[Federal Register Volume 61, Number 167 (Tuesday, August 27, 1996)]
[Proposed Rules]
[Pages 43999-44001]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-21623]


 ========================================================================
 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.
 
 ========================================================================
 

  Federal Register / Vol. 61, No. 167 / Tuesday, August 27, 1996 / 
Proposed Rules  

[[Page 43999]]



DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 457

RIN 0563-AB52


Common Crop Insurance Regulations; ELS Cotton Crop Insurance 
Provisions

AGENCY: Federal Crop Insurance Corporation.

ACTION: Proposed rule.

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

SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes to 
amend the Extra Long Staple (ELS) Cotton Crop Insurance Provisions. The 
intended effect of this action is to provide policy changes to better 
meet the needs of the insured.

DATES: Written comments, data, and opinions on this proposed rule will 
be accepted until close of business September 26, 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 October 25, 1996.

ADDRESSES: Interested persons are invited to submit written comments to 
the Chief, Product Development Branch, Federal Crop Insurance 
Corporation, U.S. 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, 14th and 
Independence Avenue, S.W., Washington, D.C., 8:15 a.m.-5:45 p.m., 
Monday through Friday.

FOR FURTHER INFORMATION CONTACT: Stephen Hoy, Program Analyst, Research 
and Development Division, Product Development Branch, FCIC, at 9435 
Holmes Road, Kansas City, MO 64131, telephone (816) 926-7730.

SUPPLEMENTARY INFORMATION:

Executive Order No. 12866 and Departmental Regulation 1512-1

    This action has been reviewed under United States Department of 
Agriculture (USDA) procedures established by Executive Order No. 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 March 1, 1999.
    This rule has been determined to be significant for the purposes of 
Executive Order No. 12866 and, therefore, has been reviewed by the 
Office of Management and Budget (OMB).

Cost-Benefit Analysis

    A Cost-Benefit Analysis has been completed and is available to 
interested persons at the address listed above. In summary, the 
analysis finds that the expected benefits of this action outweigh the 
costs. Clarification of the provisions and administrative changes that 
simplify program operations will benefit producers, FCIC, and insurance 
providers.

Paperwork Reduction Act of 1995

    The information collection requirements contained in the 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 set 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; ELS Cotton Crop 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 ELS cotton that are eligible for Federal 
crop insurance.
    The information requested is necessary for the insurance company 
and FCIC to provide insurance and reinsurance, determine eligibility, 
determine the correct parties to the agreement or contract, 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.
    FCIC is soliciting comments 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 the use of 
automated collection techniques or other forms of information gathering 
technology.
    Comments regarding paperwork reduction 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 stated address.

Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandate Reform 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 of state, local, or tribal governments, in 
the aggregate, or to the private sector, of $100 million or more in any 
one year. When such a statement is needed for a rule, section 205 of 
the UMRA generally requires

[[Page 44000]]

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.
    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 section 202 and 205 of the UMRA.

Executive Order No. 12612

    It has been determined under section 6(a) of Executive Order No. 
12612, Federalism, that this rule does not have sufficient federalism 
implications 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 the various levels of government.

Regulatory Flexibility Act

    This regulation will not have a significant impact on a substantial 
number of small entities. Under the current regulations, a producer is 
required to complete an application and acreage report. If the crop is 
damaged or destroyed, the insured is required to give notice of loss 
and provide the necessary information to complete a claim for 
indemnity. If the insured elects to use actual records of acreage and 
production as the basis for the production guarantee, the insured may 
elect to report this information on a yearly basis. This regulation 
does not alter those requirements. Therefore, the amount of work 
required of the insurance companies and FSA offices delivering and 
servicing these policies will not increase significantly from the 
amount of work currently required. This rule does not have any greater 
or lesser impact on the insured. Therefore, this action is determined 
to be exempt from the provisions of the Regulatory Flexibility Act (5 
U.S.C. 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 No. 12372

    This program is not subject to the provisions of Executive Order 
No. 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 No. 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 No. 12778. The provisions of this rule will 
not have a 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 amend the Common Crop Insurance Regulations (7 CFR 
part 457) by revising 7 CFR Sec. 457.105 effective for the 1997 and 
succeeding crop years. The principal changes to the provisions for 
insuring ELS cotton are as follows:
    1. Section 1--Specify that the yield conversion factor normally 
applied to non-irrigated skip-row cotton acreage will not be used if 
the land between the rows of cotton is planted to any other spring 
crop. Current regulations specify that the yield conversion factor 
cannot be applied if the land between the rows of cotton is planted to 
any crop. This conflicts with the definition of ``skip-row'' in section 
1(o)(1), which allows a planting pattern of alternating rows of cotton 
and land planted to another crop planted the previous fall. Change 
``Agricultural Stabilization and Conservation Service'' to ``Farm 
Service Agency (FSA)'' to conform with the United States Department of 
Agriculture Reorganization Act of 1994. Amend the definition of 
``written agreement'' to remove the substantive provisions.
    2. Section 2(d)(1) and (2)--change ``ASCS'' to ``FSA''.
    3. Section 2(d)(2)--Clarify unit division for non-irrigated corners 
of center pivot irrigation systems.
    4. Section 5--Change the cancellation and termination dates of 
March 15 to February 28 for all states except New Mexico. This change 
is necessary to comply with the requirement of the Federal Crop 
Insurance Reform Act of 1994 that moved the sales closing dates for 
spring planted crops 30 days earlier. The present cancellation and 
termination dates of March 15 for New Mexico will remain the same 
because the date has already been moved 30 days earlier in the 1995 
crop year.
    5. Section--Move the substantive provisions for providing insurance 
coverage by written agreement from section 1(q) to this new section for 
clarification.

List of Subjects in 7 CFR Part 457

    Crop insurance, ELS Cotton, Reporting and recordkeeping 
requirements.

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 1997 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(l) and 1506(p).

    2. Section 457.105 is amended by revising subsection 1(j) as 
follows:


Sec. 457.105   Extra long staple cotton crop insurance provisions.

* * * * *
    1. Definitions
* * * * *
    (j) 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 which has been properly prepared for 
the planting method and production practice. Cotton must be planted 
in rows to be considered planted. Planting in any other manner will 
be considered as a failure to follow recognized good farming 
practices and any loss of production will not be insured unless 
otherwise provided by the Special Provisions or by written agreement 
to insure such crop. The yield conversion factor normally applied to 
non-irrigated skip-row cotton acreage will not be used if the land 
between the rows of cotton is planted to any other spring planted 
crop.
* * * * *
    3. In Sec. 457.105, Section 1(o)(2) is revised to read as follows:
* * * * *

[[Page 44001]]

    (o) * * *
    (1) * * *
    (2) Qualifies as a skip-row planting pattern as defined by the 
Farm Service Agency (FSA).
* * * * *
    4. In Sec. 457.105, Section 1(q) is revised to read as follows:
 * * * * *
    (q) Written agreement--A written document that alters designated 
terms of a policy in accordance with section 13.
* * * * *
    5. In Sec. 457.105, Section 2(d)(1) is amended by removing ``ASCS'' 
and inserting in its place ``FSA.''
    6. In Sec. 457.105, Section 2(d)(2) is revised to read as follows:

    2. Unit Division
* * * * *
    (d) * * *
    (1) * * *
    (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, 
except that 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 considered 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 other 
requirements of this section are met.
* * * * *
    7. In Sec. 457.105, Section 5 is revised to read as follows:
* * * * *
    5. Cancellation and Termination Dates
    In accordance with section 2 (Life of Policy, Cancellation, and 
Termination) of the Common Crop Insurance Policy (Sec. 457.8), the 
cancellation and termination dates are:

------------------------------------------------------------------------
                                          Cancellation and termination--
                 States                                dates            
------------------------------------------------------------------------
New Mexico..............................  March 15                      
All other States........................  February 28                   
------------------------------------------------------------------------

* * * * *
    8. In Sec. 457.105, Section 13 is added to read as follows:
 * * * * *
    13. Written Agreement
    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 
13(e).
    (b) The application for written agreement must contain all terms 
of the contract between the insurance provider and the insured that 
will be in effect if the written agreement is not approved.
    (c) If approved, the written agreement must include all variable 
terms of the contract, including, but not limited to, crop type or 
variety, the guarantee, premium rate, and price election.
    (d) Each written agreement will only be valid for one 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 August 20, 1996.
Kenneth D. Ackerman,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 96-21623 Filed 8-26-96; 8:45 am]
BILLING CODE 3410-FA-P