a significant increase in participation can be reached in a 
reasonable time.
    (c) The grant or fund transfer agreement with an administering 
agency shall expire when the administering agency has fulfilled all of 
its obligations in the long-term RCWP contracts.
    (d) When a project is completed, the administering agency is to 
provide the State Conservationist, NRCS, a closeout report which 
summarizes the actions accomplished.



                  Subpart C--Participant RCWP Contracts



Sec. 634.20  Eligible land.

    RCWP is only applicable to privately owned land. Land owned by 
corporations whose ownership is public (i.e., their stock is publicly 
traded over the market) is eligible for program assistance only if the 
corporation can document that the installation of BMP's places an 
inappropriate financial burden on the corporation.



Sec. 634.21  Eligible participants.

    (a) Any landowner or operator whose land or activities in a project 
area is contributing to the area's agricultural nonpoint source water 
quality problems and who has an approved water quality plan is eligible 
to enter into an RCWP contract.
    (b) This program will be conducted in compliance with all 
nondiscrimination requirements as contained in the Civil Rights Act of 
1964 and amendments thereto and the Regulations of the Secretary of 
Agriculture (7 CFR 15.1 through 15.12).



Sec. 634.22  Application for assistance.

    (a) Landowners or operators must apply for RCWP assistance through 
the office of the administering agency or its designee(s) by completing 
the prescribed application form.
    (b) The priority for assistance among landowners and operators in 
developing water quality plans is to be determined jointly, through an 
agreed-to process, by the county ASC committee and the soil conservation 
district, with technical assistance from NRCS.
    (c) Applications that are ineligible or technically infeasible are 
to be returned to the applicant with a letter stating the reasons for 
disapproval. Applications that are of a low priority will be retained 
and the applicant will be sent a notice that the application is being 
held for a period to be determined locally for future consideration.



Sec. 634.23  Water quality plan.

    (a) The participant's water quality plan, developed with technical 
assistance by the NRCS or its designee, is to include appropriate BMP's 
identified in the approved agricultural portion of the 208 water quality 
management plan. Such BMP's must reduce the amount of pollutants that 
enter a stream or lake by:
    (1) Methods, such as reducing the application rates or changing the 
application methods of potential pollutants, and
    (2) Methods, such as practices or combinations of practices which 
prevent potential pollutants from leaving source areas or reduce the 
amount of potential pollutants that reach a stream or lake after leaving 
a source area.
    (b) Participant's water quality plans shall as a minimum include 
BMP's for all critical areas or sources. The plans will include BMP's 
which are required but not cost-shared. Non-cost-shared BMP's, essential 
for the performance and maintenance of cost-shared BMP's shall be 
required as a condition of the RCWP contract.
    (c) The participant is responsible for compliance with all other 
applicable Federal, State, and local laws that deal with the 
participant's nonpoint source water quality problems, such as the 
treatment, storage, and disposal of hazardous waste. BMP's required for 
compliance may be cost shared.
    (d) It is recognized that the participants' water-quality plans upon 
which the RCWP contracts are to be based may include conservation 
measures other than those related to water quality improvement. These 
measures are not eligible for cost sharing under this program. The 
installation of such conservation measures will not be required

[[Page 658]]

as a condition of the RCWP contract and will not be shown in the time 
schedules for implementing BMP's.
    (e) Time schedules for implementing BMP's are to be provided in the 
participant's water quality plan. The time schedule is to establish the 
length of the contract within the 5 to 10 year period established by 
law.
    (f) The Natural Resources Conservation Service will certify as to 
the technical adequacy of the water-quality plan.
    (g) The soil conservation districts are to review and approve all 
water-quality plans and modifications.



Sec. 634.24  Cost sharing.

    (a) The portion of BMP cost (including labor) to be cost shared 
shall be that part which the Secretary determines is necessary and 
appropriate. The value of land upon which BMP's are applied, or the 
participant's water rights, cannot be considered a part of the 
participant's share of the cost.
    (b) The administering agency, in consultation with the county ASC 
committee(s), soil conservation district(s), and designated management 
agency will annually set maximum individual BMP cost-share levels for 
the project area. However, the Federal share of the cost of the contract 
cannot exceed 50 percent unless a variance has been granted.
    (c) Recommended variances exceeding the 50 percent level must be in 
the public interest and based on the following criteria:
    (1) The main benefits to be derived from measures are related to 
improving offsite water quality, and
    (2) The matching share requirements would place a burden on the 
landowner or operator which would probably prevent him or her from 
participating in the program.
    (d) BMP's to be cost shared must have a positive effect on water 
quality by reducing the amount of agricultural nonpoint source 
pollutants that enter a stream or lake.
    (e) Cost sharing is not to be made available for:
    (1) Measures installed primarily for bringing additional land into 
crop production, including but not limited to land clearing and brush 
removal;
    (2) Measures installed primarily for increasing production on 
existing cropland, including but not limited to bedding, field ditches, 
open drains, and tile drains;
    (3) Measures having flood protection as the primary purpose, 
including but not limited to open channels, clearing and snagging, and 
obstruction removal;
    (4) Structural measures authorized for installation under Pub. L. 
83-566.
    (f) The Federal cost-share level is not to be reduced by the 
contribution of a State or subdivision thereof. Total payments from 
Federal, State, and local sources for a BMP may not exceed the total 
cost of that BMP.



Sec. 634.25  Contracting.

    (a) To participate in RCWP, a landowner or operator must enter into 
a contract in which he or she agrees to apply his or her water-quality 
plan. Any person who controls, or shares control, of the farm, ranch, or 
other land for the proposed contract period (5 to 10 years) must sign 
the contract.
    (b) Cost-sharing payments cannot be provided for any measure that is 
initiated before the contract is approved by the administering agency.
    (c) The participant must furnish satisfactory evidence of his or her 
control of the farm, ranch, or other land. The administering agency is 
to determine the acceptability of the evidence and maintain current 
ownership evidence in the contract file.
    (d) RCWP contracts shall include the basic contract document, 
special provisions as needed, the participant's water-quality plan, 
schedule of operations, and any other data necessary.
    (e) NRCS or its designee shall approve the technical adequacy of the 
RCWP contract and obtain the required signature of the participants. The 
NRCS or its designee will provide the contract to the administering 
agency for certification of fund availability and for execution.
    (f) Participants shall install best management practices according 
to the specifications that are applicable at the time measures are 
installed.
    (g) NRCS will provide technical assistance to participants for 
installing BMPs. The State Conservationist, NRCS, or its designee may 
enter into

[[Page 659]]

contracts with qualified soil conservation districts or others to 
provide technical assistance.
    (h) The RCWP contract is to require BMPs to be operated and 
maintained by the participant at no cost to that administering agency.
    (i) The contract period is to be not less than 5 and not more than 
10 years. A contract is to extend for at least 1 year after the 
application of the last cost-shared BMPs. All contract items are to be 
accomplished prior to contract expiration.
    (j) A land owner or operator may enter into a contract jointly 
(pooling ageement) with other land owners or operators to solve mutual 
water quality problems. Each participant must enter into an RCWP 
contract to treat water quality problems not covered by the joint 
arrangement.
    (k) Participants may use all available sources of assistance to 
accomplish their water-quality objectives. They are responsible for:
    (1) Accomplishing the water-quality plan;
    (2) Keeping the administering agency informed of their current 
mailing address;
    (3) Obtaining, having in hand, and maintaining any required permits 
and landrights necessary to perform the planned work;
    (4) Applying or arranging for the application of BMPs, as scheduled 
in the plan, according to approved standards and specifications;
    (5) The operation and maintenance of BMPs installed during the 
contract period; and
    (6) Obtaining the authorities, rights, easements, or other approvals 
necessary to maintain BMPs in keeping with applicable laws and 
regulations.
    (l) Unless otherwise approved by the Administrator, NRCS, and 
Administrator, EPA, the administering agency shall not enter into any 
new RCWP contracts after five (5) years of elapsed time from the date 
when RCWP funds are first made available to begin the project.
    (m) Contracts may be terminated due to hardship by mutual agreement 
if the administering agency and the State Conservationist, NRCS, 
determine that such action would be in the public interest.



Sec. 634.26  Contract modifications.

    (a) The administering agency may modify contracts previously entered 
into if it is determined to be desirable to carry out the purposes of 
the program, facilitate the practical administration thereof, or to 
accomplish equitable treatment with respect to other conservation, land-
use, or water-quality programs.
    (b) Requirements of active contracts may be waived or modified by 
the administering agency only if such waiver or modification is 
specifically provided for in these regulations. NRCS concurrence in 
modifications is necessary when modifications involve a technical aspect 
of the participant's water-quality plan. A contract may be modified only 
if it is determined that such modifications are desirable to carry out 
purposes of the program or to facilitate the program's practical 
administration.
    (c) Contracts may be modified to add, delete, substitute, or 
reinstall best management practices when:
    (1) The installed measure failed to achieve the desired results 
through no fault of the participant,
    (2) The installed measure deteriorated because of conditions beyond 
the control of the participant, or
    (3) Another BMP is substituted that will achieve the desired 
results.
    (d) Contract modifications are not required when items of work are 
accomplished prior to scheduled completion or within 1 year following 
the year of scheduled completion.
    (e) If, during the contract period, all or part of the right and 
interest in the land is transferred by sale or other transfer action, 
the contract is terminated on the land unit that was transferred and the 
participant having control over such land:
    (1) Forfeits all right to any future cost-share payments on the 
transferred land unit, and
    (2) Must refund with interest all cost-share payments that have been 
made on the transferred land unit unless the new land owner or operator 
becomes a party to the contract, except that

[[Page 660]]

where it is determined by the administering agency, with the approval of 
the State conservationist, NRCS, that the established BMPs will provide 
water quality benefits for the design life of the BMP, the payment may 
be retained.
    (f) If the new land owner or operator becomes a party to the 
contract:
    (1) Payment which has been earned, but not made to the participant 
who applied the BMPs and had control prior to the transfer, can be made,
    (2) Such land owner or operator is to assume all obligations of the 
previous participant on the transferred land unit,
    (3) The contract with the new participant is to remain in effect 
with the original terms and conditions, and
    (4) The contract is to be modified in writing to show the changes 
caused by the transfer. If the modification is not acceptable to the 
administering agency, the provisions of paragraphs (e) (1) and (2) of 
this section apply.
    (g) The transfer of all or part of a land unit by a participant does 
not affect the rights and obligations of other participants who have 
signed the contract.



Sec. 634.27  Cost-share payment.

    (a) General. Participants are to obtain or contract for materials or 
services as needed to install BMPs. Federal Cost-share payments are to 
be made by the administering agency upon certification by the District 
Conservationist, NRCS, or its designee, that the BMPs, or an 
identifiable unit thereof, have been properly carried out and meet the 
appropriate standards and specifications.
    (b) Payment maximum. The maximum total Federal cost-share payment to 
a participant shall be limited to $50,000. Exceptions to this limit may 
be made by the administering agency with concurrence of the 
Administrator, NRCS, upon recommedation of the NRCWCC, where it 
determines that the main benefits to be derived are essential for 
meeting the water quality objectives in the project area.
    (c) Basis for cost-share payment. (1) Cost-share payments are to be 
made by the administering agency at the cost-share percentage and by one 
of the following methods designated by the administering agency and set 
out in the contract:
    (i) Average cost, or
    (ii) Actual cost not to exceed average cost.
    (2) If the average cost at the time of starting the installation of 
a BMP or identifiable unit is less than the costs specified in the 
contract, payment is to be at the lower rate. If the costs at the start 
of installation are higher, payment may be made at the higher rate. A 
modification will be necessary if the higher cost results in a 
significant increase in the total cost-share obligation. Cost-share 
payment is not to be made until the modification reflecting the increase 
is approved.
    (d) Average cost development. Average costs are to be developed by 
the administering agency for each project using cost data from the local 
area. These costs should be reviewed by the SRCWCC for consistency with 
average costs in other USDA programs. The average cost list is to be 
updated annually by the administering agency.
    (e) Application for payment. Cost-share payments can be made by the 
administering agency after a participant has carried out a BMP or an 
identifiable unit of a BMP. Application for payment must be submitted to 
the administering agency, be certified by the NRCS or its designee, and 
be supported by such cost receipts as are required by the administering 
agency. It is the participant's responsibility to apply for payments.
    (f) Authorizations for payments to suppliers. (1) The contract may 
authorize that part or all of the Federal cost share for a BMP or an 
identifiable unit be made directly to suppliers of materials or 
services. The materials or services must be delivered or performed 
before payment is made.
    (2) Federal cost shares will not be in excess of the cost share 
attributable to the material or service used or not in excess of the 
cost share for all identifiable units as may be requested by the 
participant.
    (g) Material inspection and analysis. When authorizations for 
payments to suppliers are specified, the administering agency, its 
representatives, or the

[[Page 661]]

Government reserve the right to inspect, sample, and analyze materials 
or services prior to their use.
    (h) Assignments, set-offs, and claims. (1) A State or local 
administering agency may allow the assignment of payments to the extent 
provided by State law. When ASCS is designated as the administering 
agency, assignments by any participant who may be entitled to cost-share 
payment under the program are prohibited unless they are made in 
accordance with the provisions of section 203, Title 31, U.S.C., as 
amended, and section 15, Title 41, U.S.C., as amended.
    (2) If any participant to whom compensation is payable under RCWP is 
indebted to the United States and such indebtedness is listed on the 
county register of indebtedness maintained by the County ASC committee, 
the compensation due the participant must be used (set-off) to reduce 
that idebtedness. Indebtedness to USDA is to be given first 
consideration. Deductions for setoffs involving a nonresident alien 
shall be made as provided by 26 U.S.C. 871. Setoffs made pursuant to 
this section are not to deprive the participant of any right to contest 
the justness of the indebtedness involved, either by administrative 
appeal or by legal action.
    (3) Any cost-share payment due any participant shall be allowed 
without deduction of claims for advances except as provided for above 
and without regard to any claim or lien against any crop, or proceeds 
thereof, in favor of the participant or any other creditor.
    (i) Access to land unit and records. Any authorized administering 
agency, or NRCS employees or agents, shall have the right of access at 
reasonable times to land under application or contract, and the right to 
examine any program records to ascertain the accuracy of any 
representations made in the application or contract. This is limited to 
the right to furnish technical assistance and to inspect work performed 
under the contract.
    (j) Suspension of payments. No cost-share payments will be made 
pending a decision on whether or not a contract violation has occurred.
    (k) Ineligible payments. The filing of requests for payment for 
BMP's not carried out, or for BMP's carried out in such a manner that 
they do not meet contract specifications, constitutes a violation of the 
contract.



Sec. 634.28  Appeals not related to contract violations.

    (a) The participant may, prior to execution of the contract, request 
that the administering agency review or reconsider criteria being used 
in developing his or her contract. Such review or reconsideration may 
include the eligibility of BMP's which had not been approved for 
application in the project area, cost-sharing levels for BMP's, 
priorities for developing water quality plans, and standards and 
specifications.
    (1) If verbal agreement is not reached, the participant may make a 
written request within 30 days after receiving notice of the decision of 
his or her verbal request.
    (2) The administering agency shall have 30 days in which to make a 
decision and notify the participant in writing.
    (3) The decision of the administering agency shall be final.
    (b) If, after the contract has been executed, the participant and 
the administering agency are unable to reach written agreement relative 
on matters which are not related to contract violations, the participant 
may request and receive a review by the appeals board. The administering 
agency will:
    (1) Notify the participant, in writing, of the date the appeals 
board will consider the appeal.
    (2) Within 30 days after receiving the administering agency's 
notice, the participant may file a request to appear and present oral 
and other evidence. If the participant does not request an appearance, 
the administering agency appeals board will decide the dispute on the 
evidence available to them, including statements or briefs of the 
authorized representatives of the soil conservation district and NRCS. 
The administering agency shall notify the participants of the appeals 
board's decision in writing. There shall be no further administrative 
appeal of this decision.
    (c) Filing of documents. A document is considered filed when it is 
received in

[[Page 662]]

the office of the person or agency concerned.



Sec. 634.29  Violations.

    (a) Actions causing violations. The following actions constitute 
violation of a contract by a participant:
    (1) Knowingly or negligently damaging or causing BMP's to become 
impaired.
    (2) Adopting a land use or practice during the contract period which 
tends to defeat the purposes of the program.
    (3) Failing to comply with the terms of the contract.
    (4) Filing a false claim.
    (5) Misusing authorizations for payment.
    (b) Contract termination as a result of violations. (1) By signing a 
contract, the participant agrees to forfeit all rights to further cost-
sharing payments under a contract and to refund all cost-share payments 
received, with interest, if the administering agency, with the 
concurrence of the State Conservationist, NRCS, determines that:
    (i) There was a violation of the contract during the time the 
participant had control of the land; and
    (ii) The violation was of such a nature as to warrant termination of 
the contract.
    (2) The participant shall be obligated to refund all cost-share 
payments and all cost shares paid under authorizations, with interest, 
at the rates established by the Secretary of the Treasury pursuant to 
Pub. L. 92-41, 85 Stat. 97.
    (c) Payment adjustments and refunds resulting from violations. (1) 
By signing a contract, the participant agrees to refund cost-share 
payments received under the contract or to accept payment adjustments if 
the administering agency determines and the State Conservationist, NRCS, 
concurs that:
    (i) There was a violation of the contract during the time the 
participant had control of the land; and
    (ii) The nature of the violation does not warrant termination of the 
contract.
    (2) Payment adjustments may include decreasing the rate of cost 
share, or deleting from the contract a cost-share commitment, or 
withholding cost-share payments earned but not paid. The participant who 
signs the contract may be obligated to refund cost-share payments.



Sec. 634.30  Appeals in USDA administered projects.

    The participant in a USDA-administered RCWP project may appeal 
decisions of the administering agency in accordance with part 614 of 
this title.

[60 FR 67316, Dec. 29, 1995]



Sec. 634.31  Appeals of contract violations.

    (a) Scope. This section prescribes the regulations dealing with 
contract violations. The Administrator, NRCS, reserves the right to 
revise or supplement any of the provisions of this section at any time 
if the action does not adversely affect the participant, or if the 
participant has been officially notified before this action is taken.
    (b) Determination by administering agency. Upon notification that a 
contract violation may have occurred, the administering agency:
    (1) Determines that a violation did not occur or that the violation 
was of such a nature that no further action is to be taken; or
    (2) Determines that a violation did occur and the participant agrees 
to accept a written penalty of forfeiture, refund, payment adjustment, 
or termination. If no agreement is reached, further action is to be 
taken.
    (c) Notice of possible violation. (1) When the administering agency 
is notified that a contract violation may have occurred and the matter 
is not resolved under Sec. 634.31(b)(1) it shall notify, in writing, 
each participant who signed the contract of the alleged violation. This 
notice setting forth the alleged violation may be personally delivered 
or sent by certified or registered mail. A participant is considered to 
have received the notice at the time of personal receipt acknowledged in 
writing, at the time of delivery of a certified or registered letter, or 
at the time of the return of a refused certified or registered letter.
    (2) The notice shall give the participant an opportunity to appear 
at a hearing before an appeals board. The participant's request for a 
hearing shall be submitted in writing, and must be received by the 
appeals board within 30 days after receipt of the notice. The

[[Page 663]]

participant shall be notified in writing by the appeals board of the 
time, date, and place for the hearing. The participant shall have no 
right to a hearing if he does not file a written request for a hearing, 
or if he or his representative does not appear at the appointed time, 
unless the appeals board, at its discretion, permits an appearance. A 
request for a hearing filed by a participant shall be considered to be a 
request by all participants who signed the contract.
    (d) Hearing. The appeals board shall conduct an open hearing to 
obtain the facts about the alleged violation. The appeals board shall 
limit the hearing to relevant facts and evidence, and shall not be bound 
by the strict rules of evidence. Witnesses may be sworn in at the 
discretion of the appeals board.
    (1) The participant or his or her representative shall be given full 
opportunity to present oral or documentary evidence about the alleged 
violation. Likewise, the administering agency may submit statements and 
evidence. Individuals not otherwise represented at the hearing may, at 
the discretion of the appeals board, be permitted to give information or 
evidence. The appeals board, at its discretion, may permit witnesses to 
be cross-examined.
    (2) The appeals board shall make a record of the hearing. A summary 
of the testimony may be made if both the participant and the appeals 
board agree. A transcript of the hearing shall be made if requested by 
either the appeals board or the participant within 10 days prior to the 
hearing. If a transcript is requested by the participant, the 
participant may be assessed the cost of a copy of the transcript.
    (3) The appeals board shall, after a reasonable period of time, 
close the hearing if the participant or his or her representative is not 
present at the scheduled time. The appeals board may, at its discretion, 
accept information and evidence submitted by others present for the 
hearing.
    (4) The appeals board shall furnish the administering agency and the 
State Conservationist, NRCS, with a written report setting forth their 
findings, conclusions, and recommendations. The report shall include the 
summary of testimony or transcript made of the hearing and any other 
information which would aid the administering agency in reaching a 
decision.
    (e) Decision by the administering agency. The administering agency 
shall make a decision within 30 days on the basis of the appeals board 
report, recommendations of soil conservation district board, if any, and 
any other information available, including if applicable, the amount of 
the forfeiture, refund, or payment adjustment. The decision shall state 
whether the violation is of such a nature as to warrant termination of 
the contract. The administering agency shall notify, in writing, each 
participant who signed the contract of its decision. The administering 
agency may authorize or require the reopening of any hearing before the 
appeals board for any reason at any time before their decision. The 
administering agency's decision shall be final.
    (1) If the decision provides for termination of the contract, it 
shall state that the contract is terminated and that all rights to 
further cost-share payments under the contract are forfeited and that 
all cost-share payments received under the contract shall be refunded 
with interest. The decision is to state the amount of refund and method 
of payment.
    (2) If the decision does not provide for termination of the 
contract, the participant may be required to make a refund of cost-share 
payments or to accept payment adjustments. The decision shall state the 
amount and justification for refunds of cost-share payments or payment 
adjustments.



                     Subpart D--Financial Management



Sec. 634.40  Financial management.

    (a)(1) Finance and accounting will be in conformance with Office of 
Management & Budget Circular A-102, (Rev.); U.S. Department of Health, 
Education & Welfare Brochure OASC-10, Federal Management Circular FMC 
74-4, ``Cost Principles Applicable to Grants and Contracts with State 
and Local Government''; Department of the Treasury, Department Circular 
No. 1075 (4th Rev.), ``Withdrawal of Cash from the Treasury for Advances 
under Federal Grant and other Programs''; Office of

[[Page 664]]

Management & Budget Circular No. A-34, ``Instruction on Budget 
Execution''; U.S. Treasury Requirements Manual for Guidance of 
Departments and Agencies; and General Accounting Office Policy & 
Procedures Manual for Guidance of Federal Agencies.
    (2) Administering agency RCWP grants will be funded under Letter-of-
Credit serviced by the U.S. Treasury Regional Disbursing Office (RCO), 
subject to the terms and conditions of the grant agreement or by NRCS 
approved advance/reimbursement financing agreements.
    (3) The State of local administering agency shall maintain a 
financial management system which provides accurate and complete 
disclosure of the financial status of the RCWP grant in accordance with 
prescribed reporting requirements.
    (4) The State or local administering agency shall upon request make 
its financial management system records available to NRCS, USDA Office 
of Inspector General, and the General Accounting Office.
    (5) Participation in comprehensive USDA/EPA joint water quality 
monitoring, evaluating, and analysis will be funded according to the 
plan approved in Sec. 634.50(a)(3).
    (b)(1) The carrying out of RCWP will require both financial and 
performance reporting to the Natural Resources Conservation Service by 
participating USDA and State or local agencies.
    (2) USDA participating agencies shall furnish NRCS with reports 
prescribed by the U.S. Treasury Department; Office of Management and 
Budget; Administrative Regulations of the U.S. Department of 
Agriculture; and other reports required by law, regulation, or 
agreement.
    (3) State or local administering agencies shall furnish financial 
status reports to NRCS on a quarterly basis as required by the grant 
agreement. The administering agency is also to provide an audit report 
upon request. The audit report is to be prepared in sufficient detail to 
allow NRCS to determine that funds have been used in compliance with 
applicable laws, regulations, and the grant agreement.



                  Subpart E--Monitoring and Evaluation



Sec. 634.50  Program and project monitoring and evaluation.

    (a) Comprehensive USDA/EPA joint water quality monitoring, 
evaluation, and analysis. (1) Representative RCWP project areas will be 
selected to evaluate the improvement in water quality in the project 
area and to make projections on a nationwide basis. Water-quality 
monitoring, evaluation, and analysis will be conducted to evaluate the 
overall cost and effectiveness of projects and BMPs to provide 
information on the impact of the program on improved water quality and 
for general RCWP program management.
    (2) Monitoring, evaluation, and analysis is a joint USDA/EPA 
responsibility. Subject to appropriation of funds, the Administrator, 
NRCS, and EPA are jointly to select the project areas to be monitored 
and evaluated based on a list of project areas recommended by the 
NRCWCC.
    (3) The Administrator, NRCS, and Administrator, EPA, are jointly to 
determine the criteria to be used for comprehensive water-quality 
monitoring, evaluation, and analysis in the selected project areas. A 
monitoring and evaluation plan is to be developed and agreed to by NRCS 
and EPA prior to initiating a project selected for monitoring and 
evaluation. The State water-quality agency and other Federal, State, and 
local agencies will be involved in the development of the plan for 
water-quality evaluation. The involvement of concerned agencies in 
implementing the plan will be determined at the time the plan is 
prepared.
    (4) The project areas selected for detailed analysis are to be 
representative of agricultural and silvicultural nonpoint source 
pollution problems, categories of agriculture and silvicutural nonpoint 
source pollutants, agricultural enterprises, and BMPs used in the RCWP.
    (5) Preference in the selection of project areas for comprehensive 
evaluation is to be given to those project areas for which long-term 
baseline information exists on land use, hydrologic data, and water 
quality.

[[Page 665]]

    (6) Monitoring and evaluation of selected project areas is to begin 
sufficiently in advance of the installation of BMPs to document, in a 
statistically satisfactory manner, existing land-use practices and 
baseline water-quality problems.
    (7) The water quality monitoring and evaluation plan will provide 
sufficient basic information to adequately describe the land use, 
hydrologic water quality relationship. As a minimum, the plan will 
contain the following components:
    (i) Chemical and physical water quality monitoring,
    (ii) Biological monitoring,
    (iii) Appropriate hydrologic data,
    (iv) Soils properties and characteristics, topographic information,
    (v) Land use and farm inventory.
    (b) Program and project evaluation.
    (1) There will be a continuing evaluation of the Rural Clean Water 
Program to measure its effectiveness and for each project for which 
cost-sharing funds are provided.
    (2) Program and project evaluations will be conducted under the 
direction of the Assistant Secretary for Conservation, Research and 
Education, USDA, the Director of Economics, Policy Analysis, and Budget, 
USDA; and the Assistant Administrator for Water and Waste Management, 
EPA; or their representatives working through NRCWCC.
    (3) Evaluative reports for the program and each project area will be 
submitted annually to the Secretary of Agriculture and the 
Administrator, EPA.
    (c) Funding. (1) Research oriented activities will be from sources 
other than RCWP.
    (2) Funding for program and project monitoring and evaluation will 
be provided through RCWP and other authorizations.



PART 636--WILDLIFE HABITAT INCENTIVES PROGRAM--Table of Contents




Sec.
636.1  Applicability.
636.2  Administration.
636.3  Definitions.
636.4  Program requirements.
636.5  Establishing priority for enrollment in WHIP.
636.6  Cost-share payments.
636.7  The Wildlife Habitat Development Plan (WHDP).
636.8  Cost-share agreements.
636.9  Modifications.
636.10  Transfer of interest in a cost-share agreement.
636.11  Termination of cost-share agreements.
636.12  Violations and remedies.
636.13  Misrepresentation and scheme or device.
636.14  Offsets and assignments.
636.15  Appeals.

    Authority: 16 U.S.C. 3836a.

    Source: 62 FR 49365, Sept. 19, 1997, unless otherwise noted.



Sec. 636.1  Applicability.

    (a) The purpose of the WHIP is to help participants develop habitat 
for upland wildlife, wetland wildlife, threatened and endangered 
species, fish, and other types of wildlife.
    (b) The regulations in this part set forth the requirements for the 
Wildlife Habitat Incentives Program (WHIP).
    (c) The Chief, NRCS may implement WHIP in any of the 50 states, the 
District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin 
Islands of the United States, American Samoa, and the Commonwealth of 
the Northern Mariana Islands.



Sec. 636.2.  Administration.

    (a) The regulations in this part will be administered under the 
general supervision and direction of the Chief, NRCS.
    (b) The State Conservationist will consult with the State Technical 
Committee in the implementation of the program and in establishing 
program direction for the NRCS in the applicable State. The State 
Conservationist has the authority to accept or reject the State 
Technical Committee recommendation; however, the State Conservationist 
will give strong consideration to the State Technical Committee's 
recommendation.
    (c) NRCS may enter into cooperative agreements with Federal 
agencies, State and local agencies, conservation districts, local 
watershed groups, and private entities to assist with program 
implementation, including cost-share agreement execution, assistance, 
planning, and monitoring responsibilities.

[[Page 666]]

    (d) NRCS may make payments pursuant to agreements with other 
Federal, State, or local agencies, conservation districts, local 
watershed groups, or private entities for program implementation, 
coordination of enrollment of cost-share agreements, or for other goals 
consistent with the program provided for in this part.
    (e) NRCS will provide the public with reasonable notice of 
opportunities to apply for participation in the program.
    (f) Nothing in this part shall preclude the Chief of NRCS, or a 
designee, from determining any question arising under this part or from 
reversing or modifying any determination made under this part.



Sec. 636.3.  Definitions.

    Chief means the Chief of the Natural Resources Conservation Service 
or the person delegated authority to act for the Chief.
    Conservation district means a political subdivision of a State, 
Native American Tribe, or territory, organized pursuant to the State or 
territorial soil conservation district law, or Tribal law. The 
subdivision may be a conservation district, soil conservation district, 
soil and water conservation district, resource conservation district, 
natural resource district, land conservation committee, or similar 
legally constituted body.
    Conservation plan means a record of a participant's decisions, and 
supporting information, for treatment of a unit of land or water, and 
includes a schedule of operations, activities, and estimated 
expenditures needed to solve identified natural resource problems.
    Cost-share agreement means the document that specifies the 
obligations and the rights of any person who has been accepted for 
participation in the program.
    Cost-share payment means the payments under this part to develop 
wildlife habitat.
    Habitat development means the physical actions or practices 
undertaken to establish, improve, protect, enhance, or restore the 
present conditions of the land for the specific purpose of improving 
conditions for wildlife.
    Participant means an applicant who is a party to a WHIP cost-share 
agreement.
    Person means an individual, partnership, association, corporation, 
cooperative, estate, trust, joint venture, joint operation, or other 
business enterprise or other legal entity and, whenever applicable, a 
State, a political subdivision of a State, or any agency thereof.
    Practice means a specified treatment, such as a structural or land 
management measure, which is planned and applied according to NRCS 
standards and specifications.
    Recurring practices means practices repeated on the same area over 
the life of a cost-share agreement to achieve specific habitat 
attributes.
    State Conservationist means the NRCS employee authorized to direct 
and supervise NRCS activities in a State, the Caribbean Area, or the 
Pacific Basin Area.
    State Technical Committee means a committee established by the 
Secretary of the United States Department of Agriculture in a State 
pursuant to 16 U.S.C. 3861.
    Wildlife means birds, fishes, reptiles, amphibians, invertebrates, 
and mammals, along with all other animals.
    Wildlife habitat means the aquatic and terrestrial environments 
required for wildlife to complete their life cycles, including air, 
food, cover, water, and spatial requirements.



Sec. 636.4.  Program requirements.

    (a) To participate in WHIP, a person must:
    (1) Develop and agree to comply with a WHDP, as described in 
Sec. 636.7;
    (2) Enter into a cost-share agreement for the development of 
wildlife as described in Sec. 636.8;
    (3) Provide NRCS with written evidence of ownership or legal control 
for the life of the proposed cost-share agreement period; however, an 
exception may be made by the Chief:
    (i) In the case of land allotted by the Bureau of Indian Affairs, 
tribal land, or
    (ii) Other instances in which NRCS determines there is sufficient 
assurance of control;
    (4) Agree to provide all information to NRCS as determined to be 
necessary to assess the merits of a proposed

[[Page 667]]

project and to monitor the compliance of a participant with a cost-share 
agreement; and (5)Agree to grant to NRCS or its representatives access 
to the land for purposes related to application, assessment, monitoring, 
enforcement, or other actions required to implement this part.
    (b) Ineligible land. NRCS shall not provide cost-share assistance 
with respect to practices on land:
    (1) Enrolled in a program where wildlife habitat objectives have 
been sufficiently achieved through other forms of assistance or without 
assistance, as determined by NRCS.
    (2) With on-site or off-site conditions which NRCS determines would 
undermine the benefits of the habitat development or otherwise reduce 
its value;
    (3) Where NRCS determines that the wildlife habitat development 
benefits attainable are of lessor value than would occur on other lands; 
or
    (4) Owned by the United States, except where there is a direct 
Tribal, State, or private benefit; or
    (5) On which habitat for threatened or endangered species would be 
adversely affected.
    (c) All other land except as provided in paragraph (b) of this 
section is eligible.



Sec. 636.5  Establishing priority for enrollment in WHIP.

    (a) In response to national and regional needs, the Chief may limit 
program implementation in any given year to specific geographic areas or 
to address specific habitat development needs of targeted species of 
special concern.
    (b) The State Conservationist, in consultation with the State 
Technical Committee, may limit implementation of WHIP to address unique 
species, habitats, or special geographic areas of the State. Subsequent 
cost-share agreement offers that would complement previous cost-share 
agreements due to geographic proximity of the lands involved or other 
relationships may receive priority consideration for participation.
    (c) NRCS will evaluate the applications and make enrollment 
decisions based on the wildlife habitat need using some or all of the 
following criteria:
    (1) Contribution to resolving an identified habitat problem of 
national, regional, or state importance;
    (2) Relationship to any established wildlife or conservation 
priority areas;
    (3) Duration of benefits to be obtained from the habitat development 
practices;
    (4) Self-sustaining nature of the habitat development practices;
    (5) Availability of other partnership matching funds or reduced 
funding request by the person applying for participation;
    (6) Estimated costs of wildlife habitat development activities; and
    (7) Other factors determined appropriate by NRCS to meet the 
objectives of the program.
    (d) Notwithstanding the criteria set forth in paragraph (c) of this 
section, the State Conservationist, in consultation with the State 
Technical Committee, may deny an application if it is not cost effective 
or does not sufficiently meet program requirements:



Sec. 636.6  Cost-share payments.

    (a) NRCS may share the cost with a participant for implementing the 
practices as provided in the WHDP; NRCS shall offer to pay no more than 
75 percent of the cost of establishing such practices. The cost-share 
payment to a participant shall be reduced proportionately below 75 
percent to the extent that direct Federal financial assistance is 
provided to the participant from sources other than NRCS, except for 
certain cases that merit additional cost-share assistance to achieve the 
intended goals of the program, as determined by the State 
Conservationist.
    (b) Cost-share payments may be made only upon a determination by the 
NRCS that an eligible practice or an identifiable unit of the practice 
has been established in compliance with appropriate standards and 
specifications. Identified practices may be implemented by the 
participant or other designee.
    (c) Cost-share payments may be made for the establishment and 
installation of additional eligible practices, or the

[[Page 668]]

maintenance or replacement of an eligible practice, but only if NRCS 
determines the practice is needed to meet the objectives of the program, 
or that the failure of the original practice was due to reasons beyond 
the control of the participant.



Sec. 636.7  The Wildlife Habitat Development Plan (WHDP).

    (a) The participant develops a WHDP with the assistance of NRCS or 
other public or private natural resource professionals, and the WHDP is 
approved by the participant, NRCS, and the local conservation district. 
A WHDP encompasses the parcel of land that has the wildlife habitat 
conditions that are of concern to the participant.
    (b) The WHDP forms the basis for the agreement and is incorporated 
therein. The WHDP includes a schedule for installation of the wildlife 
habitat development practices, maintenance, and related requirements to 
maintain the habitat for the life of the cost-share agreement.
    (c) The WHDP may be modified in accordance with Sec. 636.9.



Sec. 636.8  Cost-share agreements.

    (a) To apply for WHIP cost-share assistance, a person must submit an 
application for participation in the WHIP at a USDA office or to an NRCS 
representative.
    (b) A WHIP cost-share agreement shall:
    (1) Incorporate all portions of a WHDP;
    (2) Be for a period of 5 to 10 years, unless provisions of paragraph 
(c) of this section apply;
    (3) Include all provisions as required by law or statute;
    (4) Specify the requirements for operation and maintenance of 
applied wildlife habitat development practices;
    (5) Include any participant reporting and recordkeeping requirements 
to determine compliance with the cost-share agreement and program;
    (6) Be signed by the participant. When the participant is not the 
owner, concurrence from the owner is required; and,
    (7) Include any other provision determined necessary or appropriate 
by the NRCS representative.
    (c) The Chief may allow a cost-share agreement period for less than 
five years in situations where wildlife habitat is threatened as a 
result of a disaster and emergency measures are necessary to address the 
potential for dramatic declines in one or more wildlife populations.



Sec. 636.9  Modifications.

    (a) NRCS, with the concurrence of the conservation district, may 
approve modifications to a WHDP where such modifications are acceptable 
to the parties.
    (b) NRCS may approve modifications to the cost-share agreement where 
such modifications are acceptable to the parties.
    (c) Any modifications made under this section must meet WHIP program 
objectives, and must be in compliance with this part.



Sec. 636.10  Transfer of interest in a cost-share agreement.

    (a) (1) If the ownership or operation of the land changes during the 
term of the cost-share agreement, NRCS shall modify the cost-share 
agreement to reflect the new interested persons and new divisions of 
payments. NRCS shall make eligible cost-share payments upon presentation 
of an assignment of rights or other evidence that title had passed.
    (2) With respect to any and all payments owed to participants who 
wish to transfer ownership or control of land subject to a cost-share 
agreement, the division of payment shall be determined by the original 
party and that party's successor. In the event of a dispute or claim on 
the distribution of cost-share payments, NRCS may withhold payments 
without the accrual of interest pending a settlement or adjudication on 
the rights to the funds.
    (b) (1) If such new owners or operators are not willing to assume 
the responsibilities posed in an existing WHIP cost-share agreement, 
NRCS shall terminate the cost-share agreement and may require that all 
cost-share payments may be forfeited, refunded, or both.
    (2) The signatories to the cost-share agreement shall be jointly and 
severally responsible for refunding the cost-

[[Page 669]]

share payments pursuant to paragraph (b)(1) of this section.



Sec. 636.11  Termination of cost-share agreements.

    (a) The State Conservationist may, by mutual agreement with the 
parties to the cost-share agreement, consent to the termination of the 
contract where:
    (1) The parties to the cost-share agreement are unable to comply 
with the terms of the cost-share agreement as the result of conditions 
beyond their control;
    (2) Compliance with the terms of the cost-share agreement would work 
a severe hardship on the parties to the contract; or,
    (3) Termination of the cost-share agreement would, as determined by 
the State Conservationist, be in the public interest.
    (b) If a cost-share agreement is terminated in accordance with the 
provisions of this section, the State Conservationist may allow the 
participants to retain any cost-share payments received under the cost-
share agreement in a porportion appropriate to the effort the 
participant has made to comply with the cost-share agreement, or, in 
cases of hardship, where forces beyond the participant's control 
prevented compliance with the cost-share agreement.



Sec. 636.12  Violations and remedies.

    (a) (1) If NRCS determines that a participant is in violation of a 
cost-share agreement or documents incorporated by reference into the 
cost-share agreement, NRCS may give the parties to the cost-share 
agreement reasonable notice and an opportunity to voluntarily correct 
the violation within 30 days of the date of the notice, or such 
additional time as NRCS may allow.
    (2) If the participant fails to cure the violation of a cost-share 
agreement within the period provided under paragraph (a)(1) of this 
section, NRCS may terminate the agreement and require the participant to 
refund all or part of any assistance earned under that cost-share 
agreement, plus interest, as well as require the participant to forfeit 
all rights for future payment under the agreement.
    (b) [Reserved].



Sec. 636.13  Misrepresentation and scheme or device.

    (a) A person who is determined by NRCS to have erroneously 
represented any fact affecting a program determination made in 
accordance with this part shall not be entitled to cost-share agreement 
payments and must refund all payments, plus interest as determined by 
NRCS.
    (b) A person who is determined to have knowingly:
    (1) Adopted any scheme or device that tends to defeat the purpose of 
the program;
    (2) Made any fraudulent representation; or,
    (3) Misrepresented any fact affecting a program determination shall 
refund to NRCS all payments, plus interest as determined by NRCS, with 
respect to all NRCS cost-share agreements. The person's interest in all 
NRCS cost-share agreements may be terminated.



Sec. 636.14  Offsets and assignments.

    (a) Except as provided in paragraph (b) of this section, any payment 
or portion thereof to any person shall be made without regard to 
questions of title under State law and without regard to any claim or 
lien against the land, or proceeds thereof, in favor of the owner or any 
other creditor except agencies of the U.S. Government. The regulations 
governing offsets and withholdings found in part 3 of this title shall 
be applicable to cost-share agreement payments.
    (b) Any person entitled to any cash payment under this program, may 
assign the right to receive such payments in whole or in part.



Sec. 636.15  Appeals.

    (a) Any person may obtain reconsideration and review of 
determinations affecting participation in this program in accordance 
with part 614 Part C of this title, except as provided in paragraph (b) 
of this section.
    (b) In accordance with the provisions of the Department of 
Agriculture Reorganization Act of 1994, Pub. L. 103-354 (7 U.S.C. 6901), 
the following decisions are not appealable:

[[Page 670]]

    (1) Payment rates, payment limits, and cost-share percentages;
    (2) The designation of approved wildlife priority areas, habitats or 
practices;
    (3) NRCS program funding decisions;
    (4) Eligible conservation practices; and
    (5) Other matters of general applicability.
    (c) Before a person may seek judicial review of any action taken 
under this part, the person must exhaust all administrative appeal 
procedures set forth in paragraph (a) of this section.

[[Page 671]]



                        SUBCHAPTER E  [RESERVED]





                    SUBCHAPTER F--SUPPORT ACTIVITIES





PART 650--COMPLIANCE WITH NEPA--Table of Contents




            Subpart A--Procedures for NRCS-Assisted Programs

Sec.
650.1  Purpose.
650.2  Applicability.
650.3  Policy.
650.4  Definition of terms.
650.5  Environmental evaluation in planning.
650.6  Categorical exclusions.
650.7  When to prepare an EIS.
650.8  When to prepare an environmental assessment (EA).
650.9  NEPA and interagency planning.
650.10  Adoption of an EIS prepared by a cooperating agency.
650.11  Environmental documents.
650.12  NRCS decisionmaking.
650.13  Review and comment.

                Subpart B--Related Environmental Concerns

650.20  Reviewing and commenting on EIS's prepared by other agencies.
650.21  Working relations with the U.S. Environmental Protection Agency 
          (EPA) and related State environmental agencies.
650.22  Rare, threatened, and endangered species of plants and animals.
650.23  Natural areas.
650.24  Scenic beauty (visual resource).
650.25  Flood-plain management.



            Subpart A--Procedures for NRCS-Assisted Programs

    Authority: 42 U.S.C. 4321 et seq.; Executive Order 11514 (Rev.); 16 
U.S.C. 1001-1008; 7 U.S.C. 1010-1011; 16 U.S.C. 590 a-f, q.; 7 CFR 2.62, 
unless otherwise noted.

    Source: 44 FR 50579, Aug. 29, 1979, unless otherwise noted.



Sec. 650.1  Purpose.

    (a) This rule prescribes procedures by which NRCS is to implement 
the provisions of NEPA. The Natural Resources Conservation Service 
recognizes NEPA as the national charter for protection, restoration, and 
enhancement of the human environment. NEPA establishes policy, sets 
goals (Section 101), and provides means (Section 102) for carrying out 
this policy.
    (b) The procedures included in this rule supplement CEQ's NEPA 
regulations, 40 CFR parts 1500-1508. CEQ regulations that need no 
additional elaboration to address NRCS-assisted actions are not repeated 
in this rule, although the regulations are cited as references. The 
procedures include some overlap with CEQ regulations. This is done to 
highlight items of importance for NRCS. This does not supersede the 
existing body of NEPA regulations.
    (c) These procedures provide that--
    (1) Environmental information is to be available to citizens before 
decisions are made about actions that significantly affect the human 
environment;
    (2) NRCS-assisted actions are to be supported to the extent possible 
by accurate scientific analyses that are technically acceptable to NRCS;
    (3) NRCS-prepared NEPA documents are to be available for public 
scrutiny; and
    (4) Documents are to concentrate on the issues that are timely and 
significant to the action in question rather than amassing needless 
detail.
    (d) Procedures for implementing NEPA are designed to ensure that 
environmental consequences are considered in decisionmaking. They allow 
NRCS to assist individuals and nonfederal public entities to take 
actions that protect, enhance, and restore environmental quality.
    (e) These procedures make possible the early identification of 
actions that have significant effects on the human environment to avoid 
delays in decisionmaking.



Sec. 650.2  Applicability.

    This rule applies to all NRCS-assisted programs including the 
uninstalled parts of approved projects that are not covered by 
environmental documents prepared under previous rules for compliance 
with NEPA. It is effective on the date of publication of the final rule. 
NRCS is to consult with

[[Page 672]]

CEQ in the manner prescribed by 40 CFR 1506.11 if it is necessary to 
take emergency actions.



Sec. 650.3  Policy.

    (a) NRCS mission. The NRCS mission is to provide assistance that 
will allow use and management of ecological, cultural, natural, 
physical, social, and economic resources by striving for a balance 
between use, management, conservation, and preservation of the Nation's 
natural resource base. The NRCS mission is reemphasized and expanded to 
carry out the mandate of section 101(b) of NEPA, within other 
legislative constraints, in all its programs of Federal assistance. NRCS 
will continue to improve and coordinate its plans, functions, programs, 
and recommendations on resource use so that Americans, as stewards of 
the environment for succeeding generations--
    (1) Can maintain safe, healthful, productive, and esthetically and 
culturally pleasing surroundings that support diversity of individual 
choices; and
    (2) Are encouraged to attain the widest range of beneficial uses of 
soil, water, and related resources without degradation to the 
environment, risk to health or safety, or other undesirable and 
unintended consequences.
    (b) NRCS environmental policy. NRCS is to administer Federal 
assistance within the following overall environmental policies:
    (1) Provide assistance to Americans that will motivate them to 
maintain equilibrium among their ecological, cultural, natural, 
physical, social, and economic resources by striving for a balance 
between conserving and preserving the Nation's natural resource base.
    (2) Provide technical and financial assistance through a systematic 
interdisciplinary approach to planning and decisionmaking to insure a 
balance between the natural, physical, and social sciences.
    (3) Consider environmental quality equal to economic, social, and 
other factors in decisionmaking.
    (4) Insure that plans satisfy identified needs and at the same time 
minimize adverse effects of planned actions on the human environment 
through interdisciplinary planning before providing technical and 
financial assistance.
    (5) Counsel with highly qualified and experienced specialists from 
within and outside NRCS in many technical fields as needed.
    (6) Encourage broad public participation in defining environmental 
quality objectives and needs.
    (7) Identify and make provisions for detailed survey, recovery, 
protection, or preservation of unique cultural resources that otherwise 
may be irrevocably lost or destroyed by NRCS-assisted project actions, 
as required by Historic Preservation legislation and/or Executive Order.
    (8) Encourage local sponsors to review with interested publics the 
operation and maintenance programs of completed projects to insure that 
environmental quality is not degraded.
    (9) Advocate the retention of important farmlands and forestlands, 
prime rangeland, wetlands, or other lands designated by State or local 
governments. Whenever proposed conversions are caused or encouraged by 
actions or programs of a Federal agency, licensed by or require approval 
by a Federal agency, or are inconsistent with local or State government 
plans, provisions are to be sought to insure that such lands are not 
irreversibly converted to other uses unless other national interests 
override the importance of preservation or otherwise outweigh the 
environmental benefits derived from their protection. In addition, the 
preservation of farmland in general provides the benefits of open space, 
protection of scenery, wildlife habitat, and in some cases, recreation 
opportunities and controls on urban sprawl.
    (10) Advocate actions that reduce the risk of flood loss; minimize 
effects of floods on human safety, health, and welfare; and restore and 
preserve the natural and beneficial functions and values of flood 
plains.
    (11) Advocate and assist in the reclamation of abandoned surface-
mined lands and in planning for the extraction of coal and other 
nonrenewable resources to facilitate restoration of the land to its 
prior productivity as mining is completed.

[[Page 673]]

    (12) Advocate the protection of valuable wetlands, threatened and 
endangered animal and plant species and their habitats, and designated 
ecosystems.
    (13) Advocate the conservation of natural and manmade scenic 
resources to insure that NRCS-assisted programs or activities protect 
and enhance the visual quality of the landscape.
    (14) Advocate and assist in actions to preserve and enhance the 
quality of the Nation's waters.

[44 FR 50579, Aug. 20, 1979; 44 FR 54981, Sept. 24, 1979]



Sec. 650.4  Definition of terms.

    Definitions of the following terms or phrases appear in 40 CFR part 
1508, CEQ regulations. These terms are important in the understanding 
and implementation of this rule. These definitions are not repeated in 
the interest of reducing duplication:
    Categorical exclusion. (40 CFR 1508.4)
    Cooperating agency. (40 CFR 1508.5)
    Cumulative impact. (40 CFR 1508.7)
    Environmental impact statement (EIS). (40 CFR 1508.11)
    Human environment. (40 CFR 1508.14)
    Lead agency. (40 CFR 1508.16)
    Major Federal action. (40 CFR 1508.18)
    Mitigation. (40 CFR 1508.20)
    NEPA process. (40 CFR 1508.21)
    Scope. (40 CFR 1508.25)
    Scoping. (40 CFR 1501.7)
    Tiering. (40 CFR 1508.28)
    (a) Channel realignment. Channel realignment includes the 
construction of a new channel or a new alignment and may include the 
clearing, snagging, widening, and/or deepening of the existing channel. 
(Channel Modification Guidelines, 43 FR 8276).
    (b) Environmental assessment (EA). (40 CFR 1508.9)
    (1) An environmental assessment is a concise public document for 
which a Federal agency is responsible that--
    (i) Briefly provides sufficient evidence and analysis for 
determining whether to prepare an environmental impact statement or a 
finding of no significant impact.
    (ii) Aids an agency's compliance with the Act when no environmental 
impact statement is necessary.
    (iii) Facilitates preparation of an environmental impact statement 
when one is necessary.
    (2) An environmental assessment includes brief discussions of the 
need for the proposal, alternatives as required by section of the 
environmental impacts of the proposed action and alternatives, and a 
list of agencies and persons consulted.
    (c) Environmental evaluation. The environmental evaluation (EE) 
(formerly referred to by NRCS as an environmental assessment) is the 
part of planning that inventories and estimates the potential effects on 
the human environment of alternative solutions to resource problems. A 
wide range of environmental data together with social and economic 
information is considered in determining whether a proposed action is a 
major Federal action significantly affecting the human environment. The 
environmental evaluation for a program, regulation, or individual action 
is used to determine the need for an environmental assessment or an 
environmental impact statement. It also aids in the consideration of 
alternatives and in the identification of available resources.
    (d) Federally-assisted actions. These actions are planned and 
carried out by individuals, groups, or local units of government largely 
on nonfederal land with technical and/or financial assistance provided 
by NRCS.
    (e) Interdisciplinary planning. NRCS uses an interdisciplinary 
environmental evaluation and planning approach in which specialists and 
groups having different technical expertise act as a team to jointly 
evaluate existing and future environmental quality. The 
interdisciplinary group considers structure and function of natural 
resource systems, complexity of problems, and the economic, social, and 
environmental effects of alternative actions. Public participation is an 
essential part of effective interdisciplinary planning. Even if an NRCS 
employee provides direct assistance to an individual land user, the 
basic data used is a result of interdisciplinary development of guide 
and planning criteria.

[[Page 674]]

    (f) Nonproject actions. Nonproject actions consist of technical and/
or financial assistance provided to an individual, group, or local unit 
of government by NRCS primarily through a cooperative agreement with a 
local conservation district, such as land treatment recommended in the 
Conservation Operations, Great Plains Conservation, Rural Abandoned 
Mine, and Rural Clean Water Programs. These actions may include 
consultations, advice, engineering, and other technical assistance that 
land users usually cannot accomplish by themselves. Nonproject technical 
and/or financial assistance may result in the land user installing field 
terraces, waterways, field leveling, onfarm drainage systems, farm 
ponds, pasture management, conservation tillage, critical area 
stablization and other conservation practices.
    (g) Notice of intent (NOI) (40 CFR 1508.22). A notice of intent is a 
brief statement inviting public reaction to the decision by the 
responsible Federal official to prepare an EIS for a major Federal 
action. The notice of intent is to be published in the Federal Register, 
circulated to interested agencies, groups, individuals, and published in 
one or more newspapers serving the area of the proposed action.
    (h) Project actions. A project action is a formally planned 
undertaking that is carried out within a specified area by sponsors for 
the benefit of the general public. Project sponsors are units of 
government having the legal authority and resources to install, operate, 
and/or maintain works of improvement.
    (i) Record of Decision. (ROD) (40 CFR 1505.2). A record of decision 
is a concise written rationale by the RFO regarding implementation of a 
proposed action requiring an environmental impact statement. This was 
previously defined by NRCS as a Statement of Findings (SOF).
    (j) Responsible Federal official (RFO). The NRCS Administrator is 
the responsible Federal official (RFO) for compliance with NEPA 
regarding proposed legislation, programs, legislative reports, 
regulations, and program EIS's. NRCS state conservationists (STC's) are 
the RFO's for compliance with the provisions of NEPA in other NRCS-
assisted actions.
    (k) Significantly. (40 CFR 1508.27) ``Significantly'' as used in 
NEPA requires considerations of both context and intensity:
    (1) Context. This means that the significance of an action must be 
analyzed in several contexts such as society as a whole (human, 
national), the affected region, the affected interests, and the 
locality. Significance varies with the setting of the proposed action. 
For instance, for a site-specific action, significance usually depends 
on the effects in the locale rather than in the world as a whole. Both 
short- and long-term effects are relevant.
    (2) Intensity. This refers to the severity of impact. Responsible 
officials must bear in mind that more than one agency may make decisions 
about partial aspects of a major action.

The following should be considered in evaluating intensity:
    (i) Impacts that may be both beneficial and adverse. A significant 
effect may exist even if the Federal agency believes that on balance the 
effect will be beneficial.
    (ii) The degree to which the proposed action affects public health 
or safety.
    (iii) Unique characteristics of the geographic area such as 
proximity to historic or cultural resources, park lands, prime 
farmlands, wetlands, wild and scenic rivers, or ecologically critical 
areas.
    (iv) The degree to which the effects on the quality of the human 
environment are likely to be highly controversial.
    (v) The degree to which the possible effects on the human 
environment are highly uncertain or involve unique or unknown risks.
    (vi) The degree to which the action may establish a precedent for 
future actions with significant effects or represents a decision in 
principle about a future consideration.
    (vii) Whether the action is related to other actions with 
individually insignificant but cumulatively significant impacts. 
Significance exists if it is reasonable to anticipate a cumulatively 
significant impact on the environment. Significance cannot be avoided by 
terming an action temporary or by breaking it down into small component 
parts.

[[Page 675]]

    (viii) The degree to which the action may adversely affect 
districts, sites, highways, structures, or objects listed in or eligible 
for listing in the National Register of Historic Places or may cause 
loss or destruction of significant scientific, cultural, or historical 
resources.
    (ix) The degree to which the action may adversely affect an 
endangered or threatened species or its habitat that has been determined 
to be critical under the Endangered Species Act of 1973 as amended.
    (x) Whether the action threatens a violation of Federal, State, or 
local law or requirements imposed for the protection of the environment.
    (l) Finding of no significant impact (FNSI). (40 CFR 1508.13) 
``Finding of No Significant Impact'' means a document by a Federal 
agency briefly presenting the reasons why an action not otherwise 
excluded (Sec. 1508.4) will not have a significant effect on the human 
environment, and an environmental impact statement therefore will not be 
prepared. It shall include the environmental assessment or a summary of 
it and shall note any other environmental documents related to it 
(Sec. 1501.7(a)(5)). If the assessment is included, the finding need not 
repeat any of the discussion in the assessment but may incorporate it by 
reference.

[44 FR 50579, Aug. 29, 1979; 44 FR 54981, Sept. 24, 1979]



Sec. 650.5  Environmental evaluation in planning.

    (a) General. Environmental evaluation (EE) integrates environmental 
concerns throughout the planning, installation, and operation of NRCS-
assisted projects. The EE applies to all assistance provided by NRCS, 
but planning intensity, public involvement, and documentation of actions 
vary according to the scope of the action. NRCS begins consideration of 
environmental concerns when information gathered during the 
environmental evaluation is used:
    (1) To identify environmental concerns that may be affected, gather 
baseline data, and predict effects of alternative courses of actions;
    (2) To provide data to applicants for use in establishing objectives 
commensurate with the scope and complexity of the proposed action;
    (3) To assist in the development of alternative courses of action; 
(40 CFR 1502.14). In NRCS-assisted project actions, nonstructural, water 
conservation, and other alternatives that are in keeping with the Water 
Resources Council's Principles and Standards are considered, if 
appropriate.
    (4) To perform other related investigations and analyses as needed, 
including economic evaluation, engineering investigations, etc.
    (5) To assist in the development of detailed plans for 
implementation and operation and maintenance.
    (b) Procedures. NRCS's Guide for Environmental Assessment issued in 
March 1977 and published in the Federal Register on August 8, 1977, 
provides guidance for conducting an environmental evaluation. (42 FR 
40123-40167).
    (c) Decision points. Figure 1 illustrates the decision points for 
compliance with NEPA in NRCS decisionmaking.

[[Page 676]]

[GRAPHIC] [TIFF OMITTED] TC03SE91.000



Sec. 650.6  Categorical exclusions.

    (a) Some NRCS programs or parts of programs do not normally create 
significant individual or cumulative impacts on the human environment. 
Therefore, an EA or EIS is not needed. These are data gathering and 
interpretation programs and include:
    (1) Soil Survey--7 CFR part 611;
    (2) Snow Survey and Water Supply Forecasts--7 CFR part 612;
    (3) Plant Materials for Conservation--7 CFR part 613;
    (4) Inventory and Monitoring--Catalog of Federal Domestic 
Assistance--10.908; and
    (5) River Basin Studies under section 6 of Pub. L. 83-566 as 
amended--7 CFR part 621.
    (b) The environmental evaluation performed by the RFO when any new 
action under these programs is planned

[[Page 677]]

is to identify extraordinary circumstances that might lead to 
significant individual or cumulative impacts. Actions that have 
potential for significant impacts on the human environment are not 
categorically excluded.



Sec. 650.7  When to prepare an EIS.

    The following are categories of NRCS action used to determine 
whether or not an EIS is to be prepared.
    (a) An EIS is required for:
    (1) Projects that include stream channel realignment or work to 
modify channel capacity by deepening or widening where significant 
aquatic or wildlife habitat exists. The EE will determine if the channel 
supports significant aquatic or wildlife habitat;
    (2) Projects requiring Congressional action;
    (3) Broad Federal assistance programs administered by NRCS when the 
environmental evaluation indicates there may be significant cumulative 
impacts on the human environment (Sec. 650.7(e)); and
    (4) Other major Federal actions that are determined after 
environmental evaluation to affect significantly the quality of the 
human environment (Sec. 650.7(b)). If it is difficult to determine 
whether there is a significant impact on the human environment, it may 
be necessary to complete the EE and prepare an EA in order to decide if 
an EIS is required.
    (b) The RFO is to determine the need for an EIS for each action, 
program, or regulation. An environmental evaluation, using a systematic 
interdisciplinary analysis and evaluation of data and information 
responding to the five provisions of Section 102(2)(C) of NEPA, will 
assist the RFO in deciding if the action requires the preparation of an 
EIS. In analyzing and evaluating environmental concerns, the RFO will 
answer the following questions:
    (1) Environmental impact. Will the proposed action significantly 
affect the quality of the human environment (40 CFR 1508.14)? For 
example, will it significantly alter or destroy valuable wetlands, 
important farmlands, cultural resources, or threatened and endangered 
species? Will it affect social values, water quality, fish and wildlife 
habitats, or wilderness and scenic areas?
    (2) Adverse environmental effects that cannot be avoided. What are 
the important environmental amenities that would be lost if the proposed 
action were implemented?
    (3) Alternatives. Are there alternatives that would achieve the 
planning objectives but avoid adverse environmental effects?
    (4) Short-term uses versus long-term productivity. Will the proposed 
actions, in combination with other actions, sacrifice the enhancement of 
significant long-term productivity as a tradeoff for short-term uses?
    (5) Commitment of resources. Will the proposed action irreversibly 
and irretrievably commit the use of resources such as important 
farmlands, wetlands, and fish and wildlife habitat?
    (c) Criteria for determining the need for a program EIS:
    (1) A program EIS is required if the environmental evaluation 
reveals that actions carried out under the program have individually 
insignificant but cumulatively significant environmental impacts.
    (2) A project EIS, in lieu of a program EIS, is required if the 
environmental evaluation reveals that actions carried out under the 
program will have both individually and cumulatively significant 
environmental impacts. (7 CFR Parts 620 through 623 and 640 through 
643).
    (d) The RFO, through the process of tiering, is to determine if a 
site-specific EA or EIS is required for an individually significant 
action that is included in a program EIS.



Sec. 650.8  When to prepare an environmental assessment (EA).

    An environmental assessment (EA) is to be prepared for:
    (a) Land and water resource projects that are not included in 
Sec. 650.7(a) (1) through (4) for which State and local units of 
government receive Federal technical and financial assistance from NRCS 
(7 CFR parts 620 through 623; and 640 through 643); and
    (b) Other actions not included in a program EIS nor categorically 
excluded that the EE reveals may be a

[[Page 678]]

major Federal action significantly affecting the quality of the human 
environment.



Sec. 650.9  NEPA and interagency planning.

    (a) Lead agency. (1) NRCS is to be the lead agency for actions under 
programs it administers. If the actions affect more than one State, the 
NRCS Administrator is to designate one NRCS state conservationist as the 
RFO.
    (2) NRCS normally takes the role of lead agency in actions that 
share program responsibilities among USDA agencies if NRCS provides the 
majority of funds for the actions. If the lead agency role is in 
question, the role of NRCS and other USDA agencies is to be determined 
by the USDA Environmental Coordinator, Office of Environmental Quality 
Activities.
    (3) If NRCS and Federal agencies outside USDA cannot agree on which 
will be the lead agency and which will be the cooperating agencies, the 
procedures in 40 CFR 1501.5(e) are to be followed.
    (4) NRCS, as lead agency, is to coordinate the participation of all 
concerned agencies in developing the EIS according to the provisions of 
40 CFR 1501.6(a).
    (b) Cooperating agencies. (1) NRCS is to request, as appropriate, 
the assistance of cooperating agencies in preparing the environmental 
evaluation. This assistance will broaden the expertise in the planning 
and help to avoid future conflict. NRCS is to request assistance in 
determining the scope of issues to be addressed and identifying the 
significant issues related to a proposed action from Federal agencies 
that have jurisdiction by law or special expertise.
    (2) NRCS is to act as a cooperating agency if requested. NRCS may 
request to be designated as a cooperating agency if proposed actions may 
affect areas of NRCS expertise, such as prime farmlands, soils, erosion 
control, and agricultural sources of nonpoint pollution. NRCS, as a 
cooperating agency, is to comply with the requirements of 40 CFR 
1501.6(b) to the extent possible depending on funds, personnel, and 
priority. If insufficient funds or other resources prevent NRCS from 
participating fully as a cooperating agency, NRCS is to request the lead 
agency to provide funds or other resources which will allow full 
participation.
    (c) Scoping. See 40 CFR 1501.7 for a definition of scoping.
    (1) NRCS is to use scoping to identify and categorize significant 
environmental issues in its environmental evaluation. Formalized scoping 
is used to insure that an analytical EIS can be prepared that will 
reduce paperwork and avoid delay. Scoping allows NRCS to obtain the 
assistance and consultation of affected agencies that have special 
expertise or legal jurisdiction in the proposed action. If early 
environmental evaluation identifies a need for an EIS, NRCS is to 
publish a notice of intent (NOI) to prepare an EIS. The NOI is to 
request the assistance of all interested agencies, groups, and persons 
in determining the scope of the evaluation of the proposed action.
    (2) Normally a scoping meeting is held and Federal, State, or local 
agencies that have special expertise or legal jurisdiction in resource 
values that may be significantly affected are requested to participate. 
The scoping meeting will identify agencies that may become cooperating 
agencies.
    (3) In the scoping meeting, the range of actions, alternatives, and 
impacts to be evaluated and included in the EIS as defined in (40 CFR 
1508.25) are to be determined. Tiering (40 CFR 1508.28) may be used to 
define the relation of the proposed statement to other statements.
    (4) Periodic meetings of the cooperating agencies are to be held at 
important decisionmaking points to provide timely interagency, 
interdisciplinary participation.
    (5) Scoping is to include the items listed in 40 CFR 1501.7(a) and 
may also include any of the activities in 40 CFR 1501.7(b). Appropriate, 
timely requests and notification are to be made to promote public 
participation in scoping in accordance with paragraph (d) of this 
section.
    (6) The RFO through the scoping process will set time and page 
limits as prescribed in 40 CFR 1501.8. Time and page limits are 
established by NRCS in consultation with sponsors and others according 
to the projected availability of resources. The RFO is to make the

[[Page 679]]

applicant aware of the possible need for revising time and page limits 
because of changes in resources.
    (d) Public participation. (1) General. Public participation 
activities begin early in the EE and are to be appropriate to the 
proposed action. For example, extensive public participation activities 
are required in the implementation of new programs and project actions, 
but limited public participation is appropriate for nonproject technical 
and financial assistance programs on nonfederal land.
    (2) Early public involvement. The public is to be invited and 
encouraged to participate in the early stages of planning, including the 
consideration of the potential effects of NRCS-assisted actions on 
significant environmental resources such as wetlands, flood plains, 
cultural values, endangered species, important farmland.
    (3) Project activities. The following are general considerations for 
providing opportunities for public participation:
    (i) Identification of interested public. The interested public 
consisting of but not limited to individuals, groups, organizations, and 
government agencies are to be identified, sought out, and encouraged to 
participate in and contribute to interdisciplinary planning and 
environmental evaluation.
    (ii) Public notices. (40 CFR 1506.6) If the effects of an action are 
primarily of local concern, notice of each public meeting or hearing 
should be: Submitted to State and areawide clearinghouses pursuant to 
OMB Circular A-95 (revised); submitted to Indian tribes if they are 
interested; published in local newspapers; distributed through other 
local media; provided to potentially interested community organizations 
including small business associations; published in newsletters that may 
be expected to reach potentially interested persons; mailed directly to 
owners and occupants of nearby or affected property; and posted onsite 
and offsite in the area where the action is to be located.
    (iii) State statutes. If official action by the local units of 
government cooperating in the proposal is governed by State statute, the 
public notice and mailing requirement of the statute is to be followed. 
If the effects of an action are of national concern, notice is to be 
published in the Federal Register and mailed to national organizations 
reasonably expected to be interested.
    (iv) Public meetings. The RFO, after consultation with the sponsors, 
is to determine when public meetings or hearings are to be held. Public 
meetings may be in the form of a workshop, tour, open house, etc. Public 
involvement will include early discussion of flood-plain management and 
protection of wetlands, where appropriate. Environmental information is 
to be presented and discussed along with other appropriate information. 
To the extent practical, pertinent information should be made available 
before the meetings.
    (v) Documentation. The RFO is to maintain a reviewable record of 
public participation in the environmental evaluation process.
    (4) Nonproject activities. Public participation in the planning and 
application of conservation practices with individual land users is 
accomplished primarily through conservation districts. These districts 
are governed by boards of supervisors directors, commissioners, etc., 
who are elected and/or appointed to insure that soil, water, related 
resources, and environmental qualities in the district are maintained 
and improved. The public is to be encouraged to participate in the 
development of long-range district programs and district annual plans. 
The district keeps the public informed through public meetings, district 
newsletters, news stories, radio and television programs, and annual 
reports.



Sec. 650.10  Adoption of an EIS prepared by a cooperating agency.

    (a) If NRCS adopts an EIS prepared by another Federal or State 
agency, the RFO is to review the document to insure that it meets the 
requirements of the CEQ regulations and NRCS-NEPA procedures.
    (b) If the actions included in the EIS are substantially the same as 
those proposed by NRCS, the RFO is to recirculate the EIS as ``final.'' 
The final EIS is to include an appropriate explanation of the action. If 
these actions are not substantially the same, the EIS is to be 
supplemented and recirculated

[[Page 680]]

as a draft EIS. The RFO is to inform the preparing agency of the 
proposed action.
    (c) If the adopted EIS is not final, if it is the subject of a 
referral under 40 CFR part 1504, or if the statement's adequacy is in 
litigation, the RFO is to include an appropriate explanation in the EIS.
    (d) The RFO is to take appropriate action to inform the public and 
appropriate agencies of the proposed action.



Sec. 650.11  Environmental documents.

    (a) NRCS is to use the following documents in compliance with NEPA 
(see Sec. 650.4):
    (1) Environmental assessments (EA)
    (2) Environmental impact statements (EIS)
    (3) Notice of intent (NOI)
    (4) Finding of no significant impact (FNSI)
    (5) Record of decision (ROD)
    (b) The format and content of each document is to be appropriate to 
the action being considered and consistent with the CEQ regulations.
    (1) To reduce duplication, NRCS may combine environmental documents 
with other planning documents of the same proposal, as appropriate. For 
example, NRCS, in consultation with CEQ and the office of the Secretary 
of Agriculture, has determined that each EIS is to satisfy the 
requirements for a regulatory impact analysis as required by Executive 
Order 12044. This may necessitate modifying the recommended CEQ format. 
If documents are combined, the RFO is to include the information and 
sections required by the CEQ regulations (40 CFR 1502.10). The 
environmental impact statement should indicate those considerations, 
including factors not related to environmental quality, that are likely 
to be relevant to a decision.
    (2) The RFO is to establish the format and content of each document 
giving full consideration to the guidance and requirements of the CEQ 
regulations. The NRCS technical service center director is to provide 
guidance and concurrence on the format and content if the NRCS state 
conservationist is the RFO. The results of scoping are to determine the 
content of the EA or the EIS and the amount of detail needed to analyze 
the impacts.
    (3) In addition to the minimum requirements of the CEQ regulations 
(40 CFR 1502.10), environmental assessments and environmental impact 
statements are to include--
    (i) A brief description of public participation activities of 
agencies, groups, and individuals during the environmental evaluation;
    (ii) A description of the hazard potential of each alternative, 
including an explanation of the rationale for dam classification and the 
risk of dam failure from overtopping for other causes;
    (iii) Information identifying any approved regional plans for water 
resource management in the study area (40 CFR 1506.2(d)) and a statement 
on whether the proposed project is consistent with such plans;
    (iv) All Federal permits, licenses, and other entitlements that must 
be obtained (40 CFR 1502.25(b)); and
    (v) A brief description of major environmental problems, conflicts, 
and disagreements among groups and agencies and how they were resolved. 
Unresolved conflicts and the NRCS's proposal for resolving the 
disagreements before the project is implemented are to be summarized.
    (4) Letters of comment and responses. (40 CFR 1503.4, 1502.9(b)) 
Letters of comment that were received and the responses to these 
comments are to appended to the final EIS. Opposing views and other 
substantive comments that were not adequately discussed in the draft EIS 
are to be incorporated in the final EIS.
    (5) Appendix. The RFO may use an appendix to an EA or EIS. If an 
appendix is too voluminous to be circulated with the EIS, the RFO is to 
make it available on request. If an appendix is included it is to--
    (i) Meet the requirements of 40 CFR 1502.18;
    (ii) Identify any methodologies used (40 CFR 1502.24) and make 
explicit reference to other sources relied on for conclusions; and
    (iii) Briefly describe the relationship between the benefit-cost 
analysis and any analyses of unquantified environmental impacts, values, 
and amenities. ``For purposes of complying with the

[[Page 681]]

Act, the weighing of the merits or drawbacks of the various alternatives 
need not be displayed in a monetary cost benefit and should not be when 
these are important qualitative considerations.'' (40 CFR 1502.23).



Sec. 650.12  NRCS decisionmaking.

    (a) General. The purpose of these procedures is to insure that 
environmental information is provided to decision makers in a timely 
manner. The NEPA process is a part of NRCS decisionmaking. The RFO is to 
insure that the policies and purposes of NEPA and CEQ regulations are 
complied with in NRCS decisionmaking by:
    (1) Including in all decision documents and supporting environmental 
documents a discussion of all alternatives considered in the decision. 
Alternatives to be considered in reaching a decision will be available 
to the public.
    (2) Submitting relevant environmental documents, comments, and 
responses with other decision documents through the review process.
    (3) Including in the record of formal rulemaking or adjudicatory 
proceedings relevent environmental documents, comments and responses.
    (4) Providing for pre- and post-project monitoring (40 CFR 
1505.2(c), 1505.3) and evaluation in representative projects to insure 
that planning and evaluation procedures are performed according to sound 
criteria.
    (b) Decision points in NRCS-assisted projects. NRCS administers 
programs that may have a significant effect on the human environment. 
Program procedures incorporate provisions for compliance with NEPA and 
for providing environmental information to the public, other agencies, 
and decision makers in a timely manner. NRCS provides technical and 
financial assistance for projects under the Watershed Protection and 
Flood Prevention and the Resource Conservation and Development (RC&D) 
programs. These usually require the preparation of project EA's or 
EIS's. The major decisionmaking points and their relation to NEPA 
compliance are as follows:
    (1) For Watershed Protection and Flood Prevention projects:
    (i) Application for assistance by the sponsoring local organization 
(SLO).
    (ii) A preauthorization report identifying goals, alternatives, and 
effects of alternatives (including environmental impacts) prepared by 
the RFO and submitted to the applicant for decision. It is circulated to 
local, State, and Federal agencies and public comment is solicited. A 
decision is made to stop planning assistance or to develop a watershed 
plan.
    (iii) Granting of planning authorization by the Administrator. The 
RFO must provide an evaluation of the potential environmental impacts to 
obtain the authorization.
    (iv) A watershed agreement between the SLO and NRCS. The agreement 
is based on a completed watershed plan and associated environmental 
documents, which have been adequately reviewed within NRCS.
    (v) A project agreement between the SLO and the RFO executed after 
the NEPA process is complete and the watershed plan has been approved 
and final plans and specifications have been developed.
    (2) For RC&D measure plans:
    (i) A request for assistance (measure proposal) is reviewed by the 
RC&D council to insure that the proposal is in accordance with the RC&D 
area plan. The proposal is then referred to NRCS.
    (ii) A preliminary report is prepared by the RFO to identify goals, 
alternatives, and effects (including environmental impacts). The report 
is submitted to the sponsor for review. The sponsor may then apply to 
NRCS for planning assistance for measures considered in the preliminary 
report.
    (iii) An authorization for planning assistance is granted by the 
RFO.
    (iv) The RC&D measure plan is signed by the applicant and the RFO 
after the preparation and review of the measure plan and environmental 
documents.
    (v) A project agreement is signed between the applicant and the RFO 
after the NEPA process is complete, the measure plan has been approved, 
and final plans and specifications have been prepared.
    (c) Record of decision--(1) EIS's. The RFO is to prepare a concise 
record of decision (ROD) for actions requiring an

[[Page 682]]

EIS. The record of decision is to be prepared and signed by the RFO 
following the 30-day administrative action period initiated by the EPA's 
publication of the notice of availability of the final EIS in the 
Federal Register. It is to serve as the public record of decision as 
described in 40 CFR 1505.2 of the CEQ regulations. The ROD is to be 
distributed to all who provided substantive comments on the draft EIS 
and all others who request it. A notice of availability of the ROD will 
be published in the Federal Register and local newspaper(s) serving the 
project area. The RFO may choose to publish the entire ROD.
    (2) Environmental Assessments (EA). If the EA indicates that the 
proposed action is not a major Federal action significantly affecting 
the quality of the human environment, the RFO is to prepare a finding of 
no significant impact (FNSI).
    (3) Distribution and publication of the FNSI (Sec. 1506.6(b)). The 
RFO is to distribute the FNSI to interested agencies and individuals. 
Notice of its availability is to be published in the Federal Register 
and in one or more newspapers serving the area of the proposed action. 
Single copy requests for the document are to be filed without charge. A 
charge may be made for multiple copies. Implementing action is not to be 
initiated for 30 days after the notice of availability of the FNSI has 
been published in the Federal Register.
    (d) Changes in actions. When it appears that a project or other 
action needs to be changed, the RFO will perform an environmental 
evaluation of the authorized action before making a change.



Sec. 650.13  Review and comment.

    In addition to the requirements of 40 CFR 1503, 1506.10 and 1506.11, 
NRCS will take the following steps in distributing EIS's for review and 
comment:
    (a) Draft EIS's. Five copies of the draft EIS are to be filed by the 
RFO with the Office of Environmental Review, A-104, Environmental 
Protection Agency (EPA), Washington, D.C. At the same time, the RFO is 
to send copies of the draft EIS to the following:
    (1) Other Federal agencies. The regional office of EPA and other 
agencies that have jurisdiction by law or special expertise with respect 
to any environmental effect, other Federal agencies (including 
appropriate field and regional offices), and affected Indian tribes.
    (2) State and local agencies. OMB Circular No. A-95 (Revised), 
through its system of State and areawide clearinghouses, provides a 
means for obtaining the views of State and local environmental agencies 
that can assist in the preparation and review of EIS's
    (3) Organizations, groups, and individuals. A copy of the draft EIS 
is to be sent to the appropriate official of each organization or group 
and each individual of the interested public (Sec. 650.9(d)(3)(i)) and 
to others as requested. A charge may be made for multiple copy requests.
    (b) Time period for comment. The time period for review ends 45 days 
after the date EPA publishes the notice of public availability of the 
draft in the Federal Register. A 15-day-extension of time for review and 
comment is to be considered by the RFO when such requests are submitted 
in writing. If neither comments nor a request for an extension is 
received at the end of the 45-day period, it is to be presumed that the 
agency or party from whom comments were requested has no comments to 
make.
    (c) News releases. In addition to the notice of availability 
published in the Federal Register by EPA, the RFO is to announce the 
availability of the draft EIS in one or more newspapers serving the 
area.
    (d) Revising a draft EIS. If significant changes in the proposed 
action are made as a result of comments on the draft EIS, a revised 
draft EIS may be necessary. The revised draft EIS is to be recirculated 
for comment in the same manner as a draft EIS.
    (e) Final EIS's. After the review period for the draft EIS, the RFO 
is to prepare a final EIS, making adjustments where necessary by taking 
into consideration and responding to significant comments and opposing 
viewpoints received on the draft EIS. The following steps are to be 
taken in filing and distributing the final EIS:

[[Page 683]]

    (1) Letters of comment are to be appended to the final EIS. If 
numerous repetitive responses are received, summaries of the repetitive 
comments and a list of the groups or individuals who commented may be 
appended in lieu of the actual letter.
    (2) The RFO is to send five copies of the final EIS to EPA's Office 
of Environmental Review, and a copy of the final EIS to each State and 
Federal agency, organization, group, and individual who commented on the 
draft EIS. Single copy requests for copies of the final EIS will be 
provided without charge. A charge may be made for multiple copy 
requests.
    (3) During the 30-day administrative action period noted in 
Sec. 650.12(c), NRCS will make its final EIS available to the public (40 
CFR 1506.10).
    (f) Supplements to EIS's. (1) If NRCS determines that it is 
necessary to clarify or amplify a point of concern raised after the 
final EIS is filed, appropriate clarification or amplification is to be 
sent to EPA with information copies furnished to those who received 
copies of the final EIS. The waiting periods do not apply.
    (2) If the RFO determines that the final EIS or supplement to the 
original EIS previously filed becomes inadequate because of a major 
change in the plan for the proposed action that significantly affects 
the quality of the human environment, a new EIS is to be prepared, 
filed, and distributed as described in this section.



                Subpart B--Related Environmental Concerns

    Authority: Pub. L. 86-523, 74 Stat. 220 as amended, Pub. L. 93-291, 
88 Stat. 174 (16 U.S.C. 469); Pub. L. 89-665, 80 Stat. 915 (16 U.S.C. 
470); Pub. L. 93-205, 87 Stat. 884 (16 U.S.C. 1531 et seq.); Secretary 
of Agriculture Memorandum 1695, May 28, 1970; 42 U.S.C. 4332(2)(C); E.O. 
11514, 16 U.S.C. 1001-1008; 7 U.S.C. 1010-1011; 16 U.S.C. 590 a-f, q; 7 
CFR 2.62.

    Source: 39 FR 43993, Dec. 20, 1974, unless otherwise noted.



Sec. 650.20  Reviewing and commenting on EIS's prepared by other agencies.

    (a) NRCS employees assigned to review and comment on EIS's prepared 
by other agencies are to be familiar with NRCS policies and guidelines 
contained in this part, and NEPA.
    (b) EIS's received for review by NRCS for which NRCS has expertise 
or interest shall be responded to promptly. Comments are to be objective 
with the intent to offer suggestions to help minimize adverse impacts of 
the proposed action to ensure the health and welfare of the agricultural 
community. Comments are to be based on knowledge readily available. 
Field office technical guides, soil surveys, field investigation 
reports, and other resource data and reference materials developed by 
NRCS and other agencies should be used and cited. It is not intended 
that special surveys or investigations be conducted to acquire 
additional information for use in preparing comments.
    (c) The NRCS reviewer should consider the following kinds of 
concerns--(1) The suitability or limitations of the soils for the 
proposed action. Would an alternative route, location, or layout 
minimize land use problems and adverse environmental impacts?
    (2) Provisions for control of erosion and management of water during 
construction. Are there resources downstream that would be affected by 
sediment from the construction area, and does the statement provide for 
adequate control measures? Will lack of erosion control cause air 
pollution? Is the stockpiling of topsoil for future use considered in 
the EIS?
    (3) Provisions for soil and water conservation managment measures on 
project lands, rights-of-way, access roads, and borrow areas. Does the 
statement indicate that enduring soil and water practices are to be 
installed and maintained?
    (4) The effect of water discharges from project lands or rights-of-
way onto other properties. Will discharges cause erosion or flooding on 
other lands? Will discharges affect water quality?

[[Page 684]]

    (5) The effects of disruption of the natural drainage patterns and 
severance of private land units. Does the statement indicate that 
natural drainage patterns will be maintained? Will bridges, culverts, 
and other water control structures be located to ensure that adjacent 
lands are not flooded or otherwise restricted in use? Does the EIS 
describe the effects of severance on private land ownerships?
    (6) The impact on existing soil and water conservation management 
systems. To what extent will conservation systems be altered, severed, 
or suffer blocked outlets? Will land use or cover be affected?
    (7) Impacts on prime and unique farmland. Would an alternative 
location or route require less prime farmland? Does the EIS consider 
secondary effects on prime farmland? What benefits are foregone if prime 
farmland is taken?
    (8) Impacts on ecosystems. Does the EIS describe impacts on major 
plant communities, and terrestrial and aquatic ecosystems?
    (9) Impacts on NRCS-assisted projects. Does the statement reflect 
the effect of the proposed action on present or planned NRCS assisted 
projects?
    (d) EIS's referred to NRCS for departmental comments. EIS's referred 
by the USDA Coordinator for Environmental Quality Activities to the NRCS 
national office may designate NRCS as the lead agency for preparing 
comments for USDA. In this case, the NRCS national office determines 
whether inputs from STC's and other USDA agencies are needed. If so, 
STC's and other USDA agencies are requested to forward comments to the 
Environmental Services Division fo use in preparing the USDA response.
    (e) EIS's referred to NRCS for agency comments. EIS's received by 
the NRCS national office are screeened by the Director, Environmental 
Services Division to determine which office within NRCS will prepare 
comments. If the proposed action is within one State, the draft EIS will 
be forwarded to the appropriate STC and he will reply directly to the 
agency requesting the comments. If the proposed action involves more 
than one State, one STC will be designated to forward NRCS comments 
directly to the agency requesting the comments. In some cases, the 
action may be national or regional in scope, and require inputs from 
several offices within NRCS. In this instance, comments will be 
assembled in the Environmental Services Division for preparation of a 
response to the agency requesting comments. A copy of each response 
prepared by a STC should be sent to the Director, Environmental Services 
Division.
    (f) EIS's sent to NRCS offices other than the national office. If a 
STC receives an EIS from another agency, he is to respond to the 
initiating agency. A copy of his comments should be sent to the 
Director, Environmental Services Division.
    (1) EIS's addressed to NRCS area or field offices. If an EIS is 
received by a field or area office of NRCS, the STC will coordinate the 
response.
    (2) EIS's submitted to conservation districts. NRCS may furnish 
needed soil, water, and related resource information to the district for 
their use in preparing comments.
    (g) Distribution of NRCS comments on other agencies' draft EIS's. 
Five copies of review comments made by NRCS on draft EIS's prepared by 
other Federal agencies are to be sent to CEQ.
    (h) Third party requests for a copy of NRCS comments on another 
agency's EIS will be filled after NRCS has forwarded copies of its 
letter of comments to CEQ.

[42 FR 40118, Aug. 8, 1977]



Sec. 650.21  Working relations with the U.S. Environmental Protection Agency (EPA) and related State environmental agencies.

    (a) Background. The authorities and missions of NRCS, EPA, and state 
environmental agencies make it imperative that an effective cooperative 
and coordinative working relationship be developed and maintained in 
areas of mutual concern. These common areas include air quality, water 
quality, pesticides, waste recycling and disposal, environmental 
considerations in land use, Environmental Impact Statements (EIS's) and 
environmental considerations in the conservation and development of 
natural resources.

[[Page 685]]

    (b) Policy. NRCS will work closely with EPA in accordance with the 
provisions of the EPA-USDA Memorandum of Understanding July 31, 1974, at 
all administrative levels and with related state agencies to meet 
statutory requirements and to achieve harmonious implementation of all 
actions of mutual concern directed to improving or maintaining the 
quality of the environment.
    (c) Responsibility--(1) NRCS national office. The Deputy 
Administrator for Field Services is responsible for overall coordination 
with EPA at the national office level. The Deputy Administrator for 
Water Resources is responsible for contacts with EPA in relation to 
activities of the Water Resources Council on water and related land 
resource planning and for coordinating work with EPA on EIS development.
    (2) Technical service center. The TSC director is responsible for 
contacts and coordination with EPA regional offices within the group of 
states served by the TSC.
    (3) NRCS state office. The state conservationist is responsible for 
contacts and coordination with regional representatives of EPA and state 
environmental agencies in matters of mutual concern within his state.
    (d) Coordination and implementation. (1) The NRCS national office 
will:
    (i) Within the framework of USDA agreements and guidelines, develop 
agreements for undertaking specific activities or projects of national 
significance and mutual advantage.
    (ii) Assist EPA as requested in developing EPA policy, guidelines, 
and standards.
    (iii) Consider EPA needs in soil survey and land, inventory, and 
monitoring activities.
    (iv) Maintain needed liaison and develop mutual guidelines with EPA 
on water resources work and in coordinating EIS's.
    (v) Advise EPA regarding soils, plant materials, and soil and water 
conservation techniques.
    (vi) Establish procedures for periodic review of NRCS national 
standards for treatment systems and practices for agricultural pollution 
abatement, including wind and water erosion and sediment control, 
transport of pesticides, organic matter and fertilizers, and burning of 
residues or clearing debris.
    (2) The TSC director will:
    (i) Within the framework of NRCS memorandums and guidelines 
coordinate with the EPA regional administrator(s) the development of 
needed agreements for undertaking specific activities or projects of 
multistate significance and mutual advantage.
    (3) The state conservationist will:
    (i) Obtain early input of EPA and interested state and local 
environmental agencies in the planning process for projects or measures 
within the state impacting on the environment.
    (ii) Coordinate preparations of NRCS practice standards and 
procedures for agricultural pollution abatement within the state with 
EPA and related state agencies.
    (iii) Encourage the development of a coordinated review and approval 
process within the state with EPA and appropriate state and local 
agencies including conservation districts for actions of mutual concern.
    (iv) Attempt to resolve all EPA areas of concern on NRCS assisted 
project-type actions within the state before a final EIS is prepared.



Sec. 650.22  Rare, threatened, and endangered species of plants and animals.

    (a) Background. (1) A variety of plant and animal species of the 
United States are so reduced in numbers that they are threatened with 
extinction. The disappearance of any of these would be a biological, 
cultural, and in some instances an economic loss. Their existence 
contributes to scientific knowledge and understanding, and their 
presence adds interest and variety to life.
    (2) The principal hazard to threatened and endangered species is the 
destruction or deterioration of their habitats by human activities such 
as industrialization, urbanization, agriculture, lumbering, recreation, 
and transportation. These activities of man will continue but the 
necessity of recognizing their adverse impacts and selecting 
alternatives that minimize or eliminate such impacts on threatened and 
endangered species is imperative.
    (3) The Endangered Species Act of 1973 (Pub. L. 93-205, 87 Stat. 884 
(16

[[Page 686]]

U.S.C. 1531 et seq.)) provides a means whereby the ecosystems upon which 
endangered and threatened species depend may be maintained and a program 
for the conservation of such species. The Act also provides that, in 
addition to the Department of the Interior, ``All other federal 
departments and agencies shall, in consultation with and with the 
assistance of the Secretary (of Interior), utilize their authorities for 
the conservation of endangered species and threatened species listed 
pursuant to section 4 of this Act and by taking such action necessary to 
insure that actions authorized, funded, or carried out by them do not 
jeopardize the continued existence of such endangered species and 
threatened species or result in the destruction or modification of 
habitat of such species which is determined by the Secretary, after 
consultation as appropriate with the affected states, to be critical.'' 
The Act also:
    (i) Defines endangered species as any species in danger of 
extinction throughout all or a significant portion of its range and 
threatened species as any species likely to become an endangered species 
within the foreseeable future throughout all or a significant portion of 
its range. The Act uses the category ``threatened.'' The term ``rare'' 
is not used.
    (ii) Further defines species as including any subspecies of fish or 
wildlife or plants and any other group of fish and wildlife of the same 
species or smaller taxa in common spatial arrangements that interbreed 
when mature.
    (iii) Provides for the Secretary of the Interior to enter into 
cooperative agreements with states for the purpose of implementing state 
programs for the conservation of endangered and threatened fish and 
wildlife. This assistance may include financial grants.
    (iv) Provides national lists of endangered and threatened animal and 
plant species to be maintained by the Secretary of the Interior and 
published in the Federal Register. When resident fish and wildlife are 
added to the list, the affected states are to be consulted by the 
Secretary. The Secretary of the Smithsonian Institution is preparing a 
list of endangered or threatened plant species.
    (b) Policy. The Act gives NRCS additional direction for 
participation in the conservation and protection of endangered and 
threatened species. As the principal federal agency concerned with land 
use planning of privately owned rural land and with professional 
conservation employees headquartered in almost every county, NRCS is 
uniquely capable of playing a vital role. Additional training will be 
provided as needed to meet NRCS responsibilities. NRCS will assist in 
the conservation of threatened and endangered species and consistent 
with legal requirements avoid or prevent activities detrimental to such 
species. NRCS concern for these species will not be limited to those 
listed by the Secretary of the Interior and published in the Federal 
Register, but will include species designated by state agencies as rare, 
threatened, endangered, etc.
    (c) Responsibility--(1) NRCS national office. The Administrator will 
arrange for consultation and coordination of NRCS national office 
activities with the U.S. Fish and Wildlife Service, other federal 
agencies, and national organizations.
    (2) Technical service center. The TSC director will, within the 
group of states served by the TSC arrange for consultation and 
coordination with regional representatives of the U.S. Fish and Wildlife 
Service, other Federal agencies, and national and regional 
organizations.
    (3) NRCS state office. The state conservationist will arrange for 
consultation and coordination with the state fish and game or 
conservation agency, other state agencies, state organizations and 
foundations, conservation districts, and state representatives of 
federal agencies and national organizations.
    (d) Coordination and implementation. (1) The NRCS national office 
will:
    (i) Within the framework of national legislation, USDA agreements, 
and NRCS objectives, develop NRCS policies and directives for guiding 
agency efforts that will protect threatened and endangered species and 
for avoiding actions that jeopardize the continued existence of such 
species and their critical habitats.

[[Page 687]]

    (ii) Maintain needed liaison and develop mutual understanding with 
the U.S. Fish and Wildlife Service and other concerned federal agencies.
    (iii) Establish procedures for periodic review of NRCS participation 
in the national effort to conserve these species.
    (2) The TSC director will: (i) Within the framework of NRCS policies 
and guidelines, arrange for needed liaison and understanding with 
regional counterparts of other federal agencies within the group of 
states served by the TSC and keep state conservationists informed of 
developments within such states.
    (ii) Provide guidance and assistance to state conservationists in 
carrying out NRCS policies and guidelines.
    (3) The state conservationist will develop procedures to establish 
working relationships with other concerned federal agencies, state fish 
and wildlife or conservation agencies, conservation districts, concerned 
scientists in state university systems and natural history museums, and 
other informed persons and organizations to offer assistance in:
    (i) Preparing or maintaining lists of the state's threatened and 
endangered species.
    (ii) Determining the geographic occurrence of endangered and 
threatened species, the nature of their habitat, and that portion of the 
habitat that is critical to the survival, maintenance, or increase of 
these species.
    (iii) Discussing the kinds of measures important to preserve their 
habitat.
    (iv) A monitoring program that would obtain advanced warning of 
actions or conditions that could further endanger these species, thereby 
enabling NRCS and others to take appropriate protective action.
    (v) Assisting recovery teams, as appropriate, in preparing species 
recovery plans of those endangered and threatened species included in 
Federal lists.
    (4) The state conservationist will also:
    (i) Keep NRCS area and field offices informed of species listed as 
being threatened or endangered, geographic area in which they are found, 
and information such as their numbers, preferred habitat, and critical 
factors.
    (ii) Review the status of threatened and endangered species each 
December and send a report of the review to the Administrator.
    (5) NRCS district conservationists within the geographic range of 
threatened and endangered species will examine conservation district 
programs and NRCS operations to evaluate their effects on these species, 
and recommend to district officials and the state conservationist any 
action needed for their protection.
    (6) NRCS field employees within the geographic range of threatened 
and endangered species will be continually alert to conditions, actions, 
or trends that may adversely affect the welfare of these species and 
report adverse situations to the state conservationist.



Sec. 650.23  Natural areas.

    (a) Background. (1) Natural areas are defined as land or water units 
where natural conditions are maintained insofar as possible. Natural 
conditions usually result from allowing ordinary physical and biological 
processes to operate with a minimum of human intervention. Manipulations 
may be required on natural areas to maintain or restore features that 
the areas were established to protect.
    (2) Natural areas may be designated areas of Federal, non-Federal 
government, or privately controlled land. Designation may be formal as 
provided for under federal regulations for areas of federal land to be 
administered as natural areas or by foundations or conservation 
organizations specifically created to acquire and maintain natural 
areas. Designation may be informal in the case of private landowners who 
designate a specific area as a natural area and manage it accordingly. 
Several professional societies concerned with renewable natural 
resources encourage establishment of natural areas withdrawn from 
economic uses and recognition of natural areas maintained and managed in 
economic enterprises.
    (3) Natural areas are established and maintained for a variety of 
purposes including:
    (i) Furthering science and education. Natural areas provide sites 
for research

[[Page 688]]

and outdoor classrooms for study of plant and animal communities in 
environments with particular ecological conditions.
    (ii) Monitoring the surrounding environment. Natural areas serve as 
gauges against which to evaluate changes in land use, vegetation, animal 
life, air quality, or other environmental values.
    (iii) Providing recreation attractions. Natural areas are valued by 
many people for their scenic, wild, and undisturbed character but must 
be protected, as needed, to prevent disturbance or alteration of the 
resources.
    (iv) Preserving unique values. Natural areas may be established to 
protect scenic, biologic, geologic, or paleontologic features.
    (v) Serving as a genetic base for native plants and animals. Natural 
areas may be established to preserve examples of land and water 
ecosystems with their full range of genetic diversity of native plants 
and animals including threatened and endangered species.
    (b) Policy. NRCS will recognize natural areas, if so dedicated, as a 
land use, and will support the designation of appropriate natural areas.
    (c) Responsibility--(1) NRCS national office. The Administrator will 
designate a member of the national office staff to act as NRCS 
representative on the Federal Committee for Ecological Preserves and to 
provide appropriate liaison with other federal agencies and non-Federal 
groups concerned with natural areas.
    (2) Technical service center. The TSC director will designate a TSC 
plant sciences discipline leader to provide leadership, appropriate 
liaison, and assistance on natural areas to NRCS state offices.
    (3) NRCS state office. The state conservationist will designate an 
appropriate NRCS representative to work with other agencies and groups, 
and will coordinate assistance on natural areas needed by area and field 
offices.
    (d) Coordination and implementation. (1) NRCS technical assistance 
will be furnished to representatives of administering agencies, 
foundations, groups, and individuals when requested through conservation 
districts. Conservation district officers will be encouraged to 
recognize appropriate natural areas concepts and programs and to 
participate in them.
    (2) NRCS employees will report to state conservationists abuses and 
potential or actual damages to natural areas that may be found in the 
course of ordinary business.
    (3) NRCS will cooperate with professional societies, groups, and 
individuals in locating areas suitable for and needed as natural areas.
    (4) NRCS employees providing technical assistance to land users must 
inform them about the impact their decisions may have on adjacent or 
nearby natural areas. Land users will be encouraged to consult with 
concerned agencies, societies, and individuals to arrive at mutually 
satisfactory land use and treatment.
    (5) Recommended classification systems for characterizing areas 
designated as ecological preserves or as natural areas are contained in 
the following publications:
Soil Taxonomy, a Basic System of Soil Classification for Making and 
Interpreting Soil Surveys, USDA-NRCS Agricultural Handbook 436.
Forest Cover Types of North America Exclusive of Mexico, Report of the 
Committee on Forest Cover Types, Society of American Foresters, 1964.
Potential Natural Vegetation of Conterminous United States. A. W. 
Kuchler, American Geographical Society Special Publication 36, 1964.
Wetlands classification described by the U.S. Fish and Wildlife Service 
in its Circular 39.

NRCS will, to the extent feasible, use these classification systems when 
providing technical assistance on public and private natural areas and 
ecological preserves.
    (6) The NRCS published National List of Scientific Plant Names will 
be used when scientific names or name symbols are needed for automatic 
data processing.



Sec. 650.24  Scenic beauty (visual resource).

    (a) Background. Contributions to scenic beauty are a normal product 
of NRCS work. Strip-cropping, field borders, field windbreaks, and ponds 
are examples. Emphasis is given to those soil and water conservation 
measures that contribute to a productive and efficient agriculture and 
increase the

[[Page 689]]

attractiveness of rural America and are in line with goals and 
objectives of conservation districts. This is best accomplished by 
considering the landscape visual resource when providing planning 
assistance to individual landowners, groups, units of government, and 
watershed and resource conservation development project sponsors. NRCS 
responsibilities in recreation also offer opportunities to develop the 
scenic beauty of the rural landscape. Department of Agriculture 
Secretary's Memorandum 1695, May 28, 1970, ``Protecting and Improving 
The Quality of the Environment,'' includes scenic beauty as an objective 
of the Department's programs.
    (b) Policy. NRCS will: (1) Provide technical assistance with full 
consideration of alternative management and development systems that 
preserve scenic beauty or improve the visual resource; (2) emphasize the 
application of conservation practices having scenic beauty or visual 
resource values particularly in waste management systems; field borders, 
field windbreaks, wetland management, access roads, critical area 
treatment; design and management of ponds, stream margins, odd areas, 
and farmsteads; siting or positioning of structures and buildings to be 
in harmony with the landscape while reducing the potential for erosion; 
using native and other adaptable plants for conservation which enhance 
scenic beauty and create variety while linking beauty with utility; (3) 
promote personal pride in landowners in the installation, maintenance, 
and appearance of conservation practices and their properties; (4) 
select suitable areas for waste products and use of screens to hide 
``eyesore'' areas, and (5) encourage conservation districts to include 
practices which promote scenic beauty in their annual and long-range 
programs.
    (c) Responsibility. The Natural Resources Conservation Service will 
provide technical assistance through conservation districts to 
landowners, operators, communities, and state and local governments in 
developing programs relating to scenic beauty.
    (1) NRCS national office. The Administrator will:
    (i) Assign appropriate NRCS national office leadership to insure 
that enhancement of scenic beauty is included in national information, 
policy, guidelines, standards, guides to specifications for conservation 
practices without impairing basic soil and water conservation functions.
    (ii) Emphasize in plant material center management and in plant 
materials functions that locating and evaluating plants for forage, 
erosion control, and recreation or wildlife uses be carried out with 
full attention to visual resource value.
    (2) NRCS state office. The state conservationist will:
    (i) Assign appropriate staff member(s) to provide leadership in 
carrying out scenic beauty policy and procedure within the state.
    (ii) Develop and keep current a landscape management plan to improve 
and maintain the appearance of all real properties under NRCS control, 
and provide appropriate assistance to owners and managers of properties 
leased or rented by NRCS.
    (iii) Give emphasis to preserving scenic beauty and contributing to 
the visual resource in the NRCS information program whenever 
opportunities exist.
    (d) Coordination and implementation. (1) The governing body of each 
conservation district will be encouraged to revise or update its 
district program to appropriately provide for beautification of the 
countryside through applicable land use changes and effective soil and 
water conservation treatment.
    (2) In providing assistance to watershed and resource conservation 
and development project sponsors and other resource planning groups for 
soil, water, and related resources, emphasis will be given to measures 
that preserve natural beauty or contribute to the quality of the visual 
resource.
    (3) Local organizations and groups interested in scenic beauty will 
be contacted and consulted for cooperation in and coordination with NRCS 
and conservation district efforts.



Sec. 650.25  Flood-plain management.

    Through proper planning, flood plains can be managed to reduce the 
threat to human life, health, and property in ways that are 
environmentally

[[Page 690]]

sensitive. Most flood plains are valuable for maintaining agricultural 
and forest products for food and fiber, fish and wildlife habitat, 
temporary floodwater storage, park and recreation areas, and for 
maintaining and improving environmental values. NRCS technical and 
financial assistance is provided to land users primarily on non-Federal 
land through local conservation districts and other State and local 
agencies. Through its programs, NRCS encourages sound flood-plain 
management decisions by land users.
    (a) Policy--(1) General. NRCS provides leadership and takes action, 
where practicable, to conserve, preserve, and restore existing natural 
and beneficial values in base (100-year) flood plains as part of 
technical and financial assistance in the programs it administers. In 
addition, 500-year flood plains are taken into account where there are 
``critical actions'' such as schools, hospitals, nursing homes, 
utilities, and facilities producing or storing volatile, toxic, or 
water-reactive materials.
    (2) Technical assistance. NRCS provides leadership, through 
consultation and advice to conservation districts and land users, in the 
wise use, conservation, and preservation of all land, including flood 
plains. Handbooks, manuals, and internal memoranda set forth specific 
planning criteria for addressing flood-plain management in NRCS-assisted 
programs. The general procedures and guidelines in this part comply with 
Executive Order (E.O.) 11988, Floodplain Management, dated May 24, 1977, 
and are consistent with the Water Resources Council's Unified National 
Program for Floodplain Management.
    (3) Compatible land uses. The NRCS Administrator has determined that 
providing technical and financial assistance for the following land uses 
is compatible with E.O. 11988:
    (i) Agricultural flood plains that have been used for producing 
food, feed, forage, fiber, or oilseed for at least 3 of the 5 years 
before the request for assistance; and
    (ii) Agricultural production in accordance with official State or 
designated area water-quality plans.
    (4) Nonproject technical and financial assistance programs. The NRCS 
Administrator has determined that NRCS may not provide technical and 
financial assistance to land users if the results of such assisted 
actions are likely to have significant adverse effects on existing 
natural and beneficial values in the base flood plain and if NRCS 
determines that there are practicable alternatives outside the base 
flood plain. NRCS will make a case-by-case decision on whether to limit 
assistance whenever a land user proposes converting existing 
agricultural land to a significantly more intensive agricultural use 
that could have significant adverse effects on the natural and 
beneficial values or increase flood risk in the base flood plain. NRCS 
will carefully evaluate the potential extent of the adverse effects and 
any increased flood risk.
    (5) Project technical and financial assistance programs. In planning 
and installing land and water resource conservation projects, NRCS will 
avoid to the extent possible the long and short-term adverse effects of 
the occupancy and modification of base flood plains. In addition, NRCS 
also will avoid direct or indirect support of development in the base 
flood plain wherever there is a practicable alternative. As such, the 
environmental evaluation required for each project action (Sec. 650.5 of 
this part) will include alternatives to avoid adverse effects and 
incompatible development in base flood plains. Public participation in 
planning is described in Sec. 650.6 of this part and will comply with 
section 2(a)(4) of E.O. 11988. Flood-plain management requires the 
integration of these concerns into NRCS's National Environmental Policy 
Act (NEPA) process for project assistance programs as described in 
Section 650 of this part.
    (6) Real property and facilities under NRCS ownership or control. 
NRCS owns or controls about 30 properties that are used primarily for 
the evaluation and development of plant materials for erosion control 
and fish and wildlife habitat plantings (7 CFR Part 613, Plant Materials 
Centers, 16 U.S.C. 590 a-e, f, and 7 U.S.C. 1010-1011). If NRCS real 
properties or facilities are located in the base flood plain, NRCS will 
require an environmental evaluation when new structures and facilities 
or major

[[Page 691]]

modifications are proposed. If it is determined that the only 
practicable alternative for siting the proposed action may adversely 
affect the base flood plain, NRCS will design or modify its action to 
minimize potential harm to or within the flood plain and will prepare 
and circulate a notice explaining why the action is proposed to be 
located in the base flood plain. Department of Housing and Urban 
Development (HUD) flood insurance maps, other available maps, 
information, or an onsite analysis will be used to determine whether the 
proposed NRCS action is in the base flood plain. Public participation in 
the action will be the same as described in Sec. 650.6 of this part.
    (b) Responsibility. NRCS provides technical and financial assistance 
to land users primarily through conservation districts, special purpose 
districts, and other State or local subdivisions of State government. 
Acceptance of this assistance is voluntary on the part of the land user. 
NRCS does not have authority to make land use decisions on non-Federal 
land. NRCS provides the land user with technical flood hazard data and 
information on flood-plain natural values. NRCS informs the land user 
how alternative land use decisions may affect the aquatic and terrestial 
ecosystems, human safety, property, and public welfare. Alternatives to 
flood-plain occupancy, modification, and development are discussed 
onsite with the land user by NRCS.
    (1) NRCS National Office. (Sec. 600.2 of this part). The NRCS 
Administrator, state conservationist, and district conservationist are 
the responsible Federal officials in NRCS for implementing the policies 
expressed in these rules. Any deviation from these rules must be 
approved by the Administrator. The Deputy Administrator for Programs has 
authority to oversee the application of policy in NRCS programs. 
Oversight assistance to state conservationists for flood-plain 
management will be provided by the NRCS technical service centers 
(Sec. 600.3 of this part).
    (2) NRCS state offices. (Sec. 600.4 of this part). Each state 
conservationist is the responsible Federal official in all NRCS-assisted 
programs administered within the State. He or she is also responsible 
for administering the plant materials centers within the State. The 
state conservationist will assign a staff person who has basic knowledge 
of landforms, soils, water, and related plant and animal ecosystems to 
provide technical oversight to ensure that assistance to land users and 
project sponsors on the wise use, conservation, and preservation of 
flood plains is compatible with national policy. For NRCS-assisted 
project actions, the staff person assigned by the state conservationist 
will consult with the local jurisdictions, sponsoring local 
organizations, and land users, on the basis of an environmental 
evaluation, to determine what constitutes significant adverse effects or 
incompatible development in the base flood plain. The state 
conservationist is to prepare and circulate a written notice for NRCS-
assisted actions for which the only practicable alternative requires 
siting in a base flood plain and may result in adverse effects or 
incompatible development. The NRCS NEPA process will be used to 
integrate flood-plain management into project planning and consultations 
on land use decisions by land users and project sponsors.
    (3) NRCS field offices. The district conservationist (Sec. 600.6 of 
this part) is delegated the responsibility for providing technical 
assistance and approving financial assistance to land users in 
nonproject actions, where applicable, and for deciding what constitutes 
an adverse effect or incompatible development of a base flood plain. 
This assistance will be based on official NRCS policy, rules, 
guidelines, and procedures in NRCS handbooks, manuals, memoranda, etc. 
For NRCS-assisted nonproject actions, the district conservationist, on 
the basis of the environmental evaluation, will advise recipients of 
technical and financial assistance about what constitutes a significant 
adverse effect or incompatible development in the base flood plain.
    (c) Coordination and implementation. All planning by NRCS staffs is 
interdisciplinary and encompasses the six NEPA policy statements, the 
WRC Principles and Standards, and an equivalent of the eight-step 
decisionmaking process in the WRC's February

[[Page 692]]

1978 Floodplain Management Guidelines. NRCS internal handbooks, manuals, 
and memoranda provide detailed information and guidance for NRCS 
planning and environmental evaluation.
    (1) Steps for nonproject technical and financial assistance 
programs. (i) NRCS assistance programs are voluntary and are carried out 
through local conservation districts (State entities) primarily on non-
Federal, privately owned lands.
    (ii) After the land user decides the type, extent, and location of 
the intended action for which assistance is sought, the district 
conservationist will determine if the intended action is in the base 
flood plain by using HUD flood insurance maps, and other available maps 
and information or by making an onsite determination of the approximate 
level of the 100-year flood if maps or other usable information are 
lacking.
    (iii) If the district conservationist determines that the land 
user's proposed location is outside the base flood plain, and would not 
cause potential harm within the base flood plain, NRCS will continue to 
provide assistance, as needed.
    (iv) If the district conservationist determines that the land user's 
proposed action is within the base flood plain and would likely result 
in adverse effects, incompatible development, or an increased flood 
hazard, it is the responsibility of the district conservationist to 
determine and point out to the land user alternative methods of 
achieving the objective, as well as alternative locations outside the 
base flood plain. If the alternative locations are determined to be 
impractical, the district conservationist will decide whether to 
continue providing assistance. If the decision is to terminate 
assistance for the proposed action, the land user and the local 
conservation district, if one exists, will be notified in writing about 
the decision.
    (v) If the district conservationist decides to continue providing 
technical and financial assistance for a proposed action in the base 
flood plain, which is the only practicable alternative, NRCS may require 
that the proposed action be designed or modified so as to minimize 
potential harm to or within the flood plain. The district 
conservationist will prepare and circulate locally a written notice 
explaining why the action is proposed to be located in the base flood 
plain.
    (2) Steps for project assistance programs. (i) NRCS project 
assistance to local sponsoring organizations (conservation districts and 
other legal entities of State government) and land users is carried out 
primarily on non-Federal land in response to requests for assistance. 
NRCS helps the local sponsoring organizations prepare a plan for 
implementing the needed resource measures.
    (ii) NRCS uses an interdisciplinary environmental evaluation 
(Sec. 650.6 of this part) as a basis for providing recommendations and 
alternatives to project sponsors. Flood-plain management is an integral 
part of every NRCS environmental evaluation. NRCS delineates the base 
flood plain by using detailed HUD flood insurance maps and other 
available data, as appropriate, and provides recommendations to sponsors 
on alternatives to avoid adverse effects and incompatible development in 
base flood plains. NRCS will develop, as needed, detailed 100-year and 
500-year flood-plain maps where there are none.
    (iii) NRCS's NEPA process (part 650 of this chapter) is used to 
integrate the spirit and intent of E.O. 11988 Sections 2(a) and 2(c) 
into agency planning and recommendations for land and water use 
decisions by local sponsoring organizations and land users.
    (iv) NRCS will terminate assistance to a local sponsoring 
organization in project programs if it becomes apparent that decisions 
by land users and local jurisdictions concerning flood-plain management 
would likely result in adverse effects or incompatible development and 
the environmental evaluation reveals that there are practicable 
alternatives to the proposed project that would not cause adverse 
effects on the base flood plain.
    (v) In carrying out the planning and installation of land and water 
resource conservation projects, NRCS will avoid, to the extent possible, 
the long-

[[Page 693]]

term and short-term adverse effects associated with the occupancy and 
modification of base flood plains. In addition, NRCS will also avoid 
direct or indirect support of development in the base flood plain 
wherever there is a practicable alternative. Where appropriate, NRCS 
will require design modifications to minimize harm to or within the base 
flood plain. NRCS will provide appropriate public notice and public 
participation in the continuing planning process in accordance with NRCS 
NEPA process.
    (vi) NRCS may require the local government to adopt and enforce 
appropriate flood plain regulations as a condition to receiving project 
financial assistance.
    (3) Actions on property and facilities under NRCS ownership or 
control. For real property and facilities owned by or under the control 
of NRCS, the following actions will be taken:
    (i) Locate new structures, facilities, etc., outside the base flood 
plain if there is a practicable alternate site.
    (ii) Require public participation in decisions to construct 
structures, facilities, etc., in flood plains that might result in 
adverse effects and incompatible development in such areas if no 
practicable alternatives exist.
    (iii) New construction or rehabilitation will be in accordance with 
the standards and criteria of the National Flood Insurance Program and 
will include floodproofing and other flood protection measures as 
appropriate.

[44 FR 44462, July 30, 1979]

                        PARTS 651-652  [RESERVED]



PART 653--TECHNICAL STANDARDS--Table of Contents




Sec.
653.1  General.
653.2  Technical standards and criteria.
653.3  Adaptation of technical standards.
653.4  Availability of technical standards.

    Authority: 7 CFR 2.62.

    Source: 43 FR 58079, Dec. 12, 1978, unless otherwise noted.



Sec. 653.1  General.

    The Natural Resources Conservation Service (NRCS) is responsible for 
the technical adequacy of conservation practices installed under all 
NRCS programs, and those practices applied under programs administered 
by the Agricultural Stabilization and Conservation Service (ASCS) where 
NRCS has the technical responsibility. NRCS technical or financial 
assistance will be provided when the practices are applied according to 
established technical standards.



Sec. 653.2  Technical standards and criteria.

    Technical standards and criteria have been established for all 
conservation practices. They provide the guidance and direction needed 
to assure that the practices meet the intended purpose and are of the 
quality needed to assure lasting for the design life. Standards and 
criteria are developed in consultation with universities, research 
institutions, and individual industrial and private firms and 
individuals. Research information and practical experience are used in 
setting standards. Changes and new technical standards and criteria are 
prepared in the same manner as set out above.



Sec. 653.3  Adaptation of technical standards.

    Technical standards and criteria developed on a national basis may 
require special adaptation to meet local needs. These adaptations must 
be approved by the Administrator of the Natural Resources Conservation 
Service or his designee.



Sec. 653.4  Availability of technical standards.

    Information on technical standards used by NRCS is available at 
field, area, or State offices of NRCS.



PART 654--OPERATION AND MAINTENANCE--Table of Contents




                           Subpart A--General

Sec.
654.1  Purpose and scope.
654.2  Definitions.

            Subpart B--Federal Financially-Assisted Projects

654.10  Operation and maintenance agreement.

[[Page 694]]

654.11  Sponsor(s)' responsibility.
654.12  Financing operations and maintenance.
654.13  Designating responsibility for operation and maintenance.
654.14  Duration of sponsor(s)' responsibility.
654.15  Operation and maintenance.
654.16  Property management.
654.17  Inspection.
654.18  Natural Resources Conservation Service responsibility.
654.19  Plan of operation and maintenance.
654.20  Violations of operation and maintenance agreement.

                   Subpart C--Conservation Operations

654.30  Responsibility for operation and maintenance.
654.31  Performing operation and maintenance.

                Subpart D--Emergency Watershed Protection

654.40  Responsibility for operation and maintenance.
654.41  Performance of operation and maintenance.

              Subpart E--Great Plains Conservation Program

654.50  Responsibility for operation and maintenance.

    Authority: Pub. L. 83-566, 68 Stat. 666, as amended (16 U.S.C. 1001-
1008). Sec. 1, Pub. L. 86-468, 74 Stat. 131, as amended (16 U.S.C. 
1006a); sec. 2, Pub. L. 78-534, 58 Stat. 889 (33 U.S.C. 701a-1); sec. 
13, Pub. L. 78-534, 58 Stat. 905; sec. 5, Pub. L. 93-251, 88 Stat. 15; 
Pub. L. 87-703, 76 Stat. 607 (7 U.S.C. 1010-1011); Pub. L. 74-46, 49 
Stat. 163 (16 U.S.C. 590a-f, q); Pub. L. 84-1021, 70 Stat. 1115, as 
amended (16 U.S.C. 590p(b)); sec. 216, Pub. L. 81-516, 64 Stat. 184 (33 
U.S.C. 701b-1); 7 CFR 2.62.

    Source: 42 FR 58159, Nov. 8, 1977, unless otherwise noted.



                           Subpart A--General



Sec. 654.1  Purpose and scope.

    (a) This part sets forth the operation and maintenance requirements 
pertaining to measures installed with Natural Resources Conservation 
Service (NRCS) assistance. This includes measures installed under the 
following programs:
    (1) Federal financially-assisted projects.
    (i) Watershed Protection and Flood Prevention (WP&FP). See part 622 
of this title.
    (ii) Flood Prevention (FP). See part 623 of this title.
    (iii) Specifically authorized projects.
    (iv) Resource Conservation and Development (RC&D).
    (2) Conservation Operations (CO).
    (3) Emergency Watershed Protection (EWP). See part 624 of this 
title.
    (4) Great Plains Conservation Program (GP). See part 631 of this 
title.
    (b) These regulations shall apply to all Federal financially-
assisted projects as set forth in subpart B for the duration of their 
respective operation and maintenance agreements. However, this does not 
relieve the sponsor(s) of any liability which may continue beyond the 
evaluated life of the measure under Federal, State, and local laws. 
Operation and maintenance agreements in effect prior to the effective 
date of these regulations are not affected by these regulations.



Sec. 654.2  Definitions.

    Evaluated life. The time period for which project or measure 
benefits and costs have been evaluated. The evaluated life starts after 
the last project measure of the evaluation unit has been completed.
    Landuser. Those who individually or collectively use land as owner, 
lessee, occupier, or by other arrangements which give them conservation 
planning or implementation concern and responsibility for the land 
involved.
    Maintenance. The work and actions required to keep works of 
improvement in a condition to function for their intended purpose and 
the replacement of portions of project measures as specified in the O&M 
agreement.
    Operation. The administration, management, and performance of 
services needed to insure the continued proper functioning of completed 
project measures.
    Operation and maintenance agreement. A written agreement between the 
sponsor(s) and NRCS or other recipient(s) in which responsibilities and 
actions are established for the operation, maintenance, replacement, and 
inspection of project measures.
    Plan of operation and maintenance. A detailed program of action to 
provide for performing the operation and maintenance of a specific 
project measure.

[[Page 695]]

    Project measures. An undertaking for watershed protection; flood 
prevention; the conservation, development, utilization, and disposal of 
water; the conservation and proper utilization of land; or a combination 
thereof. The undertaking may consist of vegetative, structural, or 
management measures or a combination thereof. Vegetative measures are 
those measures involving only seedbed preparation and/or the planting of 
vegetative material.
    Public recreation and/or fish and wildlife facility. A project 
measure or part thereof which (a) creates or improves the potential for 
public recreational use and enjoyment, or (b) materially contributes to 
the preservation, production, or harvest of fish and wildlife.
    Sponsor. An agency or organization with authority to provide local 
responsibility for a Federal financially-assisted local project under a 
program administered by NRCS.
    State Conservationist. The NRCS officer responsible for NRCS 
activities within a particular State, the Commonwealth of Puerto Rico, 
or the U.S. Virgin Islands.
    Structural measures. Structural measures are those measures that are 
excavated or constructed with concrete, earth, masonry, metal, rock, or 
other materials, and associated vegetation.



            Subpart B--Federal Financially-Assisted Projects



Sec. 654.10  Operation and maintenance agreement.

    A duly authorized official of the sponsor(s) must execute an O&M 
agreement with NRCS prior to NRCS furnishing financial assistance.



Sec. 654.11  Sponsor(s)' responsibility.

    (a) On non-Federal land, sponsor(s) are responsible for financing 
and performing without cost to the Federal Government, needed operation 
and maintenance (O&M) of project measures installed with Federal 
financial assistance.
    (b) The Federal agency administering Federal land involving project 
measures is responsible either for performing or requiring the 
performance of O&M on land administered by that agency. If project 
measures benefit both Federal and non-Federal land or interests, the O&M 
may be performed by the Federal agency, the sponsor(s), or both as 
mutually agreed by the Federal agency, sponsor(s), and NRCS. If O&M of 
project measures is performed by mutual agreement, the cost of O&M may 
be shared by the Federal agency and sponsor(s) as agreed.
    (c) The sponsor(s) shall obtain NRCS approval before modifying a 
project measure of changing land use to fulfill a different purpose.



Sec. 654.12  Financing operations and maintenance.

    Sources of funds needed to operate and maintain project measures for 
the duration of the O&M agreement shall be identified in the watershed 
or RC&D measure plan.



Sec. 654.13  Designating responsibility for operation and maintenance.

    Those organizations or agencies responsible for the O&M of each 
project measure shall be identified in the watershed or RC&D measure 
plan.



Sec. 654.14  Duration of sponsor(s)' responsibility.

    (a) Sponsor(s)' responsibility for O&M of a completed project 
measure begins when a part of all of the contract installing such 
measure is completed and accepted from the contractor. If the 
installation of the project measure is performed by force account, 
division of work, or performance of work methods, the sponsor(s)' O&M 
responsibilities begin on the date the work or portion thereof is 
completed as determined by NRCS, except for completed work located on 
Federal lands which are subject to special-use permits. The O&M 
agreement shall specify that O&M will continue through: (1) The 
evaluated life of the project, or (2) the evaluated life of measures 
that are economically evaluated as a unit, or (3) the useful life of 
cost-shared measures that are for land conservation or land utilization. 
The sponsor(s)' duties and liabilities for the measures under other 
Federal and State laws are not affected by the expiration of the O&M 
agreement.
    (b) For project measures being installed in segments, the sponsor(s)

[[Page 696]]

shall be responsible for O&M of completed and accepted segments. 
However, the NRCS may share in the cost of repairing damages to a 
completed segment when the damage is attributed to the continuation of 
work on uncompleted segments of the measure or when due to the fact that 
the measure was only partially completed.



Sec. 654.15  Operation and maintenance.

    Sponsor(s) are to operate and maintain completed project measures 
in:
    (a) Compliance with applicable Federal, State, and local laws, 
regulations, and ordinances.
    (b) Compliance with any applicable conditions set forth in the 
instruments by which the landrights were acquired for installing, 
operating, and maintaining the project measures.
    (c) A manner that will not significantly degrade the environment and 
will permit project measures to serve the purpose for which they were 
installed as set forth in the watershed or RC&D measure plan.
    (d) Compliance with the time frames and O&M work items established 
in the plan of O&M and inspection reports.
    (e) Accordance with agreements with NRCS on admission charges and 
user fees for public recreation and/or fish and wildlife facility. 
Admission or user fees shall be charged only as necessary to produce 
revenues required to amortize the sponsor(s)' share of installation 
costs and to provide adequate O&M for that portion of the project 
measures pertaining to public recreation and/or fish and wildlife 
facility. Sponsor(s)' admission or user fee charges require prior NRCS 
approval throughout the life of the O&M agreement.
    (f) Accordance with the schedule for withdrawal of water in water 
impounding structures as specified in the watershed or RC&D measure plan 
or other legal documents.
    (g) A manner consistent with the project objectives.



Sec. 654.16  Property management.

    Sponsor(s) are to:
    (a) Use real property acquired in whole or in part with Federal 
funds as long as needed for the purpose for which it was acquired and in 
accordance with the O&M agreement. If real property acquired in whole or 
in part with Federal funds is no longer needed for the purpose for which 
it was acquired, the sponsor(s) shall obtain NRCS approval for future 
use or disposition.
    (b) Use nonexpendable personal property acquired in whole or in part 
with Federal funds as long as needed for the purpose for which it was 
acquired in accordance with the rules governing Federal grant property 
(34 CFR part 256).
    (c) Establish, adopt, and comply with a property management system 
which meets the standards governing Federal grant property.



Sec. 654.17  Inspection.

    (a) Sponsor(s) are to make periodic and special inspections of 
installed project measures as provided in the plan of O&M. For 
structural measures, inspections are to be made at least annually and 
after each major storm or occurrence of any unusual condition that might 
adversely affect the project measures. At the discretion of the State 
Conservationist, NRCS may assist sponsor(s) with their inspections. NRCS 
or land-administering agencies may make independent inspections at any 
time during the period covered by the O&M agreement.
    (b) Sponsor(s) are to maintain a written record of each inspection 
and furnish NRCS and land-administering agencies a copy of that record. 
The record should indentify items inspected, O&M work that may be 
needed, a time frame to do the work, and the date of the inspection. The 
NRCS and land-administering agencies will provide the sponsor(s) a copy 
of a similar record of independent inspections.
    (c) The sponsor(s) shall perform the O&M work listed as needed in 
the inspection reports within the time frame established for each item 
of work. Failure to perform O&M work will be considered a violation of 
the O&M agreement and will be handled in accordance with Sec. 654.20.
    (d) Sponsor(s) are to maintain a written record of work performed 
which is listed in the inspection report and a

[[Page 697]]

record of other significant O&M activity. The record will identify the 
measure, item of work, cost of performance, and date completed.
    (e) Sponsor(s)' records relative to the project shall be made 
available to NRCS for examination.



Sec. 654.18  Natural Resources Conservation Service responsibility.

    The Natural Resources Conservation Service will assist the 
sponsor(s) in developing a watershed or RC&D measure plan which includes 
a description of O&M work and estimated cost, assist in the preparation 
of O&M agreements and plans of O&M, enter into O&M agreements with the 
sponsor(s), and notify the sponsor(s) of observed failures to comply 
with the O&M agreement.



Sec. 654.19  Plan of operation and maintenance.

    (a) The plan for O&M shall be incorporated into and made a part of 
the O&M agreement. A separate plan of O&M shall be prepared for each 
project measure that is expected to a have a unique O&M need. Two or 
more measures with similar O&M needs may be included in a single plan 
for O&M.
    (b) The plan of O&M shall include the known and anticipated items of 
O&M, an explanation of how the O&M activities may be carried out, a 
general time frame for making O&M inspections and for completing the 
needed O&M work, and the records and reports deemed appropriate by the 
sponsor(s) and NRCS.



Sec. 654.20  Violations of operation and maintenance agreement.

    (a) The State Conservationist shall investigate alleged sponsor 
violations of the O&M agreement. If the State Conservationist determines 
that a violation has occurred that may prevent the project measure from 
functioning as intended, create a health or safety hazard, or prevent 
the accrual of project benefits, he shall provide sponsor(s) written 
notification.
    (b) If the sponsor(s) fail to comply with the O&M agreement or fail 
to take corrective action, NRCS may notify authorities having 
appropriate jurisdiction, withhold further assistance to the project, 
require the sponsor(s) to reimburse the government for the NRCS share of 
the cost of the project, and/or pursue other action authorized by the 
O&M agreement or law.



                   Subpart C--Conservation Operations



Sec. 654.30  Responsibility for operation and maintenance.

    The land user is responsible for O&M of soil and water conservation 
measures installed with NRCS assistance provided through soil, water, 
and other conservation districts.



Sec. 654.31  Performing operation and maintenance.

    The method of performing O&M is to be at the option of the land 
user. The NRCS, working through districts, will furnish information and 
technical assistance as needed and requested to the extent NRCS 
resources permit.



                Subpart D--Emergency Watershed Protection



Sec. 654.40  Responsibility for operation and maintenance.

    (a) Non-Federal lands. The need for an O&M agreement will be 
determined by the State Conservationist. Where an O&M agreement is 
necessary, the sponsor(s) will provide the O&M and adopt standards for 
Federal grant property (34 CFR part 256). Where no O&M agreement is 
necessary, other arrangements will be made for complying with Federal 
property management.
    (b) Federal lands. The Federal agency administering the Federal land 
is responsible for operating and maintaining emergency measures 
installed on Federal land.



Sec. 654.41  Performance of operation and maintenance.

    (a) Arrangement. O&M is a prerequisite for approval of Federal 
emergency assistance when:
    (1) The emergency measure needs to be operated and maintained in 
order to serve its intended purpose, or
    (2) The emergency measure needs to be operated and maintained to 
insure that it will not become hazardous.
    (b) Time of operation and maintenance. The sponsor(s)' obligations 
for O&M

[[Page 698]]

begin when the measure is installed and extend for the duration of the 
time required for the emergency measure to serve the purpose for which 
it is installed.
    (c) Performance. Operation and maintenance is to be performed in a 
manner that will protect the environment and otherwise comply with NRCS, 
State, and local requirements. The method of performing O&M is at the 
option of the sponsor(s).



              Subpart E--Great Plains Conservation Program



Sec. 654.50  Responsibility for operation and maintenance.

    Responsibility for practices under the Great Plains Conservation 
Program are contained in Sec. 631.10 of this chapter.

                          PART 655  [RESERVED]



PART 656--PROCEDURES FOR THE PROTECTION OF ARCHEOLOGICAL AND HISTORICAL PROPERTIES ENCOUNTERED IN NRCS-ASSISTED PROGRAMS--Table of Contents




Sec.
656.1  Purpose.
656.2  Archeological and historical laws and Executive orders applicable 
          to NRCS-assisted programs.
656.3  Policy.
656.4--656.9  [Reserved]

    Authority: Pub. L. 86-523, 74 Stat. 220, as amended (16 U.S.C. 469 
et seq.); Pub. L. 89-665, 80 Stat. 915, as amended (16 U.S.C. 470 et 
seq.); 7 CFR 2.62.

    Source: 42 FR 36804, July 18, 1977, unless otherwise noted.



Sec. 656.1  Purpose.

    This part prescribes Natural Resources Conservation Service (NRCS) 
policy, procedures, and guidelines for the implementation of 
archeological and historical laws and appropriate executive orders for 
administering NRCS programs.



Sec. 656.2  Archeological and historical laws and Executive orders applicable to NRCS-assisted programs.

    (a) The Act of June 27, 1960, relating to the preservation of 
historical and archeological data, Pub. L. 86-523, 74 Stat. 220, as 
amended May 24, 1974; Pub. L. 93-291, 88 Stat. 174 (16 U.S.C. 469 et 
seq.), provides for the preservation of historical and archeological 
materials or data, including relics and specimens, that might otherwise 
be lost or destroyed as a result of any Federal or federally-assisted or 
licensed project, activity, or program.
    (b) The National Historic Preservation Act, Pub. L. 89-665, 80 Stat. 
915, as amended, (16 U.S.C. 470 et seq.), authorizes the Secretary of 
the Interior to maintain and expand a National Register of Historic 
Places (NRHP), including historic districts, sites, buildings, 
structures, and objects that are significant in American history, 
architecture, archeology, and culture. This law also establishes the 
Advisory Council on Historic Preservation (ACHP), to be appointed by the 
President. Section 106 of this Act (16 U.S.C. 470f), requires that prior 
to the approval of any Federal or federally-assisted or licensed 
undertaking, the Federal agency shall afford the ACHP a reasonable 
opportunity to comment, if properties listed in or eligible for listing 
in NRHP are affected.
    (c) Executive Order 11593 (36 FR 8921, 3 CFR 1971 Comp. P. 154), 
Protection and Enhancement of the Cultural Environment, provides that 
the Federal government shall furnish leadership in preserving, 
restoring, and maintaining the historical and cultural environment of 
the nation, and that Federal agencies shall administer the cultural 
properties under their control in a spirit of stewardship and 
trusteeship for future generations; initiate measures necessary to 
direct their policies, plans, and programs in such a way that federally 
owned sites, structures, and objects of historical, architectural, or 
archeological significance are preserved, restored, and maintained. 
Section 1(3) directs that agencies institute procedures to assure that 
Federal plans

[[Page 699]]

and programs contribute to the preservation and enhancement of non-
federally owned sites, structures, and objects of historical, 
architectural, or archeological significance in consultation with the 
ACHP.



Sec. 656.3  Policy.

    (a) NRCS recognizes that significant historical, archeological, and 
architectural resources are an important part of our national heritage, 
the protection of which requires careful consideration in this agency's 
project planning and implementation process.
    (b) NRCS will take reasonable precautions to avoid damaging any 
significant historic, cultural, or natural aspects of our national 
heritage and will work with the National Park Service (NPS) and the 
Advisory Council on Historic Preservation (ACHP) in identifying and 
seeking to avoid or mitigate adverse effects of NRCS-assisted projects 
on the Nation's significant cultural resources. The procedures contained 
in this part have been developed to comply with sections 1(3) and 2(c) 
of Executive Order 11593.



Secs. 656.4--656.9  [Reserved]



PART 657--PRIME AND UNIQUE FARMLANDS--Table of Contents




                Subpart A--Important Farmlands Inventory

Sec.
657.1  Purpose.
657.2  Policy.
657.3  Applicability.
657.4  NRCS responsibilities.
657.5  Identification of important farmlands.

    Authority: 16 U.S.C. 590a-f, q; 7 CFR 2.62; Pub. L. 95-87; 42 U.S.C. 
4321 et seq.

    Source: 43 FR 4031, Jan. 31, 1978, unless otherwise noted.



                Subpart A--Important Farmlands Inventory



Sec. 657.1  Purpose.

    NRCS is concerned about any action that tends to impair the 
productive capacity of American agriculture. The Nation needs to know 
the extent and location of the best land for producing food, feed, fiber 
forage, and oilseed crops. In addition to prime and unique farmlands, 
farmlands that are of statewide and local importance for producing these 
crops also need to be identified.



Sec. 657.2  Policy.

    It is NRCS policy to make and keep current an inventory of the prime 
farmland and unique farmland of the Nation. This inventory is to be 
carried out in cooperation with other interested agencies at the 
National, State, and local levels of government. The objective of the 
inventory is to identify the extent and location of important rural 
lands needed to produce food, feed, fiber, forage, and oilseed crops.



Sec. 657.3  Applicability.

    Inventories made under this memorandum do not constitute a 
designation of any land area to a specific land use. Such designations 
are the responsibility of appropriate local and State officials.



Sec. 657.4  NRCS responsibilities.

    (a) State Conservationist. Each NRCS State Conservationist is to:
    (1) Provide leadership for inventories of important farmlands for 
the State, county, or other subdivision of the State. Each is to work 
with appropriate agencies of State government and others to establish 
priorities for making these inventories.
    (2) Identify the soil mapping units within the State that qualify as 
prime. In doing this, State Conservationists, in consultation with the 
cooperators of the National Cooperative Soil Survey, have the 
flexibility to make local deviation from the permeability criterion or 
to be more restrictive for other specific criteria in order to assure 
the most accurate identification of prime farmlands for a State. Each is 
to invite representatives of the Governor's office, agencies of the 
State government, and others to identify farmlands of statewide 
importance and unique farmlands that are to be inventoried within the 
framework of this memorandum.
    (3) Prepare a statewide list of:
    (i) Soil mapping units that meet the criteria for prime farmland;
    (ii) Soil mapping units that are farmlands of statewide importance 
if the

[[Page 700]]

criteria used were based on soil information; and
    (iii) Specific high-value food and fiber crops that are grown and, 
when combined with other favorable factors, qualify lands to meet the 
criteria for unique farmlands. Copies are to be furnished to NRCS Field 
Offices and to NRCS Technical Service Centers (TSC's). (See 7 CFR 600.3, 
600.6.)
    (4) Coordinate soil mapping units that qualify as prime farmlands 
with adjacent States, including the States responsible for the soil 
series. Since farmlands of statewide importance and unique farmlands are 
designated by others at the State level, the soil mapping units and 
areas identified need not be coordinated among States.
    (5) Instruct NRCS District Conservationists to arrange local review 
of lands identified as prime, unique, and additional farmlands of 
statewide importance by Conservation Districts and representatives of 
local agencies. This review is to determine if additional farmland 
should be identified to meet local decisionmaking needs.
    (6) Make and publish each important farmland inventory on a base map 
of national map accuracy at an intermediate scale of 1:50,000 or 
1:100,000. State Conservationists who need base maps of other scales are 
to submit their requests with justification to the Administrator for 
consideration.
    (b) Technical Service Centers. Field representatives are to provide 
requested technical assistance to State Conservationists in inventorying 
prime and unique farmlands (see 7 CFR 600.2). This includes reviewing 
statewide lists of soil mapping units that meet the criteria for prime 
farmlands and resolving coordination problems that may occur among 
States for specific soil series or soil mapping units.
    (c) National Office. The Assistant Administrator for Field Services 
(see 7 CFR 600.2) is to provide national leadership in preparing 
guidelines for inventorying prime farmlands and for national statistics 
and reports of prime farmlands.



Sec. 657.5  Identification of important farmlands.

    (a) Prime farmlands--(1) General. Prime farmland is land that has 
the best combination of physical and chemical characteristics for 
producing food, feed, forage, fiber, and oilseed crops, and is also 
available for these uses (the land could be cropland, pastureland, 
rangeland, forest land, or other land, but not urban built-up land or 
water). It has the soil quality, growing season, and moisture supply 
needed to economically produce sustained high yields of crops when 
treated and managed, including water management, according to acceptable 
farming methods. In general, prime farmlands have an adequate and 
dependable water supply from precipitation or irrigation, a favorable 
temperature and growing season, acceptable acidity or alkalinity, 
acceptable salt and sodium content, and few or no rocks. They are 
permeable to water and air. Prime farmlands are not excessively erodible 
or saturated with water for a long period of time, and they either do 
not flood frequently or are protected from flooding. Examples of soils 
that qualify as prime farmland are Palouse silt loam, 0 to 7 percent 
slopes; Brookston silty clay loam, drained; and Tama silty clay loam, 0 
to 5 percent slopes.
    (2) Specific criteria. Prime farmlands meet all the following 
criteria: Terms used in this section are defined in USDA publications: 
``Soil Taxonomy, Agriculture Handbook 436''; ``Soil Survey Manual, 
Agriculture Handbook 18''; ``Rainfall-erosion Losses From Cropland, 
Agriculture Handbook 282''; ``Wind Erosion Forces in the United States 
and Their Use in Predicting Soil Loss, Agriculture Handbook 346''; and 
``Saline and Alkali Soils, Agriculture Handbook 60.''
    (i) The soils have:
    (A) Aquic, udic, ustic, or xeric moisture regimes and sufficient 
available water capacity within a depth of 40 inches (1 meter), or in 
the root zone (root zone is the part of the soil that is penetrated or 
can be penetrated by plant roots) if the root zone is less than 40 
inches deep, to produce the commonly grown cultivated crops (cultivated 
crops include, but are not limited to, grain, forage, fiber, oilseed, 
sugar beets, sugarcane, vegetables, tobacco, orchard, vineyard, and bush 
fruit crops) adapted to the region in 7 or more years out of 10; or

[[Page 701]]

    (B) Xeric or ustic moisture regimes in which the available water 
capacity is limited, but the area has a developed irrigation water 
supply that is dependable (a dependable water supply is one in which 
enough water is available for irrigation in 8 out of 10 years for the 
crops commonly grown) and of adequate quality; or,
    (C) Aridic or torric moisture regimes and the area has a developed 
irrigation water supply that is dependable and of adequate quality; and,
    (ii) The soils have a temperature regime that is frigid, mesic, 
thermic, or hyperthermic (pergelic and cryic regimes are excluded). 
These are soils that, at a depth of 20 inches (50 cm), have a mean 
annual temperature higher than 32 deg. F (0 deg. C). In addition, the 
mean summer temperature at this depth in soils with an O horizon is 
higher than 47 deg. F (8 deg. C); in soils that have no O horizon, the 
mean summer temperature is higher than 59 deg. F (15 deg. C); and,
    (iii) The soils have a pH between 4.5 and 8.4 in all horizons within 
a depth of 40 inches (1 meter) or in the root zone if the root zone is 
less than 40 inches deep; and,
    (iv) The soils either have no water table or have a water table that 
is maintained at a sufficient depth during the cropping season to allow 
cultivated crops common to the area to be grown; and,
    (v) The soils can be managed so that, in all horizons within a depth 
of 40 inches (1 meter) or in the root zone if the root zone is less than 
40 inches deep, during part of each year the conductivity of the 
saturation extract is less than 4 mmhos/cm and the exchangeable sodium 
percentage (ESP) is less than 15; and,
    (vi) The soils are not flooded frequently during the growing season 
(less often than once in 2 years); and,
    (vii) The product of K (erodibility factor) x percent slope is less 
than 2.0, and the product of I (soils erodibility)  x  C (climatic 
factor) does not exceed 60; and
    (viii) The soils have a permeability rate of at least 0.06 inch 
(0.15 cm) per hour in the upper 20 inches (50 cm) and the mean annual 
soil temperature at a depth of 20 inches (50 cm) is less than 59 deg. F 
(15 deg. C); the permeability rate is not a limiting factor if the mean 
annual soil temperature is 59 deg. F (15 deg. C) or higher; and,
    (ix) Less than 10 percent of the surface layer (upper 6 inches) in 
these soils consists of rock fragments coarser than 3 inches (7.6 cm).
    (b) Unique farmland--(1) General. Unique farmland is land other than 
prime farmland that is used for the production of specific high value 
food and fiber crops. It has the special combination of soil quality, 
location, growing season, and moisture supply needed to economically 
produce sustained high quality and/or high yields of a specific crop 
when treated and managed according to acceptable farming methods. 
Examples of such crops are citrus, tree nuts, olives, cranberries, 
fruit, and vegetables.
    (2) Specific characteristics of unique farmland. (i) Is used for a 
specific high-value food or fiber crop; (ii) Has a moisture supply that 
is adequate for the specific crop; the supply is from stored moisture, 
precipitation, or a developed-irrigation system; (iii) Combines 
favorable factors of soil quality, growing season, temperature, 
humidity, air drainage, elevation, aspect, or other conditions, such a 
nearness to market, that favor the growth of a specific food or fiber 
crop.
    (c) Additional farmland of statewide importance. This is land, in 
addition to prime and unique farmlands, that is of statewide importance 
for the production of food, feed, fiber, forage, and oil seed crops. 
Criteria for defining and delineating this land are to be determined by 
the appropriate State agency or agencies. Generally, additional 
farmlands of statewide importance include those that are nearly prime 
farmland and that economically produce high yields of crops when treated 
and managed according to acceptable farming methods. Some may produce as 
high a yield as prime farmlands if conditions are favorable. In some 
States, additonal farmlands of statewide importance may include tracts 
of land that have been designated for agriculture by State law.
    (d) Additional farmland of local importance. In some local areas 
there is concern for certain additional farmlands

[[Page 702]]

for the production of food, feed, fiber, forage, and oilseed crops, even 
though these lands are not identified as having national or statewide 
importance. Where appropriate, these lands are to be identified by the 
local agency or agencies concerned. In places, additional farmlands of 
local importance may include tracts of land that have been designated 
for agriculture by local ordinance.



PART 658--FARMLAND PROTECTION POLICY ACT--Table of Contents




Sec.
658.1  Purpose.
658.2  Definitions.
658.3  Applicability and exemptions.
658.4  Guidelines for use of criteria.
658.5  Criteria.
658.6  Technical assistance.
658.7  USDA assistance with Federal agencies' reviews of policies and 
          procedures.

    Authority: 7 U.S.C. 4201-4209.

    Source: 49 FR 27724, July 5, 1984, unless otherwise noted.



Sec. 658.1  Purpose.

    This part sets out the criteria developed by the Secretary of 
Agriculture, in cooperation with other Federal agencies, pursuant to 
section 1541(a) of the Farmland Protection Policy Act (FPPA or the Act) 
7 U.S.C. 4202(a). As required by section 1541(b) of the Act, 7 U.S.C. 
4202(b), Federal agencies are (a) to use the criteria to identify and 
take into account the adverse effects of their programs on the 
preservation of farmland, (b) to consider alternative actions, as 
appropriate, that could lessen adverse effects, and (c) to ensure that 
their programs, to the extent practicable, are compatible with State and 
units of local government and private programs and policies to protect 
farmland. Guidelines to assist agencies in using the criteria are 
included in this part. The Department of Agriculture (hereinafter USDA) 
may make available to States, units of local government, individuals, 
organizations, and other units of the Federal Government, information 
useful in restoring, maintaining, and improving the quantity and quality 
of farmland.



Sec. 658.2  Definitions.

    (a) Farmland means prime or unique farmlands as defined in section 
1540(c)(1) of the Act or farmland that is determined by the appropriate 
state or unit of local government agency or agencies with concurrence of 
the Secretary to be farmland of statewide of local importance. 
``Farmland'' does not include land already in or committed to urban 
development or water storage. Farmland ``already in'' urban development 
or water storage includes all such land with a density of 30 structures 
per 40-acre area. Farmland already in urban development also includes 
lands identified as ``urbanized area'' (UA) on the Census Bureau Map, or 
as urban area mapped with a ``tint overprint'' on the USGS topographical 
maps, or as ``urban-built-up'' on the USDA Important Farmland Maps. 
Areas shown as white on the USDA Important Farmland Maps are not 
``farmland'' and, therefore, are not subject to the Act. Farmland 
``committed to urban development or water storage'' includes all such 
land that receives a combined score of 160 points or less from the land 
evaluation and site assessment criteria.
    (b) Federal agency means a department, agency, independent 
commission, or other unit of the Federal Government.
    (c) Federal program means those activities or responsibilities of a 
Federal agency that involve undertaking, financing, or assisting 
construction or improvement projects or acquiring, managing, or 
disposing of Federal lands and facilities.
    (1) The term ``Federal program'' does not include:
    (i) Federal permitting, licensing, or rate approval programs for 
activities on private or non-Federal lands; and
    (ii) Construction or improvement projects that were beyond the 
planning stage and were in either the active design or construction 
state on August 4, 1984.
    (2) For the purposes of this section, a project is considered to be 
``beyond the planning stage and in either the active design or 
construction state on August 4, 1984'' if, on or before that date, 
actual construction of the project had commenced or:

[[Page 703]]

    (i) Acquisition of land or easements for the project had occurred or 
all required Federal agency planning documents and steps were completed 
and accepted, endorsed, or approved by the appropriate agency;
    (ii) A final environmental impact statement was filed with the 
Environmental Protection Agency or an environmental assessment was 
completed and a finding of no significant impact was executed by the 
appropriate agency official; and
    (iii) The engineering or architectural design had begun or such 
services had been secured by contract. The phrase ``undertaking, 
financing, or assisting construction or improvement projects'' includes 
providing loan guarantees or loan insurance for such projects and 
includes the acquisition, management and disposal of land or facilities 
that a Federal agency obtains as the result of foreclosure or other 
actions taken under a loan or other financial assistance provided by the 
agency directly and specifically for that property. For the purposes of 
this section, the phrase ``acquiring, managing, or disposing of Federal 
lands and facilities'' refers to lands and facilities that are acquired, 
managed, or used by a Federal agency specifically in support of a 
Federal activity or program, such as national parks, national forests, 
or military bases, and does not refer to lands and facilities that are 
acquired by a Federal agency as the incidental result of actions by the 
agency that give the agency temporary custody or ownership of the lands 
or facilities, such as acquisition pursuant to a lien for delinquent 
taxes, the exercise of conservatorship or receivership authority, or the 
exercise of civil or criminal law enforcement forfeiture or seizure 
authority.
    (d) State or local government policies or programs to protect 
farmland include: Zoning to protect farmland; agricultural land 
protection provisions of a comprehensive land use plan which has been 
adopted or reviewed in its entirety by the unit of local government in 
whose jurisdiction it is operative within 10 years preceding proposed 
implementation of the particular Federal program; completed purchase or 
acquisition of development rights; completed purchase or acquisition of 
conservation easements; prescribed procedures for assessing agricultural 
viability of sites proposed for conversion; completed agricultural 
districting and capital investments to protect farmland.
    (e) Private programs to protect farmland means programs for the 
protection of farmland which are pursuant to and consistent with State 
and local government policies or programs to protect farmland of the 
affected State and unit of local government, but which are operated by a 
nonprofit corporation, foundation, association, conservancy, district, 
or other not-for-profit organization existing under State or Federal 
laws. Private programs to protect farmland may include: (1) Acquiring 
and holding development rights in farmland and (2) facilitating the 
transfer of development rights of farmland.
    (f) Site means the location(s) that would be converted by the 
proposed action(s).
    (g) Unit of local government means the government of a county, 
municipality, town, township, village, or other unit of general 
government below the State level, or a combination of units of local 
government acting through an areawide agency under a State law or an 
agreement for the formulation of regional development policies and 
plans.

[49 FR 27724, July 5, 1984, as amended at 59 FR 31117, June 17, 1994]



Sec. 658.3  Applicability and exemptions.

    (a) Section 1540(b) of the Act, 7 U.S.C. 4201(b), states that the 
purpose of the Act is to minimize the extent to which Federal programs 
contribute to the unnecessary and irreversible conversion of farmland to 
nonagricultural uses. Conversion of farmland to nonagricultural uses 
does not include the construction of on-farm structures necessary for 
farm operations. Federal agencies can obtain assistance from USDA in 
determining whether a proposed location or site meets the Act's 
definition of farmland. The USDA Natural Resources Conservation Service 
(NRCS) field office serving the area will provide the assistance. Many 
State or local government planning offices can also provide this 
assistance.

[[Page 704]]

    (b) Acquisition or use of farmland by a Federal agency for national 
defense purposes is exempted by section 1547(b) of the Act, 7 U.S.C. 
4208(b).
    (c) The Act and these regulations do not authorize the Federal 
Government in any way to regulate the use of private or non-Federal 
land, or in any way affect the property rights of owners of such land. 
In cases where either a private party or a non-Federal unit of 
government applies for Federal assistance to convert farmland to a 
nonagricultural use, the Federal agency should use the criteria set 
forth in this part to identify and take into account any adverse effects 
on farmland of the assistance requested and develop alternative actions 
that would avoid or mitigate such adverse effects. If, after 
consideration of the adverse effects and suggested alternatives, the 
landowners want to proceed with conversion, the Federal agency, on the 
basis of the analysis set forth in Sec. 658.4 and any agency policies or 
procedures for implementing the Act, may provide or deny the requested 
assistance. Only assistance and actions that would convert farmland to 
nonagricultural uses are subject to this Act. Assistance and actions 
related to the purchase, maintenance, renovation, or replacement of 
existing structures and sites converted prior to the time of an 
application for assistance from a Federal agency, including assistance 
and actions related to the construction of minor new ancillary 
structures (such as garages or sheds), are not subject to the Act.
    (d) Section 1548 of the Act, as amended, 7 U.S.C. 4209, states that 
the Act shall not be deemed to provide a basis for any action, either 
legal or equitable, by any person or class of persons challenging a 
Federal project, program, or other activity that may affect farmland. 
Neither the Act nor this rule, therefore, shall afford any basis for 
such an action. However, as further provided in section 1548, the 
governor of an affected state, where a state policy or program exists to 
protect farmland, may bring an action in the Federal district court of 
the district where a Federal program is proposed to enforce the 
requirements of section 1541 of the Act, 7 U.S.C. 4202, and regulations 
issued pursuant to that section.

[49 FR 27724, July 5, 1984, as amended at 59 FR 31117, June 17, 1994]



Sec. 658.4  Guidelines for use of criteria.

    As stated above and as provided in the Act, each Federal agency 
shall use the criteria provided in Sec. 658.5 to identify and take into 
account the adverse effects of Federal programs on the protection of 
farmland. The agencies are to consider alternative actions, as 
appropriate, that could lessen such adverse effects, and assure that 
such Federal programs, to the extent practicable, are compatible with 
State, unit of local government and private programs and policies to 
protect farmland. The following are guidelines to assist the agencies in 
these tasks:
    (a) An agency may determine whether or not a site is farmland as 
defined in Sec. 658.2(a) or the agency may request that NRCS make such a 
determination. If an agency elects not to make its own determination, it 
should make a request to NRCS on Form AD-1006, the Farmland Conversion 
Impact Rating Form, available at NRCS offices, for determination of 
whether the site is farmland subject to the Act. If neither the entire 
site nor any part of it are subject to the Act, then the Act will not 
apply and NRCS will so notify the agency. If the site is determined by 
NRCS to be subject to the Act, then NRCS will measure the relative value 
of the site as farmland on a scale of 0 to 100 according to the 
information sources listed in Sec. 658.5(a). NRCS will respond to these 
requests within 10 working days of their receipt except that in cases 
where a site visit or land evaluation system design is needed, NRCS will 
respond in 30 working days. In the event that NRCS fails to complete its 
response within the required period, if further delay would interfere 
with construction activities, the agency should proceed as though the 
site were not farmland.
    (b) The Form AD 1006, returned to the agency by NRCS will also 
include the following incidental information: The total amount of 
farmable land (the land in the unit of local government's

[[Page 705]]

jurisdiction that is capable of producing the commonly grown crop); the 
percentage of the jurisdiction that is farmland covered by the Act; the 
percentage of farmland in the jurisdiction that the project would 
convert; and the percentage of farmland in the local government's 
jurisdiction with the same or higher relative value than the land that 
the project would convert. These statistics will not be part of the 
criteria scoring process, but are intended simply to furnish additional 
background information to Federal agencies to aid them in considering 
the effects of their projects on farmland.
    (c) After the agency receives from NRCS the score of a site's 
relative value as described in Sec. 658.4(a) and then applies the site 
assessment criteria which are set forth in Sec. 658.5 (b) and (c), the 
agency will assign to the site a combined score of up to 260 points, 
composed of up to 100 points for relative value and up to 160 points for 
the site assessment. With this score the agency will be able to identify 
the effect of its programs on farmland, and make a determination as to 
the suitability of the site for protection as farmland. Once this score 
is computed, USDA recommends:
    (1) Sites with the highest combined scores be regarded as most 
suitable for protection under these criteria and sites with the lowest 
scores, as least suitable.
    (2) Sites receiving a total score of less than 160 need not be given 
further consideration for protection and no additional sites need to be 
evaluated.
    (3) Sites receiving scores totaling 160 or more be given 
increasingly higher levels of consideration for protection.
    (4) When making decisions on proposed actions for sites receiving 
scores totaling 160 or more, agency personnel consider:
    (i) Use of land that is not farmland or use of existing structures;
    (ii) Alternative sites, locations and designs that would serve the 
proposed purpose but convert either fewer acres of farmland or other 
farmland that has a lower relative value;
    (iii) Special siting requirements of the proposed project and the 
extent to which an alternative site fails to satisfy the special siting 
requirements as well as the originally selected site.
    (d) Federal agencies may elect to assign the site assessment 
criteria relative weightings other than those shown in Sec. 658.5 (b) 
and (c). If an agency elects to do so, USDA recommends that the agency 
adopt its alternative weighting system (1) through rulemaking in 
consultation with USDA, and (2) as a system to be used uniformly 
throughout the agency. USDA recommends that the weightings stated in 
Sec. 658.5 (b) and (c) be used until an agency issues a final rule to 
change the weightings.
    (e) It is advisable that evaluations and analyses of prospective 
farmland conversion impacts be made early in the planning process before 
a site or design is selected, and that, where possible, agencies make 
the FPPA evaluations part of the National Environmental Policy Act 
(NEPA) process. Under the agency's own NEPA regulations, some categories 
of projects may be excluded from NEPA which may still be covered under 
the FPPA. Section 1540(c)(4) of the Act exempts projects that were 
beyond the planning stage and were in either the active design or 
construction state on the effective date of the Act. Section 1547(b) 
exempts acquisition or use of farmland for national defense purposes. 
There are no other exemptions of projects by category in the Act.
    (f) Numerous States and units of local government are developing and 
adopting Land Evaluation and Site Assessment (LESA) systems to evaluate 
the productivity of agricultural land and its suitability for conversion 
to nonagricultural use. Therefore, States and units of local government 
may have already performed an evaluation using criteria similar to those 
contained in this rule applicable to Federal agencies. USDA recommends 
that where sites are to be evaluated within a jurisdiction having a 
State or local LESA system that has been approved by the governing body 
of such jurisdiction and has been placed on the NRCS State 
conservationist's list as one which meets the purpose of the FPPA in 
balance with other public policy objectives, Federal agencies use that 
system to make the evaluation.

[[Page 706]]

    (g) To meet reporting requirements of section 1546 of the Act, 7 
U.S.C. 4207, and for data collection purposes, after the agency has made 
a final decision on a project in which one or more of the alternative 
sites contain farmland subject to the FPPA, the agency is requested to 
return a copy of the Form AD-1006, which indicates the final decision of 
the agency, to the NRCS field office.
    (h) Once a Federal agency has performed an analysis under the FPPA 
for the conversion of a site, that agency's, or a second Federal 
agency's determination with regard to additional assistance or actions 
on the same site do not require additional redundant FPPA analysis.

[49 FR 27724, July 5, 1984, as amended at 59 FR 31118, June 17, 1994]



Sec. 658.5  Criteria.

    This section states the criteria required by section 1541(a) of the 
Act, 7 U.S.C. 4202(a). The criteria were developed by the Secretary of 
Agriculture in cooperation with other Federal agencies. They are in two 
parts, (1) the land evaluation criterion, relative value, for which NRCS 
will provide the rating or score, and (2) the site assessment criteria, 
for which each Federal agency must develop its own ratings or scores. 
The criteria are as follows:
    (a) Land Evaluation Criterion--Relative Value. The land evaluation 
criterion is based on information from several sources including 
national cooperative soil surveys or other acceptable soil surveys, NRCS 
field office technical guides, soil potential ratings or soil 
productivity ratings, land capability classifications, and important 
farmland determinations. Based on this information, groups of soils 
within a local government's jurisdiction will be evaluated and assigned 
a score between 0 to 100, representing the relative value, for 
agricultural production, of the farmland to be converted by the project 
compared to other farmland in the same local government jurisdiction, 
This score will be the Relative Value Rating on Form AD 1006.
    (b) Site Assessment Criteria. Federal agencies are to use the 
following criteria to assess the suitability of each proposed site or 
design alternative for protection as farmland along with the score from 
the land evaluation criterion described in Sec. 658.5(a). Each criterion 
will be given a score on a scale of 0 to the maximum points shown. 
Conditions suggesting top, intermediate and bottom scores are indicated 
for each criterion. The agency would make scoring decisions in the 
context of each proposed site or alternative action by examining the 
site, the surrounding area, and the programs and policies of the State 
or local unit of government in which the site is located. Where one 
given location has more than one design alternative, each design should 
be considered as an alternative site. The site assessment criteria are:
    (1) How much land is in nonurban use within a radius of 1.0 mile 
from where the project is intended?

More than 90 percent--15 points
90 to 20 percent--14 to 1 point(s)
Less than 20 percent--0 points

    (2) How much of the perimeter of the site borders on land in 
nonurban use?

More than 90 percent--10 points
90 to 20 percent--9 to 1 point(s)
Less than 20 percent--0 points

    (3) How much of the site has been farmed (managed for a scheduled 
harvest or timber activity) more than 5 of the last 10 years?
More than 90 percent--20 points
90 to 20 percent--19 to 1 points(s)
Less than 20 percent--0 points

    (4) Is the site subject to State or unit of local government 
policies or programs to protect farmland or covered by private programs 
to protect farmland?

Site is protected--20 points
Site is not protected--0 points

    (5) How close is the site to an urban built-up area?

The site is 2 miles or more from an urban built-up area--15 points
The site is more than 1 mile but less than 2 miles from an urban built-
up area--10 points
The site is less than 1 mile from, but is not adjacent to an urban 
built-up area--5 points
The site is adjacent to an urban built-up area--0 points


[[Page 707]]


    (6) How close is the site to water lines, sewer lines and/or other 
local facilities and services whose capacities and design would promote 
nonagricultural use?

None of the services exist nearer than 3 miles from the site--15 points
Some of the services exist more than 1 but less than 3 miles from the 
site--10 points
All of the services exist within \1/2\ mile of the site--0 points

    (7) Is the farm unit(s) containing the site (before the project) as 
large as the average-size farming unit in the county? (Average farm 
sizes in each county are available from the NRCS field offices in each 
State. Data are from the latest available Census of Agriculture, Acreage 
of Farm Units in Operation with $1,000 or more in sales.)

As large or larger--10 points
Below average--deduct 1 point for each 5 percent below the average, down 
to 0 points if 50 percent or more below average--9 to 0 points

    (8) If this site is chosen for the project, how much of the 
remaining land on the farm will become non-farmable because of 
interference with land patterns?

Acreage equal to more than 25 percent of acres directly converted by the 
project--10 points
Acreage equal to between 25 and 5 percent of the acres directly 
converted by the project--9 to 1 point(s)
Acreage equal to less than 5 percent of the acres directly converted by 
the project--0 points

    (9) Does the site have available adequate supply of farm support 
services and markets, i.e., farm suppliers, equipment dealers, 
processing and storage facilities and farmer's markets?

All required services are available--5 points
Some required services are available--4 to 1 point(s)
No required services are available--0 points

    (10) Does the site have substantial and well-maintained on-farm 
investments such as barns, other storage buildings, fruit trees and 
vines, field terraces, drainage, irrigation, waterways, or other soil 
and water conservation measures?

High amount of on-farm investment--20 points
Moderate amount of on-farm investment--19 to 1 point(s)
No on-farm investment--0 points

    (11) Would the project at this site, by converting farmland to 
nonagricultural use, reduce the demand for farm support services so as 
to jeopardize the continued existence of these support services and 
thus, the viability of the farms remaining in the area?

Substantial reduction in demand for support services if the site is 
converted--10 points
Some reduction in demand for support services if the site is converted--
9 to 1 point(s)
No significant reduction in demand for support services if the site is 
converted--0 points

    (12) Is the kind and intensity of the proposed use of the site 
sufficiently incompatible with agriculture that it is likely to 
contribute to the eventual conversion of surrounding farmland to 
nonagricultural use?

Proposed project is incompatible with existing agricultural use of 
surrounding farmland--10 points
Proposed project is tolerable to existing agricultural use of 
surrounding farmland--9 to 1 point(s)
Proposed project is fully compatible with existing agricultural use of 
surrounding farmland--0 points

    (c) Corridor-type Site Assessment Criteria. The following criteria 
are to be used for projects that have a linear or corridor-type site 
configuration connecting two distant points, and crossing several 
different tracts of land. These include utility lines, highways, 
railroads, stream improvements, and flood control systems. Federal 
agencies are to assess the suitability of each corridor-type site or 
design alternative for protection as farmland along with the land 
evaluation information described in Sec. 658.4(a). All criteria for 
corridor-type sites will be scored as shown in Sec. 658.5(b) for other 
sites, except as noted below:
    (1) Criteria 5 and 6 will not be considered.
    (2) Criterion 8 will be scored on a scale of 0 to 25 points, and 
criterion 11 will be scored on a scale of 0 to 25 points.

[[Page 708]]



Sec. 658.6  Technical assistance.

    (a) Section 1543 of the Act, 7 U.S.C. 4204 states, ``The Secretary 
is encouraged to provide technical assistance to any State or unit of 
local government, or any nonprofit organization, as determined by the 
Secretary, that desires to develop programs or policies to limit the 
conversion of productive farmland to nonagricultural uses.'' In 
Sec. 2.62, of 7 CFR part 2, subtitle A, NRCS is delegated leadership 
responsibility within USDA for the activities treated in this part.
    (b) In providing assistance to States, local units of government, 
and nonprofit organizations, USDA will make available maps and other 
soils information from the national cooperative soil survey through NRCS 
field offices.
    (c) Additional assistance, within available resources, may be 
obtained from local offices of other USDA agencies. The Agricultural 
Stabilization and Conservation Service and the Forest Service can 
provide aerial photographs, crop history data, and related information. 
A reasonable fee may be charged. In many States, the Cooperative 
Extension Service can provide help in understanding and identifying 
farmland protection issues and problems, resolving conflicts, developing 
alternatives, deciding on appropriate actions, and implementing those 
decisions.
    (d) Officials of State agencies, local units of government, 
nonprofit organizations, or regional, area, State-level, or field 
offices of Federal agencies may obtain assistance by contacting the 
office of the NRCS State conservationist. A list of Natural Resources 
Conservation Service State office locations appears in Appendix A, 
Sec. 661.6 of this title. If further assistance is needed, requests 
should be made to the Assistant Secretary for Natural Resources and 
Environment, Office of the Secretary, Department of Agriculture, 
Washington, DC 20250.



Sec. 658.7  USDA assistance with Federal agencies' reviews of policies and procedures.

    (a) Section 1542(a) of the Act, 7 U.S.C. 4203, states, ``Each 
department, agency, independent commission or other unit of the Federal 
Government, with the assistance of the Department of Agriculture, shall 
review current provisions of law, administrative rules and regulations, 
and policies and procedures applicable to it to determine whether any 
provision thereof will prevent such unit of the Federal Government from 
taking appropriate action to comply fully with the provisions of this 
subtitle.''
    (b) Section 1542(b) of the Act, 7 U.S.C. 4203, requires, as 
appropriate, each department, agency, independent commission, or other 
unit of the Federal Government, with the assistance of the Department of 
Agriculture, to develop proposals for action to bring its programs, 
authorities, and administrative activities into conformity with the 
purpose and policy of the Act.
    (c) USDA will provide certain assistance to other Federal agencies 
for the purposes specified in section 1542 of the Act, 7 U.S.C. 4203. If 
a Federal agency identifies or suggests changes in laws, administrative 
rules and regulations, policies, or procedures that may affect the 
agency's compliance with the Act, USDA can advise the agency of the 
probable effects of the changes on the protection of farmland. To 
request this assistance, officials of Federal agencies should correspond 
with the Chief, Natural Resources Conservation Service, P.O. Box 2890, 
Washington, DC 20013.
    (d) To meet the reporting requirements of section 1546 of the Act, 7 
U.S.C. 4207, and for data collection purposes, each Federal agency is 
requested to report to the Chief of the Natural Resources Conservation 
Service by November 15th of each year on progress made during the prior 
fiscal year to implement sections 1542 (a) and (b) of the Act, 7 U.S.C. 
4203 (a) and (b). Until an agency fully implements those sections, the 
agency should continue to make the annual report, but may omit the 
report upon full implementation. However, an agency is requested to file 
an annual report for any future year in which the agency has 
substantially changed its process for compliance with the Act.

[49 FR 27724, July 5, 1984, as amended at 59 FR 31118, June 17, 1994]

[[Page 709]]



                       SUBCHAPTER G--MISCELLANEOUS



                          PART 660  [RESERVED]



PART 661--PUBLIC INFORMATION AND RIGHT TO PRIVACY--Table of Contents




            Subpart A--Availability of Records and Materials

Sec.
661.1  General.
661.2  Public access and copying.
661.3  Requests for records.
661.4  Appeals.
661.5  Exempt records.

                       Subpart B--Right to Privacy

661.6  General.

Appendix A to Part 661--Availability of Information

    Authority: 5 U.S.C. 552, 552a; 7 CFR 1.1-1.16, 1.110-1.123.

    Source: 43 FR 34756, Aug. 7, 1978, unless otherwise noted.



            Subpart A--Availability of Records and Materials



Sec. 661.1  General.

    This part is issued in accordance with the regulations of the 
Secretary of Agriculture at 7 CFR 1.1 through 1.16 implementing the 
Freedom of Information Act, 5 U.S.C. 552. The Secretary's regulations, 
as implemented by the regulations in this part, govern the availability 
to the public of records of the Natural Resources Conservation Service 
and the records for which the Natural Resources Conservation Service has 
custodial responsibility.



Sec. 661.2  Public access and copying.

    Natural Resources Conservation Service will make available for 
public inspection and copying those materials covered by 5 U.S.C. 
552(a)(2) as set out in the Secretary's regulations.



Sec. 661.3  Requests for records.

    Requests for records under 5 U.S.C. 552(a)(3) will be made in 
accordance with 7 CFR 1.3(a). The titles and mailing addresses of the 
officials in Natural Resources Conservation Service authorized to 
receive requests for records are shown in Appendix A of this subpart. 
Authority is hereby delegated to these officials to make determinations 
regarding such requests in accordance with 7 CFR 1.4(c).



Sec. 661.4  Appeals.

    Any person whose request for records above is denied shall have the 
right to appeal that denial in accordance with 7 CFR 1.3(e). All appeals 
shall be addressed to: Administrator, Natural Resources Conservation 
Service, U.S. Department of Agriculture, P.O. Box 2890, Washington, DC 
20013.



Sec. 661.5  Exempt records.

    Records exempt under 5 U.S.C. 552(b) may be withheld in accordance 
with 7 CFR 1.11.



                       Subpart B--Right to Privacy



Sec. 661.6  General.

    Natural Resources Conservation Service implementation of the Privacy 
Act of 1974, 5 U.S.C. 552a is contained in the regulations of the 
Secretary, 7 CFR 1.110 through 1.123.

           Appendix A to Part 661--Availability of Information

    The following list pertaining to the availability of information are 
published in accordance with the requirement and pursuant to the 
authority of sections 552, 559 of Title 5, United States Code.

               request for examination or copy of records

                                 General

    Request for examination and copying of a record or for copies of 
records shall be made to the Deputy Administrator for Administration, 
Natural Resources Conservation Service, U.S. Department of Agriculture, 
P.O. Box 2890, Washington, DC 20013, or to the State Conservationist in 
any of the listed State offices.

      natural resources conservation service, state office location

State Conservationist, Wright Building, 138 South Gay St., P.O. Box 311, 
Auburn, Ala. 36830.

[[Page 710]]

State Conservationist, Suite 129, Professional Bldg., 2221 East Northern 
Lights Blvd., Anchorage, Alaska 99504.
State Conservationist, 230 North 1st Ave., Federal Bldg., Phoenix, Ariz. 
85025.
State Conservationist, Federal Bldg., Room 5029, 700 West Capitol St., 
P.O. Box 2323, Little Rock, Ark. 72203.
State Conservationist, 2828 Chiles Rd., Davis, Calif. 95616.
State Conservationist, Mansfield Professional Park, Route 44A, Storrs, 
Conn. 06268.
State Conservationist, Treadway Towers, Suite 2-4, 9 East Loockerman 
St., Dover, Del. 19901.
State Conservationist, Federal Bldg., P.O. Box 1208, Gainesville, Fla., 
32602.
State Conservationist, Federal Bldg., 355 East Hancock Ave., P.O. Box 
832, Athens, Ga. 30603.
State Conservationist, 300 Moana Blvd., Ala., Room 4316, P.O. Box 50004, 
Honolulu, Hawaii 96850.
State Conservationist, Room 313, 2490 West 26th Ave., P.O. Box 17107, 
Denver, Colo. 80217.
State Conservationist, Federal Bldg., 200 West Church St., P.O. Box 678, 
Champaign, Ill. 61820.
State Conservationist, Atkinson Square-West, Suite 220, 5610 
Crawfordsville Rd., Indianapolis, Ind. 46224.
State Conservationist, 823 Federal Bldg., 210 Walnut St., Des Moines, 
Iowa 50309.
State Conservationist, 760 South Broadway, P.O. Box 600, Salina, Kans. 
67401.
State Conservationist, 333 Waller Ave., Lexington, Ky. 40504.
State Conservationist, 3737 Government St., P.O. Box 1630, Alexandria, 
La. 71301.
State Conservationist, USDA Bldg., University of Maine, Orono, Maine 
04473.
State Conservationist, Hartwick Bldg., Room 522, 4321 Hartwick Rd., 
College Park, Md. 20740.
State Conservationist, 29 Cottage St., Amherst, Mass. 01002.
State Conservationist, Room 345, 304 North 8th St., Boise, Idaho 83702.
Staten Conservationist, Milner Bldg., Room 590, 210 South Lamar St., 
P.O. Box 610, Jackson, Miss. 39205.
State Conservationist, 555 Vandiver Dr., Columbia, Mo. 65201.
State Conservationist, Federal Bldg., P.O. Box 970, Bozeman, Mont. 
59715.
State Conservationist, Federal Bldg.,-U.S. Courthouse, Room 345, 
Lincoln, Nebr. 68508.
State Conservationist, U.S. Post Office Bldg., P.O. Box 4850, Reno, Nev. 
89505.
State Conservationist, Federal Bldg., Durham, N.H. 03824.
State Conservationist, 1370 Hamilton St., P.O. Box 219, Somerset, N.J. 
08873.
State Conservationist, 517 Gold Ave., SW., P.O. Box 2007, Albuquerque, 
N. Mex. 87103.
State Conservationist, U.S. Courthouse and Federal Bldg., 100 South 
Clinton St., Room 771, Syracuse, N.Y. 13260.
State Conservationist, 1405 South Harrison Rd., East Lansing, Mich. 
48823.
State Conservationist, 200 Federal Bldg. and U.S. Courthouse, 316 North 
Robert St., St. Paul, Minn. 55101.
State Conservationist, 200 North High St., Room 522, Columbus, Ohio 
43215.
State Conservationist, Agriculture Center Bldg., Farm Rd. and Brumley 
St., Stillwater, Okla. 74074.
State Conservationist, Federal Bldg., 1220 Southwest 3d Ave., Portland, 
Oreg. 97204.
State Conservationist, Federal Bldg., and Courthouse, Box 985 Federal 
Square Station, Harrisburg, Pa. 17108.
State Conservationist, Caribbean Area, Room 633 Federal Bldg., Chardon 
Ave., G.P.O. Box 4868, Hato Rey, P.R. 00936.
State Conservationist, 222 Quaker Lane, West Warwick, R.I. 02893.
State Conservationist, 240 Stoneridge Dr., Columbia, S.C. 29210.
State Conservationist, 200 4th St., SW., P.O. Box 1357, Huron, S. Dak. 
57350.
State Conservationist, Federal Office Bldg., 310 New Bern Ave., Fifth 
Floor-P.O. Box 27307, Raleigh, N.C. 27611.
State Conservationist, Federal Bldg., P.O. Box 1458, Bismarck, N. Dak. 
58501.
State Conservationist, Federal Bldg., 101 South Main St., P.O. Box 648, 
Temple, Tex. 76501.
State Conservationist, 4012 Federal Bldg., 125 South State St., Salt 
Lake City, Utah 84138.
State Conservationist, Burlington Square, Suite 205, Burlington, Vt. 
05401.
State Conservationist, Federal Bldg., Room 9201, 400 North 8th St., P.O. 
Box 10026, Richmond, Va. 23240.
State Conservationist, 360 U.S. Courthouse, West 920 Riverside Ave., 
Spokane, Wash. 99201.
State Conservationist, 75 High St., P.O. Box 865, Morgantown, W. Va. 
26505.
State Conservationist, 4601 Hammersley Rd., Madison, Wis. 53711.
State Conservationist, Federal Office Bldg., P.O. Box 2440, Casper, Wyo. 
82601.
State Conservationist, 675 U.S. Courthouse, Nashville, Tenn. 37203.

    Only those matters pertaining to the particular State and matters of 
general application will be available in each State office.

                        PARTS 662-699  [RESERVED]



[[Page 711]]



                              FINDING AIDS




  --------------------------------------------------------------------

  A list of CFR titles, subtitles, chapters, subchapters and parts and 
an alphabetical list of agencies publishing in the CFR are included in 
the CFR Index and Finding Aids volume to the Code of Federal Regulations 
which is published separately and revised annually.

  Table of CFR Titles and Chapters
  Alphabetical List of Agencies Appearing in the CFR
  List of CFR Sections Affected



[[Page 713]]



                    Table of CFR Titles and Chapters




                     (Revised as of January 1, 1999)

                      Title 1--General Provisions

         I  Administrative Committee of the Federal Register 
                (Parts 1--49)
        II  Office of the Federal Register (Parts 50--299)
        IV  Miscellaneous Agencies (Parts 400--500)

                          Title 2--[Reserved]

                        Title 3--The President

         I  Executive Office of the President (Parts 100--199)

                           Title 4--Accounts

         I  General Accounting Office (Parts 1--99)
        II  Federal Claims Collection Standards (General 
                Accounting Office--Department of Justice) (Parts 
                100--299)

                   Title 5--Administrative Personnel

         I  Office of Personnel Management (Parts 1--1199)
        II  Merit Systems Protection Board (Parts 1200--1299)
       III  Office of Management and Budget (Parts 1300--1399)
        IV  Advisory Committee on Federal Pay (Parts 1400--1499)
         V  The International Organizations Employees Loyalty 
                Board (Parts 1500--1599)
        VI  Federal Retirement Thrift Investment Board (Parts 
                1600--1699)
       VII  Advisory Commission on Intergovernmental Relations 
                (Parts 1700--1799)
      VIII  Office of Special Counsel (Parts 1800--1899)
        IX  Appalachian Regional Commission (Parts 1900--1999)
        XI  Armed Forces Retirement Home (Part 2100)
       XIV  Federal Labor Relations Authority, General Counsel of 
                the Federal Labor Relations Authority and Federal 
                Service Impasses Panel (Parts 2400--2499)
        XV  Office of Administration, Executive Office of the 
                President (Parts 2500--2599)
       XVI  Office of Government Ethics (Parts 2600--2699)
       XXI  Department of the Treasury (Parts 3100--3199)

[[Page 714]]

      XXII  Federal Deposit Insurance Corporation (Part 3201)
     XXIII  Department of Energy (Part 3301)
      XXIV  Federal Energy Regulatory Commission (Part 3401)
       XXV  Department of the Interior (Part 3501)
      XXVI  Department of Defense (Part 3601)
    XXVIII  Department of Justice (Part 3801)
      XXIX  Federal Communications Commission (Parts 3900--3999)
       XXX  Farm Credit System Insurance Corporation (Parts 4000--
                4099)
      XXXI  Farm Credit Administration (Parts 4100--4199)
    XXXIII  Overseas Private Investment Corporation (Part 4301)
      XXXV  Office of Personnel Management (Part 4501)
        XL  Interstate Commerce Commission (Part 5001)
       XLI  Commodity Futures Trading Commission (Part 5101)
      XLII  Department of Labor (Part 5201)
     XLIII  National Science Foundation (Part 5301)
       XLV  Department of Health and Human Services (Part 5501)
      XLVI  Postal Rate Commission (Part 5601)
     XLVII  Federal Trade Commission (Part 5701)
    XLVIII  Nuclear Regulatory Commission (Part 5801)
         L  Department of Transportation (Part 6001)
       LII  Export-Import Bank of the United States (Part 6201)
      LIII  Department of Education (Parts 6300--6399)
       LIV  Environmental Protection Agency (Part 6401)
      LVII  General Services Administration (Part 6701)
     LVIII  Board of Governors of the Federal Reserve System (Part 
                6801)
       LIX  National Aeronautics and Space Administration (Part 
                6901)
        LX  United States Postal Service (Part 7001)
       LXI  National Labor Relations Board (Part 7101)
      LXII  Equal Employment Opportunity Commission (Part 7201)
     LXIII  Inter-American Foundation (Part 7301)
       LXV  Department of Housing and Urban Development (Part 
                7501)
      LXVI  National Archives and Records Administration (Part 
                7601)
      LXIX  Tennessee Valley Authority (Part 7901)
      LXXI  Consumer Product Safety Commission (Part 8101)
     LXXIV  Federal Mine Safety and Health Review Commission (Part 
                8401)
     LXXVI  Federal Retirement Thrift Investment Board (Part 8601)
    LXXVII  Office of Management and Budget (Part 8701)

                         Title 7--Agriculture

            Subtitle A--Office of the Secretary of Agriculture 
                (Parts 0--26)
            Subtitle B--Regulations of the Department of 
                Agriculture
         I  Agricultural Marketing Service (Standards, 
                Inspections, Marketing Practices), Department of 
                Agriculture (Parts 27--209)

[[Page 715]]

        II  Food and Nutrition Service, Department of Agriculture 
                (Parts 210--299)
       III  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 300--399)
        IV  Federal Crop Insurance Corporation, Department of 
                Agriculture (Parts 400--499)
         V  Agricultural Research Service, Department of 
                Agriculture (Parts 500--599)
        VI  Natural Resources Conservation Service, Department of 
                Agriculture (Parts 600--699)
       VII  Farm Service Agency, Department of Agriculture (Parts 
                700--799)
      VIII  Grain Inspection, Packers and Stockyards 
                Administration (Federal Grain Inspection Service), 
                Department of Agriculture (Parts 800--899)
        IX  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Fruits, Vegetables, Nuts), Department 
                of Agriculture (Parts 900--999)
         X  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Milk), Department of Agriculture 
                (Parts 1000--1199)
        XI  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Miscellaneous Commodities), Department 
                of Agriculture (Parts 1200--1299)
      XIII  Northeast Dairy Compact Commission (Parts 1300--1399)
       XIV  Commodity Credit Corporation, Department of 
                Agriculture (Parts 1400--1499)
        XV  Foreign Agricultural Service, Department of 
                Agriculture (Parts 1500--1599)
       XVI  Rural Telephone Bank, Department of Agriculture (Parts 
                1600--1699)
      XVII  Rural Utilities Service, Department of Agriculture 
                (Parts 1700--1799)
     XVIII  Rural Housing Service, Rural Business-Cooperative 
                Service, Rural Utilities Service, and Farm Service 
                Agency, Department of Agriculture (Parts 1800--
                2099)
      XXVI  Office of Inspector General, Department of Agriculture 
                (Parts 2600--2699)
     XXVII  Office of Information Resources Management, Department 
                of Agriculture (Parts 2700--2799)
    XXVIII  Office of Operations, Department of Agriculture (Parts 
                2800--2899)
      XXIX  Office of Energy, Department of Agriculture (Parts 
                2900--2999)
       XXX  Office of the Chief Financial Officer, Department of 
                Agriculture (Parts 3000--3099)
      XXXI  Office of Environmental Quality, Department of 
                Agriculture (Parts 3100--3199)
     XXXII  Office of Procurement and Property Management, 
                Department of Agriculture (Parts 3200--3299)
    XXXIII  Office of Transportation, Department of Agriculture 
                (Parts 3300--3399)

[[Page 716]]

     XXXIV  Cooperative State Research, Education, and Extension 
                Service, Department of Agriculture (Parts 3400--
                3499)
      XXXV  Rural Housing Service, Department of Agriculture 
                (Parts 3500--3599)
     XXXVI  National Agricultural Statistics Service, Department 
                of Agriculture (Parts 3600--3699)
    XXXVII  Economic Research Service, Department of Agriculture 
                (Parts 3700--3799)
   XXXVIII  World Agricultural Outlook Board, Department of 
                Agriculture (Parts 3800--3899)
       XLI  [Reserved]
      XLII  Rural Business-Cooperative Service and Rural Utilities 
                Service, Department of Agriculture (Parts 4200--
                4299)

                    Title 8--Aliens and Nationality

         I  Immigration and Naturalization Service, Department of 
                Justice (Parts 1--499)

                 Title 9--Animals and Animal Products

         I  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 1--199)
        II  Grain Inspection, Packers and Stockyards 
                Administration (Packers and Stockyards Programs), 
                Department of Agriculture (Parts 200--299)
       III  Food Safety and Inspection Service, Department of 
                Agriculture (Parts 300--599)

                           Title 10--Energy

         I  Nuclear Regulatory Commission (Parts 0--199)
        II  Department of Energy (Parts 200--699)
       III  Department of Energy (Parts 700--999)
         X  Department of Energy (General Provisions) (Parts 
                1000--1099)
      XVII  Defense Nuclear Facilities Safety Board (Parts 1700--
                1799)

                      Title 11--Federal Elections

         I  Federal Election Commission (Parts 1--9099)

                      Title 12--Banks and Banking

         I  Comptroller of the Currency, Department of the 
                Treasury (Parts 1--199)
        II  Federal Reserve System (Parts 200--299)
       III  Federal Deposit Insurance Corporation (Parts 300--399)
        IV  Export-Import Bank of the United States (Parts 400--
                499)

[[Page 717]]

         V  Office of Thrift Supervision, Department of the 
                Treasury (Parts 500--599)
        VI  Farm Credit Administration (Parts 600--699)
       VII  National Credit Union Administration (Parts 700--799)
      VIII  Federal Financing Bank (Parts 800--899)
        IX  Federal Housing Finance Board (Parts 900--999)
        XI  Federal Financial Institutions Examination Council 
                (Parts 1100--1199)
       XIV  Farm Credit System Insurance Corporation (Parts 1400--
                1499)
        XV  Department of the Treasury (Parts 1500--1599)
      XVII  Office of Federal Housing Enterprise Oversight, 
                Department of Housing and Urban Development (Parts 
                1700-1799)
     XVIII  Community Development Financial Institutions Fund, 
                Department of the Treasury (Parts 1800--1899)

               Title 13--Business Credit and Assistance

         I  Small Business Administration (Parts 1--199)
       III  Economic Development Administration, Department of 
                Commerce (Parts 300--399)

                    Title 14--Aeronautics and Space

         I  Federal Aviation Administration, Department of 
                Transportation (Parts 1--199)
        II  Office of the Secretary, Department of Transportation 
                (Aviation Proceedings) (Parts 200--399)
       III  Commercial Space Transportation, Federal Aviation 
                Administration, Department of Transportation 
                (Parts 400--499)
         V  National Aeronautics and Space Administration (Parts 
                1200--1299)

                 Title 15--Commerce and Foreign Trade

            Subtitle A--Office of the Secretary of Commerce (Parts 
                0--29)
            Subtitle B--Regulations Relating to Commerce and 
                Foreign Trade
         I  Bureau of the Census, Department of Commerce (Parts 
                30--199)
        II  National Institute of Standards and Technology, 
                Department of Commerce (Parts 200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  Foreign-Trade Zones Board, Department of Commerce 
                (Parts 400--499)
       VII  Bureau of Export Administration, Department of 
                Commerce (Parts 700--799)
      VIII  Bureau of Economic Analysis, Department of Commerce 
                (Parts 800--899)

[[Page 718]]

        IX  National Oceanic and Atmospheric Administration, 
                Department of Commerce (Parts 900--999)
        XI  Technology Administration, Department of Commerce 
                (Parts 1100--1199)
      XIII  East-West Foreign Trade Board (Parts 1300--1399)
       XIV  Minority Business Development Agency (Parts 1400--
                1499)
            Subtitle C--Regulations Relating to Foreign Trade 
                Agreements
        XX  Office of the United States Trade Representative 
                (Parts 2000--2099)
            Subtitle D--Regulations Relating to Telecommunications 
                and Information
     XXIII  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                2300--2399)

                    Title 16--Commercial Practices

         I  Federal Trade Commission (Parts 0--999)
        II  Consumer Product Safety Commission (Parts 1000--1799)

             Title 17--Commodity and Securities Exchanges

         I  Commodity Futures Trading Commission (Parts 1--199)
        II  Securities and Exchange Commission (Parts 200--399)
        IV  Department of the Treasury (Parts 400--499)

          Title 18--Conservation of Power and Water Resources

         I  Federal Energy Regulatory Commission, Department of 
                Energy (Parts 1--399)
       III  Delaware River Basin Commission (Parts 400--499)
        VI  Water Resources Council (Parts 700--799)
      VIII  Susquehanna River Basin Commission (Parts 800--899)
      XIII  Tennessee Valley Authority (Parts 1300--1399)

                       Title 19--Customs Duties

         I  United States Customs Service, Department of the 
                Treasury (Parts 1--199)
        II  United States International Trade Commission (Parts 
                200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)

                     Title 20--Employees' Benefits

         I  Office of Workers' Compensation Programs, Department 
                of Labor (Parts 1--199)
        II  Railroad Retirement Board (Parts 200--399)

[[Page 719]]

       III  Social Security Administration (Parts 400--499)
        IV  Employees' Compensation Appeals Board, Department of 
                Labor (Parts 500--599)
         V  Employment and Training Administration, Department of 
                Labor (Parts 600--699)
        VI  Employment Standards Administration, Department of 
                Labor (Parts 700--799)
       VII  Benefits Review Board, Department of Labor (Parts 
                800--899)
      VIII  Joint Board for the Enrollment of Actuaries (Parts 
                900--999)
        IX  Office of the Assistant Secretary for Veterans' 
                Employment and Training, Department of Labor 
                (Parts 1000--1099)

                       Title 21--Food and Drugs

         I  Food and Drug Administration, Department of Health and 
                Human Services (Parts 1--1299)
        II  Drug Enforcement Administration, Department of Justice 
                (Parts 1300--1399)
       III  Office of National Drug Control Policy (Parts 1400--
                1499)

                      Title 22--Foreign Relations

         I  Department of State (Parts 1--199)
        II  Agency for International Development, International 
                Development Cooperation Agency (Parts 200--299)
       III  Peace Corps (Parts 300--399)
        IV  International Joint Commission, United States and 
                Canada (Parts 400--499)
         V  United States Information Agency (Parts 500--599)
        VI  United States Arms Control and Disarmament Agency 
                (Parts 600--699)
       VII  Overseas Private Investment Corporation, International 
                Development Cooperation Agency (Parts 700--799)
        IX  Foreign Service Grievance Board Regulations (Parts 
                900--999)
         X  Inter-American Foundation (Parts 1000--1099)
        XI  International Boundary and Water Commission, United 
                States and Mexico, United States Section (Parts 
                1100--1199)
       XII  United States International Development Cooperation 
                Agency (Parts 1200--1299)
      XIII  Board for International Broadcasting (Parts 1300--
                1399)
       XIV  Foreign Service Labor Relations Board; Federal Labor 
                Relations Authority; General Counsel of the 
                Federal Labor Relations Authority; and the Foreign 
                Service Impasse Disputes Panel (Parts 1400--1499)
        XV  African Development Foundation (Parts 1500--1599)
       XVI  Japan-United States Friendship Commission (Parts 
                1600--1699)
      XVII  United States Institute of Peace (Parts 1700--1799)

[[Page 720]]

                          Title 23--Highways

         I  Federal Highway Administration, Department of 
                Transportation (Parts 1--999)
        II  National Highway Traffic Safety Administration and 
                Federal Highway Administration, Department of 
                Transportation (Parts 1200--1299)
       III  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 1300--1399)

                Title 24--Housing and Urban Development

            Subtitle A--Office of the Secretary, Department of 
                Housing and Urban Development (Parts 0--99)
            Subtitle B--Regulations Relating to Housing and Urban 
                Development
         I  Office of Assistant Secretary for Equal Opportunity, 
                Department of Housing and Urban Development (Parts 
                100--199)
        II  Office of Assistant Secretary for Housing-Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 200--299)
       III  Government National Mortgage Association, Department 
                of Housing and Urban Development (Parts 300--399)
        IV  Office of Multifamily Housing Assistance 
                Restructuring, Department of Housing and Urban 
                Development (Parts 400--499)
         V  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 500--599)
        VI  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 600--699) [Reserved]
       VII  Office of the Secretary, Department of Housing and 
                Urban Development (Housing Assistance Programs and 
                Public and Indian Housing Programs) (Parts 700--
                799)
      VIII  Office of the Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Section 8 Housing Assistance 
                Programs, Section 202 Direct Loan Program, Section 
                202 Supportive Housing for the Elderly Program and 
                Section 811 Supportive Housing for Persons With 
                Disabilities Program) (Parts 800--899)
        IX  Office of Assistant Secretary for Public and Indian 
                Housing, Department of Housing and Urban 
                Development (Parts 900--999)
         X  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Interstate Land Sales 
                Registration Program) (Parts 1700--1799)
       XII  Office of Inspector General, Department of Housing and 
                Urban Development (Parts 2000--2099)
        XX  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 3200--3899)
       XXV  Neighborhood Reinvestment Corporation (Parts 4100--
                4199)

[[Page 721]]

                           Title 25--Indians

         I  Bureau of Indian Affairs, Department of the Interior 
                (Parts 1--299)
        II  Indian Arts and Crafts Board, Department of the 
                Interior (Parts 300--399)
       III  National Indian Gaming Commission, Department of the 
                Interior (Parts 500--599)
        IV  Office of Navajo and Hopi Indian Relocation (Parts 
                700--799)
         V  Bureau of Indian Affairs, Department of the Interior, 
                and Indian Health Service, Department of Health 
                and Human Services (Part 900)
        VI  Office of the Assistant Secretary-Indian Affairs, 
                Department of the Interior (Part 1001)
       VII  Office of the Special Trustee for American Indians, 
                Department of the Interior (Part 1200)

                      Title 26--Internal Revenue

         I  Internal Revenue Service, Department of the Treasury 
                (Parts 1--799)

           Title 27--Alcohol, Tobacco Products and Firearms

         I  Bureau of Alcohol, Tobacco and Firearms, Department of 
                the Treasury (Parts 1--299)

                   Title 28--Judicial Administration

         I  Department of Justice (Parts 0--199)
       III  Federal Prison Industries, Inc., Department of Justice 
                (Parts 300--399)
         V  Bureau of Prisons, Department of Justice (Parts 500--
                599)
        VI  Offices of Independent Counsel, Department of Justice 
                (Parts 600--699)
       VII  Office of Independent Counsel (Parts 700--799)

                            Title 29--Labor

            Subtitle A--Office of the Secretary of Labor (Parts 
                0--99)
            Subtitle B--Regulations Relating to Labor
         I  National Labor Relations Board (Parts 100--199)
        II  Office of Labor-Management Standards, Department of 
                Labor (Parts 200--299)
       III  National Railroad Adjustment Board (Parts 300--399)
        IV  Office of Labor-Management Standards, Department of 
                Labor (Parts 400--499)
         V  Wage and Hour Division, Department of Labor (Parts 
                500--899)
        IX  Construction Industry Collective Bargaining Commission 
                (Parts 900--999)
         X  National Mediation Board (Parts 1200--1299)

[[Page 722]]

       XII  Federal Mediation and Conciliation Service (Parts 
                1400--1499)
       XIV  Equal Employment Opportunity Commission (Parts 1600--
                1699)
      XVII  Occupational Safety and Health Administration, 
                Department of Labor (Parts 1900--1999)
        XX  Occupational Safety and Health Review Commission 
                (Parts 2200--2499)
       XXV  Pension and Welfare Benefits Administration, 
                Department of Labor (Parts 2500--2599)
     XXVII  Federal Mine Safety and Health Review Commission 
                (Parts 2700--2799)
        XL  Pension Benefit Guaranty Corporation (Parts 4000--
                4999)

                      Title 30--Mineral Resources

         I  Mine Safety and Health Administration, Department of 
                Labor (Parts 1--199)
        II  Minerals Management Service, Department of the 
                Interior (Parts 200--299)
       III  Board of Surface Mining and Reclamation Appeals, 
                Department of the Interior (Parts 300--399)
        IV  Geological Survey, Department of the Interior (Parts 
                400--499)
        VI  Bureau of Mines, Department of the Interior (Parts 
                600--699)
       VII  Office of Surface Mining Reclamation and Enforcement, 
                Department of the Interior (Parts 700--999)

                 Title 31--Money and Finance: Treasury

            Subtitle A--Office of the Secretary of the Treasury 
                (Parts 0--50)
            Subtitle B--Regulations Relating to Money and Finance
         I  Monetary Offices, Department of the Treasury (Parts 
                51--199)
        II  Fiscal Service, Department of the Treasury (Parts 
                200--399)
        IV  Secret Service, Department of the Treasury (Parts 
                400--499)
         V  Office of Foreign Assets Control, Department of the 
                Treasury (Parts 500--599)
        VI  Bureau of Engraving and Printing, Department of the 
                Treasury (Parts 600--699)
       VII  Federal Law Enforcement Training Center, Department of 
                the Treasury (Parts 700--799)
      VIII  Office of International Investment, Department of the 
                Treasury (Parts 800--899)

                      Title 32--National Defense

            Subtitle A--Department of Defense
         I  Office of the Secretary of Defense (Parts 1--399)
         V  Department of the Army (Parts 400--699)
        VI  Department of the Navy (Parts 700--799)

[[Page 723]]

       VII  Department of the Air Force (Parts 800--1099)
            Subtitle B--Other Regulations Relating to National 
                Defense
       XII  Defense Logistics Agency (Parts 1200--1299)
       XVI  Selective Service System (Parts 1600--1699)
       XIX  Central Intelligence Agency (Parts 1900--1999)
        XX  Information Security Oversight Office, National 
                Archives and Records Administration (Parts 2000--
                2099)
       XXI  National Security Council (Parts 2100--2199)
      XXIV  Office of Science and Technology Policy (Parts 2400--
                2499)
     XXVII  Office for Micronesian Status Negotiations (Parts 
                2700--2799)
    XXVIII  Office of the Vice President of the United States 
                (Parts 2800--2899)
      XXIX  Presidential Commission on the Assignment of Women in 
                the Armed Forces (Part 2900)

               Title 33--Navigation and Navigable Waters

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Corps of Engineers, Department of the Army (Parts 
                200--399)
        IV  Saint Lawrence Seaway Development Corporation, 
                Department of Transportation (Parts 400--499)

                          Title 34--Education

            Subtitle A--Office of the Secretary, Department of 
                Education (Parts 1--99)
            Subtitle B--Regulations of the Offices of the 
                Department of Education
         I  Office for Civil Rights, Department of Education 
                (Parts 100--199)
        II  Office of Elementary and Secondary Education, 
                Department of Education (Parts 200--299)
       III  Office of Special Education and Rehabilitative 
                Services, Department of Education (Parts 300--399)
        IV  Office of Vocational and Adult Education, Department 
                of Education (Parts 400--499)
         V  Office of Bilingual Education and Minority Languages 
                Affairs, Department of Education (Parts 500--599)
        VI  Office of Postsecondary Education, Department of 
                Education (Parts 600--699)
       VII  Office of Educational Research and Improvement, 
                Department of Education (Parts 700--799)
        XI  National Institute for Literacy (Parts 1100-1199)
            Subtitle C--Regulations Relating to Education
       XII  National Council on Disability (Parts 1200--1299)

[[Page 724]]

                        Title 35--Panama Canal

         I  Panama Canal Regulations (Parts 1--299)

             Title 36--Parks, Forests, and Public Property

         I  National Park Service, Department of the Interior 
                (Parts 1--199)
        II  Forest Service, Department of Agriculture (Parts 200--
                299)
       III  Corps of Engineers, Department of the Army (Parts 
                300--399)
        IV  American Battle Monuments Commission (Parts 400--499)
         V  Smithsonian Institution (Parts 500--599)
       VII  Library of Congress (Parts 700--799)
      VIII  Advisory Council on Historic Preservation (Parts 800--
                899)
        IX  Pennsylvania Avenue Development Corporation (Parts 
                900--999)
         X  Presidio Trust (Parts 1000--1099)
        XI  Architectural and Transportation Barriers Compliance 
                Board (Parts 1100--1199)
       XII  National Archives and Records Administration (Parts 
                1200--1299)
       XIV  Assassination Records Review Board (Parts 1400-1499)

             Title 37--Patents, Trademarks, and Copyrights

         I  Patent and Trademark Office, Department of Commerce 
                (Parts 1--199)
        II  Copyright Office, Library of Congress (Parts 200--299)
        IV  Assistant Secretary for Technology Policy, Department 
                of Commerce (Parts 400--499)
         V  Under Secretary for Technology, Department of Commerce 
                (Parts 500--599)

           Title 38--Pensions, Bonuses, and Veterans' Relief

         I  Department of Veterans Affairs (Parts 0--99)

                       Title 39--Postal Service

         I  United States Postal Service (Parts 1--999)
       III  Postal Rate Commission (Parts 3000--3099)

                  Title 40--Protection of Environment

         I  Environmental Protection Agency (Parts 1--799)
         V  Council on Environmental Quality (Parts 1500--1599)

          Title 41--Public Contracts and Property Management

            Subtitle B--Other Provisions Relating to Public 
                Contracts
        50  Public Contracts, Department of Labor (Parts 50-1--50-
                999)

[[Page 725]]

        51  Committee for Purchase From People Who Are Blind or 
                Severely Disabled (Parts 51-1--51-99)
        60  Office of Federal Contract Compliance Programs, Equal 
                Employment Opportunity, Department of Labor (Parts 
                60-1--60-999)
        61  Office of the Assistant Secretary for Veterans 
                Employment and Training, Department of Labor 
                (Parts 61-1--61-999)
            Subtitle C--Federal Property Management Regulations 
                System
       101  Federal Property Management Regulations (Parts 101-1--
                101-99)
       105  General Services Administration (Parts 105-1--105-999)
       109  Department of Energy Property Management Regulations 
                (Parts 109-1--109-99)
       114  Department of the Interior (Parts 114-1--114-99)
       115  Environmental Protection Agency (Parts 115-1--115-99)
       128  Department of Justice (Parts 128-1--128-99)
            Subtitle D--Other Provisions Relating to Property 
                Management [Reserved]
            Subtitle E--Federal Information Resources Management 
                Regulations System
       201  Federal Information Resources Management Regulation 
                (Parts 201-1--201-99) [Reserved]
            Subtitle F--Federal Travel Regulation System
       300  General (Parts 300-1--300.99)
       301  Temporary Duty (TDY) Travel Allowances (Parts 301-1--
                301-99)
       302  Relocation Allowances (Parts 302-1--302-99)
       303  Payment of Expenses Connected with the Death of 
                Certain Employees (Parts 303-1--303-2)
       304  Payment from a Non-Federal Source for Travel Expenses 
                (Parts 304-1--304-99)

                        Title 42--Public Health

         I  Public Health Service, Department of Health and Human 
                Services (Parts 1--199)
        IV  Health Care Financing Administration, Department of 
                Health and Human Services (Parts 400--499)
         V  Office of Inspector General-Health Care, Department of 
                Health and Human Services (Parts 1000--1999)

                   Title 43--Public Lands: Interior

            Subtitle A--Office of the Secretary of the Interior 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Lands
         I  Bureau of Reclamation, Department of the Interior 
                (Parts 200--499)
        II  Bureau of Land Management, Department of the Interior 
                (Parts 1000--9999)

[[Page 726]]

       III  Utah Reclamation Mitigation and Conservation 
                Commission (Parts 10000--10005)

             Title 44--Emergency Management and Assistance

         I  Federal Emergency Management Agency (Parts 0--399)
        IV  Department of Commerce and Department of 
                Transportation (Parts 400--499)

                       Title 45--Public Welfare

            Subtitle A--Department of Health and Human Services 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Welfare
        II  Office of Family Assistance (Assistance Programs), 
                Administration for Children and Families, 
                Department of Health and Human Services (Parts 
                200--299)
       III  Office of Child Support Enforcement (Child Support 
                Enforcement Program), Administration for Children 
                and Families, Department of Health and Human 
                Services (Parts 300--399)
        IV  Office of Refugee Resettlement, Administration for 
                Children and Families Department of Health and 
                Human Services (Parts 400--499)
         V  Foreign Claims Settlement Commission of the United 
                States, Department of Justice (Parts 500--599)
        VI  National Science Foundation (Parts 600--699)
       VII  Commission on Civil Rights (Parts 700--799)
      VIII  Office of Personnel Management (Parts 800--899)
         X  Office of Community Services, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 1000--1099)
        XI  National Foundation on the Arts and the Humanities 
                (Parts 1100--1199)
       XII  Corporation for National and Community Service (Parts 
                1200--1299)
      XIII  Office of Human Development Services, Department of 
                Health and Human Services (Parts 1300--1399)
       XVI  Legal Services Corporation (Parts 1600--1699)
      XVII  National Commission on Libraries and Information 
                Science (Parts 1700--1799)
     XVIII  Harry S. Truman Scholarship Foundation (Parts 1800--
                1899)
       XXI  Commission on Fine Arts (Parts 2100--2199)
      XXII  Christopher Columbus Quincentenary Jubilee Commission 
                (Parts 2200--2299)
     XXIII  Arctic Research Commission (Part 2301)
      XXIV  James Madison Memorial Fellowship Foundation (Parts 
                2400--2499)
       XXV  Corporation for National and Community Service (Parts 
                2500--2599)

[[Page 727]]

                          Title 46--Shipping

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Maritime Administration, Department of Transportation 
                (Parts 200--399)
       III  Coast Guard (Great Lakes Pilotage), Department of 
                Transportation (Parts 400--499)
        IV  Federal Maritime Commission (Parts 500--599)

                      Title 47--Telecommunication

         I  Federal Communications Commission (Parts 0--199)
        II  Office of Science and Technology Policy and National 
                Security Council (Parts 200--299)
       III  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                300--399)

           Title 48--Federal Acquisition Regulations System

         1  Federal Acquisition Regulation (Parts 1--99)
         2  Department of Defense (Parts 200--299)
         3  Department of Health and Human Services (Parts 300--
                399)
         4  Department of Agriculture (Parts 400--499)
         5  General Services Administration (Parts 500--599)
         6  Department of State (Parts 600--699)
         7  United States Agency for International Development 
                (Parts 700--799)
         8  Department of Veterans Affairs (Parts 800--899)
         9  Department of Energy (Parts 900--999)
        10  Department of the Treasury (Parts 1000--1099)
        12  Department of Transportation (Parts 1200--1299)
        13  Department of Commerce (Parts 1300--1399)
        14  Department of the Interior (Parts 1400--1499)
        15  Environmental Protection Agency (Parts 1500--1599)
        16  Office of Personnel Management Federal Employees 
                Health Benefits Acquisition Regulation (Parts 
                1600--1699)
        17  Office of Personnel Management (Parts 1700--1799)
        18  National Aeronautics and Space Administration (Parts 
                1800--1899)
        19  United States Information Agency (Parts 1900--1999)
        20  Nuclear Regulatory Commission (Parts 2000--2099)
        21  Office of Personnel Management, Federal Employees 
                Group Life Insurance Federal Acquisition 
                Regulation (Parts 2100--2199)
        23  Social Security Administration (Parts 2300--2399)
        24  Department of Housing and Urban Development (Parts 
                2400--2499)
        25  National Science Foundation (Parts 2500--2599)
        28  Department of Justice (Parts 2800--2899)
        29  Department of Labor (Parts 2900--2999)

[[Page 728]]

        34  Department of Education Acquisition Regulation (Parts 
                3400--3499)
        35  Panama Canal Commission (Parts 3500--3599)
        44  Federal Emergency Management Agency (Parts 4400--4499)
        51  Department of the Army Acquisition Regulations (Parts 
                5100--5199)
        52  Department of the Navy Acquisition Regulations (Parts 
                5200--5299)
        53  Department of the Air Force Federal Acquisition 
                Regulation Supplement (Parts 5300--5399)
        54  Defense Logistics Agency, Department of Defense (Part 
                5452)
        57  African Development Foundation (Parts 5700--5799)
        61  General Services Administration Board of Contract 
                Appeals (Parts 6100--6199)
        63  Department of Transportation Board of Contract Appeals 
                (Parts 6300--6399)
        99  Cost Accounting Standards Board, Office of Federal 
                Procurement Policy, Office of Management and 
                Budget (Parts 9900--9999)

                       Title 49--Transportation

            Subtitle A--Office of the Secretary of Transportation 
                (Parts 1--99)
            Subtitle B--Other Regulations Relating to 
                Transportation
         I  Research and Special Programs Administration, 
                Department of Transportation (Parts 100--199)
        II  Federal Railroad Administration, Department of 
                Transportation (Parts 200--299)
       III  Federal Highway Administration, Department of 
                Transportation (Parts 300--399)
        IV  Coast Guard, Department of Transportation (Parts 400--
                499)
         V  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 500--599)
        VI  Federal Transit Administration, Department of 
                Transportation (Parts 600--699)
       VII  National Railroad Passenger Corporation (AMTRAK) 
                (Parts 700--799)
      VIII  National Transportation Safety Board (Parts 800--999)
         X  Surface Transportation Board, Department of 
                Transportation (Parts 1000--1399)
        XI  Bureau of Transportation Statistics, Department of 
                Transportation (Parts 1400--1499)

                   Title 50--Wildlife and Fisheries

         I  United States Fish and Wildlife Service, Department of 
                the Interior (Parts 1--199)

[[Page 729]]

        II  National Marine Fisheries Service, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 200--299)
       III  International Fishing and Related Activities (Parts 
                300--399)
        IV  Joint Regulations (United States Fish and Wildlife 
                Service, Department of the Interior and National 
                Marine Fisheries Service, National Oceanic and 
                Atmospheric Administration, Department of 
                Commerce); Endangered Species Committee 
                Regulations (Parts 400--499)
         V  Marine Mammal Commission (Parts 500--599)
        VI  Fishery Conservation and Management, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 600--699)

                      CFR Index and Finding Aids

            Subject/Agency Index
            List of Agency Prepared Indexes
            Parallel Tables of Statutory Authorities and Rules
            List of CFR Titles, Chapters, Subchapters, and Parts
            Alphabetical List of Agencies Appearing in the CFR



[[Page 731]]





           Alphabetical List of Agencies Appearing in the CFR




                     (Revised as of January 1, 1999)

                                                  CFR Title, Subtitle or 
                     Agency                               Chapter

Administrative Committee of the Federal Register  1, I
Advanced Research Projects Agency                 32, I
Advisory Commission on Intergovernmental          5, VII
     Relations
Advisory Committee on Federal Pay                 5, IV
Advisory Council on Historic Preservation         36, VIII
African Development Foundation                    22, XV
  Federal Acquisition Regulation                  48, 57
Agency for International Development, United      22, II
     States
  Federal Acquisition Regulation                  48, 7
Agricultural Marketing Service                    7, I, IX, X, XI
Agricultural Research Service                     7, V
Agriculture Department
  Agricultural Marketing Service                  7, I, IX, X, XI
  Agricultural Research Service                   7, V
  Animal and Plant Health Inspection Service      7, III; 9, I
  Chief Financial Officer, Office of              7, XXX
  Commodity Credit Corporation                    7, XIV
  Cooperative State Research, Education, and      7, XXXIV
       Extension Service
  Economic Research Service                       7, XXXVII
  Energy, Office of                               7, XXIX
  Environmental Quality, Office of                7, XXXI
  Farm Service Agency                             7, VII, XVIII
  Federal Acquisition Regulation                  48, 4
  Federal Crop Insurance Corporation              7, IV
  Food and Nutrition Service                      7, II
  Food Safety and Inspection Service              9, III
  Foreign Agricultural Service                    7, XV
  Forest Service                                  36, II
  Grain Inspection, Packers and Stockyards        7, VIII; 9, II
       Administration
  Information Resources Management, Office of     7, XXVII
  Inspector General, Office of                    7, XXVI
  National Agricultural Library                   7, XLI
  National Agricultural Statistics Service        7, XXXVI
  Natural Resources Conservation Service          7, VI
  Operations, Office of                           7, XXVIII
  Procurement and Property Management, Office of  7, XXXII
  Rural Business-Cooperative Service              7, XVIII, XLII
  Rural Development Administration                7, XLII
  Rural Housing Service                           7, XVIII, XXXV
  Rural Telephone Bank                            7, XVI
  Rural Utilities Service                         7, XVII, XVIII, XLII
  Secretary of Agriculture, Office of             7, Subtitle A
  Transportation, Office of                       7, XXXIII
  World Agricultural Outlook Board                7, XXXVIII
Air Force Department                              32, VII
  Federal Acquisition Regulation Supplement       48, 53
Alcohol, Tobacco and Firearms, Bureau of          27, I
AMTRAK                                            49, VII
American Battle Monuments Commission              36, IV
American Indians, Office of the Special Trustee   25, VII
Animal and Plant Health Inspection Service        7, III; 9, I
Appalachian Regional Commission                   5, IX

[[Page 732]]

Architectural and Transportation Barriers         36, XI
     Compliance Board
Arctic Research Commission                        45, XXIII
Armed Forces Retirement Home                      5, XI
Arms Control and Disarmament Agency, United       22, VI
     States
Army Department                                   32, V
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 51
Assassination Records Review Board                36, XIV
Benefits Review Board                             20, VII
Bilingual Education and Minority Languages        34, V
     Affairs, Office of
Blind or Severely Disabled, Committee for         41, 51
     Purchase From People Who Are
Board for International Broadcasting              22, XIII
Census Bureau                                     15, I
Central Intelligence Agency                       32, XIX
Chief Financial Officer, Office of                7, XXX
Child Support Enforcement, Office of              45, III
Children and Families, Administration for         45, II, III, IV, X
Christopher Columbus Quincentenary Jubilee        45, XXII
     Commission
Civil Rights, Commission on                       45, VII
Civil Rights, Office for                          34, I
Coast Guard                                       33, I; 46, I; 49, IV
Coast Guard (Great Lakes Pilotage)                46, III
Commerce Department                               44, IV
  Census Bureau                                   15, I`
  Economic Affairs, Under Secretary               37, V
  Economic Analysis, Bureau of                    15, VIII
  Economic Development Administration             13, III
  Emergency Management and Assistance             44, IV
  Export Administration, Bureau of                15, VII
  Federal Acquisition Regulation                  48, 13
  Fishery Conservation and Management             50, VI
  Foreign-Trade Zones Board                       15, IV
  International Trade Administration              15, III; 19, III
  National Institute of Standards and Technology  15, II
  National Marine Fisheries Service               50, II, IV, VI
  National Oceanic and Atmospheric                15, IX; 50, II, III, IV, 
       Administration                             VI
  National Telecommunications and Information     15, XXIII; 47, III
       Administration
  National Weather Service                        15, IX
  Patent and Trademark Office                     37, I
  Productivity, Technology and Innovation,        37, IV
       Assistant Secretary for
  Secretary of Commerce, Office of                15, Subtitle A
  Technology, Under Secretary for                 37, V
  Technology Administration                       15, XI
  Technology Policy, Assistant Secretary for      37, IV
Commercial Space Transportation                   14, III
Commodity Credit Corporation                      7, XIV
Commodity Futures Trading Commission              5, XLI; 17, I
Community Planning and Development, Office of     24, V, VI
     Assistant Secretary for
Community Services, Office of                     45, X
Comptroller of the Currency                       12, I
Construction Industry Collective Bargaining       29, IX
     Commission
Consumer Product Safety Commission                5, LXXI; 16, II
Cooperative State Research, Education, and        7, XXXIV
     Extension Service
Copyright Office                                  37, II
Corporation for National and Community Service    45, XII, XXV
Cost Accounting Standards Board                   48, 99
Council on Environmental Quality                  40, V
Customs Service, United States                    19, I
Defense Contract Audit Agency                     32, I
Defense Department                                5, XXVI; 32, Subtitle A
  Advanced Research Projects Agency               32, I
  Air Force Department                            32, VII

[[Page 733]]

  Army Department                                 32, V; 33, II; 36, III, 
                                                  48, 51
  Defense Intelligence Agency                     32, I
  Defense Logistics Agency                        32, I, XII; 48, 54
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 2
  National Imagery and Mapping Agency             32, I
  Navy Department                                 32, VI; 48, 52
  Secretary of Defense, Office of                 32, I
Defense Contract Audit Agency                     32, I
Defense Intelligence Agency                       32, I
Defense Logistics Agency                          32, XII; 48, 54
Defense Nuclear Facilities Safety Board           10, XVII
Delaware River Basin Commission                   18, III
Drug Enforcement Administration                   21, II
East-West Foreign Trade Board                     15, XIII
Economic Affairs, Under Secretary                 37, V
Economic Analysis, Bureau of                      15, VIII
Economic Development Administration               13, III
Economic Research Service                         7, XXXVII
Education, Department of                          5, LIII
  Bilingual Education and Minority Languages      34, V
       Affairs, Office of
  Civil Rights, Office for                        34, I
  Educational Research and Improvement, Office    34, VII
       of
  Elementary and Secondary Education, Office of   34, II
  Federal Acquisition Regulation                  48, 34
  Postsecondary Education, Office of              34, VI
  Secretary of Education, Office of               34, Subtitle A
  Special Education and Rehabilitative Services,  34, III
       Office of
  Vocational and Adult Education, Office of       34, IV
Educational Research and Improvement, Office of   34, VII
Elementary and Secondary Education, Office of     34, II
Employees' Compensation Appeals Board             20, IV
Employees Loyalty Board                           5, V
Employment and Training Administration            20, V
Employment Standards Administration               20, VI
Endangered Species Committee                      50, IV
Energy, Department of                             5, XXIII; 10, II, III, X
  Federal Acquisition Regulation                  48, 9
  Federal Energy Regulatory Commission            5, XXIV; 18, I
  Property Management Regulations                 41, 109
Energy, Office of                                 7, XXIX
Engineers, Corps of                               33, II; 36, III
Engraving and Printing, Bureau of                 31, VI
Environmental Protection Agency                   5, LIV; 40, I
  Federal Acquisition Regulation                  48, 15
  Property Management Regulations                 41, 115
Environmental Quality, Office of                  7, XXXI
Equal Employment Opportunity Commission           5, LXII; 29, XIV
Equal Opportunity, Office of Assistant Secretary  24, I
     for
Executive Office of the President                 3, I
  Administration, Office of                       5, XV
  Environmental Quality, Council on               40, V
  Management and Budget, Office of                25, III, LXXVII; 48, 99
  National Drug Control Policy, Office of         21, III
  National Security Council                       32, XXI; 47, 2
  Presidential Documents                          3
  Science and Technology Policy, Office of        32, XXIV; 47, II
  Trade Representative, Office of the United      15, XX
       States
Export Administration, Bureau of                  15, VII
Export-Import Bank of the United States           5, LII; 12, IV
Family Assistance, Office of                      45, II
Farm Credit Administration                        5, XXXI; 12, VI
Farm Credit System Insurance Corporation          5, XXX; 12, XIV
Farm Service Agency                               7, VII, XVIII
Federal Acquisition Regulation                    48, 1

[[Page 734]]

Federal Aviation Administration                   14, I
  Commercial Space Transportation                 14, III
Federal Claims Collection Standards               4, II
Federal Communications Commission                 5, XXIX; 47, I
Federal Contract Compliance Programs, Office of   41, 60
Federal Crop Insurance Corporation                7, IV
Federal Deposit Insurance Corporation             5, XXII; 12, III
Federal Election Commission                       11, I
Federal Emergency Management Agency               44, I
  Federal Acquisition Regulation                  48, 44
Federal Employees Group Life Insurance Federal    48, 21
     Acquisition Regulation
Federal Employees Health Benefits Acquisition     48, 16
     Regulation
Federal Energy Regulatory Commission              5, XXIV; 18, I
Federal Financial Institutions Examination        12, XI
     Council
Federal Financing Bank                            12, VIII
Federal Highway Administration                    23, I, II; 49, III
Federal Home Loan Mortgage Corporation            1, IV
Federal Housing Enterprise Oversight Office       12, XVII
Federal Housing Finance Board                     12, IX
Federal Labor Relations Authority, and General    5, XIV; 22, XIV
     Counsel of the Federal Labor Relations 
     Authority
Federal Law Enforcement Training Center           31, VII
Federal Maritime Commission                       46, IV
Federal Mediation and Conciliation Service        29, XII
Federal Mine Safety and Health Review Commission  5, LXXIV; 29, XXVII
Federal Pay, Advisory Committee on                5, IV
Federal Prison Industries, Inc.                   28, III
Federal Procurement Policy Office                 48, 99
Federal Property Management Regulations           41, 101
Federal Property Management Regulations System    41, Subtitle C
Federal Railroad Administration                   49, II
Federal Register, Administrative Committee of     1, I
Federal Register, Office of                       1, II
Federal Reserve System                            12, II
  Board of Governors                              5, LVIII
Federal Retirement Thrift Investment Board        5, VI, LXXVI
Federal Service Impasses Panel                    5, XIV
Federal Trade Commission                          5, XLVII; 16, I
Federal Transit Administration                    49, VI
Federal Travel Regulation System                  41, Subtitle F
Fine Arts, Commission on                          45, XXI
Fiscal Service                                    31, II
Fish and Wildlife Service, United States          50, I, IV
Fishery Conservation and Management               50, VI
Food and Drug Administration                      21, I
Food and Nutrition Service                        7, II
Food Safety and Inspection Service                9, III
Foreign Agricultural Service                      7, XV
Foreign Assets Control, Office of                 31, V
Foreign Claims Settlement Commission of the       45, V
     United States
Foreign Service Grievance Board                   22, IX
Foreign Service Impasse Disputes Panel            22, XIV
Foreign Service Labor Relations Board             22, XIV
Foreign-Trade Zones Board                         15, IV
Forest Service                                    36, II
General Accounting Office                         4, I, II
General Services Administration                   5, LVII
  Contract Appeals, Board of                      48, 61
  Federal Acquisition Regulation                  48, 5
  Federal Property Management Regulations System  41, 101, 105
  Federal Travel Regulation System                41, Subtitle F
  General                                         41, 300
  Payment From a Non-Federal Source for Travel    41, 304
       Expenses
  Payment of Expenses Connected With the Death    41, 303
       of Certain Employees
  Relocation Allowances                           41, 302

[[Page 735]]

  Temporary Duty (TDY) Travel Allowances          41, 301
Geological Survey                                 30, IV
Government Ethics, Office of                      5, XVI
Government National Mortgage Association          24, III
Grain Inspection, Packers and Stockyards          7, VIII; 9, II
     Administration
Harry S. Truman Scholarship Foundation            45, XVIII
Health and Human Services, Department of          5, XLV; 45, Subtitle A
  Child Support Enforcement, Office of            45, III
  Children and Families, Administration for       45, II, III, IV, X
  Community Services, Office of                   45, X
  Family Assistance, Office of                    45, II
  Federal Acquisition Regulation                  48, 3
  Food and Drug Administration                    21, I
  Health Care Financing Administration            42, IV
  Human Development Services, Office of           45, XIII
  Indian Health Service                           25, V
  Inspector General (Health Care), Office of      42, V
  Public Health Service                           42, I
  Refugee Resettlement, Office of                 45, IV
Health Care Financing Administration              42, IV
Housing and Urban Development, Department of      5, LXV; 24, Subtitle B
  Community Planning and Development, Office of   24, V, VI
       Assistant Secretary for
  Equal Opportunity, Office of Assistant          24, I
       Secretary for
  Federal Acquisition Regulation                  48, 24
  Federal Housing Enterprise Oversight, Office    12, XVII
       of
  Government National Mortgage Association        24, III
  Housing--Federal Housing Commissioner, Office   24, II, VIII, X, XX
       of Assistant Secretary for
  Inspector General, Office of                    24, XII
  Multifamily Housing Assistance Restructuring,   24, IV
       Office of
  Public and Indian Housing, Office of Assistant  24, IX
       Secretary for
  Secretary, Office of                            24, Subtitle A, VII
Housing--Federal Housing Commissioner, Office of  24, II, VIII, X, XX
     Assistant Secretary for
Human Development Services, Office of             45, XIII
Immigration and Naturalization Service            8, I
Independent Counsel, Office of                    28, VII
Indian Affairs, Bureau of                         25, I, V
Indian Affairs, Office of the Assistant           25, VI
     Secretary
Indian Arts and Crafts Board                      25, II
Indian Health Service                             25, V
Information Agency, United States                 22, V
  Federal Acquisition Regulation                  48, 19
Information Resources Management, Office of       7, XXVII
Information Security Oversight Office, National   32, XX
     Archives and Records Administration
Inspector General
  Agriculture Department                          7, XXVI
  Health and Human Services Department            42, V
  Housing and Urban Development Department        24, XII
Institute of Peace, United States                 22, XVII
Inter-American Foundation                         5, LXIII; 22, X
Intergovernmental Relations, Advisory Commission  5, VII
     on
Interior Department
  American Indians, Office of the Special         25, VII
       Trustee
  Endangered Species Committee                    50, IV
  Federal Acquisition Regulation                  48, 14
  Federal Property Management Regulations System  41, 114
  Fish and Wildlife Service, United States        50, I, IV
  Geological Survey                               30, IV
  Indian Affairs, Bureau of                       25, I, V
  Indian Affairs, Office of the Assistant         25, VI
       Secretary
  Indian Arts and Crafts Board                    25, II
  Land Management, Bureau of                      43, II
  Minerals Management Service                     30, II
  Mines, Bureau of                                30, VI

[[Page 736]]

  National Indian Gaming Commission               25, III
  National Park Service                           36, I
  Reclamation, Bureau of                          43, I
  Secretary of the Interior, Office of            43, Subtitle A
  Surface Mining and Reclamation Appeals, Board   30, III
       of
  Surface Mining Reclamation and Enforcement,     30, VII
       Office of
Internal Revenue Service                          26, I
International Boundary and Water Commission,      22, XI
     United States and Mexico, United States 
     Section
International Development, United States Agency   22, II
     for
  Federal Acquisition Regulation                  48, 7
International Development Cooperation Agency,     22, XII
     United States
  International Development, United States        22, II; 48, 7
       Agency for
  Overseas Private Investment Corporation         5, XXXIII; 22, VII
International Fishing and Related Activities      50, III
International Investment, Office of               31, VIII
International Joint Commission, United States     22, IV
     and Canada
International Organizations Employees Loyalty     5, V
     Board
International Trade Administration                15, III; 19, III
International Trade Commission, United States     19, II
Interstate Commerce Commission                    5, XL
James Madison Memorial Fellowship Foundation      45, XXIV
Japan-United States Friendship Commission         22, XVI
Joint Board for the Enrollment of Actuaries       20, VIII
Justice Department                                5, XXVIII; 28, I
  Drug Enforcement Administration                 21, II
  Federal Acquisition Regulation                  48, 28
  Federal Claims Collection Standards             4, II
  Federal Prison Industries, Inc.                 28, III
  Foreign Claims Settlement Commission of the     45, V
       United States
  Immigration and Naturalization Service          8, I
  Offices of Independent Counsel                  28, VI
  Prisons, Bureau of                              28, V
  Property Management Regulations                 41, 128
Labor Department                                  5, XLII
  Benefits Review Board                           20, VII
  Employees' Compensation Appeals Board           20, IV
  Employment and Training Administration          20, V
  Employment Standards Administration             20, VI
  Federal Acquisition Regulation                  48, 29
  Federal Contract Compliance Programs, Office    41, 60
       of
  Federal Procurement Regulations System          41, 50
  Labor-Management Standards, Office of           29, II, IV
  Mine Safety and Health Administration           30, I
  Occupational Safety and Health Administration   29, XVII
  Pension and Welfare Benefits Administration     29, XXV
  Public Contracts                                41, 50
  Secretary of Labor, Office of                   29, Subtitle A
  Veterans' Employment and Training, Office of    41, 61; 20, IX
       the Assistant Secretary for
  Wage and Hour Division                          29, V
  Workers' Compensation Programs, Office of       20, I
Labor-Management Standards, Office of             29, II, IV
Land Management, Bureau of                        43, II
Legal Services Corporation                        45, XVI
Library of Congress                               36, VII
  Copyright Office                                37, II
Management and Budget, Office of                  5, III, LXXVII; 48, 99
Marine Mammal Commission                          50, V
Maritime Administration                           46, II
Merit Systems Protection Board                    5, II
Micronesian Status Negotiations, Office for       32, XXVII
Mine Safety and Health Administration             30, I
Minerals Management Service                       30, II
Mines, Bureau of                                  30, VI

[[Page 737]]

Minority Business Development Agency              15, XIV
Miscellaneous Agencies                            1, IV
Monetary Offices                                  31, I
Multifamily Housing Assistance Restructuring,     24, IV
     Office of
National Aeronautics and Space Administration     5, LIX; 14, V
  Federal Acquisition Regulation                  48, 18
National Agricultural Library                     7, XLI
National Agricultural Statistics Service          7, XXXVI
National Archives and Records Administration      5, LXVI; 36, XII
  Information Security Oversight Office           32, XX
National Bureau of Standards                      15, II
National Capital Planning Commission              1, IV
National Commission for Employment Policy         1, IV
National Commission on Libraries and Information  45, XVII
     Science
National and Community Service, Corporation for   45, XII, XXV
National Council on Disability                    34, XII
National Credit Union Administration              12, VII
National Drug Control Policy, Office of           21, III
National Foundation on the Arts and the           45, XI
     Humanities
National Highway Traffic Safety Administration    23, II, III; 49, V
National Imagery and Mapping Agency               32, I
National Indian Gaming Commission                 25, III
National Institute for Literacy                   34, XI
National Institute of Standards and Technology    15, II
National Labor Relations Board                    5, LXI; 29, I
National Marine Fisheries Service                 50, II, IV, VI
National Mediation Board                          29, X
National Oceanic and Atmospheric Administration   15, IX; 50, II, III, IV, 
                                                  VI
National Park Service                             36, I
National Railroad Adjustment Board                29, III
National Railroad Passenger Corporation (AMTRAK)  49, VII
National Science Foundation                       5, XLIII; 45, VI
  Federal Acquisition Regulation                  48, 25
National Security Council                         32, XXI
National Security Council and Office of Science   47, II
     and Technology Policy
National Telecommunications and Information       15, XXIII; 47, III
     Administration
National Transportation Safety Board              49, VIII
National Weather Service                          15, IX
Natural Resources Conservation Service            7, VI
Navajo and Hopi Indian Relocation, Office of      25, IV
Navy Department                                   32, VI
  Federal Acquisition Regulation                  48, 52
Neighborhood Reinvestment Corporation             24, XXV
Northeast Dairy Compact Commission                7, XIII
Nuclear Regulatory Commission                     5, XLVIII; 10, I
  Federal Acquisition Regulation                  48, 20
Occupational Safety and Health Administration     29, XVII
Occupational Safety and Health Review Commission  29, XX
Offices of Independent Counsel                    28, VI
Operations Office                                 7, XXVIII
Overseas Private Investment Corporation           5, XXXIII; 22, VII
Panama Canal Commission                           48, 35
Panama Canal Regulations                          35, I
Patent and Trademark Office                       37, I
Payment From a Non-Federal Source for Travel      41, 304
     Expenses
Payment of Expenses Connected With the Death of   41, 303
     Certain Employees
Peace Corps                                       22, III
Pennsylvania Avenue Development Corporation       36, IX
Pension and Welfare Benefits Administration       29, XXV
Pension Benefit Guaranty Corporation              29, XL
Personnel Management, Office of                   5, I, XXXV; 45, VIII
  Federal Acquisition Regulation                  48, 17
  Federal Employees Group Life Insurance Federal  48, 21
     Acquisition Regulation
[[Page 738]]

  Federal Employees Health Benefits Acquisition   48, 16
       Regulation
Postal Rate Commission                            5, XLVI; 39, III
Postal Service, United States                     5, LX; 39, I
Postsecondary Education, Office of                34, VI
President's Commission on White House             1, IV
     Fellowships
Presidential Commission on the Assignment of      32, XXIX
     Women in the Armed Forces
Presidential Documents                            3
Presidio Trust                                    36, X
Prisons, Bureau of                                28, V
Procurement and Property Management, Office of    7, XXXII
Productivity, Technology and Innovation,          37, IV
     Assistant Secretary
Public Contracts, Department of Labor             41, 50
Public and Indian Housing, Office of Assistant    24, IX
     Secretary for
Public Health Service                             42, I
Railroad Retirement Board                         20, II
Reclamation, Bureau of                            43, I
Refugee Resettlement, Office of                   45, IV
Regional Action Planning Commissions              13, V
Relocation Allowances                             41, 302
Research and Special Programs Administration      49, I
Rural Business-Cooperative Service                7, XVIII, XLII
Rural Development Administration                  7, XLII
Rural Housing Service                             7, XVIII, XXXV
Rural Telephone Bank                              7, XVI
Rural Utilities Service                           7, XVII, XVIII, XLII
Saint Lawrence Seaway Development Corporation     33, IV
Science and Technology Policy, Office of          32, XXIV
Science and Technology Policy, Office of, and     47, II
     National Security Council
Secret Service                                    31, IV
Securities and Exchange Commission                17, II
Selective Service System                          32, XVI
Small Business Administration                     13, I
Smithsonian Institution                           36, V
Social Security Administration                    20, III; 48, 23
Soldiers' and Airmen's Home, United States        5, XI
Special Counsel, Office of                        5, VIII
Special Education and Rehabilitative Services,    34, III
     Office of
State Department                                  22, I
  Federal Acquisition Regulation                  48, 6
Surface Mining and Reclamation Appeals, Board of  30, III
Surface Mining Reclamation and Enforcement,       30, VII
     Office of
Surface Transportation Board                      49, X
Susquehanna River Basin Commission                18, VIII
Technology Administration                         15, XI
Technology Policy, Assistant Secretary for        37, IV
Technology, Under Secretary for                   37, V
Tennessee Valley Authority                        5, LXIX; 18, XIII
Thrift Supervision Office, Department of the      12, V
     Treasury
Trade Representative, United States, Office of    15, XX
Transportation, Department of                     5, L
  Coast Guard                                     33, I; 46, I; 49, IV
  Coast Guard (Great Lakes Pilotage)              46, III
  Commercial Space Transportation                 14, III
  Contract Appeals, Board of                      48, 63
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 12
  Federal Aviation Administration                 14, I
  Federal Highway Administration                  23, I, II; 49, III
  Federal Railroad Administration                 49, II
  Federal Transit Administration                  49, VI
  Maritime Administration                         46, II
  National Highway Traffic Safety Administration  23, II, III; 49, V
  Research and Special Programs Administration    49, I
  Saint Lawrence Seaway Development Corporation   33, IV

[[Page 739]]

  Secretary of Transportation, Office of          14, II; 49, Subtitle A
  Surface Transportation Board                    49, X
  Transportation Statistics Bureau                49, XI
Transportation, Office of                         7, XXXIII
Transportation Statistics Brureau                 49, XI
Travel Allowances, Temporary Duty (TDY)           41, 301
Treasury Department                               5, XXI; 12, XV; 17, IV
  Alcohol, Tobacco and Firearms, Bureau of        27, I
  Community Development Financial Institutions    12, XVIII
       Fund
  Comptroller of the Currency                     12, I
  Customs Service, United States                  19, I
  Engraving and Printing, Bureau of               31, VI
  Federal Acquisition Regulation                  48, 10
  Federal Law Enforcement Training Center         31, VII
  Fiscal Service                                  31, II
  Foreign Assets Control, Office of               31, V
  Internal Revenue Service                        26, I
  International Investment, Office of             31, VIII
  Monetary Offices                                31, I
  Secret Service                                  31, IV
  Secretary of the Treasury, Office of            31, Subtitle A
  Thrift Supervision, Office of                   12, V
Truman, Harry S. Scholarship Foundation           45, XVIII
United States and Canada, International Joint     22, IV
     Commission
United States and Mexico, International Boundary  22, XI
     and Water Commission, United States Section
Utah Reclamation Mitigation and Conservation      43, III
     Commission
Veterans Affairs Department                       38, I
  Federal Acquisition Regulation                  48, 8
Veterans' Employment and Training, Office of the  41, 61; 20, IX
     Assistant Secretary for
Vice President of the United States, Office of    32, XXVIII
Vocational and Adult Education, Office of         34, IV
Wage and Hour Division                            29, V
Water Resources Council                           18, VI
Workers' Compensation Programs, Office of         20, I
World Agricultural Outlook Board                  7, XXXVIII

[[Page 741]]



List of CFR Sections Affected



All changes in this volume of the Code of Federal Regulations which were 
made by documents published in the Federal Register since January 1, 
1986, are enumerated in the following list. Entries indicate the nature 
of the changes effected. Page numbers refer to Federal Register pages. 
The user should consult the entries for chapters and parts as well as 
sections for revisions.
For the period before January 1, 1986, see the ``List of CFR Sections 
Affected 1949-1963, 1964-1972, and 1973-1985'' published in seven 
separate volumes.

                                  1986

7 CFR
                                                                   51 FR
                                                                    Page
Chapter IV
400.1--400.5 (Subpart A)  Revised..................................20246
400.27--400.34 (Subpart C)  Revised..................................879
400.27--400.36 (Subpart C)  Revised................................33238
400.28  (d), (e), (f), and (g) correctly redesignated as (c), (d), 
        (e), and (f)...............................................11704
400.33  Corrected..................................................11704
400.45--400.49 (Subpart F)  Added; interim.........................29203
400.66  (b) amended (OMB numbers)....................12307, 15463, 37890
400.90--400.101 (Subpart J)  Added..................................5147
400.92  Revised....................................................44589
400.115--400.127 (Subpart K)  Added................................17316
402.7  (d) amended.................................................29205
403.7  (d) amendment confirmed......................................5309
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
404.7  (d) amendment confirmed......................................5309
405.7  (d) amended; interim.................................29206, 29207
    Confirmed......................................................45296
408.7  (d) amendment confirmed......................................5309
409.7  (d) amendment confirmed......................................5309
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
410.7  (d) amended.................................................29205
411.7  (d) amendment confirmed......................................5309
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
412  Revised.......................................................35204
413.7  (d) amendment confirmed......................................5309
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
414.7  (d) amendment confirmed......................................7546
    (d) amended....................................................29205
415.7  (d) amended.................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
416.7  (d) amendment confirmed................................7546, 7547
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
417  Revised.......................................................15872
417.7  (d) corrected...............................................20247
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
418  Sales closing date extended...................................11285
418.7  (d) amendment confirmed......................................7546
    (d) amended; interim.............................21730, 29206, 29207
    (d) amended....................................................29205
    (d) amendment confirmed........................................36683
    Confirmed......................................................45296
418.8  Added; interim...............................................7046
    Addition confirmed.............................................29207
419.7  (d) amendment confirmed......................................7546
    (d) amended; interim.............................21730, 29206, 29207
    (d) amended....................................................29205
    (d) amendment confirmed........................................36683
    Confirmed......................................................45296

[[Page 742]]

419.8  Correctly added..............................................6216
419.9  Added; interim...............................................7046
    Addition confirmed.............................................29207
420  Sales closing date extended....................................4131
420.7  (d) amendment confirmed................................6897, 7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
420.8  Added; interim...............................................7046
    Addition confirmed.............................................29207
421  Sales closing date extended....................................4131
421.7  (d) amendment confirmed................................6897, 7546
    (d) amended.............................................29205, 37891
    (d) amended; interim....................................29206, 29207
    (d) corrected..................................................40963
    Confirmed......................................................45296
421.8  Added; interim...............................................7046
    Addition confirmed.............................................29207
422  Revised........................................................5690
    Sales closing date extended..............................8789, 10535
422.7  (d) amendment confirmed......................................6898
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
423.7  (d) amendment confirmed......................................7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
424  Sales closing date extended....................................4131
424.7  (d) amendment confirmed................................6897, 7546
    (d) amended.............................................29205, 37892
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
424.8  Added; interim...............................................7046
    Addition confirmed.............................................29207
425  Sales closing date extended....................................4131
425.7  (d) amendment confirmed................................6897, 7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
426.7  (d) amendment confirmed......................................7546
    (b) amended....................................................29205
    (b) correctly designated.......................................32903
427.7  (d) amendment confirmed......................................7546
    (d) amended; interim.............................21730, 29206, 29207
    (d) amended....................................................29205
    (d) amendment confirmed........................................36683
    Confirmed......................................................45296
427.8  Added; interim...............................................7046
    Addition confirmed.............................................29207
428.7  (d) amendment confirmed......................................7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
429.7  (d) amended; interim..........................21730, 29206, 29207
    (d) amended....................................................29205
    (d) amendment confirmed........................................36683
    Confirmed......................................................45296
430  Revised........................................................5150
430.7  (d) amendment confirmed......................................6898
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
431  Sales closing date extended....................................4131
431.7  (d) amendment confirmed................................6897, 7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
432  Sales closing date extended....................................4131
432.7  (d) amendment confirmed................................6897, 7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
432.8  Added; interim...............................................7046
    Addition confirmed.............................................29207
433.7  (d) amendment confirmed......................................7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
434.1--434.7 (Subpart)  Heading revised.............................5155
434.7  (d) amendment confirmed......................................6898
435.7  (d) amendment confirmed......................................7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
436  Sales closing date extended...................................11285
    Revised........................................................47199
436.7  (d) revised..................................................5156
    (d) amendment confirmed; (d) corrected..........................6898
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
437.7  (d) amendment confirmed......................................7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
438.7  (d) amendment confirmed................................6897, 7546
    (d) amended....................................................29205
    (d) amended; interim...........................................29207
    Confirmed......................................................45296

[[Page 743]]

439.7  (d) amendment confirmed......................................5309
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
440  Revised........................................................6900
440.7  (d) amended.................................................29205
441  Revised.......................................................37893
441.7  (d) amended.................................................29205
    (d) corrected..................................................41757
442.7  (d) amended.................................................29205
    (c) correctly designated.......................................32903
443  Revised........................................................5697
443.7  (d) amendment confirmed......................................6898
    (d) corrected...................................................8183
    (d) amended....................................................29205
444  Revised.......................................................11288
444.7  (d) amended.................................................29205
445  Revised.......................................................11293
445.7  (d) amended.................................................29205
446.7  (d) amended.................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
447  Revised.......................................................37897
447.7  (d) amendment confirmed......................................7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
448.7  (d) amendment confirmed................................6897, 7546
    (d) amended....................................................29205
    (d) amended; interim....................................29206, 29207
    Confirmed......................................................45296
448.8  Added; interim...............................................7046
    Addition confirmed.............................................29207
449  Revised.......................................................11896
449.7  (d) corrected...............................................17611
    (d) amended....................................................29205
450.7  (d) amended.................................................29205
    (d) amended; interim...........................................29207
    Confirmed......................................................45296
451  Added..........................................................1241
451.7  (d) amended.................................................29205
    (d) amended; interim...........................................29207
    Confirmed......................................................45296
Chapter V
520  Added.........................................................34191
Chapter VI
614  Added; interim................................................12827
    Revised........................................................26536
652  Removed.......................................................29208

                                  1987

7 CFR
                                                                   52 FR
                                                                    Page
Chapter IV
400.4  Revised.....................................................24979
400.5  Amended.....................................................24979
400.40--400.42 (Subpart E)  Added...................................4592
400.45--400.49 (Subpart F)  Revised................................19128
400.50--400.56 (Subpart G)  Removed................................17543
400.75--400.81 (Subpart I)  Removed................................17543
400.92  (g) added..................................................24278
400.141--400.157 (Subpart L)  Added................................17543
401  Added.........................................................28447
401.8  (d) amended; interim........................................36401
401.111  Added.....................................................45143
401.112  Added.....................................................45146
401.113  Added.....................................................45151
401.114  Added.....................................................45599
401.117  Added.....................................................45153
401.119  Added.....................................................45603
401.120  Added.....................................................45605
401.121  Added.....................................................45148
401.123  Added.....................................................45159
401.124  Added.....................................................45155
401.135  Added; interim............................................45158
402.7  (d) amended..................................................3214
403.7  (d) amended..................................................3214
    (d) corrected...................................................6775
405  Sales closing date extended...................................45443
405.7  (d) amended..................................................3214
409.7  (d) amended..................................................3214
410.7  (d) amended..................................................3214
411.7  (d) amended..................................................3214
413.1--413.7 (Subpart)  Heading revised............................47375
413.7  (d) amended..................................................3214
    (d) corrected...................................................6775
    (d) amended; interim...........................................27782
414.7  (d) amended..................................................3214
415.7  (d) amended..................................................3214
416.7  (d) amended..................................................3214
417.7  (d) amended..................................................3214
418  Sales closing date extended....................................7818
418.1--418.8 (Subpart)  Heading revised............................34627
418.7  (d) amended..................................................3214
    (d) amended; interim...........................................23424
    (d) corrected..................................................25585
418.8  Revised.....................................................24279
419  Sales closing date extended....................................7818
419.1--419.9 (Subpart)  Heading revised............................34628
419.7  (d) amended..................................................3214

[[Page 744]]

    (d) amended; interim...........................................23424
    (d) corrected..................................................25585
419.8  (b) amended..................................................9286
419.9  Revised.....................................................24279
420  Sales closing date extended....................................7818
420.7  (d) amended..................................................3214
    (d) amended.............................................17547, 17548
420.8  Revised.....................................................24279
421  Sales closing date extended....................................7818
421.7  (d) amended..................................................3214
    (d) corrected...................................................6775
421.8  Revised.....................................................24279
422  Sales closing date extended...................................48183
422.7  (d) amended...........................................3214, 23425
423.1--423.7 (Subpart)  Heading revised.....................45806, 47376
423.7  (d) amended..................................................3214
424  Sales closing date extended....................................7818
424.7  (d) amended....................................3214, 17547, 17548
424.8  Revised.....................................................24279
425.7  (d) amended....................................3214, 17547, 17548
    (d) corrected...................................................6775
427  Sales closing date extended....................................7818
427.1--427.8 (Subpart)  Heading revised............................34629
427.7  (d) amended..................................................3214
    (d) amended; interim...........................................23424
    (d) corrected..................................................25585
427.8  Revised.....................................................24279
428.7  (d) amended....................................3214, 17547, 17548
429.1--429.7 (Subpart)  Heading revised............................34630
429.7  (d) amended..................................................3214
    (d) amended; interim...........................................23424
    (d) corrected..................................................25585
430.7  (d) amended....................................3214, 17547, 17548
    (d) corrected...................................................6775
431.1--431.7 (Subpart)  Heading revised............................47377
431.7  (d) amended....................................3214, 17547, 17548
432  Sales closing date extended....................................7818
432.1--432.8 (Subpart)  Heading revised............................47378
432.7  (d) amended....................................3214, 17547, 17548
432.8  Revised.....................................................24279
433.7  (d) amended....................................3214, 17547, 17548
435.7  (d) amended..................................................3214
    (d) corrected...................................................6775
436.7  (d) amended..................................................3214
    (d) corrected...................................................6775
437.7  (d) amended..................................................3214
438.7  (d) amended..................................................3214
    (d) corrected...................................................6775
439.1--439.7 (Subpart)  Heading revised............................34630
439.7  (d) amended..................................................3214
440.7  (d) amended..................................................3214
441.7  (d) amended..................................................3214
442.7  (d) amended..................................................3214
443.7  (d) amended..................................................3214
444.7  (d) amended.................................................3214,
17547, 17548, 17549
445.7  (d) amended.................................................3214,
17547, 17548, 17549
446.7  (d) amended..................................................3214
    (d) corrected...................................................6775
447.7  (d) amended....................................3214, 17547, 17548
448  Sales closing date extended....................................7818
448.7  (d) amended..................................................3214
    (d) corrected...................................................6775
448.8  Revised.....................................................24279
449.7  (d) amended.................................................3214,
17547, 17548, 17549
450.7  (d) amended..................................................3214
451.7  (d) amended...........................................3214, 41692
452  Added..........................................................9288
453  Added.........................................................25349
454  Added..........................................................4593

                                  1988

7 CFR
                                                                   53 FR
                                                                    Page
Chapter IV
400.27--400.36 (Subpart C)  Removed................................24015
400.141--400.157 (Subpart L)  Redesignated as 400.161--400.177 
        (Subpart L); interim...........................................3
    Redesignation as 400.161--400.177 (Subpart L) confirmed........10527
400.128  Added; interim................................................3
    Addition confirmed.............................................10527
400.129  Added; interim................................................3
    Addition confirmed.............................................10527
400.130  Added; interim................................................4
    Addition confirmed.............................................10527
400.131  Added; interim................................................4
    Addition confirmed.............................................10527
400.132--400.141  Added; interim.......................................5
    Addition confirmed.............................................10527
400.142  Added; interim................................................6
    Addition confirmed.............................................10527
400.169  Revised...................................................31826
400.161--400.177 (Subpart L)  Redesignated from 400.141--400.157 
        (Subpart L); interim...........................................3
    Redesignation from 400.141--400.157 (Subpart L) confirmed......10527
400.201--400.210 (Subpart M)  Added................................24015

[[Page 745]]

401  Sales closing date extended............................15016, 38707
    Authority citation revised.....................................40718
401.8  (d) amendment confirmed......................................9099
    (d) amended; interim...........................................16540
401.101  Amended...................................................36781
401.111  Corrected............................................4006, 4589
401.115  Added......................................................6966
401.116  Added......................................................4379
401.117  Corrected..................................................1001
401.118  Added......................................................6560
    Corrected.................................................7878, 9100
401.122  Added......................................................6561
401.124  Amended...................................................40718
401.125  Added.....................................................15015
401.126  Added.....................................................19217
401.134  Added......................................................9101
401.135  Addition confirmed........................................15014
    Revised........................................................27664
    Amended........................................................34022
405  Earlier sales closing date....................................24249
    Authority citation revised.....................................46846
405.8  Heading and (c) revised.....................................46846
405.9  Added; interim...............................................1467
    Addition confirmed.............................................20279
    Revised........................................................46846
411  Earlier sales closing date....................................24249
413.7  (d) amendment confirmed......................................9103
418.7  (d) amendment confirmed.....................................36782
419.7  (d) amendment confirmed.....................................36782
420.1--420.8 (Subpart)  Heading revised.............................9104
421.1--421.8 (Subpart)  Heading revised.............................6564
422  Sales closing date extended....................................4380
422.7  (d) corrected................................................6115
424.1--424.8 (Subpart)  Heading revised.............................6565
426.1--426.7 (Subpart)  Heading revised............................12760
427.7  (d) amendment confirmed.....................................36782
428.1--428.7 (Subpart)  Heading revised.............................6565
429.7  (d) amendment confirmed.....................................36782
437  Sales closing date extended...................................15016
438.1--438.7 (Subpart)  Heading revised.............................6566
440.1--440.7 (Subpart)  Heading revised............................20280
440.7  (d) amended; interim.........................................9104
    (d) amendment confirmed........................................46847
441.7  (d) amended.................................................46848
448.1--448.8 (Subpart)  Heading revised.............................6567
451.1--451.7 (Subpart)  Heading revised............................46849
452.1--452.7 (Subpart)  Heading revised.............................6568
451.7  (d) amendment at 52 FR 41692 confirmed......................46850
454.7  (d) amended.................................................46850
455  Added....................................................6116, 6569
456  Added.........................................................31827
Chapter V
510  Revised.......................................................17685
Chapter VI
614  Authority citation revised.....................................1605
614.2  Amended......................................................1605
614.5  (e) revised..................................................1605
656  Authority citation revised.....................................4007
656.4--656.9  Removed...............................................4007

                                  1989

7 CFR
                                                                   54 FR
                                                                    Page
Chapter IV
400.172  (b) amended...............................................28411
400.250--400.252 (Subpart N)  Added................................24318
401  Sales closing date extended.............................7391, 38961
    Sales period clarification.....................................10621
    Sales period clarification corrected...........................11935
401.8  Regulation at 53 FR 16539 confirmed..........................9766
    (d) amended....................................................20370
401.101  Amended...................................................20504
401.103  Amended...................................................20504
401.105  Amended...................................................20504
401.106  Amended...................................................20504
401.107  (e) revised...............................................21196
401.110  Amended...................................................20504
401.111  Amended...................................................20504
401.113  Amended...................................................20504
401.114  Amended...................................................20504
401.116  Amended...................................................20504
401.117  Amended............................................20504, 48072
401.118  Amended...................................................20503
401.119  Revised...................................................48074
401.120  Amended...................................................48076
401.121  Revised...................................................48068
401.123  Amended...................................................28795
401.124  Amended; interim..........................................20369
    Amended........................................................20504
    Regulation at 54 FR 20369 confirmed............................33493
401.127  Added.....................................................20501
401.129  Added.....................................................48070
401.130  Added.....................................................43270
401.131  Added.....................................................43273

[[Page 746]]

401.137  Added.....................................................48073
401.140  Added......................................................7527
401.142  Added.....................................................43275
401.143  Added.....................................................14203
402  Authority citation revised....................................20505
402.7  (d) amended.................................................20505
403  Authority citation revised....................................24320
403.7  (d) amended.................................................24320
405.8  Technical correction.........................................6381
405.9  Corrected...................................................11935
406  Added..........................................................3412
    Authority citation revised.....................................33494
406.5  Amended.....................................................33494
406.7  (d) corrected...............................................14206
409  Authority citation revised....................................38962
409.7  (d) amended; interim........................................38962
411  Sales closing date extended....................................2991
    Authority citation revised.....................................20506
411.7  (d) amended.................................................20506
416  Authority citation revised....................................20507
416.7  (d) amended.................................................20507
422  Authority citation revised.............................20508, 43277
    Technical correction...........................................50607
422.7  (d) amended.................................................20508
    (d) amended; interim...........................................43277
422.9  Revised......................................................3417
422.10  Added.......................................................3418
422.11  Added.......................................................3419
425.7  (d) amended.................................................20371
426  Removed.......................................................20508
430  Authority citation revised....................................20509
430.7  (d) amended.................................................20509
433  Authority citation revised....................................20510
433.7  (d) amended.................................................20510
435.7  (d) amended.................................................20372
436  Authority citation revised....................................20511
436.7  (d) amended.................................................20511
437  Authority citation revised....................................20512
437.7  (d) amended.................................................20512
443.7  (d) amended.................................................20373
454  Authority citation revised....................................48077
454.7  (d) amended.................................................48077
455  Authority citation revised....................................30007
455.5  Amended.....................................................30007

                                  1990

7 CFR
                                                                   55 FR
                                                                    Page
Chapter IV
400.41  Revised....................................................18097
    Correctly revised..............................................27182
400.301--400.309 (Subpart O)  Added................................32595
400.351--400.352 (Subpart P)  Added................................23069
401  Sales closing date extended....................................5436
401.8  (e) added; interim...........................................6972
    Regulation at 55 FR 6972 confirmed.............................40787
    (b) revised; (d) amended; eff. 1-10-91.........................50812
401.117  Amended; interim..........................................42552
    Amended; interim...............................................50813
401.118  Amended....................................................1785
401.123  Amended...................................................40788
401.133  Added.....................................................25955
401.138  Added.....................................................21739
401.139  Added......................................................1783
401.146  Added......................................................4395
403.7  (d) amended; interim........................................35888
405.7  (d) amended.................................................35555
    (d) amended; interim...........................................35888
406.7  (d) amended; interim........................................35888
409.7  (d) amended; interim........................................35888
    Regulation at 54 FR 38962 confirmed............................35888
414  Authority citation revised....................................50814
    Effective date corrected to 1-10-91............................53100
414.7  (d) amended.................................................50814
    Effective date corrected to 1-10-91............................53100
415  Authority citation revised....................................40789
415.7  (d) amended.................................................40789
416.7  (d) amended; interim........................................35888
422.7  (d) amended; interim........................................35888
    Regulation at 54 FR 43277 confirmed............................35889
425  Authority citation revised....................................49871
425.7  (d) amended; interim........................................35888
    (d) amended; interim...........................................49872
430.7  (d) amended; interim........................................35888
    (d) amended....................................................50815
    Effective date corrected to 1-10-91............................53235
433  Authority citation revised....................................50816
433.7  (d) amended.................................................50816
    Effective date corrected.......................................52130
435.7  (d) amended; interim........................................35888
437.7  (d) amended; interim........................................35888
441.7  (d) amended; interim........................................35888
443.7  (d) amended; interim........................................35888
445.7  (d) amended; interim........................................35888
446.7  (d) amended; interim........................................35888
447.7  (d) amended; interim........................................35888
450.7  (d) amended; interim........................................35888
451.7  (d) amended; interim........................................35888
454.7  (d) amended; interim........................................35888
455.7  (d) amended; interim........................................35887
456.7  Amended......................................................1786
    (d) amended; interim...........................................35887

[[Page 747]]

                                  1991

7 CFR
                                                                   56 FR
                                                                    Page
Chapter IV
400.65--400.66 (Subpart H)  Revised................................49390
401.8  (d) amended; interim........................................13577
401.111  Amended; interim..........................................58302
401.113  Amended; interim..........................................58302
401.117  Regulation at 55 FR 42552 confirmed........................3005
    Regulation at 55 FR 50813 confirmed............................36725
    Amended; interim...............................................58302
402  Removed.......................................................64940
404  Removed.......................................................64940
408  Removed.......................................................64940
410  Removed.......................................................64940
411  Removed.......................................................64940
413  Removed.......................................................64940
417  Removed.......................................................64940
418  Removed.......................................................64940
419  Removed.......................................................64940
420  Removed.......................................................64940
421  Removed.......................................................64940
423  Removed.......................................................64940
424  Removed.......................................................64940
427  Removed.......................................................64940
428  Removed.......................................................64940
429  Removed.......................................................64940
431  Removed.......................................................64940
432  Removed.......................................................64940
434  Removed.......................................................64940
436  Removed.......................................................64940
438  Removed.......................................................64940
439  Removed.......................................................64940
440  Removed.......................................................64940
442  Removed.......................................................64940
444  Removed.......................................................64940
448  Removed.......................................................64940
449  Removed.......................................................64940
452  Removed.......................................................64940
453  Removed.......................................................64940
434  Sunset review date extended...................................56569
435  Sunset review date extended...................................56569
441  Sunset review date extended...................................57231
445  Sunset review date extended...................................57971
446  Sunset review date extended...................................57971
447  Sunset review date extended...................................56569
451  Sunset review date extended...................................56569
457  Added..........................................................1351
458  Added; interim................................................30490

                                  1992

7 CFR
                                                                   57 FR
                                                                    Page
Chapter IV
400.27--400.29 (Subpart C)  Added; interim.........................56438
400.161  (i) revised...............................................34666
400.170  (c) revised...............................................34666
400.401--400.412 (Subpart Q)  Added................................46297
401  Sunset review date extended....................................2007
    Extension of sales closing date.........................44967, 44968
401.111  Amended; interim...........................................2008
401.113  Amended; interim...........................................2008
401.117  Amended; interim...........................................2008
401.120  Amended...................................................54682
406  Extension of sales closing date........................44968, 53211
406.7  Amended; interim............................................54683
422  Extension of sales closing date...............................44969
425  Revised.......................................................52585
425.7  Corrected...................................................56963
458  Regulation at 56 FR 30490 confirmed.............................173

                                  1993

7 CFR
                                                                   58 FR
                                                                    Page
Chapter IV
400.4  Revised.....................................................64873
400.27--400.29 (Subpart C)  Authority citation added...............67303
400.27  Revised....................................................67304
400.28  (a) introductory text and (c) revised......................67304
400.37--400.38 (Subpart D)  Heading revised........................17943
400.38  Amended....................................................17943
400.40--400.42 (Subpart E)  Removed................................53110
400.47  (a) revised; (d) and (e) removed; (f) through (i) 
        redesignated as (d) through (g)............................17945
400.49  Revised....................................................17945
400.50  Added......................................................17945
400.66  (b) table revised..........................................13531
400.250  Revised; interim..........................................36593
400.251  (a) and (b) amended; interim..............................36593

[[Page 748]]

400.252  Nomenclature change; (a) and (b) amended; interim.........36593
400.402  (e) and (k) revised; interim..............................47204
400.406  Revised; interim..........................................47204
400.451--400.500 (Subpart R)  Added................................53110
401  Extensions of sales closing date.......................21241, 53393
401.101  Amended; interim...................................33508, 67631
401.103  Amended; interim...................................33508, 67633
401.105  Amended; interim...................................33508, 67634
401.106  Amended; interim..........................................33508
401.107  (e) revised...............................................64874
401.108  (b) amended...............................................64874
401.109  Amended; interim..........................................67635
401.111  Amended;...................................................3205
    Amended; interim...............................................67637
401.113  Amended;...................................................3207
    Amended; interim...............................................67638
401.117  Amended;...................................................3209
    Amended; interim...............................................67639
401.119  Amended; interim..........................................67641
401.120  Amended; interim..........................................33507
    Amended; interim...............................................67642
401.121  Amended; interim..........................................67643
401.133  Amended; interim..........................................33509
406.7  Amended; interim.....................................33508, 46074
415.7  Amended; interim............................................33509
422  Exclusion of certified seed potato option.........................1
422.7  Amended; interim............................................33508
430.7  Amended;....................................................66250
443.7  Amended; interim............................................67645
457.2  (g) corrected...............................................58262
457.6  (a) corrected...............................................58262
457.8  Corrected............................................58262, 58263
Chapter VI
623  Added; interim................................................62497

                                  1994

7 CFR
                                                                   59 FR
                                                                    Page
Chapter IV
Chapter  IV Policy statement.......................................42487
400.51--400.57 (Subpart  G) Added..................................47787
400.402  (v) revised...............................................52408
400.411  Revised...................................................52408
406.7  Amended..............................................35614, 39414
457  Heading revised.........................................9391, 49154
    Authority  citation revised....................................67136
457.8  Amended.....................................................42751
457.9  Added; interim..............................................45972
457.101  Added......................................................9391
457.102  Added......................................................9397
457.103  Added......................................................9397
457.104  Added.....................................................49154
457.105  Added.....................................................49169
457.108  Added.....................................................67136
457.110  Added; interim.............................................9615
457.113  Added.....................................................49161
    Corrected......................................................60063
Chapter  VI
658  Authority citation revised....................................31117
658.2  (a) and (c) revised.........................................31117
658.3  (c) and (d) revised.........................................31117
658.4  (a) and (c)(2) revised; (g) and (h) added...................31118
658.7  (b) redesignated as (c); new (b) and (d) added..............31118

                                  1995

7 CFR
                                                                   60 FR
                                                                    Page
Chapter IV
400  Comment period reopening and extension........................40055
400.1--400.5 (Subpart A)  Authority citation revised...............40055
400.4  Amended.....................................................40055
400.90 (Subpart J)  Revised; interim; eff. 1-16-96.................67313
400.161--400.177 (Subpart L)  Authority citation revised....21036, 57903
    Heading revised................................................57903
400.161  (c), (d) and (j) removed; (a), (b), (e) through (i), (k), 
        (l) and (m) through (o) redesignated as (b), (c), (d) 
        through (h), (i), (j) and (l) through (n); new (a) and new 
        (k) added; new (e) revised.................................57903
400.162  Revised...................................................57903
400.163  Revised...................................................57903
400.169  Revised; interim..........................................21036
400.170  Revised...................................................57903
400.171  Revised...................................................57904
400.172  Revised...................................................57904
400.173  Removed...................................................57904
400.174  Amended...................................................57904
400.175  (a) amended...............................................57904
400.177  Removed...................................................57904
400.451--400.500 (Subpart R)  Authority citation revised...........37323
400.454  (a) revised...............................................37323
400.458  Added.....................................................37324
400.459  Added.....................................................37324
    Correctly revised..............................................51321

[[Page 749]]

400.650--400.658 (Subpart T)  Added; interim........................1997
401  Authority citation revised...............29749, 29960, 56934, 62720
401.101  Regulation at 58 FR 67631 confirmed.......................37934
    Introductory text revised......................................56934
401.102  Amended; introductory text revised........................56934
401.103  Regulation at 58 FR 67633 confirmed.......................37934
    Introductory text revised......................................56934
401.104  Amended...................................................56934
401.105  Regulation at 58 FR 67634 confirmed.......................37934
    Introductory text revised......................................56934
401.106  Introductory text revised.................................56934
401.107  (e) revised...............................................40056
401.109  Amended.....................................29960, 62720, 62721
    Regulation at 58 FR 67635 confirmed............................37934
401.111  Regulation at 58 FR 67637 confirmed.......................37934
    Introductory text revised......................................56934
401.112  Amended; introductory text revised........................56934
401.113  Regulation at 58 FR 67638 confirmed.......................37934
    Introductory text revised......................................56934
401.116  Introductory text revised.................................56934
401.117  Regulation at 58 FR 67639 confirmed.......................37934
    Introductory text revised......................................56934
401.119  Regulation at 58 FR 67641 confirmed.......................37934
    Introductory text revised......................................56934
401.120  Amended.....................................29960, 62721, 62722
    Regulation at 58 FR 67642 confirmed............................37934
    Corrected; CFR correction......................................62321
401.121  Regulation at 58 FR 67643 confirmed.......................37934
    Introductory text revised......................................56934
401.124  Introductory text revised.................................56934
401.125  Introductory text revised.................................56934
401.133  Introductory text revised.................................56934
401.135  Introductory text revised.................................56935
401.143  Amended; interim..........................................29750
    Regulation at 60 FR 29750 confirmed............................62190
402  Added; interim.................................................2002
    Comment period reopening and extension.........................40055
404  Added; interim................................................26671
    Comment period reopening and extension.........................40055
406  Authority citation revised....................................56935
406.7  (d) introductory text revised...............................56935
443  Authority citation revised.............................29960, 62722
443.7  (d) amended...................................29960, 62722, 62723
    Regulation at 58 FR 67645 confirmed............................55781
457  Authority citation revised....................................62723
457.9  Regulation at 59 FR 45972 confirmed.........................16765
457.101  Amended............................................35834, 62723
457.104  Amended............................................35834, 62725
457.105  Amended............................................35834, 62726
457.108  Amended............................................29960, 62727
457.110  Regulation at 59 FR 9615 confirmed........................37934
457.113  Amended.....................................35834, 62728, 62729
457.114  Added.....................................................31378
457.115  Added.....................................................31380
457.116  Added.....................................................25602
Chapter V
510  Revised.......................................................66062
Chapter VI
Chapter  VI Heading revised; nomenclature change; interim..........28514
614  Revised; interim; eff. 1-16-96................................67313
620  Added; interim................................................28514
620.2  (1) corrected...............................................33034
620.4  (d)(3), (3)(iv) and (f) corrected...........................33034
620.12  (a)(1) corrected...........................................33034
620.14  (d) corrected..............................................33034
620.17  (a) revised; interim; eff. 1-16-96.........................67316
623.20  Revised; interim; eff. 1-16-96.............................67316
631.13  Revised; interim; eff. 1-16-96.............................67316
632.40  Revised; interim; eff. 1-16-96.............................67316
634.30  Revised; interim; eff. 1-16-96.............................67316
663.17  Revised; interim; eff. 1-16-96.............................67316

[[Page 750]]

                                  1996

7 CFR
                                                                   61 FR
                                                                    Page
Chapter IV
400.47  (b), (c) and (e) removed; (d), (f) and (g) redesignated as 
        (b), (c) and (d); interim..................................38058
400.48  (b) removed; (c) redesignated as (b); interim..............38058
400.49  Removed; interim...........................................38058
400.50  Removed; interim...........................................38058
400.161--400.177 (Subpart L)  Authority citation revised...........34368
400.168  (b) and (c) revised.......................................34368
    (c) corrected..................................................65153
400.169  Regulation at 60 FR 21036 confirmed.......................39269
    Regulation at 60 FR 21035 confirmed............................40954
400.650--400.659 (Subpart T)  Regulation at 60 FR 1997 confirmed; 
        revised....................................................42975
401.8  Amended; interim............................................39050
401.143  Introductory text revised; eff. 1-30-97...................69001
402  Revised.......................................................42985
404  Revised........................................................7200
    Removed........................................................69011
433  Authority citation revised....................................68543
433.7  Amended; interim............................................68543
457.107  Added; eff. 1-30-97.......................................69002
457.109  Added.....................................................58775
457.111  Added.....................................................57580
457.118  Added......................................................8855
    Corrected......................................................27245
457.119  Added.....................................................41300
    Corrected......................................................57583
457.121  Added.....................................................44147
Chapter V
500  Heading revised...............................................65302
    Authority citation revised.....................................65302
500.1  Revised.....................................................65302
500.2  Revised.....................................................65302
500.4  Revised.....................................................65302
500.6  Revised.....................................................65302
500.7  Revised.....................................................65302
500.8  Revised.....................................................65302
500.9  Revised.....................................................65302
500.10  Revised....................................................65302
500.11  Revised....................................................65302
500.12  Revised....................................................65303
500.13  Revised....................................................65303
502  Heading revised...............................................51211
    Authority citation revised.....................................51211
502.1  Revised.....................................................51211
502.2  Revised.....................................................51211
502.4  Revised.....................................................51211
502.5  Revised.....................................................51211
502.6  Revised.....................................................51211
502.7  Revised.....................................................51211
502.8  Revised.....................................................51211
502.9  Revised.....................................................51211
502.10  Revised....................................................51212
502.11  Revised....................................................51212
502.12  (a), (b) and (c) revised...................................51212
502.13  Removed; new 502.13 redesignated from 502.14 and revised 
                                                                   51212
502.14  Redesignated as 502.13; new 502.14 redesignated from 
        502.15 and revised.........................................51212
502.15  Redesignated as 502.14; new 502.15 redesignated from 
        502.16 and revised.........................................51212
502.16  Redesignated as 502.15; new 502.16 redesignated from 
        502.17.....................................................51212
502.17  Redesignated as 502.16.....................................51212
Chapter VI
Chapter  VI Regulation at 60 FR 28514 confirmed....................42141
    Forums.........................................................52671
610  Authority citation revised....................................27999
610.1--610.5 (Subpart A)  Subpart designation added................27999
610.1  Revised.....................................................27999
610.11--610.14 (Subpart B)  Added..................................27999
620  Regulation at 60 FR 28514 confirmed; redesignated as Part 
        1467.......................................................42141
651  Removed.......................................................66867
663  Removed.......................................................41949

                                  1997

7 CFR
                                                                   62 FR
                                                                    Page
Chapter IV
400.301--400.309 (Subpart O)  Authority citation revised...........22876
400.301  Revised...................................................22876
400.302  Amended...................................................22876
400.303  (a) revised; (b) redesignated as (c); (b), (d) and (e) 
        added......................................................22876
400.305  (b) and (c) introductory text revised.....................22877
400.307  Revised...................................................22877
400.309  (e) removed; (f) redesignated as (e); (a) and new (e) 
        revised....................................................22877
400.401--400.412 (Subpart Q)  Authority citation revised...........28608

[[Page 751]]

400.401  (a) and (b)(1) through (4) revised........................28608
400.402  Revised...................................................28608
400.403  Revised...................................................28608
400.404  Revised...................................................28608
400.405  Redesignated as 400.406...................................28608
    Added..........................................................28609
400.406  Redesignated as 400.407; new 400.406 redesignated from 
        400.405....................................................28608
    Revised........................................................28609
400.407  Redesignated as 400.408; new 400.407 redesignated from 
        400.406....................................................28608
    Revised........................................................28609
400.408  Redesignated as 400.409; new 400.408 redesignated from 
        400.407....................................................28608
    Revised........................................................28609
400.409  Redesignated as 400.410; new 400.409 redesignated from 
        400.408....................................................28608
400.410  Redesignated as 400.411; new 400.410 redesignated from 
        400.409....................................................28608
400.411  Redesignated as 400.412; new 400.411 redesignated from 
        400.410....................................................28608
    Introductory text and (a) revised..............................28609
400.412  Redesignated as 400.413; new 400.412 redesignated from 
        400.411....................................................28608
    Revised........................................................28609
400.413  Redesignated from 400.412.................................28608
    Revised........................................................28609
400.454  (a) introductory text amended.............................40928
400.675--400.683 (Subpart U)  Added................................42042
401  Heading correctly revised.....................................13983
    Authority citation revised..............................54342, 63633
401.8  (d) introductory text revised...............................42649
401.109  Revised...................................................65318
401.110  Introductory text amended.................................25108
401.114  Introductory text revised.................................54342
    Amended; interim...............................................63633
401.118  Introductory text revised.................................58624
401.120  Introductory text revised.................................28310
    Amended; interim...............................................63633
401.123  Introductory text revised.................................42649
401.126  Introductory text revised.................................28613
401.127  Introductory text amended..................................5905
401.130  Introductory text revised.................................33741
401.134  Introductory text revised..................................4117
401.137  Introductory text revised.................................14777
401.138  Introductory text revised.................................14783
401.139  Introductory text revised.................................14777
401.142  Introductory text revised.................................12070
401.146  Introductory text revised.................................33735
403  Heading and authority citation revised........................39923
403.1--403.7  (Subpart) Heading removed............................39923
403.7  (d) introductory text revised...............................39923
412  Revised.......................................................67694
414  Authority citation revised....................................13291
414.1--414.7  (Subpart) Heading revised............................13291
414.7  (d) introductory text revised...............................13291
415  Authority citation revised....................................14285
415.1--415.7  (Subpart) Heading revised............................14285
415.7  (d) introductory text revised...............................14285
416  Heading and authority citation revised........................61903
416.1--416.7  (Subpart) Heading removed............................61903
416.7  (d) introductory text revised...............................61903
422  Authority citation amended....................................65330
422.1--422.11  (Subpart) Undesignated center heading revised.......65330
422.7  (d) introductory text revised...............................65331
433.1--433.7  (Subpart) Heading revised.............................6105
433.7  (d) introductory text revised................................6105
437  Heading and authority citation revised........................65342

[[Page 752]]

437.1--437.7  (Subpart) Heading removed............................65342
437.7  (d) introductory text revised...............................65342
441  Heading and authority citation revised........................47747
441.1--441.7  (Subpart) Heading removed............................47747
441.7  (d) introductory text revised...............................47747
443  Heading revised...............................................65349
443.1--433.7  (Subpart) Heading removed............................65349
443.7  (d) introductory text revised...............................65349
445  Authority citation revised....................................14789
445.1--445.7  (Subpart) Heading revised............................14789
445.7  (d) introductory text revised...............................14789
446.1--446.7  (Subpart) Heading revised............................20091
446.7  (d) introductory text revised...............................20091
450  Heading and authority citation revised........................58630
450.1--450.7  (Subpart) Heading removed............................58630
450.7  (d) introductory text revised...............................58630
454  Heading revised...............................................23631
    Authority citation revised.....................................63633
454.1--454.7  (Subpart) Heading removed............................23631
454.7  Introductory text revised...................................23631
    (d) amended; interim...........................................63633
455  Authority citation revised.............................35662, 35664
    Heading revised................................................35664
455.1--455.7  (Subpart) Heading removed............................35664
455.7  (d) amended; interim........................................35662
    (d) introductory text revised..................................35664
456  Heading and authority citation revised........................35668
456.1--456.7  (Subpart) Heading removed............................35668
456.7  (d) introductory text revised...............................35668
457  Authority citation revised....................................63633
457.2  (b), (c) and (d) revised; (e) removed; (f), (g) and (h) 
        redesignated as (e), (f) and (g)...........................65154
457.4  Revised (OMB numbers).......................................65154
457.8  (b) revised.................................................65154
    Amended........................................................65155
457.101  Amended...................................................65164
457.104  Amended......................................7134, 65164, 65165
    Amended; interim...............................................63633
457.105  Amended.............................................6704, 65165
    Amended; interim...............................................63633
457.106  Added......................................................4117
    Amended........................................................65166
457.107  Amended...................................................65166
457.108  Amended; interim..........................................63633
    Amended.................................................65166, 65167
457.109  Amended; interim..........................................63633
    Amended........................................................65167
457.110  Amended...................................................65167
457.111  Corrected..................................................2007
    Amended.................................................65167, 65168
457.112  Added.....................................................65318
457.113  Amended; interim..........................................63633
    Amended........................................................65168
457.114  Amended...................................................65169
457.116  Amended...................................................65169
457.117  Added.....................................................14285
    Amended........................................................65169
457.119  Amended...................................................65169
457.121  Amended...................................................65170
457.122  Added.....................................................20091
    Amended........................................................65170
457.123  Added.....................................................25108
    Amended........................................................65170
457.124  Added.....................................................12070
    Amended.................................................65170, 65171
457.125  Added.....................................................42649
    Amended........................................................65171
457.127  Added.....................................................14287
457.128  Added.....................................................23631
    (b)(7) and (c)(1)(iii)(A) correctly revised....................33539
    Amended........................................................65171
457.129  Added.....................................................14783
    Corrected......................................................26205
    Amended.................................................65171, 65172
457.130  Added.....................................................35668
    Amended........................................................65172
457.131  Added.....................................................35664
    Amended........................................................65172
457.132  Added......................................................5905
    Amended........................................................65172
457.133  Added.....................................................58630
    Amended.................................................65172, 65173
457.135  Added.....................................................28613
    Amended........................................................65173
457.137  Added.....................................................61903
    Amended........................................................65173
457.138  Added.....................................................33741
    Amended.................................................65173, 65174
457.139  Added.....................................................14777
    Corrected......................................................63634

[[Page 753]]

    Amended........................................................65174
457.140  Added.....................................................65744
457.141  Added.....................................................28310
    Amended........................................................65174
457.142  Added.....................................................65331
457.143  Added.....................................................65335
457.144  Added.....................................................65336
457.145  Added.....................................................65337
457.146  Added.....................................................65337
457.147  Added.....................................................65333
457.148  Added.....................................................14789
    Amended.................................................65174, 65175
457.149  Added.....................................................47747
    Amended........................................................65175
457.150  Added......................................................6105
    Amended; interim...............................................63633
    Amended........................................................65175
457.151  Added.....................................................13291
    Amended.................................................65175, 65176
457.152  Added.....................................................65350
    Corrected......................................................67117
457.153  Added.....................................................39923
    Amended........................................................65176
457.154  Added.....................................................65342
457.155  Added.....................................................58625
    Amended........................................................65176
457.157  Added.....................................................33735
    Amended........................................................65177
457.160  Added.....................................................54342
    Amended........................................................65177
457.161  Added.....................................................65997
Chapter V
500  Heading and authority citation revised........................46432
500.1--500.15 (Subpart A)  Sections designated as Subpart A........46432
500.20--500.24 (Subpart B)  Added..................................46432
500.22  Effective date pending.....................................46431
    Regulation at 62 FR 46431 eff. 10-30-97........................58632
500.23  Effective date pending.....................................46431
    Regulation at 62 FR 46431 eff. 10-30-97........................58632
Chapter VI
600  Revised.......................................................16659
601  Revised.......................................................16660
633  Added.........................................................48472
636  Added.........................................................49365
650.26  Removed....................................................61217

                                  1998

7 CFR
                                                                   63 FR
                                                                    Page
Chapter IV
400.650--400.6597  Subpart T) Heading revised; interim.............40633
400.651  Amended; interim..........................................40634
400.655  Removed; new 400.655 redesignated from 400.657............40634
400.656  Removed; new 400.656 redesignated from 400.658............40634
400.657  Redesignated as 400.655; new 400.657 redesignated from 
        400.659....................................................40634
400.658  Redesignated as 400.656...................................40634
400.659  Redesignated as 400.657...................................40634
400.677  Amended; interim..........................................40631
400.765--400.768  (Subpart X) Added................................70313
401  Heading revised...............................................29935
401.114  Regulation at 62 FR 63633 confirmed.......................14334
401.120  Regulation at 62 FR 63633 confirmed.......................14334
401.122  Introductory text revised.................................29935
401.129  Introductory text revised.................................34551
402  Heading revised; interim......................................40631
402.4  Introductory text revised; interim..........................40631
    Amended; interim...............................................40632
405  Heading and authority citation revised........................17053
405.1--405.9  (Subpart) Heading removed............................17053
405.7 (d) introductory text revised................................17054
406  Heading and authority citation revised........................50975
406.1--406.7 (Subpart) Heading removed.............................50975
425  Heading and authority citation revised........................31335
425.1--425.7  (Subpart) Heading removed............................31335
425.7 (d) introductory text revised................................31335
435  Heading and authority citation revised........................34782
435.1--435.7  (Subpart) Heading revised............................34782
435.7  (d) introductory text revised...............................34782
447  Heading and authority citation revised........................33838
447.1--447.7 (Subpart) Heading removed.............................33838

[[Page 754]]

447.7 (d) introductory text revised................................33838
454.7 Regulation at 62 FR 63633 confirmed..........................14334
457 Heading revised.........................................17054, 55779
457.2 (e) amended..................................................66712
    457.8 Amended; interim................................40634, 66712--
                                                                   66714
457.104 Regulation at 62 FR 63633 confirmed........................14334
    Introductory text revised......................................55497
    Amended........................................................66717
457.105 Regulation at 62 FR 63633 confirmed........................14334
    Introductory text revised......................................55497
    Amended........................................................66717
457.106 Amended....................................................55779
457.108 Regulation at 62 FR 63633 confirmed........................14334
457.109 Regulation at 62 FR 63633 confirmed........................14334
457.113 Regulation at 62 FR 63633 confirmed........................14334
457.114  Introductory text revised.................................50975
457.126  Added.....................................................33838
457.128  Corrected.................................................36157
    Amended........................................................50753
457.134  Added.....................................................31335
    Corrected......................................................52134
457.136  Added.....................................................34552
457.138  Corrected.................................................31338
457.140  Amended...................................................36157
457.150  Regulation at 62 FR 63633 confirmed.......................14334
457.156  Added.....................................................34782
457.158  Added.....................................................17054
457.159  Added.....................................................29935
457.162  Added.....................................................50975
    Corrected......................................................57046
457.163  Added.....................................................50979
    Corrected......................................................57047


                                  
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