[Federal Register Volume 73, Number 41 (Friday, February 29, 2008)]
[Proposed Rules]
[Pages 11054-11060]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-3850]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 73, No. 41 / Friday, February 29, 2008 / 
Proposed Rules  

[[Page 11054]]



DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 457

RIN 0563-AC09


Common Crop Insurance Regulations; Grape Crop Insurance 
Provisions and Table Grape Crop Insurance Provisions

AGENCY: Federal Crop Insurance Corporation, USDA.

ACTION: Proposed rule with request for comments.

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

SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes to 
amend the Common Crop Insurance Regulations, Grape Crop Insurance 
Provisions and Table Grape Crop Insurance Provisions. The intended 
effect of this action is to provide policy changes and clarify existing 
policy provisions to better meet the needs of insured producers, and to 
reduce vulnerability to fraud, waste, or abuse.

DATES: Written comments and opinions on this proposed rule will be 
accepted until close of business April 29, 2008 and will be considered 
when the rule is to be made final.

ADDRESSES: Interested persons are invited to submit comments, titled 
``Grape Crop Insurance Provisions'', by any of the following methods:
     By Mail to: Director, Product Administration and Standards 
Division, Risk Management Agency, United States Department of 
Agriculture, Beacon Facility, Stop 0812, Room 421, PO Box 419205, 
Kansas City, MO 64141-6205.
     By Express Mail to: Director, Product Administration and 
Standards Division, Risk Management Agency, United States Department of 
Agriculture, Beacon Facility, Stop 0812, 9240 Troost Avenue, Kansas 
City, MO 64131-3055.
     E-mail: [email protected].
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
    A copy of each response will be available for public inspection and 
copying from 7 a.m. to 4:30 p.m., CST, Monday through Friday, except 
holidays, at 6501 Beacon Drive, Stop 0812, Room 421, Kansas City, MO 
64133-4676.

FOR FURTHER INFORMATION CONTACT: Elizabeth Lopez, Risk Management 
Specialist, Product Management, Product Administration and Standards 
Division, Risk Management Agency, United States Department of 
Agriculture, Beacon Facility, Stop 0812, Room 421, PO Box 419205, 
Kansas City, MO 64141-6205, 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 purpose 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 June 
30, 2008.

E-Government Act Compliance

    FCIC is committed to complying with the E-Government Act of 2002, 
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

[[Page 11055]]

part 3015, subpart V, published at 48 FR 29115, June 24, 1983.

Executive Order 12988

    This proposed 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

    FCIC proposes to amend the Common Crop Insurance Regulations (7 CFR 
part 457) by amending Sec.  457.138 Grape Crop Insurance Provisions and 
Sec.  457.149 Table Grape Crop Insurance Provisions effective for the 
2010 and succeeding crop years.
    The Grape Crop Insurance Provisions were last updated effective for 
the 2000 crop year and the Table Grape Crop Insurance Provisions were 
last updated for the 2001 crop year. Since then, several requests have 
been made for changes to enhance the coverage offered, address quality 
adjustment procedures, and improve clarity of the policy provisions.
    The proposed changes are as follows:
    1. FCIC proposes to amend Sec.  457.138 Grape Crop Insurance 
Provisions as follows:
    a. FCIC is proposing to remove the paragraph immediately preceding 
section 1 which refers to the order of priority in the event of a 
conflict. This same information is contained in the Basic Provisions; 
therefore, it is duplicative and should be removed in the Crop 
Provisions;
    b. Section 1--FCIC is proposing to revise the definitions of 
``harvest'' and ``set out'' so the definitions are consistent in both 
grape policies. FCIC is proposing to add a definition of ``type'' 
because optional units by type are being proposed. FCIC also proposes 
to remove the definition of ``varietal group'' because insurance is not 
being provided by varietal group. The term ``varietal group'' will be 
replaced with the term ``type'' wherever it appears in the Crop 
Provisions.
    Section 2--Current provisions regarding unit structure in 
California allow basic units by variety, and optional units when 
insured acreage is located on non-contiguous land or is grown using an 
organic practice. In all other states, basic units are allowed by 
share, and optional units are provided by: (1) By section or section 
equivalent or FSA farm serial number; (2) irrigated and non-irrigated 
acreage; (3) for grapes grown using an organic farming practice; and 
(4) by separate varietal group when such groups are specified in the 
Special Provisions. These unit structures accommodate various 
production practices, growing conditions, varieties, and availability 
of data in the different states. Since the last revisions, availability 
of production data has improved and can now serve as a basis for change 
in the unit structure. Therefore, FCIC is proposing to change the unit 
structure for all states except California. The proposal will allow 
producers in all states other than California and Arizona to obtain 
optional units by grape type (a category of grapes (one or more 
varieties) identified as a type in the Special Provisions). In these 
states, all insurable grape acreage in the county must still be 
insured. The proposed change will offer expanded coverage and allow 
producers greater flexibility in unit structure when separate types are 
specified in the Special Provisions. In addition, since FCIC is also 
proposing to add grape crop insurance coverage in the state of Arizona, 
FCIC is proposing that producers in Arizona have the same unit 
structure as is available to producers in California. The varieties, 
production practices, and risks in Arizona are most similar to 
California. Previously, Arizona grape crop insurance coverage was only 
available by written agreement.
    d. Section 3--FCIC is proposing to reorganize subsections (a), (b) 
and (c) into subsection (a), which will be applicable to California and 
Arizona, and subsection (b), which will be applicable to all other 
states. FCIC is proposing that the price and coverage level be 
specified by variety in California and Arizona and by type in all other 
states as specified in the Special Provisions.
    A new subsection (c) is being proposed that offers an alternative 
to the published price election. This alternative price will be based 
on a contract price, provided specific requirements are met, and use of 
the contract price is allowed by the Special Provisions of Insurance. 
Grape growers in some regions are entering into contracts that require 
them to use cultural practices to produce fewer tons of grapes than 
they have historically produced. In return, they receive a higher price 
per ton to compensate for the reduced tonnage. In these cases, the 
published price election, which is usually based on historical average 
prices, does not provide adequate insurance coverage for these 
producers. This proposal will consider the contract price and reduced 
tonnage to provide an appropriate level of insurance protection for the 
producer.
    In subsection (d), FCIC is proposing to allow a producer in Arizona 
to apply for a written agreement to establish a price election if the 
Special Provisions do not provide a published price election for a 
specific variety the producer wishes to insure. This is currently 
allowed only in California.
    In subsection (g), FCIC is proposing to revise the provision to 
specify that no producer in any state will be allowed to increase the 
coverage level or the ratio of the price election to the maximum price 
election if a cause of loss that could reduce yield is evident prior to 
the time of the requested increase. These revisions will not only 
clarify the provisions, they will also increase the flexibility to add 
insurance coverage in other states, if appropriate.
    e. Section 4--FCIC is proposing to add Arizona to the states with a 
contract change date of October 31.
    f. Section 5--FCIC is proposing to add Arizona to the states with a 
cancellation and termination date of January 31.
    g. Section 6--FCIC is proposing that producers in Arizona also 
report grape acreage by variety as producers in California currently do 
(each variety in California constitutes a type) and producers in all 
other states report grape acreage by type.
    h. Section 7--FCIC is proposing that producers in Arizona be able 
to elect which varieties they wish to insure as is currently applicable 
in California. In all states except Arizona and California, producers 
will be required to insure all grape types specified in the Special 
Provisions.
    In subsection (b), FCIC proposes to clarify only grapes grown for 
wine, juice, raisins, or canning are insurable under this policy. 
However, if any grapes initially intended for these uses are ultimately 
put to another use (i.e. table grapes), the production to count will be 
on a tonnage basis and no additional quality adjustment other than that 
specified in the Grape Crop Provisions will be available.

[[Page 11056]]

    In subsection (e), FCIC proposes to allow insurance for acreage 
that has not produced a two-ton average in at least one of the three 
prior crop years if provided for in the Special Provisions. This 
proposal will allow insurability requirements to be tailored to 
specific situations. For example, there may be certain varieties or 
contracts with reduced tonnage requirements where normal production 
levels are below 2 tons per acre. Instead of requiring an inspection, 
such varieties can be specified in the Special Provisions.
    i. Section 9--FCIC is proposing to revise the number of days 
coverage begins from 10 to 20 days when an application is taken after a 
specified date. This change is being proposed to be more consistent 
with other perennial crop policies where it may be possible to forecast 
loss events. A delay of coverage until 20 days after application is 
made should greatly reduce the ability to predict losses. FCIC also 
proposes to add a provision allowing termination for the current crop 
year when insurance attaches prior to the termination date but the 
premium for the previous year is not paid.
    In subsection (a)(2), FCIC is proposing to remove the seven listed 
states of California, Arizona, Idaho, Mississippi, Oregon, Texas and 
Washington, to allow the continuous coverage provision to apply to all 
states. In subsection (a)(3), FCIC is proposing to change the end of 
the insurance period date for Idaho, Oregon and Washington from 
November 1 to November 10 and add Arizona to the states using this same 
date. FCIC has been informed that acreage is still normally being 
harvested in these states until November 10.
    j. Section 12--FCIC is proposing to clarify that even if the grapes 
are put to a use other than wine, juice, raisins, or canning, they will 
count as production to count on a tonnage basis, and quality adjustment 
is limited to those specified in the Crop Provisions. In subsection 
(e)(2)(i), FCIC is proposing to clarify the quality adjustment 
procedure. FCIC is proposing that the value per ton of the damaged 
grapes will be divided by the value per ton for undamaged grapes. The 
value of undamaged grapes will not exceed the maximum price election 
for such grapes. This will ensure that the undamaged grapes are not 
over-valued.
    2. FCIC proposes to amend Sec.  457.149 Table Grape Crop Insurance 
Provisions as follows:
    a. FCIC is proposing to remove the paragraph immediately preceding 
section 1 which refers to the order of priority in the event of a 
conflict. This same information is contained in the Basic Provisions; 
therefore, it is duplicative and should be removed in the Crop 
Provisions;
    b. Section 1--FCIC is proposing to revise the definitions of 
``harvest'' and ``set out'' to be consistent in both grape policies. 
FCIC is proposing to add definitions of ``type'' and ``USDA grade 
standard''. The term ``type'' is added because it is proposed to be 
used in the structure of optional units. The term ``USDA grade 
standard'' is added to establish an objective standard by which the 
table grapes will be graded for the purposes of quality adjustment when 
there is no applicable state standard. FCIC is proposing to revise the 
definition of ``lug'' to add standards for states other than Arizona 
and California. FCIC also proposes to add language indicating the 
Special Provisions may specify a different number of pounds per lug. 
This will allow flexibility in the event standards change from year to 
year. FCIC also proposes to remove the definition of ``cluster thinning 
and removal'' as it is no longer referenced in the policy;
    c. Section 2--To be consistent with the Grape Crop Provisions, FCIC 
is proposing to add a new subsection (c) to provide unit division by 
type for all states, except Arizona and California, when separate types 
are specified in the Special Provisions;
    d. Section 3--FCIC is proposing to specify that in the states of 
Arizona and California the producer may select only one price election 
and coverage level for each table grape variety in the county. FCIC is 
proposing to add a new subsection (b) to allow producers in all states 
except Arizona and California to select only one price election and 
coverage level for each grape type specified in the Special Provisions;
    e. Section 4--FCIC is proposing to add a contract change date of 
August 31 for all states, except Arizona and California. This will 
allow the insurance coverage to be modified to more accurately reflect 
the desired coverage period and allow approved insurance providers 
sufficient time to train agents on the changes so they can properly 
inform their insureds;
    f. Section 5--FCIC is proposing to add cancellation and termination 
dates of November 20, in all states, except Arizona and California. 
This provides insurance coverage that more accurately reflects the 
production period;
    g. Section 6--FCIC is proposing to add provisions for states other 
than Arizona and California that require the producer to report acreage 
by each type insured;
    h. Section 7--FCIC is proposing to revise the introductory text of 
section 7 to specify the crop insured will be any insurable variety the 
producer elects to insure in Arizona and California or all insurable 
types in the county for which a premium rate is provided by the 
actuarial documents in all states, except Arizona and California. This 
change is necessary because California and Arizona offer insurance by 
variety but as stated above, all other states will now offer insurance 
by type. The remaining subsections have been revised to ease in reading 
and to provide consistency between the Table Grape and Grape Crop 
Provisions;
    i. Section 9--FCIC is proposing to revise the number of days before 
coverage begins from 10 days to 20 days when an application is taken 
after a specified date. This change is being proposed to be more 
consistent with other perennial crop policies where it may be possible 
to forecast loss events. A delay of coverage until 20 days after 
application is made should greatly reduce the ability to predict 
losses. Subsections have been redesignated to provide consistency 
between the Table Grape and Grape Crop Provisions;
    j. Section 10--FCIC is proposing to revise the causes of loss to be 
consistent with the Grape Crop Provisions. This means that insects and 
plant disease are now covered causes of loss except for losses caused 
by the insufficient or improper application of pest control or disease 
control measures; and
    k. Section 12--FCIC proposes to revise section 12(c)(1)(iii) to 
include the appropriate state or USDA standards, if state standards are 
not available for table grapes.

List of Subjects in 7 CFR Part 547

    Crop insurance, Grapes, Reporting and recordkeeping requirements.

Proposed Rule

    Accordingly, as set forth in the preamble, the Federal Crop 
Insurance Corporation proposes to amend 7 CFR part 457 effective for 
the 2010 and succeeding crop years to read 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 Sec.  457.138, Grape crop insurance provisions as follows:
    a. In the first line of the introductory text remove ``2000'' and 
add ``2010'' in its place;
    b. Remove the paragraph immediately preceding section 1;
    c. Amend section 1 by revising the definitions of ``harvest'' and 
``set out'',

[[Page 11057]]

adding a definition of ``type'', and removing the definition of 
``varietal group'';
    d. Revise section 2;
    e. Revise section 3;
    f. Revise section 4;
    g. Revise section 5;
    h. Revise section 6;
    i. Revise section 7;
    j. Revise section 8;
    k. Amend section 9 by revising paragraph (a) and the introductory 
text in paragraph (b);
    l. Amend section 10 by revising paragraph (a) introductory text;
    m. Amend section 11 by revising the introductory text; and
    n. Amend section 12 by adding the word ``type'' after the phrase 
``varietal group'' in both places in paragraphs (b)(2) and (4), 
revising paragraphs (c)(2) and (e)(2)(i).
    The added and revised text reads as follows:


Sec.  457.138  Grape crop insurance provisions

* * * * *
    1. Definitions.
* * * * *
    Harvest. Removing the mature grapes from the vines either by hand 
or machine.
* * * * *
    Set out. Physically planting the grape plants in the vineyard.
* * * * *
    Type. A category of grapes (one or more varieties) identified as a 
type in the Special Provisions.
    2. Unit Division.
    (a) In Arizona and California only:
    (1) A basic unit as defined in section 1 of the Basic Provisions 
will be divided into additional basic units by each variety that you 
insure; and
    (2) Provisions in the Basic Provisions that provide for optional 
units by section, section equivalent, or FSA farm serial number and by 
irrigated and non-irrigated practices are not applicable. Optional 
units may be established only if each optional unit is located on non-
contiguous land, unless otherwise allowed by written agreement.
    (b) In all states except Arizona and California, in addition to, or 
instead of, establishing optional units by section, section equivalent, 
or FSA farm serial number and by irrigated and non-irrigated acreage as 
provided in the unit division provisions contained in the Basic 
Provisions, a separate optional unit may be established if each 
optional unit:
    (1) Is located on non-contiguous land; or
    (2) Consists of a separate type when separate types are specified 
in the Special Provisions.
    3. Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities.
    In addition to the requirements of section 3 of the Basic 
Provisions:
    (a) In Arizona and California, you may select only one price 
election and coverage level for each grape variety in the county.
    (b) In all states except Arizona and California, you may select 
only one price election and coverage level for each grape type 
specified in the Special Provisions.
    (c) In addition to the definition of ``price election'' contained 
in section 1 of the Basic Provisions, a price election based on the 
price contained in your grape contract is allowed if provided by the 
Special Provisions. In the event any contract requires a reduction in 
the amount of production from any insured acreage, your approved yield 
will be adjusted in accordance with section 3(e).
    (d) In Arizona and California only, if the Special Provisions do 
not provide a price election for a specific variety you wish to insure, 
you may apply for a written agreement to establish a price election. 
Your application for the written agreement must include:
    (1) The number of tons sold for at least the two most recent crop 
years; and
    (2) The price received for all production of the grape variety in 
the years for which production records are provided.
    (e) You must report by the production reporting date designated in 
section 3 of the Basic Provisions, by type or variety, if applicable:
    (1) Any damage, removal of bearing vines, 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 vines on insurable and uninsurable 
acreage;
    (3) The age of the vines and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and anytime the planting pattern of such 
acreage is changed:
    (i) The age of the interplanted crop, and the grape type or 
variety, if applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield.
    (f) We will reduce the yield used to establish your production 
guarantee, based on our estimate of the effect of the following: 
interplanted perennial crop; removal of vines; damage; change in 
practices and any other circumstance that may affect 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 at any time we become aware of the 
circumstance.
    (g) 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 preceding the cancellation date for Arizona 
and 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 in Arizona and 
California, and November 20 for all other states.
    6. Report of Acreage.
    In addition to the requirements of section 6 of the Basic 
Provisions, you must report your acreage:
    (a) In Arizona and California, by each grape variety you insure; or
    (b) In all other states, by each grape type you insure.
    7. Insured Crop.
    In accordance with section 8 of the Basic Provisions, the crop 
insured will be any insurable variety that you elect to insure in 
Arizona and California, or in all other states all insurable types, in 
the county for which a premium rate is provided by the actuarial 
documents:
    (a) In which you have a share;
    (b) That are grown for wine, juice, raisins, or canning (if such 
grapes are put to another use, they will still be insured and they will 
count as production to count in accordance with section 12(c)(2(ii));
    (c) That are grown in a vineyard that, if inspected, is considered 
acceptable by us;
    (d) That, after being set out or grafted, have reached the number 
of growing seasons designated by the Special Provisions; and
    (e) That have produced an average of two tons of grapes per acre 
unless otherwise provided in the Special Provisions, in at least one of 
the three crop years immediately preceding the insured crop year, or we 
inspect and allow insurance on such acreage.
    8. Insurable Acreage.
    In lieu of the provisions in section 9 of the Basic Provisions that 
prohibit

[[Page 11058]]

insurance attaching to a crop planted with another crop, grapes 
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) For the year of application, coverage begins on February 1 in 
Arizona and California, and November 21 in all other states of each 
crop year. Notwithstanding the previous sentence, if your application 
is received by us after January 12 but prior to February 1 in Arizona 
or California, or after November 1 but prior to November 21 in all 
other states, insurance will attach on the 20th day after your properly 
completed application is received in our local office, unless we 
inspect the acreage during the 20-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 
vineyard.
    (2) 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.
    (3) If your grape policy is cancelled 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) The calendar date for the end of the insurance period for each 
crop year is as follows, unless otherwise specified in the Special 
Provisions:
    (i) October 10 in Mississippi and Texas;
    (ii) November 10 in Arizona, California, Idaho, Oregon and 
Washington; and
    (iii) November 20 in all other states.
    (b) In addition to the provisions of section 11 of the Basic 
Provisions:
* * * * *
    10. Cause of Loss.
    (a) In accordance with the provisions of section 12 of the Basic 
Provisions, insurance is provided only against the following cause of 
loss that occur during the insurance period:
* * * * *
    11. Duties in the Event of Damage or Loss.
    In addition to the requirements of section 14 of the Basic 
Provisions, the following will apply:
* * * * *
    12. Settlement of Claim.
* * * * *
    (c) * * *
    (2) All harvested production from the insurable acreage:
    (i) Grape production that is harvested and dried for raisins will 
be converted to a fresh weight basis by multiplying the number of tons 
of raisin production by 4.5.
    (ii) Grapes grown for wine, juice, raisins or canning and put to 
another use, will be counted as production to count on a tonnage basis 
and no quality adjustment other than that specifically provided for in 
your policy is available.
* * * * *
    (e) * * *
    (2) * * *
    (i) Dividing the value per ton of the damaged grapes by the value 
per ton for undamaged grapes (the value of undamaged grapes will be the 
lesser of the average market price or the maximum price election for 
such grapes); and
* * * * *
    3. Amend Sec.  457.149 Table grape crop insurance provisions as 
follows:
    a. In the first line of the introductory text, remove ``2001'' and 
add ``2010'' in its place;
    b. Remove the paragraph immediately preceding section 1;
    c. Amend section 1 by revising the definitions of ``harvest'', 
``lug'', and ``set out'', adding a definition of ``type and USDA grade 
standard'', and removing the definition of ``cluster thinning and 
removal'';
    d. Revise section 2;
    e. Revise section 3;
    f. Revise section 4;
    g. Revise section 5;
    h. Revise section 6;
    i. Revise section 7;
    j. Revise section 8;
    k. Revise section 9;
    l. Revise section 10;
    m. Amend section 11 by revising the introductory text; and
    n. Amend section 12 by revising paragraphs (b)(2) and (4) and 
(c)(1)(iii).
    The added and revised text reads as follows:


Sec.  457.149  Table grape crop insurance provisions.

* * * * *
    1. Definitions.
* * * * *
    Harvest. Removing the mature grapes from the vines either by hand 
or machine.
* * * * *
    Lug. Twenty (20) pounds of table grapes in the Coachella Valley, 
California district, and all other states. Twenty-one (21) pounds in 
all other California districts, or as otherwise specified in the 
Special Provisions.
    Set out. Physically planting the grape plants in the vineyard.
* * * * *
    Type. A category of grapes (one or more varieties) identified as a 
type in the Special Provisions.
    USDA grade standard. United States standard used to determine the 
minimum quality grade will be: (1) The United States Standards for 
Grades of Table Grapes (European or Vinifera Type); (2) the United 
States Standard for Grades if American (Eastern Type Bunch Grapes; and 
(3) the United States Standards for Grades of Muscadine (Vitis 
rotundifolia) Grapes. The quantity and number of samples required will 
be determined in accordance with procedure issued by FCIC or as 
provided on the Special Provisions of Insurance.
    2. Unit Division.
    (a) In Arizona and California only:
    (1) A basic unit, as defined in section 1 of the Basic Provisions, 
will be divided into additional basic units by each table grape variety 
that you insure; and
    (2) Provisions in the Basic Provisions that provide for optional 
units by section, section equivalent, or FSA farm serial number and by 
irrigated and non-irrigated practices are not applicable. Optional 
units may be established only if each optional unit is located on non-
contiguous land, unless otherwise allowed by written agreement.
    (b) In all states except Arizona and California, in addition to, or 
instead of, establishing optional units by section, section equivalent, 
or FSA farm serial number and by irrigated and non-irrigated acreage as 
provided in the unit division provisions contained in the Basic 
Provisions, a separate optional unit may be established if each 
optional unit:
    (1) Is located on non-contiguous land; or
    (2) Consists of a separate type when separate types are specified 
in the Special Provisions.
    3. Insurance Guarantees, Coverage Levels, and Price for Determining 
Indemnities. In addition to the requirements of section 3 of the Basic 
Provisions:
    (a) In Arizona and California, you may select only one price 
election and

[[Page 11059]]

coverage level for each table grape variety in the county.
    (b) In all states except Arizona and California, you may select 
only one price election and coverage level for each table grape type 
specified in the Special Provisions.
    (c) You must report by the production reporting date designated in 
section 3 of the Basic Provisions, by type or variety if applicable:
    (1) Any damage, removal of bearing vines, 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 vines on insurable and uninsurable 
acreage;
    (3) The age of the vines and the planting pattern; and
    (4) For the first year of insurance for acreage interplanted with 
another perennial crop, and anytime the planting pattern of such 
acreage is changed:
    (i) The age of the interplanted crop, and the table grape type or 
variety, if applicable;
    (ii) The planting pattern; and
    (iii) Any other information that we request in order to establish 
your approved yield.
    (d) We will reduce the yield used to establish your production 
guarantee, based on our estimate of the effect of the following: 
Interplanted perennial crop; removal of vines; damage; change in 
practices and any other circumstance that may affect 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 at any time we become aware of the 
circumstance.
    (e) 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 preceding the cancellation date for Arizona 
and 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 in Arizona and 
California, and November 20 for all other states.
    6. Report of Acreage.
    In addition to the requirements of section 6 of the Basic 
Provisions, you must report your acreage:
    (a) In Arizona and California, by each table grape variety you 
insure; or
    (b) In all other states, by each type you insure.
    7. Insured Crop.
    In accordance with section 8 of the Basic Provisions, the crop 
insured will be any insurable variety of table grapes that you elect to 
insure in Arizona and California, or in all other states all insurable 
types, in the county for which a premium rate is provided by the 
actuarial documents:
    (a) In which you have a share;
    (b) That are grown for harvest as table grapes;
    (c) That are adapted to the area;
    (d) That are grown in a vineyard that, if inspected, is considered 
acceptable by us;
    (e) That, after being set out or grafted, have reached the number 
of growing seasons designated by the Special Provisions; or
    (f) That have produced an average of at least 150 lugs of table 
grapes per acre in at least one of the most recent three crop years in 
your actual production history base period. However, we may agree in 
writing to insure acreage that has not produced this amount.
    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, table 
grapes 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) For the year of application, coverage begins on February 1 in 
Arizona and California, and November 21 in all other states. 
Notwithstanding the previous sentence, if your application is received 
by us after January 12 but prior to February 1 in Arizona or 
California, or after November 1 but prior to November 21 in all other 
states, insurance will attach on the 20th day after your properly 
completed application is received in our local office, unless we 
inspect the acreage during the 20-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 
vineyard.
    (2) 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.
    (3) If your table grape policy is cancelled 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) The calendar date for the end of insurance period for each crop 
year is the date specified in the Special Provisions.
    (b) In addition to the provisions of section 11 of the Basic 
Provisions:
    (1) If you acquire an insurable share in any insurable acreage 
after coverage begins but on or before the acreage reporting date for 
the crop year, and after an inspection we consider the acreage 
acceptable, insurance will be considered to have attached to such 
acreage on the calendar date for the beginning of the insurance period.
    (2) If you relinquish your insurable share on any insurable acreage 
of table grapes on or before the acreage reporting date for the crop 
year, insurance will not be considered to have attached to, and no 
premium will be due or indemnity paid for such acreage for that crop 
year unless:
    (i) A transfer of coverage and right to an indemnity, or a similar 
form approved by us, is completed by all affected parties;
    (ii) We are notified by you or the transferee in writing of such 
transfer on or before the acreage reporting date; and
    (iii) The transferee is eligible for crop insurance.
    10. Cause 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, unless weeds and other forms of undergrowth have not been 
controlled or pruning debris has not been removed from the vineyard;
    (3) Insects, except as excluded in 10(b)(1), but not damage due to 
insufficient or improper application of pest control measures;
    (4) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (5) Wildlife;

[[Page 11060]]

    (6) Earthquake;
    (7) Volcanic eruption; or
    (8) Failure of irrigation water supply, if caused by an insured 
peril 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 damage or loss of 
production due to:
    (1) Phylloxera, regardless of cause; or
    (2) Inability to market the table grapes for any reason other than 
the actual physical damage from an insurable cause specified in this 
section. For example, we will not pay you an indemnity if you are 
unable to market due to quarantine, boycott, or refusal of any person 
to accept production.
    11. Duties in the Event of Damage or Loss.
    In addition to the requirements of section 14 of the Basic 
Provisions, the following will apply:
* * * * *
    12. Settlement of Claim.
* * * * *
    (b) * * *
    (2) Multiplying the result in section 12(b)(1) by the respective 
price election for the variety or type;
* * * * *
    (4) Multiplying the total production to be counted of the variety 
or type (see section 12(c)) by the respective price election;
* * * * *
    (c) * * *
    (1) * * *
    (iii) Unharvested production that meets, or would meet if properly 
handled, the state quality standards or the appropriate USDA grade 
standard (if no state standard is applicable); and
* * * * *

    Signed in Washington, DC, on February 21, 2008.
Eldon Gould,
Manager, Federal Crop Insurance Corporation.
 [FR Doc. E8-3850 Filed 2-28-08; 8:45 am]
BILLING CODE 3410-08-P