[Federal Register Volume 79, Number 153 (Friday, August 8, 2014)]
[Rules and Regulations]
[Pages 46335-46348]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-18719]



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  Federal Register / Vol. 79, No. 153 / Friday, August 8, 2014 / Rules 
and Regulations  

[[Page 46335]]



DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

7 CFR Part 1412

RIN 0560-AI22


Cotton Transition Assistance Program and General Provisions for 
Agriculture Risk Coverage and Price Loss Coverage Programs

AGENCY: Commodity Credit Corporation and Farm Service Agency, USDA.

ACTION: Final rule.

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SUMMARY: This rule implements the new Cotton Transition Assistance 
Program (CTAP) authorized by the Agricultural Act of 2014 (the 2014 
Farm Bill). It also includes general provisions needed to implement 
CTAP, the Agriculture Risk Coverage (ARC), and Price Loss Coverage 
(PLC) Programs. ARC and PLC will be implemented through a separate 
rulemaking and will provide benefits for other commodities. CTAP is a 
temporary program that provides payments to producers on farms for 
which cotton base acres were in existence as of September 30, 2013, as 
adjusted. It will operate for only the 2014 crop year and in certain 
counties for the 2015 crop year, and is intended to be a transition for 
producers on farms with upland cotton base acres that were in existence 
as of September 30, 2013, between the previous Direct and Counter-
cyclical Payments Program (DCP) and the new Stacked Income Protection 
Plan (STAX), which is authorized to begin no later than the 2015 crop 
year.

DATES: Effective Date: August 8, 2014.

FOR FURTHER INFORMATION CONTACT: Brent Orr; telephone: (202) 720-7641. 
Persons with disabilities who require alternative means for 
communication (Braille, large print, audiotape, etc.) should contact 
the USDA Target Center at (202) 720-2600 (voice and TDD).

SUPPLEMENTARY INFORMATION: 

Background

    Section 1119 of the 2014 Farm Bill (Pub. L. 113-79) authorizes CTAP 
for producers on farms ``for which cotton base acres were in existence 
for the 2013 crop year.'' CTAP is only authorized for the 2014 crop 
year, and for the 2015 crop year in counties where STAX is not 
available. STAX, as specified in section 11017 of the 2014 Farm Bill, 
is required to become available no later than the 2015 crop year, but 
is not required to provide coverage for every county in 2015. (USDA's 
Risk Management Agency is implementing STAX.) CTAP has some 
similarities to the direct payment aspect of DCP, for upland cotton 
only. The new ARC and PLC Programs authorized by sections 1116 and 1117 
of the 2014 Farm Bill, respectively, which are being implemented 
through separate rulemaking, provide benefits for the commodities, 
other than upland cotton, that were previously covered by DCP.
    The 2014 Farm Bill specifies that CTAP payments will be based on 
the farm's upland cotton base acres that were ``in existence for the 
2013 crop year.'' Accordingly, the 2014 CTAP payments will be made 
available to eligible producers on farms for which cotton base acres 
were in existence as of September 30, 2013, as adjusted. STAX is 
scheduled to be available in some counties beginning with the 2015 crop 
year; producers on a farm located in a county where STAX is available 
will not be eligible for CTAP for the 2015 crop year. In counties where 
STAX is not available for the 2015 crop year, producers on farms for 
which 2013 upland cotton base acres were in existence as of September 
30, 2013, as adjusted, will be eligible for 2015 CTAP payments after 
October 1, 2015. This rule specifies the eligibility requirements for 
CTAP, which are different for 2014 and 2015 because of the provision 
involving STAX availability. Similar to DCP, producers do not have to 
actually grow or harvest upland cotton to be eligible for CTAP. 
However, producers must have an interest in the upland cotton base 
acres on the farm and must meet or satisfy other payment eligibility 
requirements (including average adjusted gross income requirements, 
conservation compliance provisions, and actively engaged in farming) to 
be eligible for CTAP.
    The regulations for CTAP, ARC, and PLC will be specified in 7 CFR 
part 1412. Some definitions and requirements for base acres that are 
needed for all three programs are specified in this rule. For example, 
as specified in the 2014 Farm Bill, base acres of upland cotton in 
effect on September 30, 2013, are defined as generic base acres for the 
purposes of ARC and PLC. As another example, provisions for double 
cropping and replacement crops are similar to those for DCP, but the 
definitions are being revised to remove references to DCP and to insert 
references to CTAP, ARC, and PLC. Additional terms ``eligible 
subsequently planted crop acreage'' and ``subsequently planted crop 
acreage'' are added as those terms have different applicable meanings 
under the 2014 Farm Bill. Under section 1114 of the 2014 Farm Bill, 
subsequently planted crop acreage can be used as payment acres or for 
attributing generic base acres if the initial crop is any crop other 
than a covered commodity. These subsequently planted crop acres are 
termed ``eligible subsequently planted crop acreage.'' The term 
``subsequently planted crop acreage'' is also added to distinguish it 
from ``eligible subsequently planted crop acreage'' by virtue of it 
following any planted and considered planted (P&CP) covered commodity 
not in an approved double cropping sequence. To reiterate, ``eligible 
subsequently planted crop acreage'' may be used to determine payment 
acres under ARC or PLC and to attribute generic base acres on a farm; 
``subsequently planted crop acreage'' may be used to facilitate base 
acre reallocation. Common provisions in 7 CFR 718 that apply to all FSA 
and CCC programs, including those for base acres and farm 
reconstitutions, apply to CTAP.

Eligible Land and Payment Amounts for CTAP

    The eligible land for CTAP in 2014 and 2015 is based on the farm's 
upland cotton base acres that were in existence for the 2013 crop year, 
as of September 30, 2013, adjusted, including, but not limited to, 
adjustments for expired, terminated, or released Conservation Reserve 
Program (CRP) land, and limited by the total number of cropland

[[Page 46336]]

acres on the farm (cropland is defined in 7 CFR 718.2). A producer's 
share interest in cropland on a farm must be equal to or greater than 
that producer's share interest in cotton base acres on the farm for 
that crop year, as reported on that farm's acreage report. FSA will 
verify and confirm the producer's share interest in cotton base acres 
reported on the CTAP application by comparing it to the producer's 
share interest in the cropland as reported on that farm's acreage 
report for that crop year. For example, if a farm has 50 base acres of 
cotton and two producers report equal shares of those 50 base acres of 
cotton, each must each have a 100 percent share interest in at least 25 
reported cropland acres on that farm's acreage report for the same crop 
year to support their reported share of cotton base acres on that farm.
    Section 1119(c) of the 2014 Farm Bill states that the CTAP payment 
amount is equal to the number of adjusted base acres of upland cotton 
divided by the national program yield for upland cotton of 597 pounds 
per acre times the transition assistance rate for upland cotton times 
the farm's DCP yield, times a specified percentage payment rate. The 
2014 Farm Bill specifies that the transition assistance rate of upland 
cotton is the June 12, 2013, midpoint estimate for the marketing year 
average price of upland cotton for the marketing year beginning August 
1, 2013, less the December 10, 2013, midpoint estimate for the 
marketing year average price of upland cotton for the marketing year 
beginning August 1, 2013, as contained in the applicable World 
Agricultural Supply and Demand Estimates report published by USDA, 
multiplied by the national program yield for upland cotton of 597 
pounds per acre. Mathematically, the 597 pounds per acre cancels out of 
the above equation. Accordingly, the transition assistance rate can be 
restated as simply the difference between the August 1, 2013, and the 
December 10, 2013, midpoint estimates. FSA has calculated the 
transition assistance rate to be $0.09 per pound. The payment rates, as 
specified in the 2014 Farm Bill are: 60 percent for the 2014 crop year 
and 36.5 percent for the 2015 crop year. Therefore, the payment per 
base acre of upland cotton for 2014 would be $0.09, times the farm's 
DCP yield, times 60 percent. If the farm's DCP yield was 500 pounds, 
that payment would be $27.00 an acre. For 2015 it would be $0.09, times 
the farm's DCP yield, times 36.5 percent. If the farm's DCP yield was 
500 pounds, that payment would be $16.425 an acre.
    CTAP payments will be made to eligible producers on or after 
October 1 of the crop year when upland cotton is or ordinarily would 
have been harvested. Similar to DCP, payment eligibility is based upon 
the number of upland cotton base acres, which are not required to be 
planted to cotton. As discussed earlier, eligibility for CTAP in 2015 
is determined in part by the availability of STAX.

Eligible Acreage Reductions for ARC and PLC

    ARC and PLC have similar provisions to the former DCP with regard 
to planting flexibility and reductions for plantings of fruits, 
vegetables, and wild rice on base acres. The acreage reduction 
provisions apply to ARC and PLC, but not to CTAP. However, we are 
specifying them in this rule so that producers are informed of how 
generic acres and acreage reductions will be used in the payment 
calculations for ARC and PLC.
    Similar to DCP, the planting or harvesting of perennial or non-
perennial fruits, vegetables (except mung beans and pulse crops), or 
wild rice will result in an acre for acre payment reduction for ARC and 
PLC (but not CTAP), unless an exception applies for double cropped 
acreage in approved double cropping counties. Under DCP, the reduction 
was applied beginning with the covered commodity or peanut acres with 
the lowest direct payment amount per acre until the acreage reduction 
amount was met. In addition, producers could agree to adjust the DCP 
acre reduction between covered commodities and peanuts on the farm, but 
only to the extent that the total acre reduction amount did not change 
for the farm, and all producers affected by the adjustment agreed to 
the adjustment in writing. Under CTAP, ARC, and PLC, as specified in 
the 2014 Farm Bill, peanuts are now a covered commodity, upland cotton 
is not a covered commodity, and what were upland cotton base acres 
under the 2008 Farm Bill are now generic base acres that will be 
counted as acres of covered commodities if planted (or considered 
planted). Therefore, determining the acres that have the lowest payment 
amount per acre for all covered commodities for ARC and PLC on the farm 
is more complicated than under DCP.
    This rule specifies that in determining reductions to base acres 
that are payment acres for ARC and PLC (only payment acres are reduced, 
not base acres) the acreage of any fruit or vegetable will first be 
attributed to cropland not having base acres, followed by base acres, 
before applying any payment acreage reduction that is required by this 
rule. The reduction will be attributed to each of the covered 
commodities on the farm having payment acres on a pro rata basis to 
reflect the ratio of the payment acres of the covered commodity on the 
farm to the total payment acres of all covered commodities on the farm. 
The reductions are required by the 2014 Farm Bill; the pro rata 
procedure for determining the reductions is discretionary and within 
FSA's authority.

CTAP Payment Limits, Eligible Persons and Legal Entities

    As specified in the 2014 Farm Bill and in 7 CFR part 1400, payment 
limits and average adjusted gross income (AGI) limits apply to CTAP. 
CTAP payments in each of the 2014 and 2015 program years are limited to 
$40,000 per person or legal entity, similar to the $40,000 per person 
or legal entity limitation that applied to DCP under the 2008 Farm 
Bill. A person or legal entity is ineligible for payments if the 
person's or legal entity's AGI for the applicable compliance program 
year is in excess of $900,000. Similar to how AGI provisions applied to 
members of legal entities in the 2008 Farm Bill, under the 2014 Farm 
Bill if a person with an indirect interest in a legal entity has AGI in 
excess of $900,000, the CTAP payments subject to AGI compliance 
provisions to the legal entity will be reduced as calculated based on 
the percent interest of the person in the legal entity receiving the 
payment. AGI will be calculated based on the average income for the 3 
taxable years preceding the most immediately preceding complete taxable 
year for which benefits are requested. For example, the relevant years 
used to calculate AGI for 2014 CTAP are the 2010, 2011, and 2012 tax 
years. For 2015 CTAP the relevant years are the 2011, 2012, and 2013 
tax years.
    To be eligible for CTAP, each producer is required to be a person 
or legal entity who is actively engaged in farming and otherwise 
eligible for payment, as specified in 7 CFR part 1400, and who complies 
with requirements including, but not limited to, those pertaining to 
highly erodible land conservation and wetland conservation provisions 
(commonly referred to as the conservation compliance provisions) 
specified in 7 CFR part 12.
    Appeal regulations specified in 7 CFR parts 11 and 780 apply. FSA 
program requirements and determinations that are not in response to, or 
result from, an individual. disputable set of facts in an individual 
participant's application for assistance are not matters that can be 
appealed. Crop insurance is not

[[Page 46337]]

required as a condition of eligibility for CTAP.

Sharing CTAP Payments Between Multiple Producers on a Farm

    The procedures to determine shared payments will be similar to 
those used for DCP. Each eligible producer on a farm will be given the 
opportunity to apply for CTAP and receive CTAP payments determined to 
be fair and equitable as agreed to by all the producers on the farm and 
approved by the FSA county committee. Each producer leasing a farm is 
required to provide a copy of their written lease to the county 
committee and, in the absence of a written lease, is required to 
provide to the county committee a complete written description of the 
terms and conditions of any oral agreement or lease. An owner's or 
landlord's signature, as applicable, affirming a zero share on an 
application for CTAP may be accepted as evidence of a cash lease 
between the owner or landlord and tenant, as applicable, as determined 
by CCC. Such signature or signatures, if entered on the application for 
CTAP to satisfy the requirement of furnishing a written lease, is 
required to be entered on the application by October 7, 2014 for 2014 
CTAP and by July 31, 2015, for 2015 CTAP. When a farm's 2013 base acres 
of upland cotton are leased in 2014 or 2015 on a share basis, neither 
the landlord nor the tenant will receive 100 percent of CTAP for the 
farm. CCC will approve an application for CTAP and approve the division 
of payment when all the following, as applicable, occur or have been 
determined to have occurred:
    (1) Landlords, tenants, and sharecroppers sign the application and 
agree to the payment shares shown; and
    (2) CCC determines that the interests of tenants and sharecroppers 
are being protected; and
    (3) CCC determines that the payment shares do not circumvent either 
the provisions of this rule or the provisions of 7 CFR part 1400.

Signup Deadlines for 2014 and 2015 CTAP

    Section 1119 of the 2014 Farm Bill authorizes CTAP, which is not to 
be paid before October 1 of the calendar year in which the crop of 
upland cotton is harvested. This means that FSA cannot make 2014 CTAP 
payments before October 1, 2014. However, signup for payments can occur 
earlier. FSA is exercising discretion and establishing a signup 
deadline of October 7, 2014, for 2014 CTAP so as to not delay CTAP 
payments. We anticipate that most producers who enrolled 2013 cotton 
base acres in 2013 DCP or the Average Crop Revenue Election (ACRE) 
Program will likely choose to apply for CTAP. For 2015 CTAP, the signup 
deadline will be July 31, 2015.
    Applications for CTAP are independent of any election and 
participation in ARC or PLC. It is possible for upland cotton base 
acres eligible for CTAP to also qualify as eligible generic base acres 
for ARC and PLC, and (more commonly) for a farm to have some cotton 
base acres eligible for CTAP and base acres for different commodities 
eligible for ARC and PLC. A producer needs to separately elect and 
enroll in ARC or PLC to be eligible for those benefits. The application 
for CTAP has no bearing on ARC or PLC elections or decision to 
participate in ARC or PLC. Likewise, persons or legal entities that 
enroll and elect ARC or PLC and who do not file an application for 2014 
or 2015 CTAP in accordance with this rule will not be paid for 2014 or 
2015 CTAP, even if those acres were eligible for CTAP.

Miscellaneous and Conforming Amendments

    This rule revises 7 CFR part 1412, which had been the regulations 
for DCP and ACRE, and will now be the regulations for ARC, PLC, and 
CTAP.
    Many of the provisions that applied to DCP and ACRE will also apply 
to ARC, PLC, and CTAP, and are therefore included in this rule with the 
required revisions. These include the provisions for planting 
flexibility and double cropping, and provisions relating to tenants, 
sharecroppers, offsets, assignments, acreage, and production reporting.
    This rule revises definitions in 7 CFR part 1412 as required to 
implement ARC, PLC, and CTAP. For example, the definition of ``contract 
period'' is revised to specify the contract periods for 2014 through 
2018 ARC and PLC. (CTAP uses applications; ARC and PLC use contracts.) 
A definition for generic base acres is added, as specified in the 2014 
Farm Bill. The definition of ``replacement crop'' is revised to refer 
to both covered commodities and upland cotton, since cotton is no 
longer a covered commodity. A definition of ``temperate japonica rice'' 
is added as a type of medium grain rice, as specified in the 2014 Farm 
Bill.

Structure of the Regulation

    This rule revises 7 CFR part 1412, adding the regulations for CTAP 
and some of the regulations for ARC and PLC, and removing all the 
regulations for DCP and ACRE as discussed above. The revised 7 CFR part 
1412 will use a similar subpart structure to the previous DCP and ACRE 
regulations. The new title of the part is ``Agriculture Risk Coverage, 
Price Loss Coverage, and Cotton Transition Assistance Program.'' 
Subpart A will cover general administration; subpart B will cover base 
acres; subpart C will cover yields for ARC and PLC; subpart D will 
cover ARC and PLC contract terms and enrollment provisions; subpart E 
will cover financial considerations including sharing payments; subpart 
F will cover violations; subpart G will cover PLC and ARC election; and 
subpart H will cover CTAP. Subparts C and G will be added in the 
separate rulemaking to implement the ARC and PLC Programs. This rule 
includes the sections needed to implement CTAP, and includes some 
sections that also apply to ARC and PLC, or that involve generic base 
acres as discussed above. Sections in 7 CFR part 1412 that apply only 
to ARC and PLC will be added in a subsequent rulemaking.

Notice and Comment

    In general, the Administrative Procedure Act (5 U.S.C. 553) 
requires that a notice of proposed rulemaking be published in the 
Federal Register and interested persons be given an opportunity to 
participate in the rulemaking through submission of written data, 
views, or arguments with or without opportunity for oral presentation, 
except when the rule involves a matter relating to public property, 
loans, grants, benefits, or contracts. The regulations to implement the 
provisions of Title I and the administration of Title I of the 2014 
Farm Bill are exempt from the notice and comment provisions of 5 U.S.C. 
553 and the Paperwork Reduction Act (44 U.S.C. chapter 35), as 
specified in section 1601(c)(2) of the 2014 Farm Bill.

Effective Date

    The Administrative Procedure Act (5 U.S.C. 553) provides generally 
that before rules are issued by Government agencies, the rule is 
required to be published in the Federal Register, and the required 
publication of a substantive rule is to be not less than 30 days before 
its effective date. One of the exceptions is when the agency finds good 
cause for not delaying the effective date. Subsection 1601(c)(2) of the 
2014 Farm Bill makes this final rule exempt from notice and comment. 
Therefore, using the administrative procedure provisions in 5 U.S.C. 
553, FSA finds that there is good cause for making this rule effective 
less than 30 days after publication in the Federal Register. This rule 
allows FSA to provide adequate notice to producers

[[Page 46338]]

about the new CTAP regulation so they will be ready to begin sign-up 
for CTAP in summer 2014, so that payments can be provided as soon as 
possible on or after October 1, 2014. Therefore, to begin providing 
benefits to producers in a timely fashion, this final rule is effective 
when published in the Federal Register.

Executive Orders 12866 and 13563

    Executive Order 12866, ``Regulatory Planning and Review,'' and 
Executive Order 13563, ``Improving Regulation and Regulatory Review,'' 
direct agencies to assess all costs and benefits of available 
regulatory alternatives and, if regulation is necessary, to select 
regulatory approaches that maximize net benefits (including potential 
economic, environmental, public health and safety effects, distributive 
impacts, and equity). Executive Order 13563 emphasized the importance 
of quantifying both costs and benefits, of reducing costs, of 
harmonizing rules, and of promoting flexibility.
    The Office of Management and Budget (OMB) designated this rule as 
economically significant under Executive Order 12866, ``Regulatory 
Planning and Review,'' and therefore, OMB has reviewed this rule. This 
regulatory action is being taken to implement a major budgetary program 
required by the 2014 Farm Bill. Consistent with OMB guidance, this type 
of action is considered a budgetary transfer representing a payment 
from taxpayers to program beneficiaries unrelated to the provision of 
any goods or services in exchange for the payment. As such, there are 
no economic gains, because the benefits and payments to those who 
receive such a transfer are matched by the costs borne by taxpayers. 
The estimated transfer payments for CTAP provided by this rule are 
summarized below. The full cost benefit analysis is available on 
regulations.gov.

Cost Benefit Analysis Summary

    CTAP payments are estimated to be $572.1 million for 2014 and $1.6 
million for 2015. In 2013, approximately 122,000 producers enrolled 
upland cotton base acres in DCP and ACRE. For 2014, we estimate a 
similar number of producers and farms will apply for 2014 CTAP payments 
totaling $572.1 million. For 2015, we estimate approximately 18,000 
producers with 2013 upland cotton base acres in areas where STAX has 
not yet been implemented will apply for CTAP payments totaling $1.6 
million.
    Some producers with cotton base acres did not enroll those acres in 
DCP and ACRE. If those producers apply for CTAP, meaning that every 
potentially eligible cotton base acre generates a CTAP payment, the 
estimates would be slightly higher, at $624 million for 2014 and $1.8 
million for 2015.
    There is a payment limit of $40,000 per year per person or legal 
entity for CTAP.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601-612), as amended by 
the Small Business Regulatory Enforcement Fairness Act of 1996 
(SBREFA), generally requires an agency to prepare a regulatory 
flexibility analysis of any rule subject to the notice and comment 
rulemaking requirements under the Administrative Procedure Act (5 
U.S.C. 553) or any other statute, unless the agency certifies that the 
rule will not have a significant economic impact on a substantial 
number of small entities. This rule is not subject to the Regulatory 
Flexibility Act because CCC is not required by any law to publish a 
proposed rule for public comment for this rulemaking initiative.

Environmental Review

    The environmental impacts of this rule have been considered in a 
manner consistent with the provisions of the National Environmental 
Policy Act (NEPA, 42 U.S.C. 4321-4347), the regulations of the Council 
on Environmental Quality (40 CFR parts 1500-1508), and FSA regulations 
for compliance with NEPA (7 CFR part 799). FSA has determined that 
participation in programs similar to those currently found in 7 CFR 
1412 will not significantly affect the quality of the human environment 
(7 CFR part 799.9(d)). Therefore no environmental assessment or 
environmental impact statement will be prepared.

Executive Order 12372

    Executive Order 12372, ``Intergovernmental Review of Federal 
Programs,'' requires consultation with State and local officials. The 
objectives of the Executive Order are to foster an intergovernmental 
partnership and a strengthened Federalism, by relying on State and 
local processes for State and local government coordination and review 
of proposed Federal Financial assistance and direct Federal 
development. For reasons specified in the Notice to 7 CFR part 3015, 
subpart V (48 FR 29115, June 24, 1983), the programs and activities 
within this rule are excluded from the scope of Executive Order 12372, 
which requires intergovernmental consultation with State and local 
officials.

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, ``Civil 
Justice Reform.'' This rule will not preempt State or local laws, 
regulations, or policies unless they represent an irreconcilable 
conflict with this rule. The rule will not have retroactive effect. 
Before any judicial action may be brought regarding the provisions of 
this rule, the administrative appeal provisions of 7 CFR parts 11 and 
780 are to be exhausted.

Executive Order 13132

    This rule has been reviewed under Executive Order 13132, 
``Federalism.'' The policies contained in this rule do not have any 
substantial direct effect on States, on the relationship between the 
Federal government and the States, or on the distribution of power and 
responsibilities among the various levels of government, except as 
required by law. Nor does this rule impose substantial direct 
compliance costs on State and local governments. Therefore, 
consultation with the States is not required.

Executive Order 13175

    This rule has been reviewed in accordance with the requirements of 
Executive Order 13175, ``Consultation and Coordination with Indian 
Tribal Governments.'' Executive Order 13175 requires Federal agencies 
to consult and coordinate with tribes on a government-to-government 
basis on policies that have tribal implications, including regulations, 
legislative comments or proposed legislation, and other policy 
statements or actions that have substantial direct effects on one or 
more Indian tribes, on the relationship between the Federal Government 
and Indian tribes or on the distribution of power and responsibilities 
between the Federal Government and Indian tribes.
    FSA has assessed the impact of this rule on Indian tribes and 
determined that this rule does not, to our knowledge, have tribal 
implications that require tribal consultation under Executive Order 
13175. If a Tribe requests consultation, FSA will work with the USDA 
Office of Tribal Relations to ensure meaningful consultation is 
provided where changes, additions, and modifications identified in this 
rule are not expressly mandated by the 2014 Farm Bill.

The Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA, Pub. L. 
104-4) requires Federal agencies to assess the effects of their 
regulatory

[[Page 46339]]

actions on State, local, and Tribal governments, or the private sector. 
Agencies generally need to prepare a written statement, including a 
cost benefit analysis, for proposed and final rules with Federal 
mandates that may result in expenditures of $100 million or more in any 
1 year for State, local, or Tribal governments, in the aggregate, or to 
the private sector. UMRA generally requires agencies to consider 
alternatives and adopt the more cost effective or least burdensome 
alternative that achieves the objectives of the rule. This rule 
contains no Federal mandates, as defined in Title II of UMRA, for 
State, local, and Tribal governments or the private sector. Therefore, 
this rule is not subject to the requirements of sections 202 and 205 of 
UMRA.

Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA)

    This rule is a major rule under the Small Business Regulatory 
Enforcement Fairness Act of 1996, (Pub. L. 104-121, SBREFA). SBREFA 
normally requires that an agency delay the effective date of a major 
rule for 60 days from the date of publication to allow for 
Congressional review. Section 808 of SBREFA allows an agency to make a 
major regulation effective immediately if the agency finds there is 
good cause to do so. Section 1601(c)(3) of the 2014 Farm Bill provides 
that the authority in Section 808 of SBREFA will be used in 
implementing the changes required by Title I of the 2014 Farm Bill, 
such as for the changes being made by this rule. Consistent with 
section 1601(c)(3) of the 2014 Farm Bill, FSA therefore finds that it 
would be contrary to the public interest to delay the effective date of 
this rule because it would delay implementation of CTAP as specified in 
the 2014 Farm Bill. The regulation needs to be effective to provide 
adequate time for producers to be ready to begin the sign-up process in 
a timely fashion and make payments as soon as possible after October 1, 
2014. Therefore, this rule is effective when published in the Federal 
Register.

Federal Assistance Programs

    The title and number of the Federal Domestic Assistance Program 
found in the Catalog of Federal Domestic Assistance to which this rule 
applies are:

10.113--Agriculture Risk Coverage
10.112--Price Loss Coverage
10.114--Cotton Transition Assistance Program

Paperwork Reduction Act of 1995

    The regulations in this rule are exempt from the requirements of 
the Paperwork Reduction Act (44 U.S.C. Chapter 35), as specified in 
subsection 1601(c)(2)(B) of the 2014 Farm Bill, which provides that 
these regulations be promulgated and administered without regard to the 
Paperwork Reduction Act.

E-Government Act Compliance

    FSA and CCC are 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.

List of Subjects in 7 CFR Part 1412

    Cotton, Feed grains, Oilseeds, Peanuts, Price support programs, 
Reporting and recordkeeping requirements, Rice, Soil conservation, 
Wheat.
    For the reasons discussed above, CCC revises 7 CFR part 1412 to 
read as follows:

PART 1412--AGRICULTURE RISK COVERAGE, PRICE LOSS COVERAGE, AND 
COTTON TRANSITION ASSISTANCE PROGRAMS

Subpart A--General Provisions
Sec.
1412.1 Applicability, changes in law, interest, application, and 
contract provisions.
1412.2 Administration.
1412.3 Definitions.
1412.4 Appeals.
Subpart B--Establishment of Base Acres for a Farm for Covered 
Commodities
1412.23 Base acres, generic base acres, and Conservation Reserve 
Program.
1412.24 Limitation of total base acres and generic base acres on a 
farm.
Subpart D-- ARC and PLC Contract Terms and Enrollment Provisions for 
Covered Commodities
1412.44 Notification of base acres.
1412.45 Treatment of generic base acres.
1412.46 Planting flexibility.
1412.49 Matters of general applicability.
Subpart E--Financial Considerations Including Sharing Payments
1412.51 Limitation of payments.
1412.54 Sharing of payments.
1412.55 Provisions relating to tenants and sharecroppers.
Subpart F--Violations and Compliance Provisions
1412.61 Contract violations.
1412.63 Contract or application liability.
1412.64 Inaccurate representation, misrepresentation, and scheme or 
device.
1412.65 Offsets and assignments.
1412.66 Acreage and production reports, prevented planting, and 
notice of loss.
1412.67 Compliance with highly erodible land and wetland 
conservation provisions.
1412.68 Controlled substance violations.
1412.69 Control of noxious weeds.
Subpart H--CTAP
1412.81 Administration.
1412.82 Eligibility and CTAP application.
1412.83 Sharing of CTAP payments.
1412.84 Impact of CTAP application on ARC or PLC.
1412.86 CTAP payments.
1412.87 Transfer of land and succession-in-interest.
1412.88 Executed CTAP application not in conformity with 
regulations.
1412.89 Division of CTAP payments and provisions relating to tenants 
and sharecroppers.

    Authority: 7 U.S.C. 1508b, 7911-7912, 7916, 8702, 8711-8712, 
8751-8752, and 15 U.S.C. 714b and 714c.
Subpart A--General Provisions


Sec.  1412.1  Applicability, changes in law, interest, application, and 
contract provisions.

    (a) This part specifies how base acres, generic base acres, and 
farm program payment yields are established or adjusted for the purpose 
of calculating payments for agriculture risk coverage (ARC) and price 
loss coverage (PLC) for covered commodities: Wheat, oats, and barley 
(including wheat, oats, and barley used for haying and grazing); corn; 
grain sorghum; long grain rice; medium grain rice; pulse crops; 
soybeans; other oilseeds; and peanuts. This part specifies how and when 
producers on a farm may make a one-time election on a farm to obtain 
either ARC or PLC (and if ARC, whether to receive ARC payments based on 
county coverage applicable on a covered commodity-by-commodity basis; 
or individual coverage applicable to all the covered commodities on a 
farm).
    (b) This part specifies how upland cotton base acres that were in 
existence for 2013, as adjusted, are determined for the purpose of 
making CTAP payments in 2014 and 2015 to eligible producers.
    (c) Payments otherwise provided for in this part are subject to 
changes made by law in rates, conditions, and eligibility 
notwithstanding any contract or application made under this part. 
However, any such modification may, as determined by CCC, allow 
producers the opportunity to withdraw their CTAP application or the ARC 
or PLC contract.
    (d) If any refund is due to CCC under this part, interest will be 
due from the date of the CCC disbursement except as determined by CCC. 
The provisions of this section will apply notwithstanding any other 
provision of this or any other part. In order to receive payment under 
this part a participant is required to

[[Page 46340]]

comply with the regulations in this part and any additional 
requirements imposed by the CTAP application or ARC or PLC contract.
    (e) For ARC and PLC, assistance under this part will be based on 
the administrative county of the farm and for CTAP, assistance under 
this part will be based on the physical location of the farm, as 
specified in part 718 of this title.


Sec.  1412.2  Administration.

    (a) ARC, PLC, and CTAP are administered under the general 
supervision of the Executive Vice-President, CCC, and will be carried 
out by FSA State and county committees (State and county committees).
    (b) State and county committees, and representatives and their 
employees, do not have authority to modify or waive any of the 
provisions of the regulations of this part.
    (c) The State committee may take any action required by the 
regulations of this part that the county committee has not taken. The 
State committee will also:
    (1) Correct, or require a county committee to correct, any action 
taken by such county committee that is not in accordance with the 
regulations of this part; or
    (2) Require a county committee to withhold taking any action that 
is not in accordance with this part.
    (d) No provision or delegation to a State or county committee will 
preclude the Executive Vice President, or the Deputy Administrator, or 
a designee, from determining any question arising under the program or 
from reversing or modifying any determination made by a State or county 
committee.
    (e) The Deputy Administrator has the authority to permit State and 
county committees to waive or modify deadlines (except deadlines 
specified in a law) and other requirements not specified by law, in 
cases where lateness or failure to meet such other requirements does 
not adversely affect operation of the program.
    (1) Producers and participants have no right to a decision 
requesting an exception for a decision about waiving or modifying 
deadlines. The Deputy Administrator's refusal to consider waiver or 
modification cases or circumstances or a decision not to exercise this 
discretionary authority under this section will not be considered an 
adverse decision and is not appealable.
    (2) CCC's decision not to consider a case under this section will 
not constitute a failure to act under any law or regulation because 
participants have no right to a waiver or modification under this 
section, they likewise have no right to a decision on a request for 
waiver or modification.
    (f) A representative of CCC may execute the FSA application form 
titled ``Cotton Transition Assistance Program (CTAP) Application'' only 
under the terms and conditions determined and announced by the 
Executive Vice President, CCC. Any application or contract that is not 
executed in accordance with such terms and conditions, including any 
alleged execution prior to or after the dates authorized by the 
Executive Vice President, CCC, is null and void and will not be 
considered to be an application or contract between CCC and the 
operator or any other producer on the farm.


Sec.  1412.3  Definitions.

    The definitions in this section are applicable for all purposes of 
administering this part. The terms defined in part 718 of this title 
and part 1400 of this chapter are also applicable, except where those 
definitions conflict with the definitions specified in this section. 
Where there is a conflict or a difference in definitions specified in 
this part and part 718 of this title or part 1400 of this chapter, the 
regulations in this part will apply.
    2014 Farm Bill means the Agricultural Act of 2014 (Pub. L. 113-79).
    Agriculture risk coverage (or ARC) means coverage provided under 
subparts D and E of this part.
    Application means the CCC-approved form used by producers to apply 
for CTAP under subpart H of this part.
    ARC-CO means the Agriculture Risk Coverage elected with the county 
option.
    ARC-IC means the Agriculture Risk Coverage elected with the 
individual option.
    Base acres means, with respect to a covered commodity on a farm, 
the number of acres in effect on September 30, 2013, as defined in the 
regulations in 7 CFR part 1412, subpart B that were in effect on that 
date, subject to any reallocation, adjustment, or reduction. Unless 
specifically stated otherwise, the term ``base acres'' includes any 
generic base acres when P&CP to a covered commodity or are eligible 
subsequently planted crop acreage.
    Considered planted means acreage approved as prevented planted in 
accordance with part 718 of this title.
    Contract or application means the CCC-approved forms and appendixes 
that constitute the CTAP application or agreement for participation in 
ARC or PLC Program, as applicable.
    Contract period means the compliance period specified for the 
contract or application for the particular program year, as designated 
on the contract or application. References to the ``contract'' or 
``application'' period refer to the compliance period for the 
particular program year. The compliance period for the each program 
year is October 1 through September 30. For example, for the 2014 
contract (and therefore for the 2014 program), the period that begins 
on October 1, 2013 and ends on September 30, 2014.
    Contract year or program year means the particular year of the 
particular contract based on the compliance period for the contract or 
application. The compliance year will run from October 1 to the 
following September 30 and will have the same name as the corresponding 
fiscal year. For example, the 2014 contract or program year will be 
October 1, 2013, through September 30, 2014, and that year will also be 
considered the 2014 crop year. The same references will apply to all 
other years.
    County coverage means agriculture risk coverage (ARC-CO) elected 
under subpart D of this part with the county option.
    Covered commodity means wheat, oats, and barley (including wheat, 
oats, and barley used for haying and grazing), corn, grain sorghum, 
long grain rice, medium grain rice, pulse crops, soybeans, other 
oilseeds, and peanuts.
    Crop year means the relevant contract or application year. For 
example, the 2014 crop year is the year that runs from October 1, 2013, 
through September 30, 2014, and references to payments for that year 
refer to payments made under contracts or applications with the 
compliance year that runs during those dates.
    Deputy Administrator means the Deputy Administrator for Farm 
Programs, FSA, or a designee.
    Developed means:
    (1) Land has been approved by the local government for uses other 
than commercial agricultural uses; and
    (2) Construction activity has begun to install any aspect of the 
development, for example utilities or roadways.
    Direct payment yield for upland cotton means the farm's upland 
cotton yield established as specified in the regulations for 7 CFR part 
1412 that were in effect as of September 30, 2013.
    Double-cropping means for covered commodities, notwithstanding the 
meaning in subparts D and E of this part for fruits and vegetables, the 
planting of a covered commodity for harvest in a crop year, in cycle 
with another covered commodity on the same acres for

[[Page 46341]]

harvest in the same crop year in counties that have been determined to 
be areas where there is determined to be substantial, successful, and 
long-term double cropping of the crop and where the producer has 
followed customary production techniques and planting deadlines as 
determined by CCC (that is, using techniques and deadlines used by the 
majority of farmers in the region to double crop the particular crops 
involved). In a county determined capable of supporting such double-
cropping of the covered commodities, as determined by CCC, both an 
initial crop and a subsequent crop will be considered planted or 
prevented planted acres for the purpose of this part. Notwithstanding 
any of the provisions of 7 CFR part 718, in those instances where the 
subsequently planted or approved prevented planted covered commodity 
cannot be recognized as double-cropped acreage under this definition, 
the subsequently planted crop acreage will not be considered planted or 
prevented planted.
    Dry peas means Austrian, wrinkled seed, yellow, Umatilla, and green 
peas, excluding peas grown for the fresh, canning, or frozen market.
    Eligible subsequently planted crop acreage means planted acres of a 
covered commodity that are a replacement crop to any crop other than a 
covered commodity. Eligible subsequently planted crop acreage is 
included as payment acres if the crop acreage is planted to a covered 
commodity as a replacement crop after the failure or prevented planting 
of any crop other than a covered commodity. Eligible subsequently 
planted crop acreage is used to determine payment acres and attribution 
of generic base acres under this part.
    Extra long staple cotton means cotton that is other than upland 
cotton and both the following:
    (1) Produced from pure strain varieties of the Barbadense species 
or any hybrid of the species, or other similar types of extra long 
staple cotton, designated by the Secretary, having characteristics 
needed for various end uses for which United States upland cotton is 
not suitable and grown in irrigated cotton-growing regions of the 
United States designated by the Secretary or other areas designated by 
the Secretary as suitable for the production of the varieties or types; 
and
    (2) Ginned on a roller-type gin or, if authorized by the Secretary, 
ginned on another type of gin for experimental purposes.
    Fiscal year means the year running from October 1 to the following 
September 30 and will be designated by the same calendar year in which 
it ends. For example, the 2014 fiscal year begins on October 1, 2013 
and ends on September 30, 2014.
    Generic base acres means the number of base acres for upland cotton 
in effect on September 30, 2013, as defined in the regulations in 7 CFR 
part 1412, subpart B that were in effect on that date, subject to any 
adjustment or reduction under this part. Generic base acres are always 
the same amount as upland cotton base acres. Any adjustment in generic 
base acres on a farm will necessarily result in an adjustment in upland 
cotton base acres on the farm.
    Harvested means the producer has removed the crop from the field by 
hand, mechanically, or by grazing of livestock. The crop is considered 
harvested once it is removed from the field and placed in or on a truck 
or other conveyance or is consumed by livestock through the act of 
grazing. Crops normally placed in a truck or other conveyance and taken 
off the crop acreage, such as hay, are considered harvested when in the 
bale, whether removed from the field or not.
    Individual coverage means ARC (ARC-IC) elected under subpart D of 
this part with the individual option.
    Initial crop means acreage of a covered commodity or cotton planted 
or approved as prevented planted for harvest as peanuts, grain, or 
lint. The initial crop includes reseeded or replanted crop acreage.
    Medium grain rice means medium grain rice and includes short grain 
rice and temperate japonica rice.
    Other oilseed means a crop of sunflower seed, rapeseed, canola, 
safflower, flaxseed, mustard seed, crambe, sesame seed, or any oilseed 
designated by the Secretary.
    Payment acres mean:
    (1) For the purpose of ARC-CO and PLC, subject to planting 
flexibility provisions as specified Sec.  1412.46, the payment acres 
for each covered commodity on a farm will be equal to 85 percent of the 
base acres for the covered commodity on the farm.
    (2) For the purpose of ARC-IC, subject to planting flexibility 
provisions as specified in Sec.  1412.46, the payment acres for a farm 
will be equal to 65 percent of the base acres for all of the covered 
commodities on the farm.
    (3) For the purpose of CTAP under subpart H of this part, the 
payment acres for a farm are the base acres of upland cotton in effect 
on a farm on September 30, 2013, subject to any adjustment or reduction 
under this part.
    Payment yield means for a farm for--
    (1) A covered commodity, the yield established under subpart C of 
this part; and
    (2) Upland cotton, the direct payment yield for upland cotton for 
the farm as of September 30, 2013.
    Planted and considered planted (P&CP) means, with respect to an 
acreage amount, the sum of the planted and prevented planted acres 
approved by the FSA county committee on the farm for a crop. For the 
purposes of this part, P&CP is limited to initially planted or 
prevented planted crop acreage, except for crops planted in an approved 
double-cropping sequence. Eligible subsequently planted crop acreage, 
replacement crop acreage, and subsequently planted crop acreage are 
each not included as P&CP.
    Price Loss Coverage (or PLC) means coverage provided under subpart 
D of this part.
    Pulse crop means dry peas, lentils, small chickpeas, and large 
chickpeas.
    Reference price means, with respect to a covered commodity for a 
crop year, the following for:
    (1) Wheat, $5.50 per bushel;
    (2) Corn, $3.70 per bushel;
    (3) Grain sorghum, $3.95 per bushel;
    (4) Barley, $4.95 per bushel;
    (5) Oats, $2.40 per bushel;
    (6) Long grain rice, $14.00 per hundredweight;
    (7) Medium grain rice, $14.00 per hundredweight;
    (8) Soybeans, $8.40 per bushel;
    (9) Other oilseeds, $20.15 per hundredweight;
    (10) Peanuts, $535.00 per ton;
    (11) Dry peas, $11.00 per hundredweight;
    (12) Lentils, $19.97 per hundredweight;
    (13) Small chickpeas, $19.04 per hundredweight; and
    (14) Large chickpeas, $21.54 per hundredweight.
    Replacement crop means the planting or approved prevented planting 
of any crop for harvest following the failure of planted crop acreage 
or prevented planted acreage of a covered commodity not in a recognized 
double-cropping sequence (as specified in this section). Replacement 
crops cannot generate payments under this part unless the replacement 
crop acreage meets the definition of eligible subsequently planted crop 
acreage as specified in this section.
    Reseeded or replanted crop means the second planting of a covered 
commodity on the same acreage after the first planting of that same 
crop has failed.
    STAX means Stacked Income Protection Plan, as specified in 7 U.S.C. 
1508b. A list of counties having farms

[[Page 46342]]

with upland cotton base acres for which STAX will not be made available 
in 2015 will be available upon request from FSA.
    Subsequently planted crop acreage means planted acres of a covered 
commodity following an initial P&CP covered commodity. Subsequently 
planted crop acreage can be used for base reallocation for ARC and PLC 
under subpart B.
    Supportive and necessary contractual documents mean those documents 
including, but not limited to, those items substantiating the ARC or 
PLC contract or CTAP application such as leases, deeds, signatures of 
contract participants, owners, operators, and other tenant signatures, 
as determined by CCC.
    Temperate japonica rice means rice that is grown in high altitudes 
or temperate regions of high latitudes with cooler climate conditions, 
in the Western United States, as determined by CCC, for the purpose of 
the--
    (1) Reallocation of base acres under subpart B of this part;
    (2) Establishment of a reference price of 115 percent times the 
established reference price of medium grain rice and determining 
temperate japonica rice's own effective price; and
    (3) Determination of the actual crop revenue and ARC guarantee 
under subparts D and E of this part.
    Upland cotton means cotton that is produced in the United States 
from other than pure strain varieties of the Barbadense species, any 
hybrid thereof, or any other variety of cotton in which one or more of 
these varieties predominate. In other words, it means any cotton that 
is not extra long staple cotton.


Sec.  1412.4  Appeals.

    A participant may seek reconsideration and review of any individual 
program eligibility adverse determination made under this part in 
accordance with the appeal regulations found at parts 11 and 780 of 
this title.
Subpart B--Establishment of Base Acres for a Farm for Covered 
Commodities


Sec.  1412.23  Base acres, generic base acres, and Conservation Reserve 
Program.

    (a) Subject to paragraphs (b) and (c) of this section, CCC will 
annually adjust the base acres for covered commodities and generic base 
acres with respect to the farm by the number of production flexibility 
contract acres or base acres protected by a Conservation Reserve 
Program (CRP) contract that expired, was voluntarily terminated, or was 
early released.
    (b) The total base acres and generic base acres on a farm cannot 
exceed the limitation specified in Sec.  1412.24.
    (c) Adjustments to (not reallocation of) base acres and generic 
base acres on a farm in accordance with this section are to be 
completed by no later than August 1 or other date as determined and 
announced by the CRP contract expired or was voluntarily terminated.
    (d) For the fiscal year in which an adjustment to base acres under 
this section is made, the producer of the farm may elect to receive ARC 
or PLC payments, in accordance with any ARC and PLC election made under 
section 1115 of the 2014 Farm Bill with respect to the base acres added 
to the farm under this section, or a prorated payment under the CRP 
contract, but not both. For any farm that had all of its base acres 
reduced for participation in CRP, if the farm had no base acres or 
election in effect before an adjustment is made to put base acres of a 
covered commodity back on the farm, the owners of that farm will have 
an opportunity to reallocate base acres and the producers will have an 
opportunity to elect ARC or PLC within 30 days of being notified of the 
establishment of base acres on that farm before producers enroll base 
acres on that farm.


Sec.  1412.24  Limitation of total base acres and generic base acres on 
a farm.

    (a) The sum of the following cannot exceed the total cropland 
acreage on the farm, plus approved double-cropped acreage for the farm:
    (1) The sum of all base acres and generic base acres (which are 
equal to upland cotton base acres used for CTAP) established for the 
farm in accordance with this part; plus
    (2) Any cropland acreage on the farm enrolled in a CRP contract in 
accordance with part 1410 of this chapter; plus
    (3) Any cropland acreage on the farm enrolled in a wetland reserve 
program contract in accordance with part 1467 of this chapter; plus
    (4) Any other acreage on the farm enrolled in a Federal 
conservation program for which payments are made in exchange for not 
producing an agricultural commodity on the acreage.
    (b) The Deputy Administrator will give the owner of the farm the 
opportunity to select the base acres or generic base acres (which are 
equal to upland cotton base acres used for CTAP) against which any 
reduction required in this section will be made. Absent the owner 
selecting the base acre or generic base acre for reduction, CCC will 
apply a pro-rata reduction against the base acres or generic base acres 
before computing and issuing any payments for the program year when a 
reduction becomes necessary. If a reduction is made to generic base 
acres on a farm, a corresponding equal reduction is made to upland 
cotton base acres.
    (c) In applying paragraph (a) of this section, CCC will take into 
account the practice of double cropping on a farm, as determined by 
CCC.
    (d) For base acre reductions:
    (1) Subject to the limitation in paragraph (d)(2) of this section, 
a permanent reduction of all or a portion of a farm's base acres, 
including generic base acres (and the equal amount of upland cotton 
base acres), will be allowed when all owners of the farm execute and 
submit a written request for such reduction, on a CCC-approved 
standard, uniform form designated by CCC, to the FSA county office 
where the records for the farm are administratively maintained.
    (2) A permanent reduction of all or a portion of a farm's base 
acres to negate or reduce a program violation is not allowed.
    (e) When base acres on a farm are converted to a non-agricultural 
commercial or industrial use, the total base acres on the farm will be 
reduced accordingly regardless of the submission of a request for such 
reduction.
    (f) The base acres and generic base acres (resulting in an equal 
amount of upland cotton base acres) on a farm will be proportionately 
reduced when it is determined that the land has been subdivided and 
developed for multiple residential units or other nonfarming uses if, 
in the judgment of the county committee, the size of the tracts and the 
density of the subdivision is such that the land is unlikely to return 
to the previous agricultural use, unless either of the following 
applies:
    (1) The producers on the farm demonstrate that the land remains 
devoted to commercial agricultural production or is likely to be 
returned to the previous agricultural use and such land has not been 
divided from the farm with a farm reconstitution performed according to 
part 718 of this title; or
    (2) A properly constituted or reconstituted farm contains 
sufficient land that has not yet been subdivided and developed for 
multiple residential units or other nonfarming uses, and the producers 
on the farm demonstrate that the land remains devoted to commercial 
agricultural production or is likely to be returned to the previous 
agricultural use.

[[Page 46343]]

Subpart D--ARC and PLC Contract Terms and Enrollment Provisions for 
Covered Commodities


Sec.  1412.44  Notification of base acres.

    Prior to enrolling the farm in the 2014 ARC or PLC program, the 
operator and each owner of record of a farm will be notified in writing 
of the number of base acres eligible for enrollment in a contract, 
unless such operator or owner of record of a farm requests in writing 
not to be furnished with the notice. The operator and each owner of 
record are responsible for notifying all other producers of a farm of 
the notice.


Sec.  1412.45  Treatment of generic base acres.

    (a) ARC and PLC payments will only be made with respect to generic 
base acres P&CP to a covered commodity or eligible subsequently planted 
crop acreage for the crop year on a farm.
    (b) Generic base acres on a farm will be attributed to a covered 
commodity as follows:
    (1) If a single covered commodity is P&CP or eligible subsequently 
planted crop acreage and the total P&CP or eligible subsequently 
planted crop acreage exceeds the generic base acres on the farm, the 
generic base acres are attributed to that covered commodity in an 
amount equal to the total number of generic base acres on the farm.
    (2) If multiple covered commodities are P&CP or eligible 
subsequently planted crop acreage and the total number of acres P&CP or 
eligible subsequently planted crop acreage to all covered commodities 
on the farm exceeds the generic base acres on the farm, the generic 
base acres will be attributed to each of the covered commodities on the 
farm on a pro rata basis to reflect the ratio of:
    (i) The P&CP and eligible subsequently planted crop acreage to a 
covered commodity on the farm; to
    (ii) The total P&CP and eligible subsequently planted crop acreage 
to all covered commodities on the farm.
    (3) If the total number of P&CP and eligible subsequently planted 
crop acreage to all covered commodities on the farm does not exceed the 
generic base acres on the farm, the number of P&CP and eligible 
subsequently planted crop acreage to a covered commodity is attributed 
to that covered commodity.
    (c) When generic base acres are P&CP or eligible subsequently 
planted crop acreage to a covered commodity or when P&CP or eligible 
subsequently planted crop acreage to a covered commodity is attributed 
to generic base acres, the generic base acres are in addition to other 
base acres on the farm.


Sec.  1412.46  Planting flexibility.

    (a) Any crop may be planted and harvested on base acres on a farm, 
except as limited in this section. Any crop may be planted on cropland 
in excess of the base acres on a farm.
    (b) Base acres may be hayed or grazed at any time.
    (c) Except as specified in paragraph (d) of this section, the 
planting or harvesting of perennial or harvesting of non-perennial 
fruits, vegetables (except mung beans and covered commodities), or wild 
rice, as determined by CCC, will result in an acre for acre payment 
reduction when such crop or crops are planted and or harvested, as 
applicable, on more than:
    (1) 15 percent of the base acres of a farm enrolled in ARC or PLC 
using county coverage; or
    (2) 35 percent of a farm enrolled in ARC using individual coverage.
    (d) Notwithstanding the provisions of paragraph (c) of this 
section, perennial fruits, vegetables, and wild rice may be planted or 
harvested on base acres of a farm and non-perennial fruits, vegetables, 
and wild rice may be harvested on base acres of a farm if a producer 
double-crops fruits, vegetables, or wild rice with a covered commodity 
in any region described in paragraph (e) of this section, in which case 
payment acres will not be reduced for the planting or harvesting of the 
fruit, vegetable, or wild rice.
    (e) Double-cropping for purposes of this section means planting for 
harvest non-perennial fruits, vegetables, or wild rice on the same 
acres in cycle with a planted covered commodity harvested for grain in 
a 12-month period under normal growing conditions for the region and 
being able to repeat the same cycle in the following 12-month period. 
For purposes of this part, the following counties have been determined 
to be regions having a history of double-cropping covered commodities 
or peanuts with fruits, vegetables, or wild rice. State committees have 
established the following counties as regions within their respective 
States:

Alabama

Baldwin, Barbour, Butler, Chambers, Chilton, Clarke, Covington, 
Cullman, Geneva, Greene, Houston, Jackson, Jefferson, Lee, Madison, 
Mobile, Montgomery, Randolph, Sumter, Talladega, Walker, and 
Washington.

Alaska

None.

Arizona

Cochise, Graham, Greenlee, LaPaz, Maricopa, Mohave, Pima, Pinal, and 
Yuma.

Arkansas

Ashley, Benton, Clay, Craighead, Crawford, Crittenden, Cross, Faulkner, 
Franklin, Greene, Independence, Jackson, Jefferson, Lawrence, Lee, 
Lincoln, Logan, Lonoke, Mississippi, Monroe, Phillips, Pulaski, St. 
Francis, Sebastian, Washington, Woodruff, and Yell.

California

Alameda, Amador, Butte, Colusa, Contra Costa, Fresno, Glenn, Imperial, 
Kern, Kings, Madera, Merced, Riverside, Sacramento, San Benito, San 
Joaquin, Santa Clara, Siskiyou, Solano, Sonoma, Stanislaus, Sutter, 
Tehama, Tulare, Yolo, and Yuba.

Caribbean Office

None.

Colorado

Otero.

Connecticut

None.

Delaware

All counties.

Florida

All counties except Monroe.

Georgia

All counties.

Hawaii

None.

Idaho

None.

Illinois

Bureau, Calhoun, Cass, Clark, Crawford, DeKalb, Edgar, Effingham, 
Gallatin, Iroquois, Jersey, Kankakee, Lawrence, LaSalle, Lee, Madison, 
Marion, Mason, Monroe, Randolph, St. Clair, Tazewell, Union, Vermilion, 
White, and Whiteside.

Indiana

Allen, Bartholemew, Daviess, Gibson, Jackson, Johnson, Knox, LaGrange, 
LaPorte, Madison, Marion, Martin, Miami, Posey, Ripley, Shelby, 
Sullivan, Vandenberg, and Warrick.

Iowa

Kossuth, Mitchell, Palo Alto, and Winnebago.

[[Page 46344]]

Kansas

None.

Kentucky

All counties.

Louisiana

Avoyelles, Franklin, Grant, Morehouse, Rapides, Richland, and West 
Carroll.

Maine

None.

Maryland

Anne Arundel, Baltimore, Calvert, Caroline, Carroll, Cecil, Charles, 
Dorchester, Harford, Kent, Prince George's, Queen Anne's, St. Mary's, 
Somerset, Talbot, Wicomico, and Worcester.

Massachusetts

None.

Michigan

St. Joseph and Kalamazoo.

Minnesota

Blue Earth, Brown, Carver, Chippewa, Cottonwood, Dakota, Dodge, 
Faribault, Fillmore, Freeborn, Goodhue, Houston, Kandiyohi, Le Sueur, 
Martin, McLeod, Meeker, Mower, Nicollet, Olmsted, Pope, Redwood, 
Renville, Rice, Scott, Sibley, Stearns, Steele, Swift, Waseca, Wabasha, 
Watonwan, and Winona.

Mississippi

All counties.

Missouri

Barton, Butler, Cape Girardeau, Dade, Dunklin, Jasper, Lawrence, 
Mississippi, New Madrid, Newton, Pemiscot, Perry, Ripley, Scott, and 
Stoddard.

Montana

None.

Nebraska

None.

Nevada

None.

New Hampshire

None.

New Jersey

Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, 
Hunterdon, Mercer, Middlesex, Monmouth, Morris, Ocean, Salem, Somerset, 
Sussex, and Warren.

New Mexico

Chaves, Curry, Dona Ana, Eddy, Hidalgo, Lea, Luna, Quay, Roosevelt, San 
Juan, and Sierra.

New York

Cayuga, Columbia, Dutchess, Erie, Genesee, Greene, Livingston, Madison, 
Monroe, Niagara, Oneida, Onondaga, Ontario, Orange, Orleans, Putnam, 
Rensselaer, Saratoga, Schoharie, Seneca, Steuben, Suffolk, Tompkins, 
Ulster, Warren, Washington, Wayne, Westchester, Wyoming, and Yates.

North Carolina

Alamance, Alexander, Alleghany, Anson, Ashe, Beaufort, Bertie, Bladen, 
Brunswick, Burke, Cabarrus, Caldwell, Camden, Carteret, Caswell, 
Catawba, Chatham, Cherokee, Chowan, Clay, Cleveland, Columbus, Craven, 
Cumberland, Currituck, Dare, Davidson, Davie, Duplin, Edgecombe, 
Franklin, Gaston, Gates, Graham, Granville, Greene, Halifax, Harnett, 
Hertford, Hoke, Hyde, Iredell, Johnston, Jones, Lee, Lenoir, Lincoln, 
Macon, Martin, McDowell, Mecklenburg, Montgomery, Moore, Nash, New 
Hanover, Northampton, Onslow, Pamlico, Pasquotank, Pender, Perquimans, 
Person, Pitt, Richmond, Robeson, Rockingham, Rutherford, Sampson, 
Scotland, Stanly, Stokes, Tyrell, Union, Vance, Wake, Warren, 
Washington, Wayne, Wilkes, Wilson, and Yadkin.

North Dakota

None.

Ohio

Carroll, Champaign, Clermont, Fulton, Henry, Jackson, Lucas, Miami, 
Morgan, Muskingum, Scioto, Stark, Tuscarawas, and Vinton.

Oklahoma

Adair, Alfalfa, Beckham, Blaine, Bryan, Caddo, Canadian, Carter, 
Cherokee, Cleveland, Cotton, Custer, Delaware, Dewey, Ellis, Garfield, 
Garvin, Grady, Grant, Greer, Harmon, Haskell, Hughes, Jackson, 
Jefferson, Kay, Kingfisher, Kiowa, LeFlore, Logan, Love, McClain, 
McIntosh, Major, Marshall, Mayes, Muskogee, Noble, Nowata, Okmulgee, 
Osage, Pawnee, Payne, Pittsburg, Pottawatomie, Roger Mills, Rogers, 
Sequoyah, Stephens, Tillman, Tulsa, Wagoner, Washita, Woods, and 
Woodward.

Oregon

Morrow and Umatilla.

Pennsylvania

Adams, Bucks, Centre, Chester, Clinton, Columbia, Cumberland, Delaware, 
Erie, Franklin, Indiana, Lancaster, Montgomery, Montour, 
Northumberland, Schuylkill, Synder, Union, and York.

Puerto Rico

None.

Rhode Island

None.

South Carolina

All counties.

South Dakota

None.

Tennessee

Bledsoe, Cannon, Chester, Cocke, Coffee, Crockett, Dickson, Dyer, 
Fayette, Gibson, Giles, Greene, Grundy, Hardeman, Haywood, Jefferson, 
Knox, Lake, Lauderdale, Lawrence, Lincoln, Madison, Marion, Maury, 
McNairy, Obion, Overton, Pickett, Putnam, Rhea, Robertson, Rutherford, 
Sequatchie, Shelby, Sumner, Tipton, Unicoi, VanBuren, Warren, 
Washington, Wayne, White, Williamson, and Wilson.

Texas

Andrews, Atascosa, Austin, Bailey, Bexar, Brazoria, Briscoe, Brooks, 
Cameron, Castro, Chambers, Childress, Clay, Cochran, Collingsworth, 
Comanche, Crosby, Dallam, Dawson, Deaf Smith, Dickens, Dimmit, Donley, 
Duval, Fannin, Floyd, Foard, Frio, Gaines, Hale, Hall, Hansford, 
Hardeman, Hardin, Hartley, Haskell, Hemphill, Hidalgo, Hockley, Howard, 
Jefferson, Jim Hogg, Jim Wells, Kent, Kinney, Kleberg, Knox, Lamb, 
LaSalle, Liberty, Lubbock, Lynn, Martin, Maverick, Medina, Midland, 
Moore, Motley, Nueces, Ochiltree, Parmer, Pecos, Randall, Reeves, San 
Patricio, Sherman, Starr, Swisher, Terry, Uvalde, Washington, Webb, 
Wheeler, Willacy, Wilson, Yoakum, Zapata, and Zavala.

Utah

None.

Vermont

None.

Virginia

Accomack, Albemarle, Alleghany, Amelia, Amherst, Appomattox, Augusta, 
Bath, Bedford, Bland, Botetourt, Brunswick, Buchanan, Buckingham, 
Campbell, Caroline, Carroll, Charles City, Charlotte, Chesapeake, 
Chesterfield, Clarke, Craig, Culpeper, Cumberland, Dickenson, 
Dinwiddie, Essex, Fairfax, Fauquier, Floyd, Fluvanna, Franklin, 
Frederick, Giles, Gloucester, Goochland, Grayson, Greene,

[[Page 46345]]

Greensville, Halifax, Hanover, Henrico, Henry, Highland, Isle of Wight, 
James City, King and Queen, King George, King William, Lancaster, Lee, 
Loudoun, Louisa, Lunenburg, Madison, Mathews, Mecklenburg, Middlesex, 
Montgomery, Nelson, New Kent, Northampton, Northumberland, Nottoway, 
Orange, Page, Patrick, Pittsylvania, Powhatan, Prince Edward, Prince 
George, Prince William, Pulaski, Rappahannock, Richmond, Roanoke, 
Rockbridge, Rockingham, Russell, Scott, Shenandoah, Smyth, Southampton, 
Spotsylvania, Stafford, Suffolk, Surry, Sussex, Tazewell, Virginia 
Beach, Warren, Washington, Westmoreland, Wise, Wythe, and York.

Washington

Yakima.

West Virginia

None.

Wisconsin

Adams, Calumet, Columbia, Dane, Dodge, Fond du Lac, Green, Green Lake, 
Iowa, Kenosha, Milwaukee, Ozaukee, Portage, Racine, Richland, Rock, 
Sauk, Trempealeau, Walworth, Washington, Waukesha, Waushara, and 
Winnebago.

Wyoming

None.

    (f) The acreage of any fruit or vegetable specified in paragraph 
(h) of this section will first be attributed to cropland not having 
base acres, followed by base acres, before applying any payment acreage 
reduction required by paragraph (c) of this section. The reduction will 
be attributed to each of the covered commodities on the farm having 
payment acres on a pro rata basis to reflect the ratio of the payment 
acres of the covered commodity on the farm to the total payment acres 
of all covered commodities on the farm. No reductions are applicable to 
CTAP payments as specified in subpart H of this part.
    (g) For the purposes of this part, fruits, vegetables, and wild 
rice planted on payment acres of a farm under ARC or PLC Program 
contract:
    (1) Will be considered harvested at the time of planting, unless 
the producer pays a fee to cover the cost of a farm visit, as specified 
in part 718 of this title, to verify that the fruit, vegetable, or wild 
rice has been destroyed before harvest, as determined by CCC, or
    (2) Will not be considered as planted to a fruit, vegetable, or 
wild rice when reported by a producer on the farm with an intended use 
of green manure or forage, as determined by CCC, and a fee to cover the 
cost of a farm visit is paid by the producer, as specified in part 718 
of this title, to verify that the crop has not been harvested.
    (h) Unless otherwise specifically included as a covered commodity 
as specified in this part, fruits and vegetables include, but are not 
limited to, all nuts except peanuts, certain fruit-bearing trees and: 
Acerola (barbados cherry), antidesma, apples, apricots, aragula, ariona 
(chokeberry), artichokes, asparagus, atemoya (custard apple), avocados, 
babaco papayas, bananas, beans (except soybeans, mung, adzuki, faba, 
and lupin), beets--other than sugar, blackberries, blackeye peas, 
blueberries, bok spare choy, boysenberries, breadfruit, broccoflower, 
broccolo-cavalo, broccoli, brussel sprouts, cabbage, cailang, caimito, 
calabaza, carambola (star fruit), calaboose, carob, carrots, 
cascadeberries, cauliflower, celeriac, celery, chayote, cherimoyas 
(sugar apples), canary melon, cantaloupes, cardoon, casaba melon, 
cassava, cherries, chinese bitter melon, chicory, chinese cabbage, 
chinese mustard, chinese water chestnuts, chufes, citron, citron melon, 
coffee, collards, cowpeas, crabapples, cranberries, cressie greens, 
crenshaw melons, cucumbers, currants, cushaw, daikon, dasheen, dates, 
dry edible beans, dunga, eggplant, elderberries, elut, endive, 
escarole, etou, feijoas, figs, gai lien, gailon, galanga, genip, 
gooseberries, grapefruit, grapes, guambana, guavas, guy choy, honeydew 
melon, huckleberries, jackfruit, jerusalem artichokes, jicama, jojoba, 
kale, kenya, kiwifruit, kohlrabi, kumquats, leeks, lemons, lettuce, 
limequats, limes, lobok, loganberries, longon, loquats, lotus root, 
lychee (litchi), mandarins, mangos, marionberries, mar bub, melongene, 
mesple, mizuna, mongosteen, moqua, mulberries, murcotts, mushrooms, 
mustard greens, nectarines, ny Yu, okra, olallieberries, olives, 
onions, opo, oranges, papaya, paprika, parsnip, passion fruits, 
peaches, pears, peas, all peppers, persimmon, persian melon, pimentos, 
pineapple, pistachios, plantain, plumcots, plums, pomegranates, 
potatoes, prunes, pummelo, pumpkins, quinces, radicchio, radishes, 
raisins, raisins (distilling), rambutan, rape greens, rapini, 
raspberries, recao, rhubarb, rutabaga, santa claus melon, salsify, 
saodilla, sapote, savory, scallions, shallots, shiso, spinach, squash, 
strawberries, suk gat, swiss chard, sweet corn, sweet potatoes, 
tangelos, tangerines, tangos, tangors, taniers, taro root, tau chai, 
teff, tindora, tomatillos, tomatoes, turnips, turnip greens, 
watercress, watermelons, white sapote, yam, and yam yu choy.


Sec.  1412.49  Matters of general applicability.

    (a) The regulations in this part and CCC's interpretation of the 
regulations in this part and internal agency directives issued to FSA 
State and county offices are matters of general applicability and are 
not individually appealable in administrative appeals according to 
Sec. Sec.  11.3 and 780.5 of this title. Additionally, the regulations 
in this part and any decisions of CCC and FSA that are not based on 
specific facts derived from an individual participant's application, 
contract, or file are not appealable under part 11 or part 780 of this 
title. Examples of such decisions include how the program is generally 
administered, signup deadlines, payment rates, or any other generally 
applicable matter or determination that is made by CCC or FSA for use 
in all similarly situated applications. The only extent by which the 
matters referenced in this section are reviewable administratively in 
an appeal forum is whether FSA's or CCC's decision to apply the 
generally applicable matter is factually accurate and in conformance 
with the regulations in this part.
    (b) The relief provisions of 7 CFR part 718 are applicable only to 
ineligibility and noncompliance decisions. The relief provisions cannot 
be used to extend a benefit or assistance not otherwise available under 
law or not otherwise available to others who have satisfied or complied 
with every eligibility or compliance requirement of the provisions of 
this part. Equitable relief provisions of part 718 of this title cannot 
be used to obtain a review of either these regulations, the 
requirements of this part, the agency's interpretations of this part, 
or compliance provisions of this part.
Subpart E--Financial Considerations Including Sharing Payments


Sec.  1412.51  Limitation of payments.

    (a) The provisions of part 1400 of this chapter apply to this part. 
Payments under this part cannot exceed the amounts specified in part 
1400 of this chapter.
    (b) No person or legal entity may receive, directly or indirectly, 
more than $40,000 in CTAP payments in each of the 2014 and 2015 crop 
years.
    (c) For all covered commodities other than peanuts, the total 
amount of ARC and PLC payments received, directly or indirectly, by a 
person or legal entity (except a joint venture or general partnership) 
for any crop year together

[[Page 46346]]

with any marketing loan gains or loan deficiency payments for any and 
all commodities other than peanuts under subtitle B of title I of the 
2014 Farm Bill cannot exceed $125,000.
    (d) For peanuts, the total amount of payments received, directly or 
indirectly, by a person or legal entity (except a joint venture or 
general partnership) for any crop year together with any marketing loan 
gains or loan deficiency payments under subtitle B of title I of the 
2014 Farm Bill for peanuts cannot exceed $125,000.


Sec.  1412.54  Sharing of payments.

    (a) Each eligible producer on a farm may apply for CTAP as 
specified in subpart H of this part and annually enroll in an ARC or 
PLC contract, as applicable, and receive assistance and payments 
determined to be fair and equitable as agreed to by all the producers 
on the farm and approved by the county committee.
    (b) Each person or legal entity leasing a farm who applies for CTAP 
or elects and enrolls in ARC or PLC is required to provide a copy of 
their written lease to the county committee and, in the absence of a 
written lease, is required to provide to the county committee a 
complete written description of the terms and conditions of any oral 
agreement or lease. An owner's or landlord's signature affirming a zero 
share on either an application for assistance or contract under this 
part, as applicable, may be accepted as evidence of a cash lease 
between the owner or landlord and tenant, as determined by CCC. For the 
purposes of obtaining payments under this part, the signature or 
signatures, if entered on the application or contract to satisfy the 
requirement of furnishing a written lease, are required to be provided 
by the application or enrollment deadline established by CCC for the 
assistance or payment.
    (c) When land on which base acres is leased on a share basis, 
neither the landlord nor the tenant is eligible to receive 100 percent 
of the CTAP payment or ARC or PLC contract payment for the farm.
    (d) CCC will approve an ARC or PLC contract for enrollment and 
approve the division of payment when CCC is satisfied and determines 
that all of the following apply:
    (1) The landlords, tenants, and sharecroppers sign the contract and 
agree to the payment shares shown on the contract;
    (2) The interests of tenants and sharecroppers are being protected; 
and
    (3) The payment shares shown on the application or contract do not 
circumvent either the provisions of this part or the provisions of part 
1400 of this chapter.
    (4) If any civil dispute between persons, legal entities, or 
members of legal entities not involving CCC is known or suspected to 
exist that CCC believes might impact the eligibility of any person or 
legal entity or administration of ARC, PLC, or CTAP under this part, 
the Deputy Administrator on CCC's behalf can elect to withhold making 
any determination on an application or contract until such time as the 
Deputy Administrator and CCC are satisfied that the dispute is resolved 
or no longer has any bearing on either the administration of ARC, PLC, 
or CTAP under this part or any eligible producer or potential eligible 
producer. A decision withheld under to this paragraph will not be 
construed to be a decision or adverse decision under any law or 
regulation nor will it be construed to be a failure of FSA or CCC to 
act under any law or regulation.
    (e) A lease will be considered to be a cash lease if the lease 
provides for only a guaranteed cash payment for a specified amount, or 
a fixed quantity of the crop (for example, pounds, or bushels per 
acre).
    (1) If a lease contains provisions that require the payment of rent 
on the basis of the amount of crop produced or the proceeds derived 
from the crop, or the interest such producer would have had if the crop 
had been produced, or combination thereof, the agreement will be 
considered to be a share lease.
    (2) If a lease provides for a guaranteed amount and a share of the 
crop or crop proceeds, the agreement will be considered a cash lease.
    (3) If the lease is a cash lease, the landlord is not eligible for 
assistance or payments under this part. The leasing of grazing or 
haying privileges is not considered cash leasing.
    (f) Shares of P&CP or eligible subsequently planted crop acreage of 
covered commodities on generic base acres will be determined based on 
the attribution in Sec.  1412.45 and shares recorded on the report of 
acreage filed in accordance with Sec.  1412.66. Shares of PLC and ARC-
CO will be determined based on the shares entered on the contract. 
Shares of ARC-IC payments will be determined based on the shares 
recorded on the report of acreage filed as specified in Sec.  1412.66. 
Further, each eligible producer having a share of P&CP or eligible 
subsequently planted crop acreage of covered commodities on a farm 
enrolled under an ARC or PLC Program contract has to do both of the 
following to be eligible for their share of a payment:
    (1) Unless otherwise already enrolled on the ARC or PLC Program 
contract, sign the ARC or PLC Program contract during the contract 
period; and
    (2) Have the producer's share recorded on the report of acreage 
filed as required by part 718 of this title and Sec.  1412.66 of this 
part.
    (g) In a case where a producer has failed to sign an ARC or PLC 
Program contract by the signup deadline or contract period established 
for enrollment and participation for the producer's reported share of 
P&CP acres or eligible subsequently planted crop acreage of covered 
commodities on a farm enrolled as specified in this part, that 
producer's share will not receive any consideration for payment and 
will not generate any payment to the producer or to any other producer 
on the farm.
    (h) CCC's approval of a CTAP application or ARC or PLC contract or 
shares under this part based on the representations of persons or legal 
entities signing the CTAP application, or ARC or PLC contract, or 
acreage report in no way implies or will be construed as CCC's 
determination that the representations or assertions made by persons or 
legal entities signing the CTAP application, or ARC or PLC contract, or 
acreage report are correct or are approved as legitimate. Any and all 
assertions and representations of a person, persons, legal entity, or 
legal entities signing forms, applications, or contracts incidental to 
program participation in this part are always subject to review and 
scrutiny or spot check by CCC. CCC can at any time demand documentation 
to substantiate any representation made by any program participant 
under this part and recover unearned amounts that are determined to 
have been paid based on such erroneous representation.


Sec.  1412.55  Provisions relating to tenants and sharecroppers.

    (a) No payment or assistance authorized under this part will be 
made by CCC if:
    (1) The landlord or operator has adopted a scheme or device for the 
purpose of depriving any tenant or sharecropper of the payments to 
which such person would otherwise be entitled under ARC, PLC, or CTAP. 
If any of such conditions occur or are discovered after payments have 
been made, all or any such part of the payments as the State committee 
may determine are required to be refunded to CCC; or
    (2) The landlord terminated a lease in violation of State law as 
determined by a State court.

[[Page 46347]]

    (b) [Reserved]
Subpart F--Violations and Compliance Provisions


Sec.  1412.61  Contract violations.

    Violations of contract or application requirements will result in 
the termination or cancellation of the ARC or PLC contract or CTAP 
application, as applicable. Upon such termination or cancellation, all 
producers that signed the contract or application forfeit all rights to 
receive payments for the ARC or PLC contract or CTAP application and 
are required to refund all payments received, plus interest as 
specified in Sec.  1412.1(d) of this part, as determined in accordance 
with part 1403 of this chapter.


Sec.  1412.63  Contract or application liability.

    All producers who signed an ARC or PLC Program contract or CTAP 
application made according to this part are jointly and severally 
liable for contract or application violations and resulting repayments 
and penalties.


Sec.  1412.64  Inaccurate representation, misrepresentation, and scheme 
or device.

    (a) Producers are required to accurately report and certify 
information provided to CCC for ARC, PLC, and CTAP. Any form containing 
the signature of a person or legal entity that contains a preprinted 
certification statement on the form will be construed to be a 
representation and certification of and from the person or legal entity 
signing the form regardless of whether or not the person or legal 
entity personally made the entry or entries on the form. Errors in 
reporting may impact eligibility or extent of eligibility. Payments 
under this part will be based on the most correct information 
available. CCC's issuing payments based on the face of a contract or 
application does not signify CCC's approval of the representations made 
by participants. Producers are responsible for refunding, with interest 
as specified in Sec.  1412.1(d) of this part, any program benefits that 
were paid based on incorrect program information.
    (b) For those cases in which FSA determines that an inaccurate 
representation or certification is due to a misrepresentation, scheme, 
or device, the person or legal entity or members of the legal entity 
will be ineligible to receive ARC, PLC, or CTAP payments and will have 
the person, legal entity's or member's interest in all contracts or 
applications terminated if it is determined that such person, legal 
entity, or member of the legal entity has done any of the following:
    (1) Adopted any scheme or device that tends to defeat the purpose 
of this part;
    (2) Made any fraudulent representation;
    (3) Misrepresented any fact affecting an ARC or PLC Program 
contract, CTAP application, or determination made under part 1400 of 
this chapter; or
    (4) Violated or been determined ineligible under Sec.  1400.5 of 
this chapter.
    (c) Any remedies taken by FSA or CCC as specified in this section 
will be in addition to any other civil or other remedies that may be 
available, including, but not limited to, those provided in part 1400 
of this chapter.


Sec.  1412.65  Offsets and assignments.

    (a) Except as provided in paragraph (b) of this section, any 
payment or portion thereof to any person will be made without regard to 
questions of title under State law and without regard to any claim or 
lien against the crop, or proceeds thereof, in favor of the owner or 
any other creditor except agencies of the U.S. Government. The 
regulations governing offsets and withholdings in part 1403 of this 
chapter apply to contract payments.
    (b) Any participant entitled to any payment may assign any payments 
in accordance with regulations governing the assignment of payments in 
part 1404 of this chapter.


Sec.  1412.66  Acreage and production reports, prevented planting, and 
notices of loss.

    (a) An accurate report of all cropland acreage on the farm is 
required for ARC, PLC, and CTAP. How to submit the acreage report is 
specified in part 718 of this title.
    (b) Prevented planting acreage credit will only be available to 
acreage that CCC determines was prevented from being planted due to an 
eligible cause of loss. Acreage ineligible for prevented planted credit 
includes acreage not planted due to a management decision. Prevented 
planting acreage credit is subject to the provisions of part 718 of 
this title.


Sec.  1412.67  Compliance with highly erodible land and wetland 
conservation provisions.

    The provisions of part 12 of this title apply to this part.


Sec.  1412.68  Controlled substance violations.

    The provisions of part 718 of this title apply to this part.


Sec.  1412.69  Control of noxious weeds.

    CTAP participants and enrolled ARC and PLC contract participants 
agree to effectively control noxious weeds and otherwise maintain the 
land on the farm in accordance with sound agricultural practices; and 
use the land on the farm for an agricultural or conserving use, and not 
for a nonagricultural commercial, industrial, or residential use.
Subpart H--CTAP


Sec.  1412.81  Administration.

    (a) The provisions of this part apply to this subpart, except for 
provisions that apply specifically to ARC and PLC only, for example, 
the yield and planting flexibility provisions apply specifically to ARC 
and PLC. To the extent that there is a conflict with the provisions of 
other subparts of this part and this subpart, the provisions of this 
subpart apply to CTAP.
    (b) CTAP payments as specified in this subpart will be made 
available for:
    (1) The 2014 crop year to eligible producers on farms in all 
counties; and
    (2) The 2015 crop year to eligible producers on farms only in 
counties where STAX is not available.


Sec.  1412.82  Eligibility and CTAP application.

    (a) Eligibility. In addition to any general eligibility provisions 
in this part, to be eligible for CTAP the following conditions are 
required:
    (1) The producer is a person or legal entity who is actively 
engaged in farming and otherwise eligible for payment, as specified in 
7 CFR part 1400;
    (2) The producer is on a farm that has cotton base acres that were 
in existence as of September 30, 2013, as adjusted; and
    (3) The producer has an interest in the upland cotton base acres on 
the farm.
    (b) Producer's share interest. A producer's share interest in 
cropland on a farm must be equal to or greater than that producer's 
share interest in cotton base acres on the farm for that crop year, as 
reported on that farm's acreage report.
    (c) Application. To apply, submit the application and supportive 
and necessary contractual documents to the FSA county office:
    (1) For 2014 CTAP by October 7, 2014; and
    (2) For 2015 CTAP, by July 31, 2015.


Sec.  1412.83  Sharing of CTAP payments.

    (a) Each eligible producer on a farm may apply for and receive CTAP 
payments determined to be fair and equitable as agreed to by all 
producers on the farm and as approved by the county committee.
    (b) The provisions of Sec.  1412.54 regarding the classification of 
leases apply to CTAP.
    (c) Shares of CTAP payments will be determined based on shares 
recorded on

[[Page 46348]]

the application for CTAP payments for the particular program year. The 
provisions of Sec.  1412.54 apply to shares of CTAP payments.


Sec.  1412.84  Impact of CTAP application on ARC or PLC.

    (a) Applications for CTAP do not establish eligibility for ARC or 
PLC. Interested producers are required to file documents that are 
specifically required for CTAP as specified on the CTAP application. An 
application for CTAP will not be considered an intent to participate in 
ARC or PLC and, conversely, an election or enrollment in ARC or PLC 
will not establish eligibility for CTAP.
    (b) [Reserved]


Sec.  1412.86  CTAP payments.

    (a) In the case of producers on a farm who apply for CTAP as 
specified in this part, and where all other eligibility provisions have 
been satisfied, CCC will make CTAP payments available to the producers 
on a farm's application as specified in this subpart.
    (b) CTAP payments for upland cotton producers on farms with 
eligible upland cotton base acres as specified in Sec.  1412.82(a) are 
equal to:
    (1) For 2014, the product of multiplying 60 percent of the farm's 
upland cotton base acres, times the farm's direct payment yield for 
upland cotton, times $0.09, times the producer's share on the approved 
application; or
    (2) Where applicable for 2015 according to this part and subpart, 
the product of multiplying 36.5 percent of the farm's upland cotton 
base acres, times the farm's direct payment yield for upland cotton, 
times $0.09, times the producer's share on the approved application.


Sec.  1412.87  Transfer of land and succession-in-interest.

    (a) A succession in interest application for CTAP is required if 
there has been a change in the producer shares of upland cotton base 
acres in Sec.  1412.82(a) for 2014 or 2015, as applicable, due to:
    (1) A sale of land;
    (2) A change of producer, including a change in a partnership that 
increases or decreases the number of partners or changes who are 
partners;
    (3) A foreclosure, bankruptcy, or involuntary loss of the farm;
    (4) A change in producer shares to reflect changes in the 
producer's share of the upland cotton base acres relevant to the 
originally approved application; or
    (5) Any other change determined by the Deputy Administrator to be a 
succession that will not adversely affect or defeat the purpose of 
CTAP.
    (b) A succession in interest to the CTAP application is not 
permitted if CCC determines that the change:
    (1) Results in a violation of the landlord-tenant provisions 
specified in Sec.  1412.55; or
    (2) Adversely affects or otherwise defeats the purpose of CTAP.
    (c) If a producer who is entitled to receive CTAP payments dies, 
becomes incompetent, or is otherwise unable to receive the payment, CCC 
will make the payment in accordance with part 707 of this title.
    (d) A producer or owner of an enrolled farm is required to inform 
the county committee of changes in interest in base acres of upland 
cotton as specified in Sec.  1412.82(b) on the farm not later than:
    (1) August 1 of the fiscal year in which the change occurs if the 
change requires a reconstitution be completed in accordance with part 
718 of this title; or
    (2) September 30 of the fiscal year in which the change occurs if 
the change does not require a reconstitution be completed in accordance 
with part 718 of this title.
    (e) In any case in which a CTAP payment has previously been made to 
a predecessor, such payment will not be paid to the successor, unless 
such payment has been refunded in full by the predecessor.


Sec.  1412.88  Executed application not in conformity with regulations.

    If, after a CTAP application is approved by CCC, it is discovered 
that such any information contained in the application is not in 
conformity with the provisions of this part, the provisions of this 
part will prevail.


Sec.  1412.89  Division of CTAP payments and provisions relating to 
tenants and sharecroppers.

    (a) CTAP payments will be divided in the manner specified in the 
applicable application approved by CCC. CCC will ensure that 2014 or 
2015 producers who would have a 2014 or 2015 reported share interest in 
cropland on the farm specified in Sec.  1412.82(b) receive treatment 
that CCC deems to be equitable, as determined by CCC. CCC will refrain 
from acting on an application if, as determined by CCC, there is a 
disagreement among any person or legal entity applying as to the 
person's or legal entity's eligibility to apply as a tenant and there 
is insufficient evidence to indicate whether the person seeking 
participation as a tenant does or does not have a reported share 
interest in the cropland on the farm sufficient to cover the claimed 
share interest in cotton base acres of that farm as specified in Sec.  
1412.82(b) in 2014 or 2015, as applicable.
    (b) CCC may remove an operator or tenant from an application under 
this subpart and part when the operator or tenant:
    (1) Requests, in writing to be removed from the application;
    (2) Files for bankruptcy and the trustee or debtor in possession 
fails to affirm the application, to the extent permitted by the 
provisions of applicable bankruptcy laws;
    (3) Dies during the 2014 or 2015 program year and the Administrator 
of the estate fails to succeed to the application within a period of 
time determined by the Deputy Administrator; or
    (4) Is the subject of an order of a court of competent jurisdiction 
requiring the removal from the application under this part and subpart 
of the operator or tenant and such order is received by FSA, as 
determined by CCC.
    (c) In addition to the provisions in paragraph (b) of this section, 
tenants are required to maintain their tenancy throughout the crop year 
in order to remain on an application. Tenants who fail to maintain 
tenancy on the acreage under the application, including failure to 
comply with provisions under applicable State law, may be removed from 
an application by CCC. CCC will assume the tenancy is being maintained 
unless notified otherwise by a participant specified in the 
application.

    Signed on August 4, 2014.
Juan M. Garcia,
Executive Vice President, Commodity Credit Corporation, and 
Administrator, Farm Service Agency.
[FR Doc. 2014-18719 Filed 8-6-14; 8:45 am]
BILLING CODE 3410-05-P