[Federal Register Volume 60, Number 4 (Friday, January 6, 1995)]
[Rules and Regulations]
[Pages 1996-2000]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-358]



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DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation

7 CFR Part 400


Subpart T--Federal Crop Insurance Reform Act of 1994; Regulations 
for Implementation

RIN 0563-AB11
AGENCY: Federal Crop Insurance Corporation.

ACTION: Interim rule.

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SUMMARY: The Federal Crop Insurance Corporation (``FCIC'') hereby 
amends its General Administrative Regulations located at 7 CFR part 400 
by adding subpart T. The intended effect of this interim rule is to 
provide noninsured producers, policyholders and insurance companies the 
policies and regulations applicable to the Catastrophic Risk Protection 
Program and provide other changes in FCIC insurance programs to comply 
with the statutory mandates of the Federal Crop Insurance Act as 
amended by the Federal Crop Insurance Reform Act of 1994.

DATES: This rule is effective January 6, 1995. Written comments, data, 
and opinions on this rule will be accepted until close of business 
March 7, 1995 and will be considered when the rule is to be made final.

ADDRESSES: Written comments, data, and opinion on this interim rule 
should be sent to Diana Moslak, Regulatory and Procedural Development 
Staff, Federal Crop Insurance Corporation, USDA, Washington, D.C. 
20250. Hand or messenger delivery may be made to Suite 500, 2101 L 
Street, N.W., Washington D.C. Written comments will be available for 
public inspection and copying in the Office of the Manager, 2101 L 
Street, N.W., 5th Floor, Washington, D.C., during regular business 
hours, Monday through Friday.

FOR FURTHER INFORMATION CONTACT: For further information and a copy of 
the Regulatory Impact Analysis to the regulations for implementation of 
the Federal Crop Insurance Reform Act of 1994, contact Diana Moslak, 
Federal Crop Insurance Corporation, U.S. Department of Agriculture, 
Washington, D.C. 20250. Telephone (202) 254-8314.

SUPPLEMENTARY INFORMATION: This action has been reviewed under United 
States Department of Agriculture (``USDA'') procedures established by 
Executive Order 12866 and Departmental Regulation 1512-1. This action 
constitutes a review as to the need, currency, clarity, and 
effectiveness of these regulations under those procedures. The sunset 
review date established for these regulations is December 1, 1999.
    This rule has been determined to be ``economically significant'' 
for the purposes of Executive Order 12866, and therefore, has been 
reviewed by the Office of Management and Budget (``OMB'').
    A Regulatory Impact Analysis has been completed and is available to 
interested persons at the address listed above. In summary, the 
analysis finds that crop insurance reform generally is expected to 
result in net positive benefits to producers, taxpayers, and society. 
The effects on individual producers compared to payments under ad hoc 
disaster programs depends primarily on the farm program payment yield 
compared to the farm's actual yield and market prices. In general, 
however, the reform is expected to result in less volatility of 
producer's incomes and lesser risk of no income due to adverse weather 
events. Rural communities and farmers will benefit from the certainty 
of payments in times of catastrophic yield losses. The Government and 
taxpayers will benefit from a single disaster protection program and 
consequent reduced Federal outlays. Although some producers (previous 
non-participants in crop insurance) will have an added burden to make 
application and report yields and acreage, the benefits in terms of 
greater risk protection outweigh the costs.
    The information collection and record-keeping requirements set 
forth in this interim rule have been submitted to OMB for emergency 
clearance under 7 CFR part 402.
    It has been determined under section 6(a) of Executive Order 12612, 
Federalism, that this rule does not have sufficient federalism 
implication to warrant the preparation of a Federalism Assessment. The 
provisions and procedures contained in this rule will not have a 
substantial direct effect on states or their political subdivisions, or 
on the distribution of power and responsibilities among the various 
levels of government.
    Under the Regulatory Flexibility Act (5 U.S.C. Sec. 605), this 
regulation will not have a significant impact on a substantial number 
of small entities. Producers will be able to certify to their 
historical production levels at the time of application based on 
existing records, or they may elect to base their insurance on assigned 
yields, which will not require maintenance of production records by the 
insurance agent. The [[Page 1997]] amount of data collected by the 
agent for new insureds is not greater than the amount of data collected 
for existing insureds. Insureds may elect to keep production records to 
increase the amount of production covered by insurance but such 
production is not required to participate in the program. The benefits 
in terms of risk reduction and protection from severe losses will out-
weigh any record-keeping costs. Therefore, this action is determined to 
be exempt from the provisions of the Regulatory Flexibility Act and no 
Regulatory Flexibility Analysis was prepared.
    This program is listed in the Catalog of Federal Domestic 
Assistance under No. 10.450.
    This program is not subject to the provisions of Executive Order 
12372 which require intergovernmental consultation with State and local 
officials. See the Notice related to 7 CFR part 3015, subpart V, 
published at 48 FR 29115, June 24, 1983.
    The Office of the General Counsel has determined that these 
regulations meet the applicable standards provided in subsections 2(a) 
and 2(b)(2) of Executive Order 12778. The provisions of this rule will 
preempt state and local laws to the extent such state and local laws 
are inconsistent herewith. The administrative appeal provisions located 
at 7 CFR part 400, subpart J, and for catastrophic risk protection 
contracts of insurance delivered through local USDA offices, the 
National Appeal Division administrative appeal provisions under the 
Department of Agriculture Reorganization Act of 1994 must be exhausted 
before judicial action may be brought.
    This action is not expected to have any significant impact on the 
quality of the human environment, health, and safety. Therefore, 
neither an Environmental Assessment nor an Environmental Impact 
Statement is needed.
    This interim rule implements programs mandated by the amendments to 
the Federal Crop Insurance Act by the Federal Crop Insurance Reform Act 
of 1994. Those amendments required that the statutory changes be 
implemented for the 1995 crop year. All of the contract change dates 
and many of the sales closing dates for 1995 insured crops have passed 
or will soon pass. Many of the changes contained in these regulations 
are mandated by statute. Planting decisions for 1995 crops have been or 
will shortly be made and it is necessary that producers, lenders, and 
suppliers know the parameters and requirements of the program. 
Therefore, it is impractical and contrary to the public interest to 
publish this rule for notice and comment prior to making the rule 
effective. However, comments are solicited for 60 days after the date 
of publication in the Federal Register and will be considered by FCIC 
before this rule is made final.
    On October 13, 1994, the amendments to the Federal Crop Insurance 
Act made by the Federal Crop Insurance Reform Act of 1994, were 
effective. This regulation will provide the policy and procedures to 
carry out the insurance requirements of the Reform Act. A separate part 
will be issued to address noninsured assistance.

List of Subjects in 7 CFR Part 400, Subpart T

    General administrative regulations, Federal Crop Insurance Reform 
Act of 1994, Insurance.

Interim Rule

    For the reasons set out in the preamble, a new subpart T is added 
to 7 CFR part 400, effective for the 1995 and succeeding crop years, to 
read as follows:

PART 400--GENERAL ADMINISTRATIVE REGULATIONS

Subpart T--Federal Crop Insurance Reform Act of 1994, Insurance 
Implementation; Regulations for the 1995 and Subsequent Crop Years

Sec.
400.650  Purpose.
400.651  Definitions.
400.652  Insurance availability.
400.653  Application and acreage report.
400.654  Coverage provided.
400.655  Administrative fees and waivers.
400.656  Eligibility for other program benefits.
400.657  Coverage for acreage that is prevented from being planted.
400.658  Transitional yield for forage or feed crops, 1995-1997 crop 
years.

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


Sec. 400.650  Purpose.

    The Federal Crop Insurance Act as amended by the Federal Crop 
Insurance Reform Act of 1994 (the ``Act'') requires the Federal Crop 
Insurance Corporation (``FCIC'') to implement a crop insurance program 
which 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 new crop insurance options and 
establishes provisions and requirements for implementation of the 
insurance provisions of the Act. The regulations for the noninsured 
assistance provisions of the Act will be published elsewhere in chapter 
IV.


Sec. 400.651  Definitions.

    (a) Additional coverage--A plan 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.
    (b) Approved insurance provider--A private insurance company, 
including their agents, that has been approved and reinsured by FCIC to 
provide insurance coverage to producers participating in the Federal 
crop insurance program.
    (c) Approved yield--The average amount of production per acre 
obtained under FCIC's Actual Production History Program (7 CFR part 
400, subpart G) using production records of the insured or yields 
assigned by FCIC. At least four crop years of yields must be averaged 
to obtain the approved yield.
    (d) Catastrophic risk protection endorsement--The part of the crop 
insurance policy that contains provisions of insurance that are 
specific to catastrophic risk protection.
    (e) Catastrophic risk protection--The minimal level of coverage 
offered by FCIC, which is required before a person may qualify for 
certain other United States Department of Agriculture (``USDA'') 
program benefits. For the 1995 through 1998 crop years, such coverage 
will be 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 be 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.
    (f) 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 by the producer in the county. 
However, notwithstanding the preceding sentence, if the total expected 
liability under the catastrophic risk protection endorsement is equal 
to or less than the administrative fee required for the crop, such crop 
will not be considered a crop of economic significance.
    (g) FCIC--The Federal Crop Insurance Corporation, a wholly owned 
Government Corporation within the [[Page 1998]] Consolidated Farm 
Services Agency, USDA.
    (h) Limited coverage--A plan 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 as established by FCIC, 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 
as established by FCIC.
    (i) Limited resource farmer--A producer or operator of a small or 
family farm, including a new producer or operator, with an annual gross 
income of less than $20,000 derived from all sources of revenue for 
each of the prior two years and who demonstrates a need to maximize 
farm income. Notwithstanding the preceding sentence, a producer on a 
farm of less than 25 acres aggregated for all crops, where the producer 
derives a majority of the producer's gross income from the farm, but 
the producer's gross income from farming operations does not exceed 
$20,000, will be considered a limited resource farmer.
    (j) 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.
    (k) Secretary--The Secretary of the United States Department of 
Agriculture.


Sec. 400.652  Insurance availability.

    (a) If sufficient actuarial data are available FCIC will offer 
catastrophic risk protection, limited, and additional 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 will be offered through 
approved insurance providers and through local offices of the 
Consolidated Farm Service Agency, USDA. Limited and additional coverage 
will only be offered through approved insurance providers unless 
approved insurance providers are not available.
    (c) To obtain catastrophic risk protection coverage on a crop, a 
person must obtain catastrophic risk protection coverage for the crop 
on all insurable acreage in the county. Catastrophic risk protection 
coverage must be obtained on or before the sales closing date 
designated by FCIC for the crop in the county.
    (d) Effective for the 1995 crop year only, and only for 
catastrophic risk protection, notwithstanding any provision in any crop 
insurance policy, reinsured by FCIC, the sales closing dates will be as 
follows:
    (1) For those crops for which insurance attached before January 1, 
1995, the sales closing date will be the latest sales closing date for 
spring planted crops in the county as long as such sales closing date 
is not later than April 12, 1995;
    (2) For those crops for which insurance attached after January 1, 
1995, and have a sales closing date prior to February 15, 1995, the 
sales closing date will be February 15, 1995; and
    (3) For all other spring planted crops, the sales closing date will 
remain as specified in the policy.
    (e) For limited and additional coverage, in areas where insurance 
is not available for a particular agricultural commodity, FCIC may 
offer to enter into a written agreement with a person to insure the 
commodity, if the person has actuarially sound data relating to the 
production of the commodity that is acceptable to FCIC and if such 
written agreement is specifically allowed by the crop insurance 
regulations applicable to the crop.
    (f) A person who made timely purchase of a crop insurance policy on 
a 1995 or subsequent crop before October 13, 1994, the date of 
enactment of the Federal Crop Insurance Reform Act of 1994, may 
continue with the purchased policy under the terms and conditions of 
that policy but will receive whatever benefits would be available under 
that policy if it had been purchased subsequent to the date of 
enactment. However, if the level of coverage is less than the coverage 
under the catastrophic risk protection coverage, the insured must 
either upgrade that coverage to at least catastrophic risk protection 
coverage or lose eligibility for certain farm program benefits as set 
out in Sec. 400.656.


Sec. 400.653  Application and acreage report.

    (a) To participate in catastrophic risk protection, limited, or 
additional coverage plans of insurance, a person 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 set 
out in Sec. 400.656, a producer must obtain at least catastrophic risk 
protection coverage on all crops of economic significance if 
catastrophic risk protection is available. Notwithstanding the 
requirement contained in Sec. 400.653 (a), if the insured is not able 
to plant a crop for which coverage has been obtained, FCIC may, at its 
discretion, determine that conditions exist that would permit the 
person to insure alternative crops to those specified on the 
application. If FCIC determines that such conditions exist, the insured 
may insure the alternative crops by making application for catastrophic 
risk protection coverage on the alternative crops after the sales 
closing date but before the acreage reporting date for the alternative 
crops and paying the appropriate administrative fee. Limited or 
additional coverage is not available after the sales closing date.
    (c) For catastrophic risk protection, limited, and additional 
coverage, FCIC may allow the insured to certify the insured's actual 
production history (``APH'') yield. If FCIC permits certification of 
the APH yield by the insured, the insured must, at the request of FCIC 
or the approved insurance provider, provide verifiable records of 
acreage and production acceptable to FCIC for the years for which 
production and acreage were certified. If FCIC or the approved 
insurance provider determine that inadequate records exist to 
substantiate the certified yield, FCIC will, in addition to any civil 
fraud or criminal penalties which may exist for false certification, 
recalculate the APH yield using assigned yields for the crop years 
represented by the inadequate records.
    (d) For all coverages including catastrophic risk protection, 
limited, and additional coverages, the insured must file a signed 
acreage report on or before the acreage reporting date.


Sec. 400.654  Coverage provided.

    (a) The specific causes of loss insured against are designated in 
the crop insurance policy for the applicable crop.
    (b) An indemnity paid to a producer may be reduced 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.
    (c) Catastrophic risk protection.
    (1) A person who is eligible to receive an indemnity under a 
catastrophic risk protection plan of insurance and is also eligible to 
receive benefits for the same loss under other USDA programs must elect 
the program from which they wish to receive benefits. Only one payment 
or program benefit will be allowed.
    (2) Catastrophic risk protection must be elected on a crop basis 
unless the Catastrophic Risk Protection Endorsement allows individual 
crop types or varieties to be considered separate crops. However, any 
acreage of [[Page 1999]] an insured crop that is designated by FCIC as 
``high risk land'' may be insured under catastrophic risk protection if 
limited or additional coverage is obtained for all insurable acreage of 
the insured crop in the county that is not designated as ``high risk 
land''; Provided that, the insured executes the High Risk Land 
Exclusion Option under the limited or additional coverage policy. The 
catastrophic risk protection policy must be obtained from the same 
insurance provider from which the limited or additional coverage is 
obtained.
    (3) Catastrophic risk protection may, on a commodity-by-commodity 
basis, be elected on an individual yield and loss basis, or, where 
offered, may be elected on an area yield and loss basis.
    (4) Any person who has a bona fide insurable interest in a crop as 
an owner-operator, landlord, tenant, or share-cropper, will be eligible 
for catastrophic risk protection coverage.
    (5) The Catastrophic Risk Protection Endorsement contains coverage 
limitations and exclusions, including but not limited to:
    (i) Coverage is available by basic units only. A basic unit is all 
the acreage of the crop in the county in which the insured has a one-
hundred percent (100%) crop share or all the acreage of the crop in the 
county owned by one person and operated by another person on a share 
basis (unless otherwise provided by the Catastrophic Risk Protection 
Endorsement);
    (ii) No replant payments will be paid whether or not replanting of 
the crop is required under the policy;
    (iii) No policy options or endorsements providing increased 
coverage over that provided under the catastrophic risk plan for that 
crop will be available unless such option or endorsement is 
specifically made applicable to catastrophic coverage by its terms;
    (iv) The insured may not exclude coverage for hail and fire or High 
Risk Land; and
    (v) Written Agreements are not available unless specifically 
allowed by the Catastrophic Risk Protection Endorsement.
    (d) Limited and additional coverage.
    (1) An insured who is eligible to receive an indemnity under a 
limited or an additional coverage plan of insurance and who is also 
eligible to receive benefits for the same loss under any other USDA 
program may receive benefits under both programs unless specifically 
limited by the crop insurance policy. However, the total amount 
received for the loss will not exceed the amount of the actual loss 
sustained by the insured. The amount of the actual loss will be the 
difference between the fair market value of the production before and 
after the loss, as determined by the approved insurance provider based 
upon the insureds production records.
    (2) Limited and additional coverage must be elected on a crop basis 
and cover all insurable acreage of the crop in the county in which the 
insured has a share unless:
    (i) The applicable crop insurance policy allows the insured to 
purchase separate policies of insurance covering individual crop types 
or varieties. In such instances, protection may be elected on a crop 
type (as designated in the crop insurance policy) or variety basis. 
These individual crop types or varieties will be considered separate 
crops for insurance purposes, including the payment of administrative 
fees. (For example, if two grape varieties grown in California are 
insured under a catastrophic risk protection policy and two varieties 
are insured under an additional coverage policy, an administrative fee 
will be charged for each of the two (2) varieties under the 
catastrophic risk protection policy and an administrative fee will be 
charged for each of the two (2) varieties under the additional coverage 
policy. The same rationale would allow the insured the option to not 
insure a crop type or variety. However, failure of the insured to 
insure a crop type or variety which is determined to be a crop of 
economic significance would make the insured ineligible for certain 
other USDA programs.)
    (ii) The insured executes the High Risk Land Exclusion Option for a 
limited or additional coverage policy. In such cases the insured may 
elect to insure the ``high risk land'' under a catastrophic risk 
protection policy. If both policies are in force, that acreage of the 
crop covered under the limited or additional coverage policy and the 
acreage of the crop covered under the catastrophic risk protection 
policy will be considered as separate crops for insurance purposes, 
including the payment of administrative fees.
    (3) Limited or additional coverage may, on a commodity-by-commodity 
basis, be elected on an individual yield and loss basis, or, where 
offered, on an area yield and loss basis.
    (4) Hail and fire coverage may be excluded from the covered causes 
of loss in a crop policy if additional coverage is elected.
    (5) If a person purchases limited or additional coverage for a 
crop, the insured must purchase limited or additional coverage for all 
insurable acreage of that crop in the county unless otherwise provided 
in this part or in the crop insurance contract.


Sec. 400.655  Administrative fees and waivers.

    (a) Catastrophic risk protection and limited coverage.
    (1) If the insured elects to obtain catastrophic risk protection or 
limited coverage, the insured must pay an administrative fee each year 
of fifty dollars ($50.00) per crop, per county, not to exceed two 
hundred dollars ($200.00) per county, and six hundred dollars ($600) 
for all counties in which the insured has coverage. The insured must 
pay this administrative fee at the time of application for the first 
year, and by the acreage reporting date for all subsequent years that 
crop insurance coverage is in effect. Payment of an administrative fee 
will not be required if the insured files a bona fide zero acreage 
report on or prior to the acreage reporting date for any year except 
the year of application. If the administrative fee is not paid at the 
time of application, or by the acreage reporting date, whichever is 
applicable, the crop insurance contract will not be in effect for the 
crop year for which the fee is due and will terminate, and the person 
will not be eligible for certain USDA programs as set out in 
Sec. 400.656.
    (2) The administrative fee may not be waived unless the insured 
qualifies as a limited resource farmer.
    (3) The administrative fee will be refunded if the insured has 
previously obtained catastrophic risk protection, or limited coverage, 
paid the administrative fee, and subsequently purchases additional 
coverage for that same crop in the same county on or before the sales 
closing date. Administrative fees will be refunded only if the insured 
has not purchased catastrophic risk protection and limited coverage in 
excess of the maximum administrative fee to be paid in the applicable 
situation.
    (4) The administrative fee will not be refunded for the year of 
application even if the insured files a zero acreage report for that 
year.
    (5) For limited coverage, the administrative fee is in addition to 
the premium amount.
    (b) Additional Coverage.
    (1) If additional coverage is elected, the insured must pay, in 
addition to the premium, an administrative fee of ten dollars ($10) per 
crop, per county, each year in which crop insurance coverage remains in 
effect. The administrative fee is payable at the time insurance 
attaches. If the administrative fee is not paid by the termination date 
set out in the crop insurance contract, the crop 
[[Page 2000]] insurance contract will be voided and not have been in 
effect for the crop year for which the fee is due and will terminate, 
and the person failing to pay the fee will not be or have been eligible 
for certain other USDA program benefits as set out in Sec. 400.656 and 
any of those benefits received for the crop year must be refunded.
    (2) The administrative fee for additional coverage is not 
refundable and may not be waived.
    (c) When obtaining catastrophic risk protection, limited, or 
additional coverage, an insured must provide information regarding crop 
insurance coverage on any crop previously obtained at any other local 
USDA office or from an approved insurance provider, including the date 
such insurance was obtained, and the amount paid in administrative 
fees. If the insured has paid in excess of the maximum allowable amount 
in administrative fees, the insured will receive a refund of the excess 
fees paid from the local USDA office or from the approved insurance 
provider that collected the excess amount.


Sec. 400.656  Eligibility for other program benefits.

    The insured must obtain at least the catastrophic risk protection 
level of coverage for each crop of economic significance in the county 
in which the insured has an interest, if insurance is available in the 
county for the crop, to be eligible for:
    (a) Price support and production adjustment programs, including 
tobacco, rice, extra long staple cotton, upland cotton, feed grains, 
wheat, peanuts, oilseeds, and sugar;
    (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; 
and
    (c) The Conservation Reserve Program.


Sec. 400.657  Coverage for acreage that is prevented from being 
planted.

    (a) 1994 crop year prevented planting for all crops of wheat, feed 
grain, cotton, and rice:
    (1) For the 1994 crop year only, an insured may receive 
compensation for acreage that was prevented from being planted due to 
major, widespread flooding in the Midwest, or excessive ground 
moisture, that occurred prior to the spring sales closing date for the 
1994 crop year.
    (2) To be eligible for compensation the insured must have:
    (i) Purchased a crop insurance policy containing prevented planting 
provisions prior to the spring sales closing date for the 1994 crop 
year;
    (ii) Had a reasonable expectation of planting the insured crop on 
acreage that was eligible for prevented planting coverage under the 
terms of the crop insurance contract, (if it is determined that the 
acreage eligible for the prevented planting coverage under the terms of 
the crop insurance policy would have drained sufficiently to plant the 
crop except for additional moisture that occurred in the spring, the 
insured will be assumed to have had a reasonable expectation of 
planting the crop absent some other intervening cause); and
    (iii) Participated in a conserving use program established for the 
1994 crop of wheat, feed grains, upland cotton, or rice established 
under the Agricultural Act of 1949, whichever is applicable.
    (3) FCIC will pay as compensation under the prevented planting 
provisions of the crop insurance policy, the difference between:
    (i) The amount of any prevented planting payment that would have 
been due under the prevented planting provision of the 1994 crop year 
crop insurance policy (prevented planting indemnity less premium); and
    (ii) The amount paid under the conserving use program for the same 
crop and acreage.
    (b) 1994 crop year prevented planting for oilseeds:
    (1) If the insured satisfies the requirements of section (a)(2) (i) 
and (ii), the insured will be eligible for a prevented planting payment 
on the oil seed crop.
    (2) FCIC will pay as compensation under this prevented planting 
provision the amount payable under the prevented planting provision of 
the applicable 1994 crop year crop insurance policy (prevented planting 
indemnity less premium).
    (c) 1995 and succeeding crop year prevented planting coverage:
    Effective for the 1995 and subsequent 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:
    (1) On the sales closing date for the insured crop in the county 
for the crop year the application for insurance is accepted; or
    (2) 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 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 insured makes application and purchases a corn crop insurance 
policy for the 1995 crop year, prevented planting coverage will begin 
on the 1995 sales closing date for corn in the county. If the corn 
policy remains in effect for the 1996 crop year (is not terminated or 
cancelled during or after the 1995 crop year), or is transferred to a 
different insurance provider, prevented planting coverage for the 1996 
crop began on the 1995 sales closing date.


Sec. 400.658  Transitional yields for forage or feed crops for the 1995 
through 1997 crop years

    (a) For the 1995 through the 1997 crop year, insureds who produce 
feed or forage may be eligible for an adjustment in the assigned yield 
available under Sec. 400.55(b)(1) if:
    (1) The feed or forage is primarily for on-farm use in a livestock, 
dairy, or poultry operation; and
    (2) The insured derives at least fifty percent (50%) of the 
insured's net farm income from the livestock, dairy, or poultry 
operation.
    (b) Insureds that qualify under (a) of this section will receive an 
assigned yield, if required, under Sec. 400.55(b)(1) of 80 percent of 
the T or D-Yield.

    Done in Washington, D.C., on December 21, 1994.
Suzette Dittrich,
Acting Manager, Federal Crop Insurance Corporation.
[FR Doc. 95-358 Filed 1-3-95; 3:38 pm]
BILLING CODE 3410-08-U