[Federal Register Volume 61, Number 106 (Friday, May 31, 1996)]
[Proposed Rules]
[Pages 27315-27321]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13589]



      
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 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. 61, No. 106 / Friday, May 31, 1996 / Proposed 
Rules  

[[Page 27315]]



DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 457

RIN 0563-AB55


Common Crop Insurance Regulations; Sugar Beet Crop Insurance 
Provisions

AGENCY: Federal Crop Insurance Corporation.

ACTION: Proposed rule.

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

SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes 
specific crop provisions for the insurance of sugar beets. The 
provisions will be used in conjunction with the Common Crop Insurance 
Policy Basic Provisions 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 include the 
current sugar beet endorsement with the Common Crop Insurance Policy 
for ease of use and consistency of policy terms.

DATES: Written comments, data, and opinions on this proposed rule will 
be accepted until close of business July 30, 1996 and will be 
considered when the rule is to be made final. The comment period for 
information collection under the Paperwork Reduction Act of 1995 
continues through July 29, 1996.

ADDRESSES: Interested persons are invited to submit written comments to 
the Chief, Product Development Branch, Federal Crop Insurance 
Corporation, United States Department of Agriculture, 9435 Holmes Road, 
Kansas City, MO 64131. Written comments will be available for public 
inspection and copying in room 0324, South Building, USDA, 14th and 
Independence Avenue, S.W., Washington, D.C., 8:15 a.m.-4:45 p.m., EDT 
Monday through Friday.

FOR FURTHER INFORMATION CONTACT: Arden Routh, Program Analyst, Research 
and Development Division, Product Development Branch, FCIC, at 9435 
Holmes Road, Kansas City, MO 64131, telephone (816) 926-6397.

SUPPLEMENTARY INFORMATION:

Executive Order 12866 and Departmental Regulation 1512-1

    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 exempt for the purposes of 
Executive Order 12866 and therefore has not been reviewed by the Office 
of Management and Budget (OMB).

Paperwork Reduction Act of 1995

    The information collection requirements contained in these 
regulations were previously approved by OMB pursuant to the Paperwork 
Reduction Act of 1995 (44 U.S.C. chapter 35) under OMB control number 
0563-0003 through September 30, 1998.
    The amendments sent forth in this proposed rule do not contain 
additional information collections that require clearance by the OMB 
under the provisions of 44 U.S.C. chapter 35.
    The title of this information collection is ``Catastrophic Risk 
Protection Plan and Related Requirements including, Common Crop 
Insurance Regulations; Sugar Beet Crop Insurance Provisions.'' The 
information to be collected includes: a crop insurance acreage report, 
an insurance application and a continuous contract. Information 
collected from the acreage report and application is electronically 
submitted to FCIC by the reinsured companies. Potential respondents to 
this information collection are producers of sugar beets that are 
eligible for Federal crop insurance.
    The information requested is necessary for the insurance company 
and FCIC to provide insurance, provide reinsurance, determine 
eligibility, determine and collect premiums or other monetary amounts, 
and pay benefits.
    All information is reported annually. The reporting burden for this 
collection of information is estimated to average 16.9 minutes per 
response for each of the 3.6 responses from approximately 1,755,015 
respondents. The total annual burden on the public for this information 
collection is 2,676,932 hours.
    The comment period for information collections under the Paperwork 
Reduction Act of 1995 continues through July 29, 1996 for the 
following: (a) whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information shall have practical utility; (b) the 
accuracy of the agency's estimate of the burden of the proposed 
collection of information; (c) ways to enhance the quality, utility, 
and clarity of the information to be collected; and (d) ways to 
minimize the burden of the collection of information on respondents, 
including through the use of automated collection techniques or other 
forms of information gathering technology.
    Comments should be submitted to the Desk Officer for Agriculture, 
Office of Information and Regulatory Affairs, Office of Management and 
Budget, Washington, D.C. 20503 and to Bonnie Hart, Advisory and 
Corporate Operations Staff, Regulatory Review Group, Farm Service 
Agency, P.O. Box 2415, Ag Box 0570, U.S. Department of Agriculture, 
Washington, D.C. 20013-2415. Telephone (202) 690-2857. Copies of the 
information collection may be obtained from Bonnie Hart at the above 
address.

Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandate Reform Act of 1995 (UMRA), Pub. L. 
104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, FCIC 
generally must prepare a written statement, including a cost-benefit 
analysis, for proposed and final rules with Federal mandates that may 
result in expenditures to State, local, or tribal governments, in the 
aggregate, or to the private sector, of $100 million or more in any 1 
year. When such a statement is needed for a rule, section 205 of the 
UMRA generally requires FCIC to identify and consider a reasonable 
number of regulatory alternatives and adopt the least costly, more 
cost-effective or least burdensome alternative that achieves the 
objectives of the rule.

[[Page 27316]]

    This rule contains no Federal mandates (under the regulatory 
provisions of title II of the UMRA) for State, local, and tribal 
governments or the private sector. Thus, this rule is not subject to 
the requirements of sections 202 and 205 of the UMRA.

Executive Order 12612

    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 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.

Regulatory Flexibility Act

    This regulation will not have a significant impact on a substantial 
number of small entities. The amount of work required of the insurance 
companies delivering these policies and the procedures therein will not 
increase significantly from the amount of work currently required to 
deliver previous policies to which this regulation applies. This rule 
does not have any greater or lesser impact on the producer. Therefore, 
this action is determined to be exempt from the provisions of the 
Regulatory Flexibility Act ( 5 U.S.C. Sec. 605), and no Regulatory 
Flexibility Analysis was prepared.

Federal Assistance Program

    This program is listed in the Catalog of Federal Domestic 
Assistance under No. 10.450.

Executive Order 12372

    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.

Executive Order 12778

    The Office of the General Counsel has determined that these 
regulations meet the applicable standards provided in sections 2(a) and 
2(b)(2) of Executive Order 12778. The provisions of this rule will not 
have retroactive effect prior to the effective date. The provisions of 
this rule will preempt State and local laws to the extent such State 
and local laws are inconsistent herewith. The administrative appeal 
provisions in 7 CFR parts 11 and 780 must be exhausted before action 
for judicial review may be brought.

Environmental Evaluation

    This action is not expected to have a significant impact on the 
quality of the human environment, health, and safety. Therefore, 
neither an Environmental Assessment nor an Environmental Impact 
Statement is needed.

National Performance Review

    This regulatory action is being taken as part of the National 
Performance Review Initiative to eliminate unnecessary or duplicative 
regulations and improve those that remain in force.

Background

    FCIC proposes to add to the Common Crop Insurance Regulations (7 
CFR part 457), a new section, 7 CFR Sec. 457.109, Sugar Beet Crop 
Insurance Provisions. The provisions will be effective for the 1998 and 
succeeding crop years. The proposed Sugar Beet Crop Insurance 
Provisions will replace the provisions found at 7 CFR part 430 (Sugar 
Beet Crop Insurance Regulations). Upon publication of 7 CFR 
Sec. 457.109 as a final rule, the provisions for insuring sugar beets 
contained herein will supersede the current provisions contained in 7 
CFR part 430. By separate rule, FCIC will revise part 430 to restrict 
its effect through the 1997 crop year and later remove that part.
    This rule makes minor editorial and format changes to improve the 
Sugar Beet Crop Insurance Regulations' compatibility with the Common 
Crop Insurance Policy. In addition, FCIC is proposing substantive 
changes in the provisions for insuring sugar beets as follows:
    1. Amend the definition of ``county,'' to that contained in the 
Basic Provisions of (Sec. 457.8). The current definition includes land 
identified by an FSA farm serial number for the county that is 
physically located in another county where as the new definition does 
not. This change is made require such land to be insured using the 
actuarial materials for the county where the land is located.
    2. Section 1--Add definitions for the terms Days, FSA, Final 
planting date, Good farming practices, Initially planted, Interplanted, 
Irrigated practice, Late planted, Late planting period, Local market 
price, Planted acreage, Practical to replant, Prevented planting, 
Processor, Production guarantee (per acre), Replanting, Standardized 
ton, Sugar beet processor contract, Thinning, Timely planted, Ton, and, 
Written agreement, for clarification purposes.
    3. Section 2--Unit division provisions are expanded to include 
insured's reporting responsibilities to qualify for optional units and 
the breakdown of units by irrigated and non-irrigated acreage. The 
definition of ``unit'' under section 1(tt) of the Basic Provisions 
(part 457.8) provides for the division of units in accordance with 
applicable crop provisions. The current Sugar Beet Crop Insurance 
Regulations, however, do not provide guidelines for determining 
optional units. Section 2 will provide guidelines for optional unit 
division of sugar beet basic units that are consistent with other 
annual crop provisions. Optional units may be divided on the basis of 
section, section equivalent, or Farm Service Agency (FSA) Farm Serial 
Number, or on acreage including both irrigated and non-irrigated 
practices, or both. Consistent with the definition of ``unit'' in the 
Basic Provisions (Sec. 457.8), section 12 of the Sugar Beet Crop 
Provisions will provide that in settling a claim, loss will be 
determined on a unit basis and all optional units for which acceptable 
production records were not provided will be combined.
    4. Section 3(a)--Provision added to clarify that only 1 price 
election is available for all sugar beets insured in the county.
    5. Section 4--The contract change date is moved 30 days earlier in 
most counties to maintain at least a 3 month period between this date 
and earliest cancellation date (see item 6 below).
    6. Section 5--The cancellation and termination dates have been 
changed from April 15 to March 15 in all states except California and 
Arizona. The cancellation and termination dates for the state of 
Arizona and Imperial County, California remain unchanged at August 31. 
The cancellation and termination dates have been changed from March 31 
to February 28 for Lassen, Modoc, Shasta and Siskiyou, counties 
California. The cancellation date has been changed from March 31 to 
July 15 for all remaining California counties. The termination date for 
these California counties has been changed to November 30 immediately 
following the last final planting date for the crop year. The changes 
(except California counties with a July 15 cancellation date) are 
intended to minimize program vulnerabilities that may exist under 
current program dates by reducing the chances that insureds may be able 
to anticipate below normal yields. The change to July 15 in the 
California counties specified above is made to allow FCIC to return to 
the use of a single final planting date in counties where sugar beets 
are planted year round. Constant changes in these counties made 
establishment of multiple final planting dates extremely difficult to 
administer.

[[Page 27317]]

    7. Section 6(b)--Specify insurance eligibility requirements for 
sugar beet producers who are also the processing company. These 
provisions are needed to ensure that the same terms contained in a 
traditional sugar beet processor contract are in place.
    8. Section 7(a)(2)--Stipulate that acreage is uninsurable in any 
crop year following the discovery of rhizomania on the unit unless we 
agree in writing to insure such acreage. Rhizomania remains in the soil 
for several years and normally creates an unacceptable insurance risk.
    9. Section 7(a)(3)--Stipulate that acreage is uninsurable if it 
does not meet rotation requirements shown in the Special Provisions. 
This change identifies the location of these requirements.
    10. Section 7(b)--Clarify that any acreage damaged prior to the 
final planting date must be replanted unless replanting is not 
practical. This provision applies to all counties with an established 
final planting date (see item 11 for information regarding counties 
that do not have a final planting date).
    11. Section 7(c)--Stipulate that any acreage damaged within 30 days 
of the initial planting must be replanted unless replanting is not 
practical. This provision applies to all counties that do not have an 
established final planting date.
    12. Section 8(b)--Change the end of insurance period to the last 
day of the 12th month after the crop initially was planted in all 
California counties except Imperial, Lassen, Modoc, Shasta and 
Siskiyou. This change is made to accommodate planting that occurs 
virtually all year in these counties.
    13. Section 8(c)--Change the calendar date for the end of the 
insurance period to October 31 for Lassen, Modoc, Shasta and Siskiyou 
Counties, California and Klamath County, Oregon.
    14. Section 8(e)--The end of insurance period for New Mexico has 
been changed from November 15 to December 31. This change is being 
proposed because the sugar beet program in New Mexico at this time 
consists of 1 county that has similar planting and harvesting dates as 
the adjacent sugar beet counties in Texas. The end of the insurance 
period in these Texas counties is December 31.
    15. Section 9--Provisions are added to clarify that insufficient or 
improper application of pest or disease control measures is not an 
insured cause of loss.
    16. Section 10(b)--The maximum amount of the replanting payment has 
changed from one ton multiplied by the price election multiplied by the 
share to the lesser of 10 percent (10%) of the final stage production 
guarantee or one ton, multiplied by the price election multiplied by 
the share. The 10 percent (10%) factor has been added to prevent 
insureds who elect a lower coverage level from receiving a replant 
payment that exceeds the original liability.
    17. Section 10(c)--Reduce the liability for a unit by the amount of 
any replanting payment when sugar beets are replanted using a practice 
that was originally uninsurable. The current sugar beet provisions are 
silent regarding this issue. For example, if the Actuarial Table 
requires a specific row width and the crop is replanted to a lesser row 
width, the dollar amount of coverage would be reduced by the amount of 
any replant payment. This addition is consistent with the manner in 
which other crops are treated.
    18. Section 11(b)--Stipulate that a copy of the sugar beet 
processor contract or corporate resolution must be provided in the 
event of a loss.
    19. Section 13--Grant protection for acreage planted within 25 days 
after the final planting date, and for acreage that cannot be planted 
due to any insurable cause of loss. If the insured is prevented from 
planting by the final planting date, or intends to plant within the 
late planting period and is prevented from doing so, insurance 
protection is provided at a specified percent of the production 
guarantee for timely planted acreage. Reductions are made to recognize 
increasingly lower yield potential as planting is delayed. Late and 
prevented planting coverages are not available in any California 
counties except Imperial, Lassen, Modoc, Shasta and Siskiyou. Year 
round planting in these counties precludes the use of current prevented 
planting provisions.
    20. Section 14--Add provisions for providing insurance coverage by 
written agreement. FCIC has a long-standing policy of permitting 
modification of insurance contracts by written agreement. This 
provision is not documented in the current Sugar Beet Crop Insurance 
Regulations. Section 14 will discuss application for, and duration of, 
written agreements.

List of Subjects in 7 CFR Part 457

    Crop insurance, sugar beet.

Proposed Rule

    Pursuant to the authority contained in the Federal Crop Insurance 
Act, as amended (7 U.S.C. Sec. 1501 et seq.), the Federal Crop 
Insurance Corporation hereby proposes to amend the Common Crop 
Insurance Regulations, (7 CFR part 457), effective for the 1998 and 
succeeding crop years, to read as follows:

PART 457--[AMENDED]

    1. The authority citation for 7 CFR part 457 continues to read as 
follows:

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

    2. 7 CFR part 457 is amended by adding a new Sec. 457.109 to read 
as follows:


Sec. 457.109  Sugar beet crop insurance provisions.

    The Sugar Beet Crop Insurance Provisions for the 1998 and 
succeeding crop years are as follows:

UNITED STATES DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

Sugar Beet 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

    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 California counties, except Imperial, Lassen, Modoc, Shasta and 
Siskiyou counties, the period from planting until the applicable 
date for the end of the insurance period and 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.
    Days--Calendar days.
    FSA--Farm Service Agency of the United States Department of 
Agriculture or any successor agency.
    Final planting date--The date contained in the Special 
Provisions for the insured crop by which the crop must initially be 
planted in order to be insured for the full production guarantee.
    Good farming practices--The cultural practices generally in use 
in the county for the crop to make normal progress toward maturity 
and produce at least the yield used to determine the production 
guarantee and are those generally recognized by the Cooperative 
Extension Service as compatible with agronomic and weather 
conditions in the county.
    Harvest--Topping, lifting and removing sugar beets from the 
field.
    Initially planted--The first occurrence that land is considered 
as planted acreage for the crop year.
    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

[[Page 27318]]

needed to produce at least the yield used to establish the irrigated 
production guarantee on the irrigated acreage planted to the insured 
crop.
    Late planted--Acreage planted to the insured crop during the 
late planting period.
    Late planting period--The period that begins the day after the 
final planting date for the insured crop and ends twenty-five (25) 
days after the final planting date.
    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--Land in which seed has been placed by a machine 
appropriate for the insured crop and planting method, at the correct 
depth, into a seedbed that has been properly prepared for the 
planting method and production practice. Sugar beets 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 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, 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 in 
counties where a late planting period is applicable, or 30 days 
after initial planting for all counties where a late planting period 
is not applicable, unless replanting is generally occurring in the 
area.
    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.
    Processor--A corporation that possesses all licenses and permits 
for marketing sugar required by the state in which it is domiciled 
or operates, and that possesses facilities, or has contractual 
access to such facilities, with enough equipment to accept and 
process the 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.
    Replanting--Performing the cultural practices necessary to 
replace the sugar beet seed and then replacing the sugar beet seed 
in the insured acreage with the expectation of growing a successful 
crop.
    Standardized ton--A ton of sugar beets expressed on a basis of a 
stated percentage of raw sugar content.
    Sugar beet processor contract--A written contract between the 
grower and the processor, containing at a minimum:
    (1) The grower'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 grower 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.
    Timely planted--Planted on or before the final planting date 
designated in the Special Provisions for the insured crop in the 
county.
    Ton--Two thousand (2,000) pounds avoirdupois.
    Written agreement--A written document that alters designated 
terms of a policy in accordance with section 14.

2. Unit Division

    Unless limited by the Special Provisions, a unit as defined in 
section 1 (Definitions) of the Basic Provisions (Sec. 457.8), 
(``basic unit'') may be divided into optional units 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 in this section. If you do not comply fully with 
these provisions, we will combine all optional units that are not in 
compliance with these provisions into the basic unit from which they 
were formed. We will combine the optional units at any time we 
discover that you have failed to comply with these provisions. If 
failure to comply with these provisions is determined to be 
inadvertent, and the optional units are combined, 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 identified on the acreage report for each crop year.
    (a) The following requirements must be met for each optional 
unit:
    (1) 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;
    (2) You must plant the crop in a manner that results in a clear 
and discernable break in the planting pattern at the boundaries of 
each optional unit; and
    (3) You must have records of marketed production or measurement 
of stored production from each optional unit maintained in such a 
manner that permits us to verify the production from each optional 
unit, or the production from each unit must be kept separate until 
loss adjustment is completed by us.
    (b) Each optional unit must meet one or more of the following 
criteria, as applicable:
    (1) Optional Units by Section, Section Equivalent, or FSA Farm 
Serial Number: Optional units may be established if each optional 
unit is located in a separate legally identified Section. In the 
absence of Sections, we may consider parcels of land legally 
identified by other methods of measure including, but not limited to 
Spanish grants, railroad surveys, leagues, labors, or Virginia 
Military Lands, as the equivalent of Sections for unit purposes. In 
areas that have not been surveyed using the systems identified 
above, or another system approved by us, or in areas where such 
systems exist but boundaries are not readily discernable, each 
optional unit must be located in a separate farm identified by a 
single FSA Farm Serial Number.
    (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 FSA Farm Serial 
Number, optional units may be based on irrigated acreage or non-
irrigated acreage if both are located in the same Section, section 
equivalent, or FSA Farm Serial Number. To qualify as separate 
irrigated and non-irrigated optional units, the non-irrigated 
acreage may not continue into the irrigated acreage in the same rows 
or planting pattern. The irrigated acreage may not extend beyond the 
point at which the irrigation system can deliver the quantity of 
water needed to produce the yield on which the guarantee is based. 
However, the corners of a field in which a center-pivot irrigation 
system is used will be considered as irrigated acreage if separate 
acceptable records of production from the corners are not provided. 
If the corners of a field in which a center-pivot irrigation system 
is used do not qualify as a separate non-irrigated optional unit, 
they will be a part of the unit containing the irrigated acreage. 
However, non-irrigated acreage that is not a part of a field in 
which a center-pivot irrigation system is used may qualify as a 
separate optional unit provided that all requirements of this 
section are met.

3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities

    (a) In addition to the requirements of section 3 (Insurance 
Guarantees, Coverage Levels, and Prices for Determining Indemnities) 
of the Basic Provisions (Sec. 457.8), you may select only one price 
election for all the 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%), extends 
from planting until:
    (i) July 1 in Lassen, Modoc, Shasta and Siskiyou counties of 
California and all other states; and
    (ii) The earlier of thinning or 90 days after planting in all 
California counties except Lassen, Modoc, Shasta and Siskiyou.
    (2) Final stage, with a guarantee equal to 100 percent (100%) of 
the 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

[[Page 27319]]

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

    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 preceding the cancellation date for all other counties 
(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:

------------------------------------------------------------------------
      State and county          Cancellation date     Termination date  
------------------------------------------------------------------------
Arizona; and Imperial         August 31...........  August 31.          
 County, California.                                                    
All California counties,      July 15.............  November 30.        
 except Imperial, Lassen,                                               
 Modoc, Shasta and Siskiyou.                                            
All Other States, and         February 28.........  February 28.        
 Lassen, Modoc, Shasta and                                              
 Siskiyou Counties,                                                     
 California.                                                            
------------------------------------------------------------------------

6. 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 table:
    (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 with a processor before the acreage reporting date; 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 the processor may be able to 
establish an insurable interest if they meet the following 
requirements:
    (1) The processor must be a corporation and have a valid 
insurable interest in the crop;
    (2) The Board of Directors of the processor must have approved a 
corporate resolution that sets forth essentially the same terms that 
a traditional sugar beet processor contract would contain. Such 
corporate resolution will be considered a sugar beet processing 
contract under the terms of the sugar beet crop insurance policy;
    (3) Sales records of sugar beet production for 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.

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 sugar beets:
    (1) The preceding crop year;
    (2) In any crop year following the discovery of rhizomania on 
the acreage unless a written agreement allows otherwise; 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, 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. This paragraph does not apply to 
California counties except Imperial, Lassen, Modoc, Shasta and 
Siskiyou; and
    (c) Any acreage of the insured crop in California counties other 
than Imperial, Lassen, Modoc, Shasta and Siskiyou that is damaged 
within 30 days of initial planting to the extent growers in the area 
would normally not further care for the crop, must be replanted 
unless we agree replanting is not practical.

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:
    (a) July 15 in Arizona and in Imperial County, California;
    (b) 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;
    (c) October 31 in Lassen, Modoc, Shasta and Siskiyou Counties, 
California, and in Klamath County, Oregon;
    (d) November 25 in Ohio;
    (e) December 31 in New Mexico and Texas; and
    (f) November 15 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 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.

10. 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 percent (10%) of the production guarantee or 1 
ton, multiplied by your price election, multiplied by your insured 
share.
    (c) When sugar beets are replanted using a practice that is 
uninsurable as 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.

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):
    (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.

12. 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 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 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 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;

[[Page 27320]]

    (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 (unharvested production will not be 
adjusted for quality);
    (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, 
provided that all production from acreage subject to section 
12(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) Production 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 sugar in such sugar beets 
by the 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 sugar will be determined by the 
processor from tests performed on each load at the time of delivery. 
If individual tests of sugar content are not made at the time of 
delivery, the average percent of sugar shall equal the sugar content 
percent shown in the Special Provisions.
    (e) Production that does not meet the minimum acceptable 
standards contained in the sugar beet processor contract or 
corporate resolution 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 sugar percentage 
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 sugar percentage 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.

13. Late and Prevented Planting.

    (a) In lieu of provisions contained in the Basic Provisions 
(Sec. 457.8) regarding acreage initially planted after the final 
planting date and the applicability of a Late Planting Agreement 
Option, insurance will be provided for acreage planted to the 
insured crop during the late planting period (see section 13(c)), 
and acreage you were prevented from planting (see section 13(d)). 
These coverages provide reduced production guarantees and are 
applicable in all counties except California counties with a July 15 
cancellation date. The premium amount for late planted acreage and 
eligible prevented planting acreage 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 late planted acreage or 
prevented planting acreage 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.
    (b) You must provide written notice to us not later than the 
acreage reporting date if you were prevented from planting.
    (c) Late Planting
    (1) For sugar beet acreage planted during the late planting 
period, the production guarantee for each acre will be reduced for 
each day planted after the final planting date by:
    (i) One percent (1%) for the 1st through the 10th day; and
    (ii) Two percent (2%) for the 11th through the 25th day.
    (2) In addition to the requirements of section 6 (Report of 
Acreage) of the Basic Provisions (Sec. 457.8), you must report the 
dates the acreage is planted within the late planting period.
    (3) If planting of sugar beets 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 Special 
Provisions for the insured crop; 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 timely planting sugar beets, you 
may elect:
    (i) To plant sugar beets during the late planting period. The 
production guarantee for such acreage will be determined in 
accordance with section 13(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 35 percent (35%) of the production 
guarantee for timely planted acres. For example, if your production 
guarantee for timely planted acreage is 20.0 tons per acre, your 
prevented planting production guarantee would be 7.0 tons per acre 
(20.0 tons 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 section 12; 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 
10th day following the final planting date for the insured crop; or
    (B) A production guarantee equal to 17.5 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 10th 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 20.0 tons per acre, your prevented 
planting production guarantee would be 3.5 tons per acre (20.0 ton 
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) Production guarantees for timely, late, and prevented 
planting acreage within a unit will be combined to determine the 
production guarantee for the unit. For example, assume you insure 1 
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 were not planted but are eligible for a prevented planting 
production guarantee. The production guarantee for the unit will be 
computed as follows:
    (i) For the timely planted acreage, multiply the per acre 
production guarantee for timely planted acreage by the 50 acres 
planted timely;
    (ii) For the late planted acreage, multiply the per acre 
production guarantee for timely planted acreage by 93 percent (93%) 
and multiply the result by the 50 acres planted late; and
    (iii) For prevented planting acreage, multiply the per acre 
production guarantee for timely planted acreage by:
    (A) Thirty-five percent (35%) and multiply the result by the 50 
acres you were prevented from planting, if the acreage is eligible 
for

[[Page 27321]]

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
    (B) Seventeen and five tenths percent (17.5%) 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 (B) 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 section 
13(d)(1)(iii)).)
    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.
    (3) 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.
    (4) In addition to the provisions of section 11 (Insurance 
Period) of the Basic Provisions (Sec. 457.8), 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 insurance for sugar beets for 
the 1998 crop year, prevented planting coverage will begin on the 
1998 sales closing date for sugar beets in the county. If the sugar 
beet coverage remains in effect for the 1999 crop year (is not 
terminated or canceled during or after the 1998 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 1999 crop year began on the 1998 
sales closing date.
    (5) The acreage to which prevented planting coverage applies 
will not exceed the total eligible acreage on all 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 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 sugar beets 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 sugar beets during the crop years that 
you certified to determine your yield.
    (iii) 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.
    (iv) A prevented planting production guarantee 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 (20%) 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 4 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 (d)(2)(iii)(A) of this 
section, or a substitute crop allowed in paragraph (d)(2)(iii)(B) 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 4 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.
    (v) 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 sugar beet 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 sugar beets on one optional 
unit and 40 acres of sugar beets 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).
    (6) In accordance with the provisions of section 6 (Report of 
Acreage) of the Basic Provisions (Sec. 457.8), 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.

14. Written Agreements

    Designated terms of this policy may be altered by written 
agreement. The following conditions will apply:
    (a) You must apply in writing for each written agreement no 
later than the sales closing date, except as provided in section 
14(e).
    (b) The application for written agreement must contain all 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 1 year. If the 
written agreement is not specifically renewed the following year, 
insurance coverage for subsequent crop years will be in accordance 
with the printed policy.
    (e) An application for written agreement submitted after the 
sales closing date may be approved if, after a physical inspection 
of the acreage, it is determined that no loss has occurred and the 
crop is insurable in accordance with the policy and written 
agreement provisions.

    Signed in Washington, D.C., on May 23, 1996.
Kenneth D. Ackerman,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 96-13589 Filed 5-30-96; 8:45 am]
BILLING CODE 3410-FA-P