[Federal Register Volume 80, Number 227 (Wednesday, November 25, 2015)]
[Rules and Regulations]
[Pages 73637-73639]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-29652]



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 Rules and Regulations
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  Federal Register / Vol. 80, No. 227 / Wednesday, November 25, 2015 / 
Rules and Regulations  

[[Page 73637]]



DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 407

[Docket No. FCIC-15-0003]
RIN 0563-AC49


Area Risk Protection Insurance (ARPI) Regulations; ARPI Basic 
Provisions and ARPI Forage Crop Insurance Provisions

AGENCY: Federal Crop Insurance Corporation, USDA.

ACTION: Final rule with request for comments.

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

SUMMARY: The Federal Crop Insurance Corporation (FCIC) amends the Area 
Risk Protection Insurance (ARPI) Regulations; ARPI Basic Provisions and 
ARPI Forage Crop Insurance Provisions. The intended effect of this 
action is to meet the goals of the Acreage Crop Reporting Streamlining 
Initiative (ACRSI), which is a United States Department of Agriculture 
initiative and required by Agricultural Act of 2014 (2014 Farm Bill), 
by aligning ARPI Forage Production with the Actual Production History 
Forage Production Crop Insurance Provisions and to address language 
contained in section 12305(b)(1)(B) of the 2014 Farm Bill that 
prohibits FCIC from offering the catastrophic (CAT) level of coverage 
for any crops or grasses used for grazing. The changes will be 
effective for the 2017 and succeeding crop years.

DATES: This rule is effective November 25, 2015. Written comments and 
opinions on this rule will be accepted until close of business January 
25, 2016. FCIC will consider the comments received and may conduct 
additional rulemaking based on the comments.

ADDRESSES: FCIC prefers that comments be submitted electronically 
through the Federal eRulemaking Portal. You may submit comments, 
identified by Docket ID No. FCIC-15-0003 by any of the following 
methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Mail: Director, Product Administration and Standards 
Division, Risk Management Agency, United States Department of 
Agriculture, P.O. Box 419205, Kansas City, MO 64133-6205.
    All comments received, including those received by mail, will be 
posted without change to http://www.regulations.gov, including any 
personal information provided, and can be accessed by the public. All 
comments must include the agency name and docket number or Regulatory 
Information Number (RIN) for this rule. For detailed instructions on 
submitting comments and additional information, see http://www.regulations.gov. If you are submitting comments electronically 
through the Federal eRulemaking Portal and want to attach a document, 
we ask that it be in a text-based format. If you want to attach a 
document that is a scanned Adobe PDF file, it must be scanned as text 
and not as an image, thus allowing FCIC to search and copy certain 
portions of your submissions. For questions regarding attaching a 
document that is a scanned Adobe PDF file, please contact the RMA Web 
Content Team at (816) 823-4694 or by email at 
[email protected].
    Privacy Act: Anyone is able to search the electronic form of all 
comments received for any dockets by the name of the person submitting 
the comment (or signing the comment, if submitted on behalf of an 
association, business, labor union, etc.). You may review the complete 
User Notice and Privacy Notice for Regulations.gov at http://www.regulations.gov/#!privacyNotice.

FOR FURTHER INFORMATION CONTACT: Tim Hoffmann, Director, Product 
Management, Product Administration and Standards Division, Risk 
Management Agency, United States Department of Agriculture, Beacon 
Facility, Stop 0812, Room 421, P.O. Box 419205, Kansas City, MO 64141-
6205, telephone (816) 926-7730.

SUPPLEMENTARY INFORMATION:

Notice and Comment

    We are issuing this final rule without prior notice and opportunity 
for comment. The Administrative Procedure Act (APA) exempts rules 
``relating to agency management or personnel or to public property, 
loans, grants, benefits, or contracts'' from the statutory requirement 
for prior notice and opportunity for comment. 5 U.S.C. 553(a)(2). 
However, FCIC is providing a 60-day comment period and we invite you to 
participate in this rulemaking by submitting written comments. We will 
consider the comments we receive and may conduct additional rulemaking 
based on the comments.

Executive Order 12866

    The Office of Management and Budget (OMB) has determined that this 
rule is not-significant for the purpose of Executive Order 12866 and, 
therefore, it has not been reviewed by OMB.

Paperwork Reduction Act of 1995

    Pursuant to the provisions of the Paperwork Reduction Act of 1995 
(44 U.S.C. chapter 35), the collections of information in this rule 
have been approved by OMB under control number 0563-0085.

E-Government Act Compliance

    FCIC is committed to complying with the E-Government Act of 2002, 
to promote the use of the Internet and other information technologies 
to provide increased opportunities for citizen access to Government 
information and services, and for other purposes.

Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) 
establishes requirements for Federal agencies to assess the effects of 
their regulatory actions on State, local, and tribal governments and 
the private sector. This rule contains no Federal mandates (under the 
regulatory provisions of title II of the UMRA) for State, local, and 
tribal governments or the private sector. Therefore, this rule is not 
subject to the requirements of sections 202 and 205 of UMRA.

Executive Order 13132

    It has been determined under section 1(a) of Executive Order 13132, 
Federalism, that this rule does not have sufficient implications to 
warrant consultation with the States. The provisions contained in this 
rule will not have a substantial direct effect on

[[Page 73638]]

States, or on the relationship between the national government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government.

Executive Order 13175

    This rule has been reviewed in accordance with the requirements of 
Executive Order 13175, Consultation and Coordination with Indian Tribal 
Governments. The review reveals that this regulation will not have 
substantial and direct effects on Tribal governments and will not have 
significant Tribal implications.

Regulatory Flexibility Act

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

Federal Assistance Program

    This program is listed in the Catalog of Federal Domestic 
Assistance under No. 10.450.

Executive Order 12372

    This program is not subject to the provisions of Executive Order 
12372, which require intergovernmental consultation with State and 
local officials. See the Notice related to 7 CFR part 3015, subpart V, 
published at 48 FR 29115, June 24, 1983.

Executive Order 12988

    This rule has been reviewed in accordance with Executive Order 
12988 on civil justice reform. The provisions of this rule will not 
have a retroactive effect. The provisions of this rule will preempt 
State and local laws to the extent such State and local laws are 
inconsistent herewith. With respect to any direct action taken by FCIC 
or action by FCIC to require the insurance provider to take specific 
action under the terms of the crop insurance policy, the administrative 
appeal provisions published at 7 CFR part 11 must be exhausted before 
any action against FCIC for judicial review may be brought.

Environmental Evaluation

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

Background

    FCIC amends the Area Risk Protection Insurance Regulations (7 CFR 
part 407) by revising Sec.  407.9 Area Risk Protection Insurance Policy 
and Sec.  407.13 Forage Crop Insurance Provisions to be effective for 
the 2017 succeeding crop years. The revisions meet certain goals of 
ACRSI, which include elimination of duplicate information collection, 
simplification of producer reporting, and incorporating language 
contained in section 12305(b)(1)(B) of the 2014 Farm Bill prohibiting 
FCIC from offering the CAT level of coverage for any crops or grasses 
used for grazing.
    Previously, changes made to the Federal crop insurance policies 
codified in the Code of Federal Regulations were required to be 
implemented through the rulemaking process. Such action was not 
required by the Administrative Procedures Act because contracts were 
exempt from notice and comment rulemaking and the crop insurance policy 
is a contract. However, a prior Secretary of Agriculture published a 
notice in the Federal Register stating that the Department of 
Agriculture would, to the maximum extent practicable, use the notice 
and comment rulemaking process when making program changes, including 
those involving contracts. FCIC has complied with this notice over the 
subsequent years. Recently, the current Secretary of Agriculture has 
published a notice in the Federal Register rescinding the prior notice, 
thereby making contracts again exempt from the notice and comment 
rulemaking process. However, FCIC values the input it receives through 
comments and has elected to solicit comments to this final rule. FCIC 
will consider all of the comments that are received and may conduct 
additional rulemaking based on the comments.
    For these reasons, these policy changes are effective upon 
publication at the Office of the Federal Register.
    The specific revisions to Area Risk Protection Insurance Policy (7 
CFR 407.9) are as follows:
    1. Section 8--FCIC is revising paragraph (e)(2). The current 
provisions regarding the insured's ability to revise an acreage report 
state that consent may only be provided if the information on the 
acreage report is clearly transposed, or the insured provides adequate 
evidence that the insurance company or someone from USDA has committed 
an error regarding the information on the acreage report. FCIC is 
revising this provision to include language that gives FCIC the 
flexibility through the Crop Provisions or through the Special 
Provisions to provide additional circumstances for which insureds may 
revise their acreage reports. This change is necessary due to changes 
in the ARPI Forage Crop Provisions stated below that allow acreage 
reports be revised when the acreage has suffered winterkill. FCIC is 
also revising the paragraph to improve readability.
    The specific changes to ARPI Forage crop insurance provisions (7 
CFR 407.13) are as follows:
    1. Section 1--FCIC is revising the definition of ``harvest.'' The 
definition of ``harvest'' states ``removal of the forage from the 
field, and rotational grazing.''
    However, the 2014 Farm Bill prohibits FCIC from offering the CAT 
level of coverage for any crops or grasses used for grazing. Further, 
the Noninsured Crop Assistance Program (NAP) offers coverage at the CAT 
and additional levels of coverage. To avoid confusion between the 
benefits available, FCIC is removing the option to purchase coverage 
for grazing at the additional and CAT level of coverage so that forage 
producers are eligible for at least the CAT level of coverage offered 
under other USDA programs. Therefore, FCIC is removing the term 
``rotational grazing,'' from the definition of ``harvest'' and removing 
the definition of ``rotational grazing'' so that FCIC can continue to 
offer the CAT level of coverage to forage producers who do not graze 
acreage.
    2. Section 5--FCIC is moving the cancellation date, termination 
date and contract change date 60 days earlier: For the termination and 
cancellation dates,

[[Page 73639]]

from November 30 to September 30, and for the contact change date, from 
August 31 to June 30. A goal under ACRSI is to establish one acreage 
reporting date for each commodity that will be used for USDA programs. 
For perennial forage, ACRSI established two commodities for perennial 
forage: an established stand and fall-seeded commodity; and a spring-
seeded commodity. Each commodity requires its own acreage reporting 
date: One in the fall and one in the spring, respectively. In order to 
be insured under the ARPI forage policy, perennial forage must have an 
established stand for insurance to attach. Therefore, its acreage 
reporting date needs to be in the fall in order for its acreage 
reporting date to align with the acreage reporting date for established 
stand perennial forage insured under other plans of insurance. The 
acreage reporting date for established stand and fall-seeded perennial 
forage insured under other plans of insurance FCIC offers is set at 
November 15 or December 15, depending on the state. The fall date is 
necessary for the other perennial forage plans of insurance because 
those plans of insurance provide coverage for damage due to winterkill. 
Therefore, FCIC must require producers to report their acreage prior to 
the possibility of an occurrence of winterkill. In order to move the 
acreage reporting date, which is contained in the actuarial documents, 
from the current date of July 15 to November 15 or December 15, 
depending on the state, FCIC must also make adjustments in the Crop 
Provisions to these other program dates: cancellation and termination 
dates and the contract change date. This change will make the program 
dates for forage insured under ARPI consistent with the program dates 
for forage insured under other plans of insurance.
    3. Section 6--FCIC is removing this section and add another in its 
place. The current section 6 addresses when premium is earned and 
payable, and overrides section 7(e) in the ARPI Basic Provisions. Basic 
Provisions section 7(e) states that premium is earned and payable at 
the time coverage begins, whereas section 6 of the Forage Crop 
Provisions states that premium is earned and payable on the acreage 
reporting date. Coverage for forage begins on the date the insurance 
company accepts the application, which is in the fall. Currently, 
premium for forage is not earned and payable at the time coverage 
begins, but rather on the acreage reporting date, which is 
approximately eight months after insureds submit their applications. 
Premium is earned and payable on the acreage reporting date because 
insureds have the opportunity at acreage reporting date to opt out of 
coverage if they can establish that their acreage was damaged by 
winterkill by reporting such acreage as uninsurable on the acreage 
report. Insureds do not owe premium on acreage damaged by winterkill if 
they report such acreage on the acreage report as uninsurable. Insureds 
do not know if their acreage is damaged by winterkill until mid-to-late 
spring. If insureds report such acreage as uninsurable, then they are 
not required to pay premium on that acreage. FCIC proposes to remove 
these provisions, which then makes section 7(e) of the Basic Provisions 
applicable. Therefore, premium will be earned and payable at the time 
coverage begins. This change will make forage insured under ARPI 
consistent with forage insured under the APH plan of insurance. As a 
result of another revision discussed below, insureds will have an 
opportunity to revise their acreage reports after the acreage reporting 
date to report their acreage damaged by winterkill as uninsurable 
acreage if they do not wish to insure that acreage and pay premium on 
it.
    FCIC is adding a new section 6 titled ``Report of Acreage.'' The 
provisions in section 6 will allow insureds to submit a revised acreage 
report by a date specified in the Special Provisions if they want to 
report their acreage damaged by winterkill as uninsurable acreage. FCIC 
anticipates the date specified in the Special Provisions to be May 15. 
Without this provision, insureds would be required to insure and pay 
premium on acreage they currently are not required to insure under the 
ARPI Forage Crop Provisions.

List of Subjects in 7 CFR Part 407

    Crop insurance, Reporting and recordkeeping requirements.

Final Rule

    Accordingly, as set forth in the preamble, the Federal Crop 
Insurance Corporation amends 7 CFR part 407 effective for the 2017 and 
succeeding crop years as follows:

PART 407--AREA RISK PROTECTION INSURANCE REGULATIONS

0
1. The authority citation for 7 CFR part 407 continues to read as 
follows:

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


0
2. Amend Sec.  407.9 by:
0
a. In the introductory text, removing ``2014'' and adding ``2017'' in 
its place; and
0
b. In section 8, revising paragraph (e)(2).
    The revisions read as follows:


Sec.  407.9  Area risk protection insurance policy.

* * * * *
    8. Report of Acreage and Production
* * * * *
    (e) * * *
    (2) Consent may only be provided:
    (i) If the information on the acreage report is clearly transposed;
    (ii) If you provide adequate evidence that we have or someone from 
USDA has committed an error regarding the information on your acreage 
report;
    (iii) If allowed in the Crop Provisions; or
    (iv) As otherwise provided in the Special Provisions; and
* * * * *

0
3. Amend Sec.  407.13 by:
0
a. In the introductory text, removing ``2014'' and adding ``2017'' in 
its place;
0
b. In section 1:
0
i. Revising the definition of ``Harvest''; and
0
ii. Removing the definition of ``Rotational grazing''; and
0
c. Revising sections 5 and 6.
    The revisions read as follows:


Sec.  407.13  Area risk protection insurance for forage.

* * * * *
    1. Definitions
* * * * *
    Harvest. Removal of the forage from the field. Harvest does not 
include grazing.
* * * * *
    5. Program Dates
    September 30 is the cancellation and termination date for all 
states, unless the date is specified differently in the Special 
Provisions. The contract change date is June 30 for all states, unless 
the date is specified differently in the Special Provisions.
    6. Report of Acreage
    In addition to section 8(e)(2) of the Area Risk Protection 
Insurance Basic Provisions, regarding the ability to revise an acreage 
report you have submitted to us, we may provide you consent to revise 
your acreage report to indicate acreage damaged by winterkill that was 
not harvested (no cutting taken) as uninsurable acreage. You must 
submit a revised acreage report on or before the date specified in the 
Special Provisions.

    Signed in Washington, DC, on November 13, 2015.
Brandon Willis,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 2015-29652 Filed 11-24-15; 8:45 am]
 BILLING CODE 3410-08-P