[Congressional Record (Bound Edition), Volume 145 (1999), Part 4]
[Senate]
[Pages 6047-6048]
[From the U.S. Government Publishing Office, www.gpo.gov]




                  MAKING OF RISK MANAGEMENT DECISIONS

  Mr. ENZI. I ask unanimous consent that the Senate proceed to the 
immediate consideration of S. 756 introduced earlier today by Senator 
Lincoln and Senator Hutchinson
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report.
  The legislative clerk read as follows:

       A bill (S. 756) to provide adversely affected crop 
     producers with additional time to make fully informed risk 
     management decisions for the 1999 crop year.

  There being no objection the Senate proceeded to consider the bill.
  Mrs. LINCOLN. Mr. President, this bill addresses a crop insurance 
crisis that is plaguing my home state of Arkansas.
  As many of you know, the outlook for the agricultural economy is very 
bleak for many parts of the country. As farmers in Arkansas and other 
states making their planting decisions for the upcoming growing season, 
they were offered what seemed to be a light at the end of the tunnel. A 
crop insurance policy entitled CRCPlus.
  CRCPlus is a supplemental crop insurance policy available only from 
America Agrisurance, Inc. and is offered on corn, cotton, grain 
sorghum, soybeans, wheat and rice in several states. For Arkansas' rice 
growers, the original CRCPlus policies offered what appeared to be a 
financially viable risk management tool by adding a privately backed 3 
cents per pound to the underlying federal Crop Revenue Coverage (CRC) 
policies. This placed the guaranteed fall price for rice at a level 
above projected prices. With commodity prices depressed across the 
board, a large number of farmers decided to switch to growing rice 
based on this ``too good to be true'' offer.
  At a time when the agricultural climate in Arkansas is devastated to 
begin with, these policies were a last ray of hope for hundreds of 
farmers. Now, essentially, American Agrisurance has pulled the rug out 
from under these families. On March 1, the company reneged, saying it 
would reduce the additional guarantee of coverage from 3 cents to 11/2 
cents per pound. This announcement came after the sales period for crop 
insurance was closed, leaving many producers with a product they would 
not have otherwise purchased. Many producers felt they had been misled 
and I tend to agree. I am very thankful to Secretary of Agriculture Dan 
Glickman and Risk Management Agency Director, Ken Ackerman for their 
assistance in opening the cancellation period for crop insurance over 
the last two weeks so that the affected producers had more time to 
evaluate whether to keep the CRCPlus policies. This extra time eased 
the mind of many producers in my state during a very troubling period. 
During this extended cancellation period many producers reevaluated the 
cost/benefit ratios calculated at the 11/2 cent level rather than the 3 
cent level. Several producers canceled their policies with American 
Agrisurance, but many producers decided that the coverage offered was 
still sufficient to provide protection during a very volatile growing 
season and opted to stick with American Agrisurance and the CRCPlus 
policy. I wish the story ended here.
  American Agrisurance has since indicated that due to a problem with 
its reinsurers, they may not be able to live up to the additional 11/2 
cents of coverage on policies currently held by many producers. The 
company is reviewing its financial status and will announce on March 
25th whether or not the 11/2 cent polices will be honored. This 
situation has further clouded the outlook for producers and left them 
wondering what to believe and who to trust.
  Regardless of the company's excuses for its actions, it is now 
imperative that farmers who were wronged by this company be able to 
withdraw their business. I have been working with the Administration, 
the distinguished Chairman of the Senate Agriculture Committee Chairman 
Lugar, and several other members of the Senate Agriculture Committee to 
draft legislation that addresses our producers' needs. This bill allows 
the Department of Agriculture to reopen the crop insurance sales period 
so that producers affected by the uncertainty of the CRCPlus situation 
can transfer to another approved insurance provider.
  Farmers are on the verge of planting, so a swift response is 
necessary to clear

[[Page 6048]]

up the confusion over their insurance protection. As the daughter of a 
seventh generation Arkansas farm family, I truly understand that in 
situations like this it's the farmer who gets left holding the bag. 
Each year, farmers go out on a limb and make critical planting 
decisions based on obligations and promises. My heart goes out to all 
who have made plans based on these policies. I urge my colleagues to 
act quickly on this matter so that a wrong can be righted in America's 
heartland. Thank you, Mr. President. I yield the floor.
  Mr. ENZI. I ask unanimous consent that the bill be considered read 
the third time, and passed, the motion to reconsider be laid upon the 
table, and that any statements relating to the bill appear in the 
Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The bill (S. 756) was considered read the third time and passed, as 
follows:

                                 S. 756

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. CROP INSURANCE OPTIONS FOR PRODUCERS WHO APPLIED 
                   FOR CROP REVENUE COVERAGE PLUS.

       (a) Eligible Producers.--This section applies with respect 
     to a producer eligible for insurance under the Federal Crop 
     Insurance Act (7 U.S.C. 1501 et seq.) who applied for the 
     supplemental crop insurance endorsement known as Crop Revenue 
     Coverage PLUS (referred to in this section as ``CRCPLUS'') 
     for the 1999 crop year for a spring planted agricultural 
     commodity.
       (b) Additional Period for Obtaining or Transferring 
     Coverage.--Notwithstanding the sales closing date for 
     obtaining crop insurance coverage established under section 
     508(f)(2) of the Federal Crop Insurance Act (7 U.S.C. 
     1508(f)(2)) and notwithstanding any other provision of law, 
     the Federal Crop Insurance Corporation shall provide a 14-day 
     period beginning on the date of enactment of this Act, but 
     not to extend beyond April 12, 1999, during which a producer 
     described in subsection (a) may--
       (1) with respect to a federally reinsured policy, obtain 
     from any approved insurance provider a level of federally 
     reinsured coverage for the agricultural commodity for which 
     the producer applied for the CRCPLUS endorsement that is 
     equivalent to or less than the level of federally reinsured 
     coverage that the producer applied for from the insurance 
     provider that offered the CRCPLUS endorsement; and
       (2) transfer to any approved insurance provider any 
     federally reinsured coverage provided for other agricultural 
     commodities of the producer by the same insurance provider 
     that offered the CRCPLUS endorsement, as determined by the 
     Corporation.

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