[Federal Register Volume 72, Number 85 (Thursday, May 3, 2007)]
[Rules and Regulations]
[Pages 24523-24530]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-8340]



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  Federal Register / Vol. 72, No. 85 / Thursday, May 3, 2007 / Rules 
and Regulations  

[[Page 24523]]



DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 457

RIN 0563-AC03


Common Crop Insurance Regulations; Mint 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; Mint Crop Insurance Provisions to 
convert the mint pilot crop insurance program to a permanent insurance 
program for the 2008 and succeeding crop years.

EFFECTIVE DATE: June 4, 2007.

FOR FURTHER INFORMATION CONTACT: Linda Williams, Risk Management 
Specialist, Product Management, Product Administration and Standards 
Division, Risk Management Agency, United States Department of 
Agriculture, 6501 Beacon Drive, Stop 0812, Room 421, Kansas City, MO, 
64133-4676, telephone (816) 926-7730.

SUPPLEMENTARY INFORMATION: 

Executive Order 12866

    The Office of Management and Budget (OMB) has determined that this 
rule is non-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 provisions of 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) 
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 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, and all producers are required to submit a notice of 
loss and production information to determine the amount of 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 that small entities are given the 
same opportunities as large entities 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 will preempt 
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, or safety. Therefore, 
neither an Environmental Assessment nor an Environmental Impact 
Statement is needed.

Background

    On Monday, February 6, 2006, FCIC published a notice of proposed 
rulemaking in the Federal Register at 71 FR 6016-6021 to add 7 CFR 
457.169 Mint crop insurance provisions effective for the 2008 and 
succeeding crop years.
    The public was afforded 60 days to submit written comments and 
opinions.

[[Page 24524]]

The e-mail address listed on the proposed rule and the Federal 
eRulemaking Portal address were not operational during that time 
period, therefore, FCIC published a notice in the Federal Register at 
71 FR 14828 on March 24, 2006, extending the comment period for an 
additional 30 days, until April 24, 2006.
    A total of 20 comments were received from 3 commenters. The 
commenters were an insurance services organization and 2 approved 
insurance providers. The comments received and FCIC's responses are as 
follows:
    Comment: Two commenters recommended adding a definition for ``sales 
closing date'' to these provisions which would define the rules when a 
county has two sales closing dates similar to what has been done in the 
Small Grains Crop Provisions. The definition in the Basic Provisions 
assumes a single sales closing date for the crop.
    Response: Neither the Small Grains Crop Provisions or the Mint Crop 
Provisions assume a single sales closing date. With respect to the 
actual sales closing date, both state that it is the dates contained in 
the Special Provisions. Therefore, the Special Provisions can have 
separate sales closing dates for the Winter Coverage Option and the 
spring insurance period. FCIC agrees that there is some confusion 
regarding when application must be made and is adding a definition of 
``sales closing date'' to make it clear that if the Winter Coverage 
Option is selected, applications for both the Winter Coverage Option 
and the spring insurance period must be submitted by the sales closing 
date for the Winter Coverage Option and coverage may not be changed 
between the winter and the spring coverage periods. If the producer 
only wants coverage for the spring insurance period, application must 
be made by the spring sales closing date and changes to the policy can 
be made for the following crop year by the next spring sales closing 
date.
    Comment: Two commenters recommended the definition of ``type'' 
should be retained in the provisions because the term ``type'' is used 
frequently in the policy. Both commenters recommended revising the 
definition to include all insurable mint types. One commenter 
questioned if a definition of ``type'' would also have an effect on the 
definition of ``mint,'' which refers to spearmint or peppermint.
    Response: FCIC agrees with the recommendation to include the 
definition of ``type.'' Section 1 of the Crop Provisions has been 
revised accordingly. It is not appropriate to include all the insurable 
mint types in the definition because certain types may only be 
insurable in certain counties. For this reason the definition refers to 
the categories of mint designated as a type in the Special Provisions. 
The definition of ``type'' does not have any effect on the definition 
of ``mint.'' The definition of ``type'' refers to the categories of 
mint designated as types. Since mint is defined as spearmint or 
peppermint, type would refer to the designation of different types of 
peppermint and spearmint. No change to the definition of ``mint'' has 
been made.
    Comment: Two commenters stated in regards to section 2, producers 
use ``still'' records to separate types (basic units) and optional 
units. They asked whether pre-authorization is required for commingled 
production as with other crops such as corn and soybeans.
    Response: Section 2 of the Mint Crop Provisions states basic units 
will be established for each mint type listed in the Special 
Provisions. As provided in the Basic Provisions, producer's verifiable 
``still'' records may be used to establish basic units. However, oil 
derived from peppermint and spearmint types would not be commingled 
together. Oil from each mint type, for example, two different types of 
spearmint, are not supposed to be commingled because each is a separate 
unit. According to section 11(a)(2) of the Mint Crop Provisions, if 
production is commingled between basic units, any commingled production 
will be allocated to such units in proportion to the liability on the 
harvested acreage for the units.
    Comment: One commenter questioned whether the term ``stand age'' 
belongs in section 3(b)(2) which lists various things that ``* * * may 
reduce the expected yield below the yield upon which the insurance 
guarantee is based * * *'' The commenter recommended the term ``stand 
age'' could be combined with the reporting of the planting dates for 
new and existing mint acreage currently listed in sections 3(b)(3) and 
(4).
    Response: FCIC agrees that the stand age is not something that 
would necessarily reduce the yield below the yield upon which the 
guarantee is based. Therefore, FCIC has removed the term ``stand age'' 
from section 3(b)(2). The stand age reporting requirement is now 
contained in section 3(b)(3).
    Comment: One commenter recommended changing ``* * * deemed to not 
have attached * * *'' in section 5 to ``* * * deemed not to have 
attached * * *.''
    Response: FCIC agrees with the commenter and has made the revision 
accordingly.
    Comment: Two commenters expressed concerns regarding the added 
language in sections 6(a)(4)(i) and (ii) that indicates an inspection 
is required not only the initial year insured but also any ``subsequent 
crop year following an indemnified loss'' or when ``an indemnity was 
paid the previous crop year.'' The commenters questioned if mint is the 
second crop on the acreage, and a loss is incurred but the producer 
elects not to accept the loss payment on the mint whether an inspection 
is necessary the subsequent crop year. They also stated if a claim was 
filed the preceding crop year and it was determined there was an 
adequate stand as a result, another inspection should not be necessary 
because there was not a payable loss. One commenter indicated with this 
additional requirement, approved insurance providers would have to do 
what they could to complete claims and inspections for acreage insured 
under the Winter Coverage Option before the mint was plowed down for 
the winter.
    Response: The provisions contained in section 6(a)(4)(i) and (ii) 
were added to the crop provisions as a result of the FCIC Board of 
Directors' (Board) approval to convert the mint pilot crop insurance 
program to a permanent program. The Board's decision was based on an 
independent contractor's recommendation to modify the self-
certification program to reduce the program integrity problem caused by 
insuring acreage that did not have an adequate stand at the time 
insurance attached. The Board's Final Resolution specified that when an 
indemnity was paid the previous year's approved insurance providers 
must conduct a crop inspection to determine if the crop has an adequate 
stand.
    However, in response to the commenters, FCIC has revised the 
provisions in sections 6(a)(4) and 13(e) to not require an inspection 
for the following year in situations where a notice of loss has been 
filed, but it is determined that there is an adequate stand on the mint 
acreage. If there has been an indemnity paid or a notice of loss filed 
and the approved insurance provider determined there was not an 
adequate stand, the acreage must be inspected before insurance will 
attach for the next insurance period. For example, in those cases where 
a producer receives an indemnity payment for spring mint, or claims a 
loss and the approved insurance provider determines there is not an 
adequate stand, an inspection of the

[[Page 24525]]

acreage insured under the Winter Coverage Option must be conducted 
before coverage begins in October or November.
    Comment: One commenter recommended rewording the phrase in section 
6(c) ``* * * which provides coverage for mint that is damaged after the 
date coverage ends in the fall and before the date coverage begins in 
the spring * * *'' The phrase could be misleading to new producers 
since they had no previous coverage that ended in the fall.
    Response: The provision in section 6(c) merely notifies producers 
that winter coverage for mint is available. However, the provision 
referred to is duplicative of the provisions in section 13. Therefore, 
to avoid any potential conflicts or ambiguity between sections 6(c) and 
section 13, FCIC is revising section 6(c) to state that winter coverage 
is available in accordance with section 13. Section 13 states when 
coverage is provided under the Winter Coverage Option.
    Comment: Two commenters recommended the reference to actuarial 
documents in sections 7(b)(1) and (2) be changed back to refer to the 
Special Provisions as this is where the rotation and age limitation 
statements are located. One commenter suggested since mint will no 
longer be a pilot program, exceptions to the provisions should be made 
to allow coverage by written agreement.
    Response: FCIC agrees section 7(b)(1) and (2) should reference the 
Special Provisions. FCIC also agrees with the comment and has revised 
the provisions to allow rotation requirements and age limitations to be 
modified by written agreement.
    Comment: Two commenters questioned whether a two-week period is 
sufficient to complete inspections on all new mint policies as required 
in section 8(b). Both commenters recommended changing it to a 30-day 
period to provide adequate time to do the inspection. This would be 
consistent with the 30-day period for many other crops (i.e. Nursery). 
One commenter questioned whether the inspection time period in section 
8(b) also applies to the subsequent crop year following an indemnified 
loss and should it be referenced in this provision as well. One 
commenter also expressed concerns that the second sentence in section 
8(b) could be confusing and lead to the impression that coverage starts 
after the application is received in the local office.
    Response: Mint is similar to other perennial crops and must be 
inspected to determine if the mint stand is capable of producing the 
yield used to establish the production guarantee. Unfortunately, it is 
not possible to change the period for a crop inspection for the spring 
insurance period because the mint plants will not be out of dormancy 30 
days before the start of the insurance period. Therefore, it cannot be 
determined if there is an adequate stand earlier than two weeks before 
the start of the insurance period.
    FCIC agrees the provisions should include the requirement that an 
inspection must be made before the next insurance period following a 
notice of loss for which an indemnity was paid or the approved 
insurance provider determined there was not an adequate stand to 
determine if the mint acreage has an adequate stand for the next 
insurance period. FCIC also agrees the second sentence in section 8(b) 
could be confusing. Therefore, section 8(b) has been revised to specify 
that for the year of application and for the crop year following a 
loss, insurance will attach on the date coverage begins unless 
insurability requirements are not met.
    Comment: Three commenters stated section 8(c)(3) references that 
coverage ends at the harvest for each cutting. The reference should be 
revised since mint has multiple cuttings each crop year, and coverage 
does not end until the final cutting of the crop year, as was done in 
the pilot program.
    Response: FCIC agrees and has revised section 8(c)(3) to specify 
coverage ends at final cutting of the crop for the crop year.
    Comment: Two commenters suggested revising section 9(a)(2) to state 
``Fire, due to natural causes'' would clarify when fire is an insured 
cause of loss consistent with the Federal Crop Insurance Act and the 
Crop Insurance Handbook.
    Response: In addition to the Mint Crop Provisions, the Common Crop 
Insurance Policy, Basic Provisions are applicable for mint. Section 12 
of the Basic Provisions states all specified causes of loss must be due 
to a naturally occurring event. Adding the suggested language would be 
redundant and could cause confusion by suggesting that the other listed 
causes of loss do not have to be due to natural causes. Therefore, no 
change has been made.
    Comment: One commenter suggested ``marketable'' should be added to 
section 11(d)(2). For example, a sample was distilled on a 7 acre unit 
that was cut but not distilled because of rain over a 3-4 day period. 
The sample distilled was a bronze color when it should have been clear. 
It was determined the oil from the sample was not a marketable product 
and thus had no value. Mint oil is either marketable or not, there is 
no middle ground.
    Response: Adding ``marketable'' to section 11(d)(2) would 
effectively add quality adjustment to the policy. Quality adjustment 
can only be added to the policy if there is an objective grading 
standard upon which to base the quality. There are no objective grading 
standards for mint oil. In many instances different qualities of mint 
oil (such as smell and taste) are blended by buyers for varying uses 
such as gum, toothpaste, etc. This means it would be up to the buyer to 
determine what is ``marketable,'' which would add a significant 
vulnerability to the policy because the buyer could elect not to 
purchase the mint for reasons other than the quality and shift the loss 
to the government. Further, without a consistent standard, it would be 
possible for some producers to be indemnified under the policy while 
others are not based on the subjective decision of the buyer. No change 
has been made.
    Comment: One commenter suggested for section 13(a), deleting the 
comma before ``* * * if''.
    Response: FCIC agrees with the suggestion and has revised section 
13(a).
    Comment: Two commenters asked if any new mint acreage planted after 
the applicable acreage reporting date as stated in section 13(d) is to 
be reported as insurable or uninsurable. A final planting date for mint 
covered under the Winter Coverage Option cannot be found in the 
actuarial documents. The commenters questioned whether there is any 
time between the fall acreage reporting date and the spring final 
planting date that mint should not be planted for insurance. The 
commenter also questioned if they should be providing the Winter 
Coverage Option for mint planted past a certain date.
    Response: Mint is a perennial crop and producers will plant it, 
depending upon the region and weather conditions, during late fall, 
winter, or early spring. Therefore, there is no final planting date 
because FCIC does not want to dictate to the producer when the crop 
must be planted. However, all acreage of mint in the county must be 
reported on the acreage report. Therefore, mint planted after the 
acreage reporting date must be reported within two weeks of planting. 
FCIC recognizes that, depending on when it is planted, newly planted 
mint may not have attained an adequate stand by the date coverage 
begins. FCIC is revising the provisions to clarify that all mint must 
have attained an adequate stand by the date coverage begins before it 
can be reported as insurable. Mint that does not have an adequate stand 
on the

[[Page 24526]]

date coverage began, or that was planted after coverage began, must be 
reported as uninsured.
    Comment: Two commenters stated section 13(e)(4) of the proposed 
rule referenced new mint acreage that is planted during the Winter 
Coverage Option insurance period but a final planting date could not be 
found for the Winter Coverage Option.
    Response: It is not practical to specify a final planting date 
under the Winter Coverage Option for new mint acreage because mint is 
usually planted at any time throughout the Winter Coverage Option 
insurance period, depending on conditions. However, as stated above, 
FCIC has revised the provisions to make it clear that before it is 
insured, the new mint acreage must have attained an adequate stand. 
Therefore, mint acreage planted during the Winter Coverage Option 
insurance period must be reported as uninsured.
    Comment: Two comments were received regarding the provisions 
contained in section 13(e)(4)(i), which requires that new mint acreage 
planted during the Winter Coverage Option be inspected and accepted for 
the first crop year. Insurance providers must notify the producer of 
acceptance or rejection of the application no later than November 15 
adding that failure to notify by then will indicate acceptance. They 
questioned how the November 15 deadline fits with the December 15 
acreage reporting date for acreage insured under the Winter Coverage 
Option. They also questioned how it works for new mint acreage planted 
after the Winter Coverage Option acreage reporting date. They asked 
whether it is covered by section 13(e)(4)(iv), allowing certification 
by the producer in place of the insurance provider's inspection for any 
mint acreage planted after the initial inspection. They asked what 
happens if additional acreage is planted after the inspection as there 
does not seem to be a final plant date for mint under the option.
    Response: There were no sub-paragraphs (i) and (iv) in section 
13(e)(4) of the proposed rule as indicated by the commenters. FCIC 
believes the commenters unintentionally combined proposed section 
13(e)(4) with sub-paragraphs (i) and (iv) from proposed section 
13(e)(5). Section 13(e)(4) pertained to new mint planted after the 
acreage reporting date, and section 13(e)(5)(i) and (iv) pertained to 
all mint, including newly planted and established, for which a premium 
rate is provided for the Winter Coverage Option. As stated above, FCIC 
has revised section 13(e) to require that all mint have an adequate 
stand at the time coverage begins to be insured. Mint planted during 
the Winter Coverage Option insurance period cannot meet this 
requirement and, therefore, must be reported as uninsured. This will 
eliminate any confusion regarding the insurability of mint planted 
after the date coverage begins and no additional inspection will be 
required of such acreage until the start of the next insurance period. 
However, FCIC has added provisions to section 8(b) requiring that mint 
acreage reported as being planted during the Winter Coverage Option 
insurance period be inspected to determine whether it has attained an 
adequate stand before the date coverage begins for the spring insurance 
period.
    Comment: Two commenters stated sections 13(e)(4)(ii) and (iii) do 
not appear to apply to ``new mint acreage'' since they address 
inspection or certification in subsequent crop years. These should 
remain separate subparagraphs (5) and (6) as in the current pilot Crop 
Provisions.
    Response: Section 13(e)(4) of the proposed rule did not contain 
sub-paragraphs (ii) and (iii) as indicated by the commenters. FCIC 
believes the commenters unintentionally combined proposed section 
13(e)(4) with sub-paragraphs (ii) and (iii) from proposed section 
13(e)(5). The requirement that mint acreage must be inspected and 
accepted for the crop year following a loss that caused an inadequate 
stand or certified as having an adequate stand after the first year of 
coverage was contained in section 13(e)(5), which pertains to all mint 
types in the county. As stated above, FCIC has clarified that all mint 
must have an adequate stand to be insured and mint planted during the 
Winter Coverage Option insurance period must be reported as uninsured. 
Therefore, section 13(e) was correct in not making paragraph (5) 
applicable to new mint acreage. No change has been made in response to 
this comment.
    Comment: One commenter questioned if the ``after'' should be 
deleted from section 13(e)(5)(iii) so it would read ``* * * on the date 
coverage begins the first crop year * * *''.
    Response: Section 13(e)(5)(i) of the proposed rule required all 
mint types to be inspected and accepted the first crop year of 
insurance. Therefore, there is no need for the producer to provide such 
a certification in the first year and the provisions have been so 
revised. In addition, as stated above, the provision has been revised 
to require inspection the year after a reported loss that has caused an 
inadequate stand. Therefore, section 13(e)(4)(iii) will now require 
producers to certify to an adequate stand each crop year unless there 
was a reported loss that has caused an inadequate stand.
    Comment: One commenter stated section 13(e)(5)(iv) seems to 
indicate the producer could plant throughout the winter coverage 
insurance period and obtain coverage on new mint acreage provided the 
two week notice of planting was met.
    Response: As stated above, because mint is a perennial crop, 
producers will plant, depending upon the region and weather conditions, 
during late fall, winter, or early spring. However, the requirement 
that mint must have an adequate stand at the time coverage begins to be 
insurable applies to mint under the Winter Coverage Option. Since mint 
planted during the Winter Coverage Option insurance period could never 
have an adequate stand before coverage begins, it must be reported as 
uninsurable. Therefore, FCIC has removed section 13(e)(5)(iv) because 
it suggests that mint planted during the Winter Coverage Option 
insurance period is insurable as long as it is certified on the acreage 
report and this is not correct.
    Comment: Regarding section 13(i), three commenters asked if since 
this provision is only applicable to the Winter Coverage Option, should 
the correct production to count be 60 percent of the production 
guarantee as indicated in sections 13(b) and (l)(1).
    Response: Section 13(i) was added to address those instances when a 
producer wishes to destroy a portion of mint acreage during the Winter 
Coverage Option insurance period and before it can be determined if 
there is an adequate stand on the acreage. The producer must agree in 
writing that no indemnity will be paid for the acreage destroyed with 
consent. The total production to be counted for those acres destroyed 
with consent will not be less than the approved yield. Section 13(b) 
states the guarantee under the Winter Coverage Option is ``equal to 60 
percent of the guarantee determined under section 3 of the Crop 
Provisions.''
    In addition to the changes described above, FCIC has modified 
section 11(c) to clarify the claim for indemnity calculation when more 
than one mint type is insured.

List of Subjects in 7 CFR Part 457

    Crop insurance, Mint, Reporting and recordkeeping requirements.

Final Rule

0
Accordingly, as set forth in the preamble, the Federal Crop Insurance 
Corporation amends 7 CFR part 457 for

[[Page 24527]]

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. Section 457.169 is added to read as follows:


Sec.  457.169  Mint crop insurance provisions.

    The Mint Crop Insurance Provisions for the 2008 and succeeding crop 
years are as follows:
    FCIC policies:

United States Department of Agriculture
Federal Crop Insurance Corporation

    Reinsured policies:


(Appropriate title for insurance provider)

    Both FCIC and reinsured policies:

Mint Crop Insurance Provisions
1. Definitions
    Adequate Stand. A population of live mint plants that equals or 
exceeds the minimum required number of plants or percentage of ground 
cover, as specified in the Special Provisions.
    Appraisal. A method of determining potential production by 
harvesting and distilling a representative sample of the mint crop.
    Cover crop. A small grain crop seeded into mint acreage to reduce 
soil erosion and wind damage.
    Cutting. Severance of the upper part of the mint plant from its 
stalk and roots.
    Distillation. A process of extracting mint oil from harvested mint 
plants by heating and condensing.
    Existing mint. Mint planted for harvest during a previous crop 
year.
    Ground cover. Mint plants, including mint foliage and stolons, 
grown on insured acreage.
    Harvest. Removal of mint from the windrow.
    Mint. A perennial spearmint or peppermint plant of the family 
Labiatae and the genus Mentha grown for distillation of mint oil.
    Mint oil. Oil produced by the distillation of harvested mint 
plants.
    New mint. Mint planted for harvest for the first time.
    Planted acreage. In addition to the definition in the Basic 
Provisions, land in which mint stolons have been placed in a manner 
appropriate for the planting method and at the correct depth into a 
seedbed that has been properly prepared.
    Pound. 16 ounces avoirdupois.
    Sales closing date. In lieu of the definition contained in the 
Basic Provisions, if you select the Winter Coverage Option, application 
for the Winter Coverage Option will include application for the spring 
insurance period and must be submitted by the sales closing date for 
the Winter Coverage Option contained in the Special Provisions. 
Coverage may not be changed between the end of the Winter Coverage 
Option insurance period and the beginning of the spring insurance 
period. If you do not elect the Winter Coverage Option, application 
must be made by the spring sales closing date contained in the Special 
Provisions and all policy changes must be made by that date. If you 
later elect the Winter Coverage Option, you may select your coverage 
under the Winter Coverage Option.
    Stolon. A stem at or just below the surface of the ground that 
produces new mint plants at its tips or nodes.
    Type. A category of mint identified as a type in the Special 
Provisions.
    Windrow. Mint that is cut and placed in a row.
2. Unit Division
    A basic unit, as defined in section 1 of the Basic Provisions, will 
be divided into additional basic units by each mint type designated in 
the Special Provisions.
3. Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities
    (a) In addition to the requirements of section 3 of the Basic 
Provisions, you may only select one price election for all the mint in 
the county insured under this policy unless the actuarial documents 
provide different price elections by type, in which case you may only 
select one price election for each type designated in the actuarial 
documents. The price elections you choose for each type must have the 
same percentage relationship to the maximum price election offered by 
us for each type. For example, if you choose 100 percent of the maximum 
price election for one specific type, you must also choose 100 percent 
of the maximum price election for other types.
    (b) In addition to the provisions in section 3 of the Basic 
Provisions, you must report:
    (1) The total amount of mint oil produced from insurable acreage 
for all cuttings for each unit;
    (2) Any damage to or removal of mint plants or stolons; any change 
in practices; or any other circumstance that may reduce the expected 
yield below the yield upon which the production guarantee is based, and 
the number of affected acres;
    (3) The stand age;
    (4) The date existing mint acreage was planted;
    (5) The date new mint acreage was initially planted; and
    (6) The type of mint.
    (c) If you fail to notify us of any circumstance that may reduce 
your yields or insurable acres from previous levels, we will reduce 
your production guarantee and insurable acres at any time we become 
aware of the circumstance based on our estimate of the effect of damage 
to or removal of mint plants or stolons; stand age; change in 
practices; and any other circumstance that may affect the yield 
potential or insurable acres of the insured crop.
4. Contract Changes
    In accordance with section 4 of the Basic Provisions, the contract 
change date is June 30 preceding the cancellation date.
5. Cancellation and Termination Dates
    In accordance with section 2 of the Basic Provisions, the 
cancellation date is September 30 and the termination date is November 
30. If your policy is terminated after insurance has attached for the 
subsequent crop year, coverage will be deemed not to have attached to 
the acreage for the subsequent crop year.
6. Insured Crop
    (a) In accordance with the provisions of section 8 of the Basic 
Provisions, the crop insured will be all mint types in the county for 
which a premium rate is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That are planted for harvest and distillation for mint oil;
    (3) That have an adequate stand by the date coverage begins; and
    (4) That have been:
    (i) Inspected and accepted by us for the first crop year you are 
insured; or
    (ii) Certified by you as having an adequate stand on the date 
coverage begins after the first crop year you are insured unless an 
inspection is required under section 8(b).
    (b) In lieu of the provisions of section 8 of the Basic Provisions 
that prohibit insurance of a second crop harvested following the same 
crop in the same crop year, multiple harvests of mint on the same 
acreage will be considered as one mint crop.
    (c) In addition to the coverages provided in these Crop Provisions, 
you may also elect the Winter Coverage Option in accordance with 
section 13.

[[Page 24528]]

7. Insurable Acreage
    (a) Mint interplanted with a cover crop will not be considered 
interplanted for the purposes of section 9 of the Basic Provisions if 
the cover crop is destroyed prior to its maturity and is not harvested 
as grain.
    (b) In addition to the provisions of section 9 of the Basic 
Provisions, unless allowed by written agreement, we will not insure any 
acreage that:
    (1) Does not meet rotation requirements contained in the Special 
Provisions; or
    (2) Exceeds existing mint age limitations contained in the Special 
Provisions.
8. Insurance Period
    In lieu of the provisions of section 11 of the Basic Provisions:
    (a) Coverage begins on each unit or part of a unit for acreage with 
an adequate stand on the following calendar dates:
    (1) June 16 in Indiana, Montana, and Wisconsin;
    (2) May 16 in Washington; and
    (3) For all other states, the date as provided in the Special 
Provisions.
    (b) For the year of application, for when you have reported 
planting mint during the Winter Coverage Option insurance period, or 
for any insurance period following the payment of an indemnity or a 
reported loss where the crop was determined to not have an adequate 
stand, we will inspect all mint acreage within the two-week period 
before coverage begins (If you have elected the Winter Coverage Option, 
such inspection will occur not later than November 15).
    (1) Insurance will attach on the date coverage begins, as specified 
in section 8(a), unless we inspect the acreage during the two-week 
period and determine it does not meet insurability requirements as 
specified in section 2 of the Basic Provisions, the application, or 
these Crop Provisions.
    (2) You must provide any information we require for the crop or to 
determine the condition of the crop.
    (c) Coverage ends for each unit or part of a unit at the earliest 
of:
    (1) Total destruction of the insured crop on the unit;
    (2) Final adjustment of a loss;
    (3) The final cutting for the crop year;
    (4) Abandonment of the crop; or
    (5) The following calendar date:
    (i) September 30 in Indiana and Wisconsin;
    (ii) October 15 in Montana;
    (iii) October 31 in Washington; and
    (iv) For all other states, the date as provided in the Special 
Provisions.
9. Causes of Loss
    (a) In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following causes of 
loss that occur during the insurance period:
    (1) Adverse weather conditions;
    (2) Fire;
    (3) Insects or plant disease (except Verticillium Wilt disease), 
but not damage due to insufficient or improper application of control 
measures;
    (4) Wildlife;
    (5) Earthquake;
    (6) Volcanic eruption; or
    (7) Failure of the irrigation water supply, if caused by an insured 
cause of loss listed in sections 9(a)(1) through (6) that occurs during 
the insurance period.
    (b) In addition to the causes of loss excluded in section 12 of the 
Basic Provisions, we will not insure against any loss of production 
that:
    (1) Occurs after harvest;
    (2) Is due to your failure to distill the crop, unless such failure 
is due to actual physical damage to the crop caused by an insured cause 
of loss that occurs during the insurance period; or
    (3) Is due to Verticillium Wilt disease.
10. Duties In The Event of Damage or Loss
    In addition to your duties contained in section 14 of the Basic 
Provisions, if you discover that any insured mint is damaged, or if you 
intend to claim an indemnity on any unit:
    (a) You must give us notice of probable loss at least 15 days 
before the beginning of any cutting or immediately if probable loss is 
discovered after cutting has begun or when cutting should have begun; 
and
    (b) You must timely harvest and completely distill a sample of the 
crop on any acreage you do not intend to harvest, as designated by us, 
to determine if an indemnity is due.
11. Settlement of Claim
    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide separate, acceptable production records:
    (1) For any optional units, we will combine all optional units for 
which such production records were not provided; or
    (2) For any basic units, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for the units.
    (b) We may defer appraisals until the crop reaches maturity or the 
date mint harvest is general in the area.
    (c) In the event of loss or damage covered by this policy, we will 
settle your claim by:
    (1) Multiplying the insured acreage for each type, if applicable, 
by its respective production guarantee;
    (2) Multiplying the result of section 11(c)(1) by the respective 
price election for each type, if applicable;
    (3) Totaling the results of section 11(c)(2);
    (4) Multiplying the total production to be counted (see section 
11(d)) of each type, if applicable, by its respective price election;
    (5) Totaling the results of section 11(c)(4);
    (6) Subtracting the result in section 11(c)(5) from the result of 
section 11(c)(3); and
    (7) Multiplying the result in section 11(c)(6) by your share.
    For example:
    Assume that you have a 100 percent share in 100 acres of peppermint 
in the unit, with a production guarantee of 50 pounds of oil per acre 
and a price election of $12 per pound. Because an insured cause of loss 
has reduced production, you only harvest and distill 2,500 pounds of 
peppermint oil. Your indemnity would be calculated as follows:
    (1) 100 acres x 50 pounds = 5,000 pound production guarantee;
    (2) 5,000 pound production guarantee x $12 price election = $60,000 
value of production guarantee;
    (3) 2,500 pounds production to count x $12 price election = $30,000 
value of production to count;
    (4) $60,000 - $30,000 = $30,000 loss; and
    (5) $30,000 x 100 percent share = $30,000 indemnity payment.
    (d) The total production to count (in pounds of oil) from all 
insurable acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the production guarantee per acre for acreage:
    (A) That is abandoned;
    (B) That is put to another use without our consent;
    (C) For which you fail to meet the requirements contained in 
section 10 of these Crop Provisions;
    (D) That is damaged solely by uninsured causes; or
    (E) For which you fail to provide production records that are 
acceptable to us;
    (ii) All production lost due to uninsured causes;
    (iii) All unharvested production;
    (iv) All potential production on insured acreage that you intend to 
put to another use or abandon with our consent:
    (A) If you do not elect to continue to care for the crop, we may 
give you our

[[Page 24529]]

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 fail to provide sufficient care 
for the samples, the amount of production to count will be not less 
than the production guarantee per acre); 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 the appraised production at the time the crop reaches maturity.
    (2) All harvested production from the insurable acreage.
    (e) Harvested production must be distilled to determine production 
to count.
    (f) Any oil distilled from plants growing in the mint will be 
counted as mint oil on a weight basis.
    (g) You are responsible for the cost of distilling samples for loss 
adjustment purposes.
12. Late and Prevented Planting.
    The late and prevented planting provisions of the Basic Provisions 
are not applicable.
13. Winter Coverage Option
    (a) The provisions of this option are continuous and will be 
attached to and made part of your insurance policy if:
    (1) You elect the Winter Coverage Option on your application, or on 
a form approved by us, on or before the fall sales closing date for the 
crop year in which you wish to insure mint under this option, and pay 
the additional premium indicated in the actuarial documents for this 
optional coverage; and
    (2) You have not elected coverage under the Catastrophic Risk 
Protection Endorsement.
    (b) This option provides a production guarantee equal to 60 percent 
of the production guarantee determined under section 3 of these Crop 
Provisions.
    (c) If you elect this option, all of the insurable acreage in the 
county will be insured by this option.
    (d) In addition to the requirements of section 6 of the Basic 
Provisions, any acreage of new mint planted after the applicable 
acreage reporting date must be certified by you and reported to us 
within two weeks of planting.
    (e) In lieu of section 6(a) of these Crop Provisions, the crop 
insured will be all mint types in the county for which a premium rate 
is provided by the actuarial documents:
    (1) In which you have a share;
    (2) That are planted for harvest and distillation as mint oil;
    (3) That have an adequate stand on the date coverage begins (newly 
planted mint types must be reported in accordance with section 8(d) but 
they must be reported as uninsured unless they have an adequate stand 
by the date coverage begins); and
    (4) That has been:
    (i) Inspected and accepted by us for the first crop year you are 
insured (We will inspect all mint acreage and will notify you of the 
acceptance or rejection of your application not later than November 15. 
If we fail to notify you by that date, your application will be 
accepted unless other grounds exist to reject the application, as 
specified in the Basic Provisions, the application, or these Crop 
Provisions);
    (ii) Inspected and accepted by us not later than November 15 for 
the crop year following the payment of an indemnity or a reported loss 
unless the crop was determined to have an adequate stand (If we 
determined there was an adequate stand after the loss was reported, no 
inspection is necessary); or
    (iii) Certified by you as having an adequate stand on the date 
coverage begins unless an inspection is required under section 
13(e)(4)(ii).
    (f) Coverage under this option begins:
    (1) On existing mint acreage with an adequate stand at 12:01 a.m. 
on the calendar date listed below:
    (i) October 1 in Indiana and Wisconsin;
    (ii) October 16 in Montana;
    (iii) November 1 in Washington; and
    (iv) For all other states, the date as provided in the Special 
Provisions.
    (2) On new mint acreage, that has an adequate stand by the date 
coverage begins as specified in section 13(f)(1).
    (g) Coverage under this option ends on the unit or part of the unit 
at 11:59 p.m. on the calendar date listed below:
    (1) June 15 in Indiana, Montana, and Wisconsin;
    (2) May 15 in Washington; and
    (3) For all other states, the date as provided in the Special 
Provisions.
    (h) In lieu of section 10(a) of these Crop Provisions, you must 
give notice of probable loss within 72 hours after you discover any 
insured mint is damaged and does not have an adequate stand, but no 
later than the date coverage ends for this option.
    (i) In addition to the requirements of section 10 of these Crop 
Provisions, you must give us notice if you want our consent to put any 
mint acreage to another use before a determination can be made if there 
is an adequate stand on the acreage. We will inspect the acreage and 
you must agree in writing no payment or indemnity will be made for the 
acreage put to another use. The total production to be counted for 
acreage put to another use with our consent in accordance with this 
section will not be less than the approved yield.
    (j) In addition to section 11(a) of these Crop Provisions we will 
make a Winter Coverage Option payment only on acreage that had an 
adequate stand on the date that insurance attached if the adequate 
stand was lost due to an insured cause of loss occurring within the 
Winter Coverage Option insurance period and the acreage consists of at 
least 20 acres or 20 percent of the insurable planted acres in the 
unit.
    (k) In lieu of section 11(b) of these Crop Provisions, we may defer 
appraisals until the date coverage ends under this option.
    (l) In lieu of section 11(c) of these Crop Provisions, in the event 
of loss or damage covered by this policy, we will settle your claim by:
    (1) Multiplying 60 percent by your production guarantee per acre;
    (2) Multiplying the result in section 13(l)(1) by the number of 
acres that do not have an adequate stand;
    (3) Multiplying the result in section 13(l)(2) by the price 
election; and
    (4) Multiplying the result in section 13(l)(3) by your share.
    For example:
    Assume that you have a 100 percent share in 100 acres of mint with 
a production guarantee of 50 pounds of oil per acre and a price 
election of $12 per pound. Also assume that you do not have an adequate 
stand on 50 acres by the date coverage ends for this option because an 
insured cause has damaged the stand. Your Winter Coverage Option 
payment would be calculated as follows:
    (1) 60 percent x 50 pound production guarantee = 30 pound 
production guarantee per acre;
    (2) 30 pound production guarantee per acre x 50 acres without an 
adequate stand = 1,500 pounds;
    (3) 1,500 pounds x $12 price election = $18,000; and
    (4) $18,000 x 100 percent share = $18,000 Winter Coverage Option 
payment.
    (m) In lieu of section 11(d) of these Crop Provisions, the 
population of live mint plants to be counted from insurable acreage on 
the unit will be not less than the population of live mint plants in an 
adequate stand for acreage:
    (1) That is abandoned;
    (2) That is put to another use without our consent;

[[Page 24530]]

    (3) For which you fail to meet the requirements contained in 
section 13(h); or
    (4) That is damaged solely by uninsured causes.
    (n) Acreage for which a Winter Coverage Option payment has been 
made is no longer insurable under the Crop Provisions for the current 
crop year. Any mint production subsequently harvested from uninsured 
acreage for the crop year and not kept separate from production from 
insured acreage will be considered production to count.
    (o) Acreage for which a Winter Coverage Option payment has been 
made will receive an amount of production of zero when computing 
subsequent year's approved yield.
    (p) Sections 11(e), (f), and (g) of these Crop Provisions do not 
apply to this option.

    Signed in Washington, DC, on April 25, 2007.
Eldon Gould,
Manager, Federal Crop Insurance Corporation.
[FR Doc. E7-8340 Filed 5-2-07; 8:45 am]
BILLING CODE 3410-08-P