[Federal Register Volume 60, Number 34 (Tuesday, February 21, 1995)]
[Proposed Rules]
[Pages 9629-9631]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-4092]



 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
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 

  Federal Register / Vol. 60, No. 34 / Tuesday, February 21, 1995 / 
Proposed Rules  

[[Page 9629]]

DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 457

RIN 0563-AA79


Common Crop Insurance Regulations; Sugarcane Crop Insurance 
Provisions

AGENCY: Federal Crop Insurance Corporation.

ACTION: Proposed rule.

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SUMMARY: The Federal Crop Insurance Corporation (``FCIC'') hereby 
proposes specific crop provisions for the insurance of sugarcane to be 
contained in an endorsement to the Common Crop Insurance Policy which 
contains standard terms and conditions common to most crops. The 
intended effect of this action is to provide policy changes to better 
meet the needs of the insured and to move the current sugarcane 
endorsement from 7 CFR 401.133 to the Common Crop Insurance Policy (7 
CFR Part 457) for ease of use by the public and conformance among 
policy terms.

DATES: Written comments, data, and opinions on this proposed rule must 
be submitted no later than March 23, 1995 to be sure of consideration.

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

FOR FURTHER INFORMATION CONTACT: Diana Moslak, Federal Crop Insurance 
Corporation, U.S. Department of Agriculture, Washington, DC 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 February 1, 2000.
    This rule has been determined to be ``not significant'' for the 
purposes of Executive Order 12866, and therefore, has not been reviewed 
by the Office of Management and Budget (``OMB'').
    In accordance with the Paperwork Reduction Act of 1980 (44 U.S.C. 
3501 et seq.), the information collection or record keeping 
requirements included in this proposed rule have been approved by OMB 
and assigned OMB No. 0563-0016.
    It has been determined under section 6(a) of Executive Order 12612, 
Federalism, that this proposed rule does not have sufficient federalism 
implications to warrant the preparation of a Federalism Assessment. The 
policies 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 various levels 
of government.
    Under the Regulatory Flexibility Act (5 U.S.C. 605), this 
regulation will not have a significant impact on a substantial number 
of small entities. This action reduces the paperwork burden on the 
insured farmer and the reinsured company. 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 or promulgated by the 
National Appeals Division 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.

Background

    FCIC proposes to add to the Common Crop Insurance Regulations (7 
CFR Part 457), a new section to be known as 7 CFR 457.116, Sugarcane 
Crop Insurance Provisions. The provisions will be effective for the 
1996 and succeeding crop years.
    The proposed Sugarcane Crop Insurance Provisions will replace the 
provisions found at 7 CFR 401.133. Upon publication of 7 CFR 457.116 as 
a final rule, the provisions for insuring sugarcane contained herein 
will supersede the current provisions contained in 7 CFR 401.133. By 
separate rule, FCIC will revise Sec. 401.133 to limit its effect to the 
crop years prior to 1996.
    This rule makes minor editorial and format changes to improve its 
compatibility with the Common Crop Insurance Policy. In addition, FCIC 
is proposing other changes in the provisions for insuring sugarcane as 
follows:
    1. Subsection 3.(b)--Clarify the one year lag period for reporting 
production, e.g., 1994 crop year production must be reported to 
establish the production guarantee for the 1996 crop year.
    2. Paragraph 11.(c)(2)--Specify that final sugar extraction records 
will be used rather than preliminary mill estimates when completing the 
final claim. This will eliminate potentially incorrect payments created 
by using preliminary mill estimates.

List of Subjects in 7 CFR Part 457

    Crop insurance, sugarcane.

Proposed Rule

    Pursuant to the authority contained in the Federal Crop Insurance 
Act, as amended (7 U.S.C. 1501 et seq.), the Federal Crop Insurance 
Corporation hereby proposes to amend the Common Crop Insurance 
Regulations, (7 CFR Part 457), effective for the 1996 and 
[[Page 9630]] succeeding crop years, to read as follows:

PART 457--[AMENDED]

    1. The authority citation for 7 CFR Part 457 is revised to read as 
follows:

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

    2. 7 CFR part 457 is amended by adding Sec. 457.116 to read as 
follows:


Sec. 457.116  Sugarcane Crop Insurance Provisions

    The Sugarcane Crop Insurance Provisions for the 1996 and succeeding 
crop years are as follows:

DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

Sugarcane Crop Provisions

    If a conflict exists among the Basic Provisions (Sec. 457.8), 
these crop provisions, and the Special Provisions, the Special 
Provisions will control these crop provisions and the Basic 
Provisions; and these crop provisions will control the Basic 
Provisions.

1. Definitions

    (a) Crop year--The period from the day of planting for plant 
cane, or the day following harvest for stubble cane, until the end 
of the insurance period. The crop year is designated by the calendar 
year in which harvest normally begins in the county.
    (b) CFSA--Consolidated Farm Service Agency (previously the 
Agricultural Stabilization and Conservation Service).
    (c) Good farming practices--The cultural practices generally in 
use in the county for the crop to make normal progress toward 
maturity and produce at least the yield used to determine the 
production guarantee and are those recognized by the Cooperative 
Extension Service as compatible with agronomic and weather 
conditions in the area.
    (d) Harvest--Cutting and removing the mature sugarcane from the 
field.
    (e) 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.
    (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 acreage planted to the insured crop.
    (g) Local market price--The price per pound for raw sugar 
offered by buyers in the area in which you normally market the 
sugarcane.
    (h) Plant cane--(See definition of sugarcane).
    (i) Production guarantee--The number of pounds determined by 
multiplying the approved yield per acre by the coverage level 
percentage you elect.
    (j) Stubble cane--(See definition of sugarcane).
    (k) Sugarcane--means either:
    (1) Plant cane, which grows from seed planted for the crop year; 
or
    (2) Stubble cane, which grows from the stubble of sugarcane that 
was harvested the previous crop year.
    (l) Written agreement--Designated terms of this policy may be 
altered by written agreement. Each agreement must be applied for by 
the insured in writing no later than the sales closing date and is 
valid for one year only. If not specifically renewed the following 
year, continuous insurance will be in accordance with the printed 
policy. All variable terms including, but not limited to, crop 
variety, guarantee, premium rate and price election must be 
contained in the written agreement. Notwithstanding the sales 
closing date restrictions contained herein, in specific instances a 
written agreement may be applied for after the sales closing date, 
and approved if, after physical inspection of the acreage, it is 
determined that the crop has the expectancy of making at least the 
guaranteed yield. All applications for written agreements as 
submitted by the insured must contain all variable terms of the 
contract between the company and the insured that will be in effect 
if the written agreement is disapproved.

2. Unit Division

    Unless limited by the Special Provisions, a unit as defined in 
subsection 1.(tt) of the Basic Provisions (Sec. 457.8), may be 
divided into optional units if, for each optional unit you meet all 
the conditions of this section or if a written agreement to such 
division exists. Basic units may not be divided into optional units 
on any basis including, but not limited to, production practice, 
type, variety, and planting period other than as described under 
this section. If you do not comply fully with these provisions, we 
will combine all optional units which are not in compliance with 
these provisions into the basic unit from which they were formed. We 
may combine the optional units at any time we discover that you have 
failed to comply with these provisions. If failure to comply with 
these provisions is determined to be inadvertent, and the optional 
units are combined, that portion of the premium paid for the purpose 
of electing optional units will be refunded to you pro rata for the 
units combined. All optional units must be reflected on the acreage 
report for each crop year.
    (a) You must have records, which can be independently verified, 
of planted acreage and production for each optional unit for at 
least the last crop year used to determine your production 
guarantee.
    (b) 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.
    (c) You must have records of measurement of stored or marketed 
production from each optional unit maintained in such a manner that 
permits us to verify the production from each optional unit or the 
production from each unit must be kept separate until after loss 
adjustment under the policy is completed.
    (d) Each optional unit must meet one or more of the following 
criteria as applicable:
    (1) Optional Units by Section, Section Equivalent, or 
Consolidated Farm Service Agency (``CFSA'') Farm Serial Number: 
Optional units may be established if each optional unit is located 
in a separate legally identified Section. In the absence of 
Sections, we may consider parcels of land legally identified by 
other methods of measure including, but not limited to: Spanish 
grants, railroad surveys, leagues, labors, or Virginia Military 
Lands as the equivalent of Sections for unit purposes. In areas 
which have not been surveyed using the systems identified above, or 
another system approved by us, or in areas where such systems exist 
but boundaries are not readily discernible, each optional unit must 
be located in a separate farm identified by a single CFSA Farm 
Serial Number.
    (2) Optional Units on Acreage Including Both Irrigated and Non-
Irrigated Practices: In addition to or instead of establishing 
optional units by Section, section equivalent or CFSA Farm Serial 
Number, optional units may be based on irrigated acreage or non-
irrigated acreage if both are located in the same Section, section 
equivalent or CFSA Farm Serial Number. The irrigated acreage may not 
extend beyond the point at which your irrigation system can deliver 
the quantity of water needed to produce the yield on which your 
guarantee is based and may not continue into non-irrigated acreage 
in the same rows or planting pattern. You must plant, cultivate, 
fertilize, or otherwise care for the irrigated acreage in accordance 
with recognized good irrigated farming practices.

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 sugarcane in the county insured under this 
policy.
    (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), you are required to report production for 
the second previous crop year, e.g., 1994 crop year production must 
be reported by the required date for the 1996 crop year.

4. 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)).

5. Cancellation and Termination Dates

    In accordance with subsection 2.(f) of the Basic Provisions 
(Sec. 457.8), the cancellation and termination dates are September 
30.

6. 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 
table:
    (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. [[Page 9631]] 

7. Insurable Acreage

    Paragraph 9.(a)(3) of the Basic Provisions (Sec. 457.8) is not 
applicable to the Sugarcane Crop Provisions.

8. 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 8.(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; and
    (ii) In Louisiana, after the second crop year.
    (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.

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 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 within the insurance period.

10. 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 notice, the production to count 
will be the per acre production guarantee for such acreage.
    (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.
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.
    (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 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 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 which 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 2 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 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 quality if it is 
damaged by freeze within the insurance period and 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.

    Done in Washington, D.C., on February 10, 1995.
Kenneth D. Ackerman,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 95-4092 Filed 2-17-95; 8:45 am]
BILLING CODE 3410-08-P