[Federal Register Volume 71, Number 238 (Tuesday, December 12, 2006)]
[Rules and Regulations]
[Pages 74455-74456]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-21033]



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 Rules and Regulations
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  Federal Register / Vol. 71, No. 238 / Tuesday, December 12, 2006 / 
Rules and Regulations  

[[Page 74455]]



DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 457

RIN 0563-AC13


Common Crop Insurance Regulations; Nursery Crop Insurance 
Provisions

AGENCY: Federal Crop Insurance Corporation, USDA.

ACTION: Final rule.

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

SUMMARY: The Federal Crop Insurance Corporation (FCIC) finalizes the 
Common Crop Insurance Regulations, Nursery Crop Insurance Provisions by 
amending the definition of ``liners.'' FCIC also finalizes the Nursery 
Peak Inventory Endorsement to clarify that the peak amount of insurance 
is limited to 200 percent of the amount of insurance established under 
the Nursery Crop Insurance Provisions. The amendments will be 
applicable to the 2008 and succeeding crop years.

DATES: Effective date: This rule is effective January 11, 2007.
    Applicability: This rule is applicable to the 2008 and succeeding 
crop years.

FOR FURTHER INFORMATION CONTACT: For further information, contact 
Claire Elsea, Economist, Product Management, Product Administration and 
Standards Division, Risk Management Agency, 6501 Beacon Dr., Stop 0812, 
Room 421, Kansas City, MO, 64118, telephone (816) 926-7730.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This rule has been determined to be not-significant for the 
purposes of Executive Order 12866 and, therefore, it has not been 
reviewed by 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 November 30, 2007.

E-Government Act Compliance

    FCIC is committed to complying with the E-Government Act, to 
promote the use of the Internet and other information technologies to 
provide increased opportunities for citizen access to Government 
information and services, and for other purposes.

Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 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. This rule contains no Federal 
mandates (under the regulatory provisions of title II of 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 
UMRA.

Executive Order 13132

    It has been determined under section 1(a) of Executive Order 13132, 
Federalism, that this rule does not have sufficient implications to 
warrant consultation with the States. The provisions contained in this 
rule will not have a substantial direct effect on States, or on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.

Regulatory Flexibility Act

    FCIC certifies that this regulation will not have a significant 
economic impact on a substantial number of small entities. Program 
requirements for the Federal crop insurance program are the same for 
all producers regardless of the size of their farming operation. For 
instance, all producers are required to submit an application and 
acreage report to establish their insurance guarantees, and compute 
premium amounts, or a notice of loss and production information to 
determine an indemnity payment in the event of an insured cause of crop 
loss. Whether a producer has 10 acres or 1000 acres, there is no 
difference in the kind of information collected. To ensure crop 
insurance is available to small entities, the Federal Crop Insurance 
Act authorizes FCIC to waive collection of administrative fees from 
limited resource farmers. FCIC believes this waiver helps to ensure 
small entities are given the same opportunities to manage their risks 
through the use of crop insurance. A Regulatory Flexibility Analysis 
has not been prepared since this regulation does not have an impact on 
small entities, and, therefore, this regulation is exempt from the 
provisions of the Regulatory Flexibility Act (5 U.S.C. 605).

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 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 preempts State 
and local laws to the extent such State and local laws are inconsistent 
herewith. With respect to any direct action taken by FCIC or to require 
the insurance provider to take specific action under the terms of the 
crop insurance policy, the administrative appeal provisions published 
at 7 CFR part 11 must be exhausted before any action against FCIC for 
judicial review 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

    This rule finalizes proposed changes made to 7 CFR 457.162 (Nursery 
Crop Insurance Provisions) and 7 CFR 457.163 (Nursery Peak Inventory 
Endorsement) that were published by FCIC on September 1, 2006, as a 
notice

[[Page 74456]]

of proposed rulemaking in the Federal Register at 71 FR 52013-52014. In 
the Nursery Crop Provisions, FCIC proposed to amend the definition of 
``liners'' to remove language that specifies an established root system 
for a liner plant must reach the sides of the container and removed 
language regarding the firm root ball. These changes were necessary 
because liners are also known as starter plants, which often have not 
developed a root system that reaches the sides of the containers. In 
the Nursery Peak Inventory Endorsement, FCIC proposed to amend 
provisions to clarify that the maximum increase in the amount of 
insurance under the Nursery Peak Inventory Endorsement is limited to 
twice the amount of insurance under the Nursery Crop Insurance 
Provisions. As currently written in the Nursery Peak Inventory 
Endorsement, the peak amount of insurance is limited to 200 percent of 
the basic unit value. This means that if a basic unit value is $50 the 
producer could increase the peak amount of insurance to $100 (200 
percent of $50 basic unit value), which is a four fold increase in 
liability. FCIC never intended to allow such an increase. It meant to 
only allow increases up to twice the amount of insurance under the 
policy, not on a per unit basis.
    The public was afforded 60 days to submit written comments after 
the regulation was published in the Federal Register. One comment was 
received from three commenters. The commenters were a reinsured 
company, an insurance services organization and a grower association. 
The comment received and FCIC's response are as follows:
    Comment: All three commenters stated they are in agreement with the 
proposed changes. One commenter also commends FCIC's willingness to 
move forward with the amendment to the definition of ``liners.'' The 
commenter states the current language has been an obstacle for most 
liner producers from purchasing nursery crop insurance policies. 
Another commenter agrees the amendment to the policy provisions is 
necessary and a major improvement to the nursery program.
    Response: FCIC agrees the changes to the Peak Inventory Endorsement 
and the definition of ``liners'' in the Nursery Crop Insurance 
Provisions will provide a better risk management tool to nursery 
producers.

List of Subjects in 7 CFR Part 457

    Crop insurance, Nursery, Reporting and recordkeeping requirements.

Final Rule

0
Accordingly, as set forth in the preamble, the Federal Crop Insurance 
Corporation amends 7 CFR part 457 the Common Crop Insurance 
Regulations, for the 2008 and succeeding crop years, as follows:

PART 457--COMMON CROP INSURANCE REGULATIONS

0
1. The authority citation for 7 CFR part 457 continues to read as 
follows:

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

0
2. Revise the definition of ``liners'' in section 1 of Sec.  457.162 to 
read as follows:


Sec.  457.162  Nursery crop insurance provisions.

* * * * *
    1. Definitions.
* * * * *
    Liners. Plants produced in standard nursery containers that are 
equal to or greater than 1 inch in diameter (including trays containing 
200 or fewer individual cells, unless specifically provided by the 
Special Provisions) but less than 3 inches in diameter at the widest 
point of the container or cell interior, have an established root 
system, and meet all other conditions specified in the Special 
Provisions.
* * * * *

0
3. Revise paragraph 7 of Sec.  457.163 to read as follows:


Sec.  457.163  Nursery peak inventory endorsement.

* * * * *
    7. Liability Limit.
    The peak amount of insurance is limited to 200 percent of the 
amount of insurance established under the Nursery Crop Insurance 
Provisions.

    Signed in Washington, DC, on November 30, 2006.
Eldon Gould,
Manager, Federal Crop Insurance Corporation.
 [FR Doc. E6-21033 Filed 12-11-06; 8:45 am]
BILLING CODE 3410-08-P