[Federal Register Volume 65, Number 151 (Friday, August 4, 2000)]
[Rules and Regulations]
[Pages 47834-47840]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-19659]



[[Page 47834]]

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DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 457


Common Crop Insurance Regulations; Fig, Pear, Walnut, Almond, 
Prune, Table Grape, Peach, Plum, Apple and Stonefruit Crop Insurance 
Provisions

AGENCY: Federal Crop Insurance Corporation, USDA.

ACTION: Final rule.

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SUMMARY: The Federal Crop Insurance Corporation (FCIC) finalizes crop 
provisions for the insurance of the Figs, Pears, Walnuts, Almonds, 
Prunes, Table Grapes, Peaches, Plums, Apples and Stonefruit. The 
intended effect of this action is to provide policy changes to better 
meet the needs of the insured. The changes will be effective for the 
2001 and subsequent crop years.

EFFECTIVE DATE: August 4, 2000.

FOR FURTHER INFORMATION CONTACT: Gary Johnson, Insurance Management 
Specialist, Product Development Division, Federal Crop Insurance 
Corporation, United States Department of Agriculture, 9435 Holmes Road, 
Kansas City, MO, 64131, telephone (816) 926-7730.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This rule has been determined to be exempt for the purpose of 
Executive Order 12866 and, therefore, has not been reviewed by the 
Office of Management and Budget (OMB).

Paperwork Reduction Act of 1995

    Pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 
35), the collections of information in this rule have been approved by 
OMB under control number 0563-0053 through April 30, 2001.

Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) 
establishes requirements for Federal agencies to assess the effects of 
their regulatory actions on State, local, and tribal governments and 
the private sector. 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. Therefore, this rule is not 
subject to the requirements of sections 202 and 205 of the UMRA.

Executive Order 13132

    The policies contained in this rule do not have any substantial 
direct effect on states, on the relationship between the national 
government and the states, or on the distribution of power and 
responsibilities among the various levels of government. Nor does this 
rule impose substantial direct compliance costs on state and local 
governments. Therefore, consultation with the states is not required.

Regulatory Flexibility Act

    This regulation will not have a significant economic impact on a 
substantial number of small entities. Additionally, the regulation does 
not require any greater action on the part of small entities than is 
required on the part of large entities. The amount of work required of 
the insurance companies will not increase because the information must 
already be collected under the present policy. No additional work is 
required as a result of this action on the part of either the insured 
or the insurance companies. 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 12372

    This program is not subject to the provisions of Executive Order 
12372, which requires 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 12988

    This rule has been reviewed in accordance with Executive Order 
12988 on civil justice reform. The provisions of this rule will not 
have a retroactive effect. 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 published 
at 7 CFR part 11 must be exhausted before any action for judicial 
review of any determination made by FCIC may be brought.

Environmental Evaluation

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

Background

    On February 8, 2000, FCIC published a notice of proposed rulemaking 
in the Federal Register at 65 FR 6033-6040 to revise 7 CFR 457.110 Fig 
Crop Insurance Provisions, section 457.111 Pear Crop Insurance 
Provisions, section 457.122 Walnut Crop Insurance Provisions, section 
457.123 Almond Crop Insurance Provisions, section 457.133 Prune Crop 
Insurance Provisions, section 457.149 Table Grape Crop Insurance 
Provisions, section 457.153 Peach Crop Insurance Provisions, section 
457.157 Plum Crop Insurance Provisions, section 457.158 Apple Crop 
Insurance Provisions, and section 457.159 Stonefruit Crop Insurance 
Provisions, effective for the 2001 and succeeding crop years.
    Following publication of the proposed rule the public was afforded 
30 days to submit written comments and opinions. A total of 10 comments 
were received from 2 reinsured companies and a trade association. The 
comments received and FCIC's responses are as follows:
    Comment. A reinsured company questioned if the wording ``could or 
would reduce the yield'' in section 2 or 3 of the applicable crop 
provisions (Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities), is subject to interpretation. The commenter 
questioned: (1) If all of the acreage of the crop will need to be 
inspected if the producer requests a higher level of coverage or an 
increased price election; (2) if FCIC will determine that coverage 
cannot be increased in a specified area and publish this information in 
a bulletin, or if the company will be allowed to make the 
determination; and (3) when the determination must be made.
    Response. The provisions require the insurance provider to 
determine whether a cause of loss occurred that ``could or would reduce 
the yield.'' The producer is not allowed to increase the coverage level 
or price election if it is evident that a cause of loss had occurred 
prior to the producer's request for such increase. There is no 
requirement to inspect any acreage to determine if a loss occurred. The 
insurance provider must simply determine whether a cause of loss has 
occurred prior to accepting the application for increased coverage. 
Therefore, no change has been made.
    Comment. A reinsured company recommended changing the word 
``unshelled'' to ``in-shell'' in the definition of ``meat pounds'' in 
section 1 of the Almond Crop Insurance Provisions because this is the 
common term used by the almond industry.

[[Page 47835]]

    Response. FCIC has incorporated the change.
    Comment. A reinsured company recommended that there should be one 
specific calendar date for the end of the insurance period for all of 
the crops listed in this final rule. The commenter stated there are so 
many dates represented by different varieties, crops, etc., that 
administrative problems are caused.
    Response. Changing the end of insurance period to one specific date 
for all of the crops listed in this final rule is not feasible. The 
insurance period is set to provide insurance during the time when the 
crop is at risk from normal causes of loss. This period is not the same 
for all crops. There needs to be variance in the beginning and ending 
of insurance periods to reflect differences in the crops being insured 
and the areas where they are grown. The calendar date for the end of 
insurance period must reflect the normal harvest date for each crop. 
Therefore, no change has been made.
    Comment. A reinsured company recommended that claim examples for 
almonds and walnuts listed in this final rule should not be included in 
the Settlement of Claim section. The commenter stated the examples are 
too simple and do not provide any explanation of ``Quality Adjustment 
or Stage.''
    Response. FCIC does not agree with the comment. Claim examples were 
added to the Settlement of Claim section to provide a general 
explanation of how the indemnity payment would be calculated. There is 
no quality adjustment on almonds. Quality Adjustment for walnuts is 
provided only for mold damage and is rarely used. The claim examples 
for almonds and walnuts are consistent with other crop policies. 
Therefore, no change has been made.
    Comment. A reinsured company recommended that almond rejects be 
counted as production to count and should remain part of the Almond 
Crop Insurance Provisions.
    Response. FCIC disagrees with the idea that all rejects should be 
counted as production to count. Rejects that are due to an insured 
cause of loss which is beyond the control of the producer should not be 
counted as production to count. However, FCIC does agree that rejects 
due to uninsured causes of loss should be counted as production to 
count. Therefore, FCIC has revised section 11(c)(2) to include meat 
pounds damaged due to uninsured causes of loss as production to count.
    Comment. A reinsured company recommended revising section 14 of the 
Apple Crop Insurance Provisions which allows optional units and price 
elections by varietal group. The commenter stated that apple trees may 
be planted in a block that consists of only a few trees in a row being 
the same variety or a few rows of trees being the same variety, or even 
a single tree of a variety that was planted as a replacement. To allow 
units by variety would create problems for determining production and 
acreage.
    Response. A block of apples may include different varieties. 
However, producers harvest and market apples by variety. The provisions 
in this final rule provide producers with optional units and price 
elections based on varietal groups. These varietal groups, which 
currently consist of two groups, are listed in the Special Provisions. 
Producers have the responsibility of identifying the acreage of each 
varietal group and separately maintaining production records. FCIC has 
revised the option to specify that producers are not eligible if they 
do not have separate production records for each varietal group or 
cannot identify the acreage upon which each varietal group is produced.
    Comment. A reinsured company questioned if the provisions under 
section 14 of the Apple Crop Insurance Provisions that provide prices 
and units by varietal group will be available under the Fresh Fruit 
Option B.
    Response. Prices and units by varietal group under section 14 are 
available under Fresh Fruit Option B provided that both Option B and C 
are elected.
    Comment. A reinsured company stated the requirement to give notice 
of loss 15 days prior to harvest of walnuts when there is mold damage 
will be very difficult. Walnuts will not show mold damage prior to 
removal from the tree, so the grower generally will not know there will 
be mold before harvest.
    Response. FCIC has changed the policy to give notice when knowledge 
is obtained or 15 days prior to harvest. The 15 day requirement allows 
the insurance provider adequate time to inspect the damaged production. 
Therefore, no change will be made.
    In addition to the changes described above, FCIC has made the 
following changes:
    1. Section 457.110 Fig crop insurance provisions.
    a. Added a definition of ``Interplanted'' to standardize the term 
interplanted between other perennial crop provisions and the Fig Crop 
Insurance Provisions.
    b. Added a section 3(c) that requires the insured to report damage, 
removal of trees, change in practices or any other circumstance that 
may reduce yields. The insured must report, for the first year of 
insurance for acreage interplanted with another perennial crop and 
anytime the planting pattern of such acreage is changed, the age and 
type, if applicable, of any interplanted crop, the planting pattern, 
and any other information needed to establish the approved yield. If 
the insured fails to report these changes, the acreage or yield used to 
establish the production guarantee, or both, may be adjusted when the 
insurance provider becomes aware of the situation.
    c. Redesignated sections 8 through 11 as sections 9 through 12 
respectively and added a new section 8 to allow interplanting as an 
insurable farming practice if the fig crop is interplanted with another 
perennial crop. This change makes insurance available on more acreage 
and reduces reliance on the noninsured crop disaster assistance program 
(NAP) for protection for crop losses.
    d. Removed language in previous designated sections 8(a), (c), (d), 
(e), as this language is in the Basic Provisions. Previous designated 
sections 8(b) and (d) have been added to new section 9(a)(2) of these 
provisions.
    e. Added language to redesignated section 9(a) to clarify the date 
on which coverage begins for the year the application is first signed.
    2. Section 457.111 Pear crop insurance provisions.
    Section 8(c)--Added the phrase ``Notwithstanding paragraph (a)(1) 
of this section'' to the beginning of the provisions contained in 
section 8(c) to clarify that the dates insurance attaches contained in 
section 8(a)(1) do not apply to subsequent crop years. The dates 
contained in section 8(a)(1) apply only to the initial crop year. This 
change clarifies when year round coverage begins for each crop year.
    3. Section 457.122 Walnut crop insurance provisions.
    a. Section 4--Revised to state that October 31 is the contract 
change date for California only and added the contract change date of 
August 31 for all other states. This change will promote the walnut 
crop insurance program in states outside California.
    b. Section 5--Revised to state that January 31 is the cancellation 
and termination dates for California only and added the cancellation 
and termination dates of November 20 for all other states. This change 
will promote the walnut crop insurance program in states outside of 
California.
    c. Section 8(a)(1), (2) and (3)--Revised (a)(1) to state that 
February 1 is the date when insurance attaches in California

[[Page 47836]]

and added November 21 when insurance attaches in all other states. This 
change will promote the walnut crop insurance program in states outside 
of California. Added to (a)(2) the words, ``(Exceptions, if any, for 
specific counties, or varieties or varietal group are contained in the 
Special Provisions.)'' Added the phrase ``Notwithstanding paragraph 
(a)(1) of this section'' to the beginning of proposed section 8(a)(3) 
to clarify that the dates insurance attach under paragraph (a)(1) do 
not apply to subsequent crop years. The dates contained in paragraph 
(a)(1) apply only to the initial crop year. These changes provide 
insurance periods similar to other perennial crops and clarify when 
year round coverage begins.
    4. Section 457.123 Almond crop insurance provisions.
    Section 8(a)(3)--Added the phrase ``Notwithstanding paragraph 
(a)(1) of this section'' to the beginning of proposed section 8(a)(3) 
to clarify that the dates insurance attach contained in paragraph 
(a)(1) do not apply to subsequent crop years. The dates contained in 
paragraph (a)(1) apply only to the initial crop year. This paragraph as 
changed clarifies when year round coverage begins.
    5. Section 457.133 Prune crop insurance provisions.
    Section 8(c)--Added the phrase ``Notwithstanding paragraph (a)(1) 
of this section'' to the beginning of proposed section 8(c) to clarify 
that the dates insurance attach contained in paragraph (a)(1) do not 
apply to subsequent crop years. The dates contained in paragraph (a)(1) 
apply only to the initial crop year. This paragraph as changed 
clarifies when year round coverage begins.
    6. Section 457.149 Table grape crop insurance provisions.
    Section 9(c)--Added the phrase ``Notwithstanding paragraph (a)(1) 
of this section'' to the beginning of proposed section 9(c) to clarify 
that the dates insurance attach contained in paragraph (a)(1) do not 
apply to subsequent crop years. The dates contained in paragraph (a)(1) 
apply only to the initial crop year. This paragraph as changed 
clarifies when year round coverage begins.
    7. Section 457.153 Peach crop insurance provisions.
    Section 7(c)--Added the phrase ``Notwithstanding paragraph (a)(1) 
of this section'' to the beginning of proposed section 7(c) to clarify 
that the dates insurance attach contained in paragraph (a)(1) do not 
apply to subsequent crop years. The dates contained in paragraph (a)(1) 
apply only to the initial crop year. This paragraph as changed 
clarifies when year round coverage begins.
    8. Section 457.157 Plum crop insurance provisions.
    Section 8(c)--Added the phrase ``Notwithstanding paragraph (a)(1) 
of this section'' to the beginning of proposed section 8(c) to clarify 
that the dates insurance attach contained in paragraph (a)(1) do not 
apply to subsequent crop years. The dates contained in paragraph (a)(1) 
apply only to the initial crop year. This paragraph as changed 
clarifies when year round coverage begins.
    9. Section 457.158 Apple crop insurance provision.
    a. Section 8(c)--Added the phrase ``Notwithstanding paragraph 
(a)(1) of this section'' to the beginning of proposed section 8(c) to 
clarify that the dates insurance attach contained in paragraph (a)(1) 
do not apply to subsequent crop years. The dates contained in paragraph 
(a)(1) apply only to the initial crop year. This paragraph as changed 
clarifies when year round coverage begins.
    b. Section 11(c)(1)(iii)--Revised to read ``unharvested marketable 
production;'' This change provides clarification that quality standards 
for appraisals of unharvested production are based on the definition of 
``marketable.''
    10. Section 457.159 Stonefruit crop insurance provisions.
    a. Section 1--Revised the definition of ``grading standards'' to 
refer to the Special Provisions. This change provides recognition of 
all other states grading standards. The current regulation contains 
only grading standards for the state of California.
    b. Section 4--Revised to state that October 31 is the contract 
change date for California only and added the contract change date of 
August 31 for all other states. This change will promote the stonefruit 
crop insurance program in states outside of California and provide a 
contract change date similar to that for other perennial crops.
    c. Section 5--Revised to state that January 31 is the cancellation 
and termination dates for California only and added the cancellation 
and termination dates of November 20 for all other states. This change 
provides cancellation and termination dates similar to other perennial 
crops.
    d. Section 6(e)--Revised to provide for the recognized grading 
standards for all states, not just California. This change provides for 
the recognition of other states' grading standards. The current 
regulation contains only grading standards for the state of California.
    e. Section 8(a)(1), (a)(2)(iii) and (c)--Revised (a)(1) to state 
that February 1 is the date when insurance attaches in California only 
and added November 21 for when insurance attaches for all other states. 
Added (a)(2)(iii) with regard to the end of insurance period to read 
``As otherwise provided for specific counties or types in the Special 
Provisions.'' These changes will promote the stonefruit crop insurance 
program in states outside California. Added the phrase 
``Notwithstanding paragraph (a)(1) of this section'' to the beginning 
of proposed section 8(c) to clarify that the dates insurance attach 
contained in paragraph (a)(1) do not apply to subsequent crop years. 
The dates contained in paragraph (a)(1) apply only to the initial crop 
year. This change provides insurance periods similar to other perennial 
crops and clarify when year round coverage begins.
    Good cause is shown to make this rule effective upon publication in 
the Office of the Federal Register. This rule must be effective prior 
to the August 31, 2000, contract change date for Almond and Walnut, to 
be effective for the 2001 crop year. Therefore, public interest 
requires that FCIC act immediately to make these provisions available.

List of Subjects in 7 CFR Part 457

    Almond, Apple, Crop insurance, Fig, Peach, Pear, Plum, Prune, 
Reporting and recordkeeping requirements, Stonefruit, Table Grape, and 
Walnut.

Final Rule

    Accordingly, as set forth in the preamble, The Federal Crop 
Insurance Corporation amends the Common Crop Insurance Regulations (7 
CFR part 457) for the 2001 and succeeding crop years as follows:

PART 457--COMMON CROP INSURANCE REGULATIONS

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

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


    2. Amend 457.110 as follows:
    a. Revise the first sentence of the introductory text;
    b. Add a definition of ``Interplanted'' in section 1 of the crop 
insurance provisions;
    c. Redesignate sections 8 through 11 of the crop insurance 
provisions as sections 9 through 12;
    d. Add a new section 8 to the crop insurance provisions;
    e. Revise section 3 and newly designated section 9 of the crop 
insurance provisions to read as follows:

[[Page 47837]]

Sec. 457.110  Fig crop insurance provisions.

    The Fig Crop Insurance Provisions for the 2001 and succeeding 
crop years are as follows:
* * * * *
    1. Definitions.
* * * * *
    Interplanted--Acreage on which two or more crops are planted in 
any form of alternating or mixed pattern.
* * * * *
    3. Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities.
    (a) In addition to the requirements under section 3 of the Basic 
Provisions, you may select only one price election for each fig type 
designated in the Special Provisions and insured in the county under 
this policy.
    (b) You may not increase your elected or assigned coverage level 
or the ratio of your price election to the maximum price election if 
a cause of loss that could or would reduce the yield of the insured 
crop has occurred prior to the time you request the increase.
    (c) You must report, by the production reporting date designated 
in section 3 of the Basic Provisions, by type if applicable:
    (1) Any damage, removal of trees, change in practices, or any 
other circumstance that may reduce the expected yield below the 
yield upon which the insurance guarantee is based, and the number of 
affected acres;
    (2) The number of bearing trees on insurable and uninsurable 
acreage;
    (3) The age of the trees and the planting pattern;
    (4) For the first year of insurance for acreage interplanted 
with another perennial crop, and anytime the planting pattern of 
such acreage is changed, the age of the crop that is interplanted 
with the figs, and type if applicable, and the planting pattern; and
    (5) Any other information that we request in order to establish 
your approved yield. We will reduce the yield used to establish your 
production guarantee as necessary, based on our estimate of the 
effect of the following: Interplanted perennial crop; removal of 
trees; damage; change in practices and any other circumstance on the 
yield potential of the insured crop. If you fail to notify us of any 
circumstance that may reduce your yields from previous levels, we 
will reduce your production guarantee as necessary at any time we 
become aware of the circumstance.
* * * * *
    8. Insurable Acreage
    In lieu of the provisions in section 9 of the Basic Provisions, 
that prohibit insurance attaching to a crop planted with another 
crop, figs interplanted with another perennial crop are insurable 
unless we inspect the acreage and determine that it does not meet 
the requirements contained in your policy.
    9. Insurance Period
    (a) In accordance with the provisions of section 11 of the Basic 
Provisions:
    (1) Coverage begins on March 1, except that for the year of 
application, if your application is received after February 19 but 
prior to March 1, insurance will attach on the 10th day after your 
properly completed application is received in our local office, 
unless we inspect the acreage during the 10 day period and determine 
that it does not meet insurability requirements. You must provide 
any information that we require for the crop or to determine the 
condition of the orchard.
    (2) The calendar date for the end of the insurance period for 
each crop year is October 31 or the date harvest of the figs (by 
type) should have started on any acreage that will not be harvested 
(Exceptions, if any, for specific counties or varieties or varietal 
group are contained in the Special Provisions).
    (b) Notwithstanding paragraph (a)(1) of this section, for each 
subsequent crop year that the policy remains continuously in force, 
coverage begins on the day immediately following the end of the 
insurance period for the prior crop year. Policy cancellation that 
results solely from transferring to a different insurance provider 
for a subsequent crop year will not be considered a break in 
continuous coverage.
    (c) If your fig policy is canceled or terminated for any crop 
year, in accordance with the terms of the policy, after insurance 
attached for that crop year but on or before the cancellation and 
termination dates whichever is later, insurance will not be 
considered to have attached for that crop year and no premium, 
administrative fee, or indemnity will be due for such crop year.
* * * * *

    3. Amend 457.111 as follows:
    a. Revise the first sentence of the introductory text;
    b. In the crop insurance provisions add sections 3(c) and 8(c) and 
(d); all to read as follows:


Sec. 457.111  Pear crop insurance provisions.

    The Pear Crop Insurance Provisions for the 2001 and succeeding crop 
years are as follows:
* * * * *
    3. Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities.
* * * * *
    (c) You may not increase your elected or assigned coverage level 
or the ratio of your price election to the maximum price election if 
a cause of loss that could or would reduce the yield of the insured 
crop has occurred prior to the time that you request the increase.
* * * * *
    8. Insurance Period.
* * * * *
    (c) Notwithstanding paragraph (a)(1) of this section, for each 
subsequent crop year that the policy remains continuously in force, 
coverage begins on the day immediately following the end of the 
insurance period for the prior crop year. Policy cancellation that 
results solely from transferring to a different insurance provider 
for a subsequent crop year will not be considered a break in 
continuous coverage.
    (d) If your pear policy is canceled or terminated for any crop 
year, in accordance with the terms of the policy, after insurance 
attached for that crop year but on or before the cancellation and 
termination dates whichever is later, insurance will not be 
considered to have attached for that crop year and no premium, 
administrative fee, or indemnity will be due for such crop year.
* * * * *

    4. Amend 457.122 to:
    a. Revise the first sentence of the introductory text;
    b. Amend the introductory text of section 3 and section 3(b) of the 
crop provisions by removing in each place the parenthetical phrase, 
``(Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities);''
    c. Add new section 3(c);
    d. Revise sections 4 and 5 of the crop provisions;
    e. Amend the introductory text to section 6 of the crop provisions, 
by removing the parenthetical phrase, ``(Insured Crop);''
    f. Amend the introductory text to section 7 of the crop provisions, 
by removing the parenthetical phrase, ``(Insurable Acreage);''
    g. In section 8 of the crop provisions, revise paragraph (a);
    h. Amend the introductory text to section 9 of the crop provisions 
paragraph (a), by removing the parenthetical phrase ``(Causes of 
Loss);''
    i. Revise section 10 of the crop provisions; and
    j. In the crop provisions add an example of settlement of claim in 
section 11 after paragraph (b)(7) and revise paragraph (d) to read as 
follows:


Sec. 457.122  Walnut crop insurance provisions.

    The Walnut Crop Insurance Provisions for the 2001 and succeeding 
crop years are as follows:
* * * * *
    3. Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities
* * * * *
    (c) You may not increase your elected or assigned coverage level 
or the ratio of your price election to the maximum price election if 
a cause of loss that could or would reduce the yield of the insured 
crop has occurred prior to the time that you request the increase.
    4. Contract Changes
    In accordance with section 4 of the Basic Provisions, the 
contract change dates are October 31 for California and August 31 
preceding the cancellation date for all other states.
    5. Cancellation and Termination Dates
    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are January 31 for California and 
November 20 for all other states.
* * * * *
    8. Insurance Period
    (a) In accordance with the provisions of section 11 of the Basic 
Provisions:
    (1) Coverage begins on February 1 in California and November 21 
in all other states of each crop year, except that for the year of 
application, if your application is

[[Page 47838]]

received after January 22 but prior to February 1 in California or 
after November 11 but prior to November 21 in all states, insurance 
will attach on the 10th day after your properly completed 
application is received in our local office, unless we inspect the 
acreage during the 10 day period and determine that it does not meet 
insurability requirements. You must provide any information that we 
require for the crop or to determine the condition of the orchard.
    (2) The calendar date for the end of the insurance period for 
each crop year is November 15 (Exceptions, if any, for specific 
counties or varieties or varietal group are contained in the Special 
Provisions).
    (3) Notwithstanding paragraph (a)(1) of this section, for each 
subsequent crop year that the policy remains continuously in force, 
coverage begins on the day immediately following the end of the 
insurance period for the prior crop year. Policy cancellation that 
results solely from transferring to a different insurance provider 
for a subsequent crop year will not be considered a break in 
continuous coverage.
    (4) If your walnut policy is canceled or terminated for any crop 
year, in accordance with the terms of the policy, after insurance 
attached for that crop year but on or before the cancellation and 
termination dates whichever is later, insurance will not be 
considered to have attached for that crop year and no premium, 
administrative fee, or indemnity will be due for such crop year.
* * * * *
    10. Duties in the Event of Damage or Loss.
    (a) In addition to the requirements of section 14 of the Basic 
Provisions, if you intend to claim an indemnity on any unit:
    (1) You must notify us prior to the beginning of harvest so that 
we may inspect the damaged production;
    (2) You must give notice when knowledge is obtained of any mold 
damage or 15 days prior to harvest so that we may inspect the mold 
damaged production; and
    (3) You must not sell or dispose of the damaged crop until we 
have given you written consent to do so.
    (b) If you fail to meet the requirements of this section, all 
such production will be considered undamaged and included as 
production to count.
    11. Settlement of Claim
* * * * *
    (b) * * *
    (7) * * *
    For example:
    You have a 100 percent share in 100 acres of walnuts in the 
unit, with a guarantee of 2,500 pounds per acre and a price election 
of $0.61 per pound. You are only able to harvest 200,000 pounds. 
Your indemnity would be calculated as follows:
    (1) 100 acres  x  2,500 pounds = 250,000 pound insurance 
guarantee;
    (2 & 3) 250,000 pounds  x  $0.61 price election = $152,500 total 
value of insurance guarantee;
    (4 & 5) 200,000 pounds production to count  x  $0.61 price 
election = $122,000 total value of production to count;
    (6) $152,500 total value guarantee--$122,000 total value of 
production to count = $30,500 loss; and
    (7) $30,500  x  100 percent share = $30,500 indemnity payment.
* * * * *
    (d) Mature walnut production damaged due to an insurable cause 
of loss which occurs within the insurance period may be adjusted for 
quality based on an inspection by the Dried Fruit Association or 
during our loss adjustment process. Walnut production that has mold 
damage greater than 8 percent, based on the net delivered weight, 
will be reduced by the quality adjustment factors contained in the 
Special Provisions. Walnut production that exceeds 30 percent mold 
damage and will not be sold, the production to count will be zero.
* * * * *

    5. Amend 457.123 as follows:
    a. Revise the first sentence of the introductory text;
    b. In the crop provisions in section 1 revise the definition of 
``meat pounds;''
    c. In the crop provisions amend section 3, the introductory text 
and paragraph (b), by removing in each place the parenthetical phrase, 
``(Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities);''
    d. In the crop provisions add section 3(c);
    e. In the crop provisions amend section 4 by removing the 
parenthetical phrase, ``(Contract Changes);''
    f. In the crop provisions amend section 5 by removing the 
parenthetical phrase, ``(Life of Policy, Cancellation and 
Termination);''
    g. In the crop provisions amend section 6 by removing the 
parenthetical phrase, ``(Insured Crop);''
    h. In the crop provisions amend section 7 by removing the 
parenthetical phrase, ``(Insurable Acreage);''
    i. In the crop provisions amend section 8(a), by removing the 
parenthetical phrase, ``(Insurance Period);''
    j. In the crop provisions add section 8(a)(3) and (4);
    k. In the crop provisions amend section 9(a), by removing the 
parenthetical phrase, ``(Causes of Loss);''
    l. In the crop provisions amend section 10 by removing the 
parenthetical phrase, ``(Duties In the Event of Damage or Loss);''
    m. In the crop provisions add an example of settlement of claim in 
section 11 after paragraph (b)(7) and revise paragraph (c)(2) to read 
as follows:


Sec. 457.123  Almond crop insurance provisions.

    The Almond Crop Insurance Provisions for the 2001 and succeeding 
crop years are as follows:
* * * * *
    1. Definitions
* * * * *
    Meat pounds. The total pounds of almond meats (whole, chipped 
and broken, and in-shell meats). In-shell almonds will be converted 
to meat pounds in accordance with FCIC approved procedures.
* * * * *
    3. Insurance Guaranteed, Coverage Levels, and Prices for 
Determining Indemnities
* * * * *
    (c) You may not increase your elected or assigned coverage level 
or the ratio of your price election to the maximum price election if 
a cause of loss that would or could reduce the yield of the insured 
crop has occurred prior to the time that you request the increase.
* * * * *
    8. Insurance Period
* * * * *
    (a) * * *
    (3) Notwithstanding paragraph (a)(1) of this section, for each 
subsequent crop year that the policy remains continuously in force, 
coverage begins on the day immediately following the end of the 
insurance period for the prior crop year. Policy cancellation that 
results solely from transferring to a different insurance provider 
for a subsequent crop year will not be considered a break in 
continuous coverage.
    (4) If your almond policy is canceled or terminated for any crop 
year, in accordance with the terms of the policy, after insurance 
attached for that crop year but on or before the cancellation and 
termination dates whichever is later, insurance will not be 
considered to have attached for that crop year and no premium, 
administrative fee, or indemnity will be due for such crop year.
* * * * *
    11. Settlement of Claim.
* * * * *
    (b) * * *
    (7) * * *
    For example:
    You have a 100 percent share in 100 acres of almonds in the 
unit, with a guarantee of 1,200 pounds per acre and a price election 
of $1.70 per pound. You are only able to harvest 100,000 pounds. 
Your indemnity would be calculated as follows:
    (1) 100 acres  x  1,200 pounds = 120,000 pound insurance 
guarantee;
    (2 & 3) 120,000 pounds  x  $1.70 price election = $204,000 total 
value of insurance guarantee;
    (4 & 5) 100,000 pounds production to count  x  $1.70 price 
election = $170,000 total value of production to count;
    (6) $204,000 total of value guarantee--$170,000 total value of 
production to count = $34,000 loss; and
    (7) $34,000  x  100 percent share = $34,000 indemnity payment.
    (c) * * *
    (2) All harvested meat pounds, including meat pounds damaged due 
to uninsured causes of loss.
* * * * *

    6. Amend 457.133 to:
    a. Revise the first sentence of the introductory text;
    b. In the crop provisions add sections 3(c), 8(c) and (d); all to 
read as follows:

[[Page 47839]]

Sec. 457.133  Prune crop insurance provisions.

    The Prune Crop Insurance Provisions for the 2001 and succeeding 
crop years are as follows:
* * * * *
    3. Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities.
* * * * *
    (c) You may not increase your elected or assigned coverage level 
or the ratio of your price election to the maximum price election if 
a cause of loss that could or would reduce the yield of the insured 
crop has occurred prior to the time that you request the increase.
* * * * *
    8. Insurance Period.
* * * * *
    (c) Notwithstanding paragraph (a)(1) of this section, for each 
subsequent crop year that the policy remains continuously in force, 
coverage begins on the day immediately following the end of the 
insurance period for the prior crop year. Policy cancellation that 
results solely from transferring to a different insurance provider 
for a subsequent crop year will not be considered a break in 
continuous coverage.
    (d) If your prune policy is canceled or terminated for any crop 
year, in accordance with the terms of the policy, after insurance 
attached for that crop year but on or before the cancellation and 
termination dates whichever is later, insurance will not be 
considered to have attached for that crop year and no premium, 
administrative fee, or indemnity will be due for such crop year.
* * * * *

    7. Amend 457.149 to:
    a. Revise the first sentence of the introductory text;
    b. In the crop provisions add sections 3(c), 9(c) and (d); all to 
read as follows:


Sec. 457.149  Table grape crop insurance provisions.

    The Table Grape Crop Insurance Provisions for the 2001 and 
succeeding crop years are as follows:
* * * * *
    3. Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities.
* * * * *
    (c) You may not increase your elected or assigned coverage level 
or the ratio of your price election to the maximum price election if 
a cause of loss that could or would reduce the yield of the insured 
crop has occurred prior to the time that you request the increase.
* * * * *
    9. Insurance Period.
* * * * *
    (c) Notwithstanding paragraph (a)(1) of this section, for each 
subsequent crop year that the policy remains continuously in force, 
coverage begins on the day immediately following the end of the 
insurance period for the prior crop year. Policy cancellation that 
results solely from transferring to a different insurance provider 
for a subsequent crop year will not be considered a break in 
continuous coverage.
    (d) If your table grape policy is canceled or terminated for any 
crop year, in accordance with the terms of the policy, after 
insurance attached for that crop year but on or before the 
cancellation and termination dates whichever is later, insurance 
will not be considered to have attached for that crop year and no 
premium, administrative fee, or indemnity will be due for such crop 
year.
* * * * *

    8. Amend 457.153 to:
    a. Revise the first sentence of the introductory text;
    b. In the crop provisions add a definition for ``marketable'' in 
section 1;
    c. In the crop provisions add sections 2(c), and 7(c) and (d); all 
to read as follows:


Sec. 457.153  Peach crop insurance provisions.

    The Peach Crop Insurance Provisions for the 2001 and succeeding 
crop years are as follows:
* * * * *
    1. Definitions.
* * * * *
    Marketable. Peach production acceptable for processing or other 
human consumption even if failing to meet any U.S. or applicable 
state grading standard.
* * * * *
    2. Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities.
* * * * *
    (c) You may not increase your elected or assigned coverage level 
or the ratio of your price election to the maximum price election if 
a cause of loss that could or would reduce the yield of the insured 
crop has occurred prior to the time that you request the increase.
* * * * *
    7. Insurance Period.
* * * * *
    (c) Notwithstanding paragraph (a)(1) of this section, for each 
subsequent crop year that the policy remains continuously in force, 
coverage begins on the day immediately following the end of the 
insurance period for the prior crop year. Policy cancellation that 
results solely from transferring to a different insurance provider 
for a subsequent crop year will not be considered a break in 
continuous coverage.
    (d) If your peach policy is canceled or terminated for any crop 
year, in accordance with the terms of the policy, after insurance 
attached for that crop year but on or before the cancellation and 
termination dates whichever is later, insurance will not be 
considered to have attached for that crop year and no premium, 
administrative fee, or indemnity will be due for such crop year.
* * * * *

    9. Amend 457.157 to:
    a. Revise the first sentence of the introductory text; and
    b. In the crop provisions add sections 3(c) and 8(c) and (d); all 
to read as follows:


Sec. 457.157  Plum crop insurance provisions.

    The Plum Crop Insurance Provisions for the 2001 and succeeding 
crop years are as follows:
* * * * *
    3. Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities.
* * * * *
    (c) You may not increase your elected or assigned coverage level 
or the ratio of your price election to the maximum price election if 
a cause of loss that could or would reduce the yield of the insured 
crop has occurred prior to the time that you request the increase.
* * * * *
    8. Insurance Period.
* * * * *
    (c) Notwithstanding paragraph (a)(1) of this section, for each 
subsequent crop year that the policy remains continuously in force, 
coverage begins on the day immediately following the end of the 
insurance period for the prior crop year. Policy cancellation that 
results solely from transferring to a different insurance provider 
for a subsequent crop year will not be considered a break in 
continuous coverage.
    (d) If your plum policy is canceled or terminated for any crop 
year, in accordance with the terms of the policy, after insurance 
attached for that crop year but on or before the cancellation and 
termination dates whichever is later, insurance will not be 
considered to have attached for that crop year and no premium, 
administrative fee, or indemnity will be due for such crop year.
* * * * *

    10. Amend 457.158 to:
    a. Revise the first sentence of the introductory text;
    b. In the crop provisions add a definition for ``varietal group'' 
in section 1;
    c. In the crop provisions revise section 2;
    d. In the crop provisions section 3 revise paragraphs (a), (b) 
introductory text and (b)(4), and add paragraph (c);
    e. In the crop provisions add sections 8(c) and (d);
    f. In the crop provisions revise section 11(c)(1)(iii); and
    g. In the crop provisions add a new section 14; all to read as 
follows:


Sec. 457.158  Apple crop insurance provisions.

    The Apple Crop Insurance Provisions for the 2001 and succeeding 
crop years are as follows:
* * * * *
    1. Definitions.
* * * * *
    Varietal group. Apple varieties with similar characteristics 
that are grouped for

[[Page 47840]]

insurance purposes as specified in the Special Provisions.
    2. Unit Division.
    In addition to the requirements of section 34(b) of the Basic 
Provisions, optional units may be established if each optional unit 
is located on non-contiguous land. Optional units may also be 
established by varietal group in accordance with section 14 of these 
provisions.
    3. Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities.
* * * * *
    (a) You may select only one price election for all the apples in 
the county insured under this policy unless the Special Provisions 
provide different price elections by type or varietal group, in 
which case you may select one price election for each apple type or 
varietal group designated in the Special Provisions. The price 
elections you choose for each type or varietal group must have the 
same percentage relationship to the maximum price offered by us for 
each type or varietal group. For example, if you choose 100 percent 
of the maximum price election for one type or varietal group, you 
must also choose 100 percent of the maximum price election for all 
other types or varietal group.
    (b) You must report, by the production reporting date contained 
in section 3 of the Basic Provisions, by type or varietal group if 
applicable:
* * * * *
    (4) The separate acreage for each varietal group of apples 
intended for fresh-market or processing, for each varietal group as 
shown on the actuarial documents; and
* * * * *
    (c) You may not increase your elected or assigned coverage level 
or the ratio of your price election to the maximum price election if 
a cause of loss that could or would reduce the yield of the insured 
crop has occurred prior to the time that you request the increase.
* * * * *
    8. Insurance Period.
* * * * *
    (c) Notwithstanding paragraph (a)(1) of this section, for each 
subsequent crop year that the policy remains continuously in force, 
coverage begins on the day immediately following the end of the 
insurance period for the prior crop year. Policy cancellation that 
results solely from transferring to a different insurance provider 
for a subsequent crop year will not be considered a break in 
continuous coverage.
    (d) If your apple policy is canceled or terminated for any crop 
year, in accordance with the terms of the policy, after insurance 
attached for that crop year but on or before the cancellation and 
termination dates whichever is later, insurance will not be 
considered to have attached for that crop year and no premium, 
administrative fee, or indemnity will be due for such crop year.
* * * * *
    11. Settlement of Claim.
* * * * *
    (c) * * *
    (1) * * *
    (iii) Unharvested marketable production; and
* * * * *
    14. Option C--Prices and Units by Varietal Group.
    (a) Exclusive of other options, optional units and price 
elections by varietal group apply only if the following conditions 
are met:
    (1) You have not elected to insure your apples under the 
Catastrophic Risk Protection (CAT) Endorsement;
    (2) You or we did not cancel the option in writing on or before 
the cancellation date. Your election of CAT coverage for any crop 
year after this endorsement is effective will be considered notice 
of cancellation of the option by you; and
    (3) You have maintained separate records of production for each 
varietal group and you can identify the acreage upon which each 
varietal group is produced.
    (b) If you select the Fresh Fruit Option A for all insurable 
acreage, Option C is not available.

    11. Amend 457.159 to:
    a. Revise the first sentence of the introductory text;
    b. In the crop provisions revise definition of ``grading 
standards'' in section 1;
    c. In the crop provisions add section 3(c);
    d. In the crop provisions revise sections 4, 5 and 6(e);
    e. In the crop provisions in section 8 revise paragraphs (a)(1) and 
(a)(2)(ii) and add paragraphs (a)(2)(iii), (c) and (d); all to read as 
follows:


Sec. 457.159  Stonefruit crop insurance provisions.

    The Stonefruit Crop Insurance Provisions for the 2001 and 
succeeding crop years are as follows:
* * * * *
    1. Definitions.
* * * * *
    Grading standards--As specified in the Special Provisions.
* * * * *
    3. Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities.
* * * * *
    (c) You may not increase your elected or assigned coverage level 
or the ratio of your price election to the maximum price election we 
offer if a cause of loss that could or would reduce the yield of the 
insured crop is evident prior to the time that you request the 
increase.
    4. Contract Changes.
    In accordance with section 4 of the Basic Provisions, the 
contract change date is October 31 for California and August 31 
preceding the cancellation date for all other states.
    5. Cancellation and Termination Dates.
    In accordance with section 2 of the Basic Provisions, the 
cancellation and termination dates are January 31 for California and 
November 20 for all other states.
    6. Insured Crop.
* * * * *
    (e) That are regulated by the applicable state's Tree Fruit 
Agreement or related crop advisory board for the state (for 
applicable crop or type);
* * * * *
    8. Insurance Period.
     (a) * * *
    (1) Coverage begins on February 1 in California and November 21 
for all other states of each crop year, except that for the year of 
application, if your application is received after January 22 but 
prior to February 1 in California or after November 11 but prior to 
November 21 in all other states, insurance will attach on the 10th 
day after your properly completed application is received in our 
local office, unless we inspect the acreage during the 10 day period 
and determine that it does not meet insurability requirements. You 
must provide any information that we require for the crop or to 
determine the condition of the orchard.
    (2) * * *
    (ii) September 30 for all nectarines and peaches; and
    (iii) As otherwise provided for specific counties or types in 
the Special Provisions.
* * * * *
    (c) Notwithstanding paragraph (a)(1) of this section, for each 
subsequent crop year that the policy remains continuously in force, 
coverage begins on the day immediately following the end of the 
insurance period for the prior crop year. Policy cancellation that 
results solely from transferring to a different insurance provider 
for a subsequent crop year will not be considered a break in 
continuous coverage.
    (d) If your stonefruit policy is canceled or terminated for any 
crop year, in accordance with the terms of the policy, after 
insurance attached for that crop year but on or before the 
cancellation and termination dates whichever is the later, insurance 
will not be considered to have attached for that crop year and no 
premium, administrative fee, or indemnity will be due for such crop 
year.
* * * * *

    Signed in Washington, DC on July 27, 2000.
Kenneth D. Ackerman,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 00-19659 Filed 8-3-00; 8:45 am]
BILLING CODE 3410-08-P