[Federal Register Volume 82, Number 122 (Tuesday, June 27, 2017)]
[Rules and Regulations]
[Pages 28983-28993]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-13242]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
========================================================================
Federal Register / Vol. 82, No. 122 / Tuesday, June 27, 2017 / Rules
and Regulations
[[Page 28983]]
DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
7 CFR Part 457
[Docket No. FCIC-16-0002]
RIN 0563-AC53
Common Crop Insurance Policy Basic Provisions (7 CFR 457.8)
AGENCY: Federal Crop Insurance Corporation, USDA.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Federal Crop Insurance Corporation (FCIC) finalizes the
Common Crop Insurance Policy Basic Provisions (Basic Provisions) and
makes amendments to the final rule, with request for comment, published
in the Federal Register on June 22, 2016, that clarified and revised
the policy definition of ``practical to replant'' and ``replanted
crop,'' and policy provisions regarding double cropping. The changes to
the policy made in this rule are applicable for the 2018 and succeeding
crop years for all crops with a contract change date on or after the
effective date of the rule, and for the 2019 and succeeding crop years
for all crops with a contract change date prior to the effective date
of the rule.
DATES: This rule is effective June 27, 2017.
FOR FURTHER INFORMATION CONTACT: Tim Hoffmann, Director, Product
Administration and Standards Division, Product Management, Risk
Management Agency, United States Department of Agriculture, Beacon
Facility, Stop 0812, Room 421, PO Box 419205, Kansas City, MO 64141-
6205, telephone (816) 926-7730.
SUPPLEMENTARY INFORMATION:
Background
This final rule makes changes to the Common Crop Insurance
Regulations, Basic Provisions that were published by FCIC on June 22,
2016, as a notice of final rule with request for comment rulemaking in
the Federal Register at 81 FR 40477-40480. The public was afforded 60
days to submit written comments and opinions.
Comments were received from 59 commenters. The commenters included
persons or entities from the following categories: Insurance company,
insurance agent, farmer, financial, producer group, academic, trade
association, and other.
The public comments received regarding the final rule with request
for comment and FCIC's responses to the comments are as follows:
Practical To Replant
Comment: A commenter stated the practical to replant provision
should be adopted as written. The dates are reasonable and producers
who desire to plant a crop will often plant at these dates or beyond.
Claiming a replant unnecessarily has negative impacts on other
producer's premiums and on supporting industry operations. Ultimately,
the local economy is the loser.
Response: FCIC thanks the commenter and appreciates their input.
Comment: Several commenters supported the clarity intended by the
revisions to the definition of ``practical to replant.'' Consistency
between all insurance providers was always a challenge with the
ambiguous language with the previous definition. The commenters always
supported clear and concise definitions. A commenter stated it
generally supports any effort to take subjectivity and ambiguity out of
the crop insurance program and efforts to prevent fraud from occurring.
Response: FCIC appreciates the commenter's support for the clarity
and consistency intended by the revised definition of ``practical to
replant.''
Comment: A commenter stated there certainly is a need to provide a
clear deadline for that period (or date) when replanting of a crop is
considered to be practical and that if not replanted, insurance
coverage should not be provided for the initial crop. This information
is important to standardize practices at the farm and state insurance
agency levels to ensure that the highest standards of fairness and
consistency are practiced. The crop insurance program in Louisiana is
an essential risk management tool that must be sustained into the
future. The food security of this country could be at risk without a
viable Federal crop insurance program that is compatible with the needs
of U.S. agriculture. If changes in the definition of ``practical to
replant'' are accepted and become mandatory without exception, then
stakeholders, scientists, and policy makers should be given the
opportunity to develop workable solutions based upon the best available
information. This process does not appear to have been followed
regarding these proposed late planting dates. The commenter has
concerns, because the rule states that for ``Impacts and Effects''
(None) and for ``Priority'' (Substantive, Nonsignificant), information
is lacking for a full understanding of unintended consequences.
Response: Consistency is necessary in any program and FCIC is
striving to attain that in this final rule. Further, FCIC values the
input from stakeholders and other knowledgeable persons. FCIC has
revised this final rule in response to the comments received with a
goal of maintaining consistency but also allowing flexibility when
circumstances warrant.
Comment: A commenter was concerned about the definition change in
that it creates internal inconsistencies in the program that will not
make sense to the producers this program is meant to serve. For
example, a producer can be declared prevented from planting as of the
final plant date. But, now, under the change, if the producer did get a
particular field planted before the flood occurred, the producer would
be held to replant rules on that field through a late plant period
which might be 10, 15, 20, or 25 days later, depending on which county
the producer is in. This could create confusing and inconsistent
results that only restrict the most prudent options and the deference
paid toward a producer in attaining the best outcome.
Response: As stated previously, the revisions to the practical to
replant provisions were intended to provide clarity and consistency.
Given the differences in the programs and purposes, there should be no
confusion between prevented planting and practical to replant.
Prevented planting only provides payments for the pre-planting costs
lost due to the inability to plant the crop and does not provide a
payment for any loss in production.
[[Page 28984]]
However, once the crop has been planted and fails, the producer may be
entitled to an indemnity. While the deadlines may be different, so are
the purposes of the provisions. Replant payments are intended to
mitigate losses that impact both the producer and taxpayer, as well as
minimize disruptions to local agricultural economies.
For producers, the replant payment provides the opportunity and
financial support to replant the crop. Since the initial planting
generally takes place at an optimal time period available to the
producer, replanting the crop likely takes place at a less optimal time
in the future. While the odds of producing an above average or high
yielding crop are potentially lower, the producer still has a
reasonable chance to produce a crop that is worth more than the
indemnity payment from the insurance policy. In addition, to
potentially avoiding an indemnity, the producer's actual production
history yield for that crop year is likely to be higher, having less
impact on future crop guarantees. At worst, if the replanted crop
fails, the producer still receives the same indemnity payment he or she
would have had without replanting--but at least had the chance to earn
a larger gain from the marketplace and preserve future crop guarantees.
From a taxpayer's perspective, the replant payment is a way to
reduce the cost of the crop insurance program. This is because the
replanted crop may produce an average or even above average yield,
which results in a reduced (or even no) indemnity payment to the
producer. The reduction in indemnity payments reduces the cost of the
crop insurance program for taxpayers and mitigates impacts to future
premium rates producers would otherwise experience.
Finally, the replant payment provides stability to the local
agricultural economy. Encouraging producers to replant their crops
helps ensure a more consistent supply of the agricultural commodities
that others depend on for their livelihoods--such as livestock
producers and grain or food processors thus helping maintain a more
consistent supply of agricultural goods for consumers.
Comment: A commenter stated instead of revising the replant dates,
FCIC should be asking why there are replant dates associated with crop
insurance. The commenter questioned if a person wrecks a car does that
person only get paid if they buy a new one. The commenter questioned
why if a crop fails to make a stand there is a requirement to replant
associated with the claim being paid. Several commenters stated the
definition of ``practical to replant'' should not be made a part of the
policy. The planting period and the replant requirements should remain
the same as they are now. A commenter stated the revisions to the
definition of ``practical to replant'' are ill-advised and will result
in reduction of important benefits to producers who will possibly be in
a precarious financial position due to the circumstances that brought
this particular situation.
A commenter stated they are in total opposition to the proposed
change that would require a producer to have to continue replanting his
crop all the way through the end of the late planting period. This type
of change would only benefit the insurance companies and not the
producer, who is the one the policy is intending to protect. A
commenter stated that this change could cause a tremendous financial
burden on our producers. With the low commodity prices, the yield
expected with corn planted that late will not allow a producer to stay
in business. A commenter stated the new definition would guarantee
producers take a loss in an impossible situation to succeed.
Response: The Federal Crop Insurance Act does not authorize
coverage for losses if the producer is able to replant to the same crop
in such areas and under such circumstances as is customary to replant,
but fails to do so. If an initially planted crop is damaged, and in
that area and under such circumstances it is customary to replant, the
producer must replant for insurance coverage to continue on that crop,
and a replant payment is provided to compensate the producer for the
costs of replanting. Past experience has shown that some producers were
paid a full loss on the initially planted and insured crop and were
allowed to plant an alternative crop, even when replanting the initial
crop was practical. The practical to replant provisions were intended
to balance the needs of the producer with the requirements of the Act
and the best interests of the Federal crop insurance program and
taxpayers. This balance has not changed in the final rule.
If it is practical for the producer to replant, it is in the best
interest of the program and for the producer to replant the crop and
potentially make a full crop rather than paying the producer an
indemnity, which only covers part of the loss. Further, since the
guarantee is not reduced even if the crop is planted during the late
planting period, if there is a future yield loss due to an insurable
cause of loss, the producer will be indemnified to the same extent as
the originally planted lost crop. The final rule was simply intended to
add more consistency to determinations of practical to replant so that
all producers are treated fairly and equitably. However, as stated more
fully below, FCIC is revising the current provisions to lessen the time
in which it will generally be considered practical to replant, and
provide the general circumstances to be considered by insurance
providers in making such a determination to find a proper balance.
Comment: A few commenters stated that agricultural lending officers
rely heavily on the value of crop insurance when underwriting
agricultural loans. The extension of the late planting dates would be
detrimental to producers' overall farming operation. The commenters
were opposed to the extension of the late planting periods. Several
commenters were concerned with the final planting dates, earliest
planting dates, and late planting period for crops in their area being
incorrect.
Another commenter stated southeast Nebraska and northwest Nebraska
producers have to manage their acres completely different. The
commenter questioned why these producers should be constrained by one
set of dates limiting yield potential and the most key element of
farming, flexibility to work around the curve balls that Mother Nature
throws producers each year. The commenter stated the same could be said
for the state of Missouri and Iowa. Producers in southeast Nebraska,
southwest Iowa, northeast Kansas and northwest Missouri all experience
similar climates and plant many of the same corn hybrids and soybean
varieties and maturities. The commenter stated they could easily be
treated the same, but having varying earliest, final, and late period
plant dates within this region truly makes no sense to the commenter or
the producers the commenter works with in each of these states. Freeze,
wind, rain, heat, drought events typically affect all these areas
similarly. The commenter states that as farm operations become much
larger and they expand their acres, many large producers the commenter
works with are farming in three or four of the corners of these states
but confused by different dates, when all should be treated the same.
They all start planting at the same time and manage their acres in
these states the same. The commenter stated it was frustrating that if
it's dry in southeast Nebraska, producers have to wait until April 10
to plant but could have started April 5 in Missouri where for sake of
argument, say it rained. The
[[Page 28985]]
commenter asked that the date be changed.
The commenter stated planting in proper soil conditions has the
largest impact on final yield in the commenter's opinion. Planting in
wet conditions and fighting sidewall compaction limiting plant root
ability to get to water and nutrients, uneven emergence forcing plants
to compete with each other and runts failing to make an ear. The
commenter stated that within this geographic region, an April 1 initial
plant date makes sense. Producers in the corners of these four states
have started planting April 1 for the last four to five years and for
good reasons. It is typically dry and planting conditions are perfect
the first half of April. About mid-April each year the ``rainy season''
will begin on and off through June 1. Producers will try to ``mud it
in'' in desperation, and will fight compaction, achieve uneven stands,
or be delayed to a May dry spell and lose yield by date of planting
even with a perfect stand. These May plantings will also force the
hybrid to directly deal with the heat and dryness of July. Two weeks
before and two weeks after pollination is when the corn plant is most
successful to yield loss from stress. The commenter stated that
planting early allows hybrids to beat this hot period and pollinate in
late June or first week of July. These April 1 plantings, nine out of
ten years will yield higher or at a minimum the same as these later
plantings even if the hybrid corn has to lie in the ground for three
weeks waiting to accumulate enough Growth Degree Units (GDU's) to
emerge. The commenter stated that today's hybrids are specifically bred
for earlier planting dates and better cold stress emergence and they
are typically planted in the best soil conditions of the year limiting
sidewall compaction, rooting, and uneven emergence. Finally, the
commenter stated that as farming operations get larger, and this trend
will continue without a doubt, they have to start planting sooner to
give them the best opportunity to successfully get the desired crop
planted around rain events.
Several commenters stated the proposed change to the planting date
will be detrimental to profitability of crops. The commenters stated
that there is a potential for dramatic reduction in yield as proven by
University research from multiple states. The commenters stated the
economic impact to the producers is enhanced because of the fact it is
a replant. Most all of the input costs are already spent. This change
will require producers to spend more with no choice of making a profit.
The commenters asked that FCIC not change the planting dates.
A commenter stated there is resistance to the requirement of
replanting the initial crop until the end of the late planting period.
A commenter stated they were frustrated by the late planting period.
Every producer wants to be as profitable as possible, and have the
ability to plant corn and soybeans in the best soil conditions
possible. The commenter stated that pushing this date out 20 or 25 days
(need aligned as mentioned above) just seems like the producer is being
penalized. The producer can go back with soybeans and still have a
chance to attain the highest yield before at least June 10. A soybean
has an amazing ability to compensate with more branches and pods after
weather events, but are day-length sensitive and only have a certain
amount of time to build the factory that will feed the pods that will
be set. Planting a soybean June 25 will limit plant height, node, and
most importantly pod and seed set ability of that plant.
The commenter stated the program should provide flexibility. The
commenter has seen this happen. A producer is in a river bottom area.
The area hit an extended wet period in late April and May. The producer
is not able to plant corn, or if he did, it would drown out. The
producer wants to plant soybeans. Another extended wet period is
expected (typically mid-June is wet) and the producer cannot plant in
early June while it's dry but tries to mud in the soybeans on June 26.
Now the soybean stand will also be heavily affected and poor rooting
from compaction will allow drought later to ``burn them up.'' The
commenter believed that there should be a period where a conversation
between the adjuster and the producer should be had that discusses all
these variables and allows a producer to plant ahead of the current
date or any date to give the producer the best chance at success and
profitability. It seems senseless for the planter to set when it could
be planting in ideal soil conditions because of the date in a program.
Mother Nature forces the producer to be extremely flexible, especially
in a region where the Missouri River or similar geographies, causes a
lot of intense weather events through the spring and early summer. The
commenter asked FCIC to give the producer flexibility.
Response: The final rule with request for comment did not change
planting dates or the late planting period. The final rule with request
for comment was intended to provide a clear, known deadline for when
replanting of the crop is considered practical, ensuring that the
provisions are consistently and equitably implemented across all
insurance providers and producers. If the commenter or any interested
party is concerned about the dates for specific crops or counties, they
should advise the RMA Regional Office. Any interested person may find
contact information for the applicable regional office on RMA's Web
site at http://www.rma.usda.gov/aboutrma/fields/rsos.html.
Comment: A commenter stated that the university studies and
agricultural experts agree that April 20 is initially too late to plant
the crop so requiring producers to replant through the late planting
period is ridiculous.
Response: FCIC has not proposed revising any of the final planting
dates or late planting periods so it cannot make any such changes in
this rule. If the commenter or any interested party is concerned about
the dates for specific crops or counties, they should advise the RMA
Regional Office. Any interested person may find contact information for
the applicable regional office on RMA's Web site at http://www.rma.usda.gov/aboutrma/fields/rsos.html.
Comment: A commenter stated the proposed rule taking the
practicality to replant all the way to the end of the late planting
period seems too severe and does limit producer's ability to be
flexible in the event of a lost crop. Many, if not the majority of
crops that this would impact, have a 25-day late planting period. The
commenter stated that this will give an initially planted crop a 25
percent reduction in coverage. In this example, the producer would be
reducing a 75 percent buy-up cover to essentially a catastrophic level
cover if this was the initial planting. This certainly indicates the
policy does not think it is practical to produce a normal crop. The
commenter suggested FCIC define ``practical to replant'' similarly to
the prevented planting provisions as it pertains to the final plant
date. This is a fair and equitable solution to a difficult circumstance
for both the producer and FCIC.
Response: When a crop is deemed practical to replant there is no
reduction in the coverage that attaches to the initially planted crop.
Therefore, while the yield of a crop planted during the late planting
period may or may not be reduced, depending on many factors, the
coverage provided by the crop insurance policy is not reduced like it
otherwise would be if the crop was initially planted during the late
planting period. FCIC agrees with the commenter that taking the
practicality to replant all
[[Page 28986]]
the way to the end of the late planting period may not be appropriate
and can limit the producer's ability to be flexible in the event of a
lost crop. Therefore, FCIC revised the definition of ``practical to
replant'' to state it will be considered practical to replant through:
(1) The final planting date if no late planting period is applicable;
(2) the end of the late planting period if the late planting period is
less than 10 days; or (3) the 10th day after the final planting date if
the crop has a late planting period of 10 days or more. Changing the
provisions to encompass these three scenarios and including 10 days
after the final planting date will help bring more uniformity to the
amount of time producers are required to replant since the number of
days in the late planting period can vary by crop. Based on the
commenter's feedback, the fact that some crops and regions have varying
late planting periods and for some crops up to a 25-day late planting
period, uniform and equitable treatment to similarly situated producers
may not always occur, so FCIC is reducing the presumptive date to no
more than 10 days. FCIC also added provisions for determining whether
it is practical to replant so that approved insurance providers may
consider circumstances as to whether: (1) It is physically possible to
replant the acreage; (2) seed germination, emergence, and formation of
a healthy plant is likely; (3) field, soil, and growing conditions
allow for proper planting and growth of the replanted crop to reach
maturity; or (4) other conditions exist, as provided by the Crop
Provisions or Special Provisions. This will allow a proper balance
between the interests of producers and the interests of the program.
Comment: A commenter stated with the requirement to have crop
insurance, premiums are paid every year. The final planting dates are
already liberal with the ability of the crop to produce an economically
viable yield, depending on any given year's weather, etc. With these
proposed changes FCIC is requiring a producer to choose between two
options: (1) To spend money (the claim amount plus more) replanting a
crop 25 days later than it could be expected to produce an acceptable
yield; or (2) call the premium a government mandated donation to the
insurance company and instead of replanting (and/or collecting the
claim), plant a crop that has potential to produce a yield. The
commenter stated, in short, the final planting date should be just
that, the final date that the crop should be planted (or replanted).
There has been a lot of time and research put into developing the final
planting dates by the extension services, etc., and FCIC should be
listening to the people whose job it is to determine these dates.
Response: Requiring a producer to replant under such circumstances
as is customary for the area has been statutorily mandated and a
requirement of the policy for years. Producers have been required to
replant the crop after the final planting date if the agronomics
allowed in order to receive a replanting payment and continue insurance
coverage for the initially planted crop. This final rule does not
change this. However, there has been inconsistency in the application
of the practical to replant provisions between insurance providers such
that if two producers were in similar agronomic conditions one could be
required to replant the crop and the other may not. This final rule is
intended to address that inequity. However, FCIC agrees that the 25-day
period may be too long because of the potential effect on the replanted
crop so it is reducing the presumptive date to no more than 10 days.
This earlier date for it to be practical to replant is a presumptive
date and FCIC has added circumstances to the provisions that insurance
providers may consider whether: (1) It is physically possible to
replant the acreage; (2) seed germination, emergence, and formation of
a healthy plant is likely; (3) field, soil, and growing conditions
allow for proper planting and growth of the replanted crop to reach
maturity; or (4) other conditions exist, as provided by the Crop
Provisions or Special Provisions. This will allow a better balance
between the interests of the producers and the interests of the
program.
FCIC disagrees with the commenter that if a crop deemed practical
to replant is not replanted, the premium becomes a government-mandated
donation to the insurance company. If it is determined practical to
replant the insured crop and the producer elects not to replant the
crop, no coverage for the initially planted crop will be provided and
no premium will be due. If the producer decides not to replant, the
crop would be considered as if it never existed, and the acreage is
removed from the acreage report. No indemnity is due, no replant
payment is made, and no premium is earned nor payable by the producer.
Comment: Several commenters generally support any effort to take
subjectivity and ambiguity out of the crop insurance program and
efforts to prevent fraud from occurring, but the commenters cannot
support this change because it is not supported by research or by
Extension recommendations.
A commenter stated that no county agent, no agricultural expert, no
university study will agree that planting corn as late as May 5 in the
Arkansas, Louisiana, and Mississippi region would be considered a good
farming practice. In addition, the commenter believed no ag-lender
would provide financing for planting this late.
A commenter stated that if it was practical to replant the crop,
the crop should be able to achieve the actual production history yield
in most years. Replanting at the end of the late planting period would
have a marginal chance at achieving that level of production. The
commenter suggested that perhaps part of the solution would be to
shorten the late planting period.
Response: FCIC agrees that it should not be presumed practical to
replant the crop until the end of the late planting period and, as
stated above, has revised the provisions accordingly. This should
mitigate any unintended reductions in yield as a result of planting
during the late planting period, and producers will not be penalized
because they will still receive the full guarantee. This means that if
there is a reduction in yield, it can still be indemnified, but these
changes allow a balance between the interests of producers and the
interests of taxpayers.
Comment: Several commenters had issues with FCIC's wording under
the definition of ``practical to replant'' which states that replanting
should continue as long as the seed has the chance to germinate,
emerge, and form a healthy plant. A commenter stated that this could be
achieved planting much further past May 5 and the crop would mature
prior to the end of the insurance period, but the problem would remain
the same even if it is planted by the end of April. The producer would
not be able to produce a yield that it would take to stay in farming.
Their goal is not to make their guarantee; their goal is to make a
profit. A commenter stated that producers have other cropping options
that may be more economically viable once the original crop is lost. In
these situations, producers need all options at their disposal so the
best economic and agronomic choices can be made.
A commenter encouraged FCIC to further clarify that the revised
definition is not intended to be interpreted in such a way that could
potentially force a producer to replant a lost or damaged crop after
the end of the late planting period or after the final planting date if
there is no late planting period for the crop. The commenter believed
it would be prudent for FCIC to reiterate to both insurance providers
and insurance
[[Page 28987]]
agents that the changes made to the definition of ``practical to
replant'' is not intended to be interpreted in such a way that a
producer could be forced to replant after the end of the applicable
late planting period, and further, that even when a crop is lost prior
to the end of a late planting period, all applicable circumstances will
be considered before a decision on the practicality of replanting the
lost acreage is made. The commenter understood that this revised
definition is set to become effective for the 2017 reinsurance year,
but urged FCIC to consider further revisions to improve the
understanding and limit the potential for it to be misinterpreted.
Response: FCIC agrees that the definition of ``practical to
replant'' requires replanting during the late planting period as long
as the seed has the chance to germinate, emerge, and form a healthy
plant and may result in the ability to plant the crop even after the
late planting period, which could cause confusion. The provisions have
been revised so that insurance providers may consider circumstances as
to whether: (1) It is physically possible to replant the acreage; (2)
seed germination, emergence, and formation of a healthy plant is
likely; (3) field, soil, and growing conditions allow for proper
planting and growth of the replanted crop to reach maturity; or (4)
other conditions exist, as provided by the Crop Provisions or Special
Provisions.
Further, while FCIC does not want to hinder producers from
maximizing their profits, it must balance this with the taxpayer
interest in not paying indemnities when there is a possibility for the
crop to reach maturity. FCIC balances the interests of producers with
the interests of taxpayers by making a replant payment to offset the
costs of replanting and providing for a full guarantee so that if the
yield is later reduced, such costs will be indemnified.
Comment: A commenter stated that a producer should be required to
replant until the crop's final plant date. At that point, if conditions
are good and producers are actively planting and replanting, then a
producer should go along with what is common in the producer's area. If
not, there should be a maximum of a ten-day period from the final plant
date before acres can be released and allow the producer to go to
another crop. The late planting period should be an option, not a
requirement.
A commenter stated that if a specific date needs to be established
for ``practical to replant,'' the commenter requested FCIC consider the
following revision, ``An insured should be required to plant and
replant through the crop's final plant date.'' At that point, the acres
should not be released for an additional ten days. If after ten days an
adequate stand has not emerged, the acres should be released and the
producer should be able to go to another crop.
Response: Defaulting to the final planting date ignores the
possible agronomic circumstances that may allow the crop to be planted
and reach maturity after this date. However, FCIC is revising the
provisions to require replanting no later than 10 days into the late
planting period. It is presumed that replanting is practical during
this period and the producer will be required to replant, in order to
receive a replant payment and continue full insurance coverage for the
initially planted crop, unless the insurance provider determines it is
not practical to replant. Replant payments are intended to mitigate
losses, as stated above, by requiring replanting when agronomic
conditions and circumstances exist to produce a crop that can reach
maturity. Allowing producers to pick and choose whether to replant may
result in unnecessary indemnities and premium rate increases.
Comment: A commenter stated that producers need an appropriate
degree of situational flexibility when adverse conditions arise
particularly during the planting season. The commenter believed FCIC
will never achieve complete consistency, as even within a small area
two cases can be very different. The commenter believed the current
practical to replant standard and processes better accommodate the
needs of the producers.
Another commenter stated that to restrict a producer's options at
planting time where every minute is critical strikes the commenter as
an overly broad fix to a very narrow problem. The commenter suggested
that a better solution would be to require that when a producer chooses
to plant back to the original crop at any time during the late plant
period that this definitively be considered a replant until the late
plant period has expired.
Response: The problem with the definition of ``practical to
replant'' prior to 2017 is that the provisions were inconsistently
applied such that with neighboring farms, one producer could be
required to replant and the other not, even when agronomic conditions
were the same. The final rule with request for comment and this final
rule are intended to make the application of the provisions more
consistent, while still allowing some flexibility. This is done by
creating a presumed practical to replant date, while still allowing
insurance providers to consider certain agronomic factors and
circumstances to overcome this presumption. Allowing producers to pick
and choose whether to replant may result in unnecessary indemnities and
premium rate increases.
Comment: Several commenters felt that requiring producers to
replant through the end of the late planting period was not sound
policy. A commenter stated the University of Arkansas Division of
Agriculture Rice Verification Program has demonstrated this fact over
the past 30 years on 430 fields across the state. The planting date of
rice has a direct impact on yield. The commenter stated that this
policy would result in requiring producers to replant even though data
suggests their projected yield could be cut by approximately 40
percent, making it very difficult to make a profit on the crop. The
Arkansas Rice Production Handbook, published by the University of
Arkansas Division of Agriculture, contains recommendations for optimum
planting dates as well as recommended absolute cut-offs for rice based
upon regions of the state. The commenter stated that optimum cut-off
recommendations are May 10 for northern Arkansas, May 15 for central
Arkansas, and May 20 for southern Arkansas and the recommended absolute
cutoff recommendations are June 5 for northern Arkansas, June 10 for
central Arkansas, and June 15 for southern Arkansas. While the
recommended absolute cutoff does not mean a successful rice crop cannot
be grown outside of that time-frame, success will depend on a myriad of
factors unique to each individual farm.
A commenter stated that this proposal would force the planting of
crops well beyond the recommended dates supported by research conducted
by the LSU AgCenter. Yields are reduced by 38 to 52 percent for five of
the major crops produced in Louisiana. The economic consequences of
which would be devastating to producers which had already suffered
losses from the original crop loss.
Several commenters stated that the changes being proposed are
considered extreme by LSU AgCenter scientists that work to develop Best
Management Practices for the targeted crops. Based upon the best long-
term information generated by LSU AgCenter research and extension
scientists, the commenters stated they cannot support recommending that
producers re-plant at the latest ``practical to replant'' dates being
supported by FCIC. A commenter questioned the origin of these proposed
dates and request that FCIC provide science-based information to show
[[Page 28988]]
Louisiana producers can produce a profitable and sustainable yield if
they are required to replant the crops on these late dates. A commenter
also stated unfortunately, some of the ``practical replant'' dates
detailed in the FCIC notice are even later than the LSU AgCenter have
tested in field trials. The commenter stated that in reality, the
actual date that a producer is officially released (by program
adjuster) to plant alternative crops may not be until ten days after
the final planting date of the insured crop which makes these changes
even more unreasonable. The LSU AgCenter's optimum and latest planting
dates are based upon Best Management Practices, as well as risk
aversion for Louisiana's crop production systems. The commenter stated
that potential increases in production costs, unfavorable weather
conditions for crop development, and harvest risk associated with
adverse weather events during the late fall are real factors that must
be factored into this decision-making process.
A commenter stated the end of the late planting period for corn in
Illinois is June 30. Most agronomic experts would not recommend
planting corn this late in Illinois but the change in language would,
with some exceptions, require it.
Another commenter stated the proposed replant dates are well past
the recommended final planting dates as put forth by LSU, the various
seed companies, private consultants and anyone else with practical
knowledge of best agronomic practices in the state of Louisiana. With
the high production costs of these crops today there is less margin for
error than ever before and forcing producers to replant as much as
three weeks after recommended final planting date is guaranteeing a
potentially crippling financial loss on corn and grain sorghum. On rice
and cotton it may not be a guaranteed loss but is almost a certainty
not just in reduced yield but in increased costs fighting late season
disease, insects, irrigation expense and field work due to a late
harvest. While soybeans have the best chance of making a profit with
the new proposed replant dates of all the crops it would still be an
iffy proposition at best. These proposed changes would make buying
higher levels of coverage a risky decision for the producer and expose
them to even greater levels of uncertainty, which will lead to more
difficulty in securing financing which will ultimately lead to further
consolidation with only the largest producers benefitting.
Another commenter stated in the mid-south there is a definite cut
off period for corn that is much earlier than the final planting date
for late planting (May 5) if a producer wants to make a profitable corn
yield in an average weather year. Forcing a producer to plant corn late
dooms the producer to a loss and the insurance company to writing a
check. If producers need to change crops, allow them to continue to
make the switch after the final planting date. The commenter asks that
FCIC not make them wait until the final LATE planting date. Producers
need to have flexibility to farm the crop that is most likely to
produce a full yield in the time period given. Failure to allow that
flexibility will cost everyone money. A commenter stated that in light
of the unique and unusual conditions that can arise following the
failure of the initial crop, the revised definition, in effect, will
result in cases where the agronomic realities of planting simply do not
align with an assumption the crop will reach physiological maturity. As
an example, corn in most of southern Illinois has a final plant date of
June 5 followed by a 25-day late planting period. To limit a producer
in this situation to the replanting of corn in the last two weeks of
June rather than allowing a switch to another crop is not a sound
agronomic practice given the low probability of corn reaching maturity
before the normal frost date.
A commenter believed that most agronomic experts would not
recommend replanting the crop that late, so the producer will be in a
position of having to replant a crop at a time that agronomic experts
would not recommend. The commenter stated, for instance, the end of the
late planting period for corn in Illinois is June 30. Most agronomic
experts would not recommend planting corn this late in Illinois. The
change in language would, with some exceptions, require it. While this
would limit the level of insurance for crops being initially planted
later, the crop would still be insurable at the prevented planting
level of coverage. On the positive side of the change to the practical
to replant language--it would force more consistency in the industry as
to when acreage is allowed to be planted to another crop, instead of
replanted to the original crop. The producer receives a replant payment
and still has the original coverage on the acreage, so there is still
coverage on the replanted crop, even if replanted near the end of the
late planting period.
Response: The final rule with request for comment did not change
planting dates or the late planting period. The final rule with request
for comment was intended to provide a clear, known deadline for when
replanting of the crop is considered practical, ensuring that the
provisions are consistently and equitably implemented across all
insurance providers and producers. If the commenter or any interested
party is concerned about the dates for specific crops or counties, they
should advise the RMA Regional Office. Any interested person may find
contact information for the applicable regional office on RMA's Web
site at http://www.rma.usda.gov/aboutrma/fields/rsos.html. After
considering all the comments, FCIC agrees that requiring replanting
throughout the late planting period may not be practical. Therefore, as
stated above, FCIC revised the definition of ``practical to replant''
to state it will be considered practical to replant through: (1) The
final planting date if no late planting period is applicable; (2) the
end of the late planting period if the late planting period is less
than 10 days; or (3) the 10th day after the final planting date if the
crop has a late planting period of 10 days or more. FCIC believes it is
necessary to provide a clear, known deadline for when replanting of the
crop is considered to be practical, and while this deadline is
presumptive, FCIC is also revising the provisions to allow other
agronomic factors and circumstances to be considered when determining
whether it is practical to replant to provide needed flexibility as
necessary.
Comment: A commenter stated they are very much against the new
proposal to make a producer continue to replant all the way through the
end of the late planting period. The commenter stated that the LSU Ag
Department has documented evidence that this would mean an average of a
50 percent yield loss on those acres planted that late. The commenter
understood that a producer may still be insured at the full guarantee
but that does not really help either the producer or the crop insurance
companies. For instance: a producer has a 75 percent coverage policy
and a 175 bushel Actual Production History. That means the producer is
guaranteed 131 bushels. According to LSU the potential of corn planted
that late would be 80 bushels an acre. So that means that the producer
would cut their 80 bushels, sell it and then crop insurance would pay
the producer for the other 51 bushels. The going market on those
bushels right now is $3.30 and crop insurance is paying $3.81 per
bushel. 80 x $3.30 = $264 51 x $3.81 = $194 that comes to $458 per
acre. The cost of production on that acre of corn is $650 including
rent, seed, fertilizer, etc., excluding any profit needed to pay any
[[Page 28989]]
living expenses or maintenance on equipment. This is where the producer
makes a living. This is not just a hobby for the producer but the
producer's livelihood. That means the producer is in the hole $200 per
acre plus what it took for the producer to feed their family, pay
equipment notes, pay interest at the bank for the money the producer
still owes (1,000 acre average producer x $200 = $200,000) at 6 percent
average interest, and many other costs. So the bottom line is the
producer has lost money that the producer may never be able to recover
from. The insurance company lost by having to pay the producer a $194
an acre claim. Not to mention the $30 acre replant claim they paid the
producer (which is only about \1/3\ of the cost to actually replant).
The commenter questioned why the insurance provider could not release
those acres for the producer to plant another crop such as soybeans or
cotton to at least be able to survive. Note that the longer you wait to
release those acres the more the yield on the second crop yield is
being hurt also. Lastly, the average producer is not looking to collect
on an insurance claim. The producer would rather produce a good
yielding crop, sell it for a decent price and survive to farm another
year.
Response: As stated above, FCIC realized that requiring replanting
up to the end of the late planting period may place too much of a
burden on producers and reduced needed flexibility. Therefore, FCIC is
revising the period in which to replant a crop to no more than 10 days
and revising the provisions to allow additional agronomic factors and
circumstances to be considered by the insurance providers. However,
while FCIC understands the commenter's concerns about the economics of
producing a crop, when production costs exceed the potential value of
the planted crop the Federal crop insurance program is not in a
position to consider those costs when determining indemnities. It
indemnifies lost production at an established price, in part, using
taxpayer dollars. FCIC has a responsibility to those taxpayers to
ensure that their dollars are properly spent. Replanting a crop when it
is possible for that crop to grow and reach maturity is one way of
protecting taxpayer dollars, and helps achieve the balance between the
interests of producers and the interests of taxpayers.
With respect to the scenario stated above, the claimed losses are
outside of the control of FCIC or the scope of this rule. In the
example provided, regardless of whether the producer's original crop
failed or produced a full crop, the producer would have lost money. If
the producer produced the guarantee of 131 bushels and sold it for
$3.30, which equals $432, this is still far below the claimed expenses
of $650. Even if the producer had produced the 175 bushels actual
production history yield, the producer would only have received
$577.50.
Comment: Several commenters believed that a practical to replant
determination is best made by the producer and the adjuster on the
farm, and that a one size fits all approach could seriously jeopardize
a producer's chances of profitability as margins are already tight in a
replant situation. A commenter stated that even though the interim
rule's revised definition allows for an exception to the standard date
if ``there is no chance of seed germination, emergence, and formation
of a healthy plant,'' this language raises the question of how such an
important and time-sensitive determination will account for different
conditions, including soil types and the varying impact of rainfall on
farms just miles apart. Because of the significant differences between
crops, final plant dates and late planting periods, a thorough
assessment by the adjuster for the insurance provider along with the
producer's input and experience are a more sensible match for the
replant decision than an across-the-board application of a standard
date.
A commenter stated that when the final plant date has been reached
and during the late planting period, allow and encourage the producer
and adjuster in consultation to make a determination and decision;
based upon the conditions in the field and area as to when each field
is no longer ``practical to replant.'' By doing so this would enable
the producer to fail the first crop and plant to a second different
crop, while practical to expect a second crop can reach yield potential
and maturity. If the producer should choose to plant back to the
original crop, it would be considered a replanted crop.
A commenter stated that the producer and the adjuster have been
looked to as the best judge of whether it was practical to replant that
crop. Under this definitional change, however, the practical experience
and judgment of the producer and the adjuster, which is specifically
focused upon that farm, that area, and the unique conditions, would be
replaced with a uniform date. Thus, the change effectively declares
that it is always practical to replant, not just through the final
plant date for the crop but through the late planting period as well.
This is not a practical standard given the various adverse situations
that trigger replant provisions. Even if the final plant dates and late
planting periods were all perfect and consistent across all regions,
which they are not, the commenter still strongly believed the producer
and adjuster are best suited to make this judgment.
A commenter stated that removing the human and weather elements
from the decision-making within this definition and rule would prove
detrimental. The decisions should definitively combine both factors.
They are not independent of what is decided; only after planting
potential has been examined can an accurate determination be made. The
word ``practical'' is at the heart of this issue, even included in the
definition; therefore practicality and flexibility become the points of
action.
A few commenters stated they have serious concerns about proposed
changes to the ``practical to replant'' definition contained in the
interim rule. Beyond the proposed changes, producers were given an
inadequate window of time to respond to the changes overlapping the
state's harvest period and currently managing disastrous flooding
conditions. The commenter stated that in the Southern U.S., where rice
is grown, planting windows and options tend to be longer and more
diverse. Important replant provisions of the various crop insurance
policies only come into play when a first attempt at planting is ruined
in whole or in part. In such an adverse situation, the commenters would
maintain the producer needs all options at their disposal. The planting
dates and windows of Federal crop insurance, while necessary, cannot
reflect the best and most practical options for each farm. The
commenters believed this determination is best made by the producer and
the adjuster on the farm.
A commenter stated that in many cases, if a first crop is washed or
flooded out, but the water recedes and the producer has the ability to
plant again, planting the same first crop would not be the ideal
financial or agronomic decision even if it is still an insurable
possibility by the USDA Risk Management Agency dates. To handcuff the
producer in these situations where they can only go back to the
original crop through the late planting period seems unreasonable.
Again, the commenter thinks the current rules, which show deference to
the producer and the adjuster to make the best determination for that
farm in that situation in that adverse year, is the better model.
The commenters are very concerned about advancing integrity of
Federal crop insurance, and the commenters know that clear rules need
to be made
[[Page 28990]]
and enforced. But every farm is unique and the situation on each farm
is unique each year, so the rules have to be balanced against an
adequate flexibility that allows the producers to do their work the
best they know how. The commenters noted their support for other rules
like the first crop, second crop limitations that protect the integrity
of the program while affording the producer flexibility to make the
best productive use of the land in any given year.
Response: One of the fundamental principles of the crop insurance
program is that all producers be treated fairly and equitably. FCIC
also believes that producers working with their loss adjuster can make
or reach the best decisions for addressing crop loss on the farm, but
to do so requires clear rules and understanding. FCIC realizes that
requiring replanting until the end of the late planting period may be
too burdensome and has revised the provisions to reduce the presumptive
time to replant to not more than 10 days. In addition, when determining
whether it is practical to replant approved insurance providers may
consider circumstances as to whether: (1) It is physically possible to
replant the acreage; (2) seed germination, emergence, and formation of
a healthy plant is likely; (3) field, soil, and growing conditions
allow for proper planting and growth of the replanted crop to reach
maturity; or (4) other conditions exist, as provided by the Crop
Provisions or Special Provisions. This will allow decisions to be more
tailored to actual agronomic conditions and circumstances for
determining whether it is practical to replant. However, as stated
above, the goal of replanting is to mitigate losses in those situations
where it is still possible to produce a crop that can reach maturity.
To effectuate this goal and balance the interests of producers and
taxpayers, FCIC provides for a replant payment and allows a full
guarantee on the replanted acres, so that if there is any future
reduction in yield the producer will be indemnified.
Comment: A commenter stated if there was a change to be made to the
``practical to replant'' definition in the policy it should have been
to shorten the number of days that a producer has to replant his crops
after the final plant date. The definition should not require a
producer to replant all the way to the end.
Response: FCIC agrees with the commenter. FCIC is changing the
definition of ``practical to replant'' to state it will be considered
practical to replant through: (1) The final planting date if no late
planting period is applicable; (2) the end of the late planting period
if the late planting period is less than 10 days; or (3) the 10th day
after the final planting date if the crop has a late planting period of
10 days or more.
Comment: A commenter stated there are other unintended consequences
that the commenter asked FCIC to consider as well. If a producer
follows all guidelines of the proposed process and plants an
alternative crop after the proposed latest ``practical to replant''
date for the initial insured crop, they will in most cases be planting
the alternative crops after optimum dates and potentially suffer
economic losses as well. In addition, the resulting figures for rice,
soybeans, corn, cotton, and grain sorghum are considered to be very
conservative estimates that do not include the additional production
input costs associated with late-planting of these Louisiana crops. The
commenter stated that crop insurance should remain a tool to support
producers when unforeseen covered events adversely affect their crops.
These proposed changes have the potential to drastically affect
Louisiana agriculture and create insecurity among the commenter's
producers and which the commenter hopes is certainly not the intended
outcome.
Response: FCIC is changing the definition of ``practical to
replant'' to reduce the number of days it is presumed to be practical
to replant. Further, other agronomic factors and circumstances can be
considered when determining whether it is practical to replant. These
changes should create more stability, flexibility, and security.
Comment: A commenter stated that consistency and common
understanding of the rule from producer to insurance provider needs to
be achieved. If enacted as written, this rule becomes inconsistent with
declaration of prevent plant by the producer; which can and is allowed
to occur after the final plant date. It becomes the producer's
declaration and decision per the assessment of agronomic conditions,
weather and human assessment, soil conditions, viability to reach a
desired result of the planted crop. It is counter intuitive to require
the producer to replant following a peril that destroys their first
crop based upon the calendar date, rather than taking into
consideration the factors on each farm. Only with ``boots on the
ground'' assessing crop maturity, availability of product, plant vigor,
weather and field conditions can good farming, and program integrity
decisions be made. Because of the variability experienced by each
producer's situation, the geographies that they work within and the
unknown weather conditions that can arise at any time, there is no one
blanket date that would fit all farms. Creating a definition that
allows for these variables will enable consistency, understanding and
optimum risk management for producers, insurance providers, and
taxpayers.
Response: As stated in the final rule with request for comment, the
previous provisions, as written, regarding ``practical to replant'' can
lead to different insurance providers reaching differing determinations
as to whether it is practical to replant in the same area. Therefore,
it is important to provide a clear, known presumptive deadline for when
replanting of the crop is considered to be practical. Further, as
stated above, prevented planting and practical to replant are two
different provisions, with different purposes, that provide different
coverage. Prevented planting coverage only covers the expected costs
incurred at the time the crop was prevented from planting, which is
determined by a percentage of the guarantee. It does not indemnify for
the crop loss. When a crop fails and the issue is whether to replant,
the failed crop could receive an indemnity based on the lost production
if it is determined not to be practical to replant. However, the
requirement to replant is intended to mitigate these losses when
agronomic conditions and circumstances are such that the crop could be
expected to grow and reach maturity. In prevented planting situations,
insurance providers look at whether it was possible to plant before the
final planting date. In practical to replant situations, the
determination is made by the insurance provider after considering the
agronomics and the circumstances for the area as to whether it is
customary to replant the crop. However, FCIC agrees that one size does
not fit all and has revised the provisions to shorten the period for
practical to replant and has added provisions allowing for
consideration of additional circumstances in determining the
practicality of replanting.
Comment: A commenter stated aflatoxin is a horrible disease in
grain crops. This, as well as other diseases and risks such as
hurricane and intense heat and drought would be greatly enhanced by
requiring a producer to replant through the end of the late planting
period.
Another commenter stated getting the product that will produce the
highest yield on a specific soil type, disease environment, is
extremely important to the final yield outcome. At the end of
[[Page 28991]]
the season in the last couple years, the most desired products are sold
out, due to seed companies limiting piles of unused units that must be
written off at a loss. So, the producer is now forced to use a third or
fourth choice corn or soybean product that offers less inherent yield
potential for this geography and possibly higher risk of disease
infestation and yield loss.
Response: FCIC understands the commenter's concern regarding
increasing risks by requiring the producer to replant through the end
of the late planting period. FCIC has revised the provisions to reduce
the presumptive time to replant to no more than 10 days and allowing
for consideration of additional agronomic factors and circumstances to
be considered in the determination of practical to replant. These
changes provide a better balance of the interests of producers with
those of the taxpayer, whose interests are in paying losses when it is
not possible to replant a crop that would grow and reach maturity.
Further, since the guarantee is not reduced as a result of planting
during the late planting period, any such losses would be fully
indemnified.
With respect to the availability of seed and other inputs, the
previous definition of ``practical to replant'' stated it will be
considered to be practical to replant regardless of availability of
seed or plants, or the input costs necessary to produce the insured
crop such as those that would be incurred for seed or plants,
irrigation water, etc. FCIC inadvertently omitted this sentence from
the final rule with request for comments. Therefore, FCIC has modified
the definition of ``practical to replant'' to add that it will be
considered practical to replant regardless of the availability of seed
or plants, or the input costs necessary to produce the insured crop
such as seed or plants, irrigation water, etc. Since the Act only
authorizes coverage due to drought, flood or other natural disaster,
things such as seed availability, plants or input costs cannot be a
consideration when determining whether or not it is practical to
replant the crop.
Double Cropping
Comment: A commenter had some concerns that the wording in the 2017
Common Crop Insurance Policy Basic Provisions (Basic Provisions) under
section 15(h) could lead to misunderstandings and differing
interpretations. For example, section 15(h)(5)(i) allows for when a
historical double cropping percentage could be used for situations
where a producer acquires additional acreage. Section 15(h)(5)(i)
implies the double crop percentage would be applied to the total
acreage now in the producer's operation. However, the example under
section 15(h)(5)(i)(D) says to apply the double crop percentage to both
the current year first insured crop acreage and the current year second
crop acreage. It is unclear as to which set of determined acreage is
ultimately used as the limiting factor when total acreage in the
producer's operation as well as first insured crop acres and second
crop acres are all multiplied by the determined percentage.
Response: FCIC agrees with the commenter and has changed the
language to remove the reference to second crop acreage.
Comment: A commenter questioned if the revised language in section
15(h)(5) of the Basic Provisions only applies to policies with added
land or if it includes situations in which there is no added land but
the number of double cropping acres have increased through different
crop rotations. The commenter assumed based on the language included as
a part of the final rule the intent of this new language addresses both
added land and other situations where there is no added land but the
number of double cropping acres have been increasing. If this is indeed
the intent, the commenter recommended that FCIC consider changing or
adding to the language in 15(h)(5)(i) that indicates ``. . . if you
acquired additional acreage, you may apply the percentage of acre . .
.'' which implies that this computation only applies when additional
acreage has been acquired.
Response: The phrase ``acquired additional acreage'' in section
15(h)(5) of the Basic Provisions is intended to apply to a net
acquisition of acreage. For example, if a producer loses 50 acres of
land and gains 20 acres, the double cropping multiplier would not apply
because the total acreage in the producer's operation is not greater
than in previous years. Another example would be if a producer loses 50
acres of land and gains 60 acres, the double cropping multiplier would
apply because the total acreage in the farming operation is 10 net
acres greater than in previous years. FCIC has revised the language
accordingly.
Comment: A commenter questioned whether or not the computations
from this new section are meant to apply in the situation where the
first insured crop is planted and the second crop is prevented from
being planted (also does not specifically address where the first
insured crop is planted and the second crop is planted). The commenter
did not see any language addressing this situation but assumed that
FCIC would calculate double cropping history acres in the same manner.
This was addressed in the previous Basic Provisions by the language in
section 15(i) as follows (language addresses both planted and prevented
planting acreage of both the first and second crop that are double
cropped):
(i) The receipt of a full indemnity or prevented planting payment
on both crops that are double cropped is limited to the number of acres
for which you can demonstrate you have double cropped or that have been
historically double cropped as specified in section 15(h).
The commenters assumption is that the computations laid out in
section 15(h)(5) of the Basic Provisions is intended to encompass both
situations. However, since the language is no longer included as a part
of the lead in to the calculation, FCIC may want to consider adding
this language back in so that it is clear this calculation is intended
to cover both of these situations (section 15(h) does address a full
indemnity or a full prevented planting payment for a first insured crop
when a second crop is planted). At the very least, the Prevented
Planting Loss Adjustment Standards Handbook will need to make sure and
include additional instructions for computing double crop acres for
these situations.
Response: FCIC thanks the commenter for their comments. Section
15(h)(5)(i) is intended to apply to situations where the first insured
crop is planted and incurs an insurable loss or the first insured crop
is prevented from planting and a second crop is planted. Section
17(f)(5) is the applicable section when a first insured crop is planted
and the second crop is prevented from planting. FCIC has revised the
language in section 15 accordingly.
Comment: A commenter stated the change to double crop history seems
to be a positive move, using a producer's history of double cropping to
aid in calculating the use of newly added land. If a producer has a
history of double cropping every year, it is highly likely that a
percentage of the added land would be double cropped also. The change
to the double crop language will add more complexity to the
calculation. Before, it was simple--what you had is what you got.
Response: FCIC thanks the commenter and appreciates their input.
Comment: A commenter suggested revising 15(h)(5)(i)(B) to state ``.
. . (In the example above, 50 divided by 100 equals 50 percent of the
first insured crop acres that were double cropped in 2015, and 70
divided by 100 equals 70
[[Page 28992]]
percent that were double cropped in 2016)''.
Response: FCIC agrees and has made changes accordingly.
Executive Orders 12866, 13563, and 13771
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 not significant
under Executive Order 12866, ``Regulatory Planning and Review,'' and
therefore, OMB has not reviewed this rule. The rule is not subject to
Executive Order 13771, ``Reducing Regulation and Controlling Regulatory
Costs.''
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 numbers 0563-0053.
E-Government Act Compliance
FCIC is committed to complying with the E-Government Act of 2002,
to promote the use of the Internet and other information technologies
to provide increased opportunities for citizen access to Government
information and services, and for other purposes.
Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA)
establishes requirements for Federal agencies to assess the effects of
their regulatory actions on State, local, and tribal governments and
the private sector. This rule contains no Federal mandates (under the
regulatory provisions of title II of the UMRA) for State, local, and
tribal governments or the private sector. Therefore, this rule is not
subject to the requirements of sections 202 and 205 of UMRA.
Executive Order 13132
It has been determined under section 1(a) of Executive Order 13132,
Federalism, that this rule does not have sufficient implications to
warrant consultation with the States. The provisions contained in this
rule will not have a substantial direct effect on States, or on the
relationship between the national government and the States, or on the
distribution of power and responsibilities among the various levels of
government.
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.
The Federal Crop Insurance Corporation 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 E.O. 13175. If a Tribe requests consultation, the
Federal Crop Insurance Corporation will work with the Office of Tribal
Relations to ensure meaningful consultation is provided where changes,
additions and modifications identified herein are not expressly
mandated by Congress.
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 (Act) authorizes FCIC to
waive collection of administrative fees from beginning farmers or
ranchers and 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 Federal crop
insurance. A Regulatory Flexibility Analysis has not been prepared
since this regulation does not have an impact on small entities, and,
therefore, this regulation is exempt from the provisions of the
Regulatory Flexibility Act (5 U.S.C. 605).
Federal Assistance Program
This program is listed in the Catalog of Federal Domestic
Assistance under No. 10.450.
Executive Order 12372
This program is not subject to the provisions of Executive Order
12372, which require intergovernmental consultation with State and
local officials. See the Notice related to 7 CFR part 3015, subpart V,
published at 48 FR 29115, June 24, 1983.
Executive Order 12988
This rule has been reviewed in accordance with Executive Order
12988 on civil justice reform. The provisions of this rule will not
have a retroactive effect. The provisions of this rule will preempt
State and local laws to the extent such State and local laws are
inconsistent herewith. With respect to any direct action taken by FCIC
or to require the insurance provider to take specific action under the
terms of the crop insurance policy, the administrative appeal
provisions published at 7 CFR part 11 must be exhausted before any
action against FCIC for judicial review may be brought.
Environmental Evaluation
This action is not expected to have a significant economic impact
on the quality of the human environment, health, or safety. Therefore,
neither an Environmental Assessment nor an Environmental Impact
Statement is needed.
List of Subjects in 7 CFR Part 457
Crop insurance, Reporting and recordkeeping requirements. Final
Rule.
Accordingly, as set forth in the preamble, the Federal Crop
Insurance Corporation amends 7 CFR part 457 as follows:
PART 457--COMMON CROP INSURANCE REGULATIONS
0
1. The authority citation for part 457 continues to read as follows:
Authority: 7 U.S.C. 1506(l) and 1506(o).
[[Page 28993]]
0
2. Amend Sec. 457.8, in the Common Crop Insurance Policy, as follows:
0
a. In section 1 by revising the definition of ``practical to replant''
and ``replanted crop;'' and
0
b. In section 15 by revising paragraph (h).
The revisions read as follows:
Sec. 457.8 The application and policy.
* * * * *
Common Crop Insurance Policy
* * * * *
1. Definitions
* * * * *
Practical to replant. Our determination, after loss or damage to
the insured crop, that you are able to replant to the same crop in such
areas and under such circumstances as it is customary to replant and
that replanting the insured crop will allow the crop to attain maturity
prior to the calendar date for the end of the insurance period. We may
consider circumstances as to whether: (1) It is physically possible to
replant the acreage; (2) seed germination, emergence, and formation of
a healthy plant is likely; (3) field, soil, and growing conditions
allow for proper planting and growth of the replanted crop to reach
maturity; or (4) other conditions exist, as provided by the Crop
Provisions or Special Provisions. Unless we determine it is not
practical to replant, based on the circumstances listed above, it will
be considered practical to replant through: (1) The final planting date
if no late planting period is applicable; (2) the end of the late
planting period if the late planting period is less than 10 days; or
(3) the 10th day after the final planting date if the crop has a late
planting period of 10 days or more. We will consider it practical to
replant regardless of the availability of seed or plants, or the input
costs necessary to produce the insured crop such as seed or plants,
irrigation water, etc.
* * * * *
Replanted crop. The same agricultural commodity replanted on the
same acreage as the insured crop for harvest in the same crop year if:
(1) The replanting is specifically made optional by the policy and you
elect to replant the crop and insure it under the policy covering the
insured crop; or (2) Replanting is required by the policy. The crop
will be considered a replanted insured crop and no replanting payment
will be paid if we have determined it is not practical to replant the
insured crop and you choose to plant the acreage to the same insured
crop.
* * * * *
15. Production Included in Determining an Indemnity and Payment
Reductions
* * * * *
(h) You may receive a full indemnity, or a full prevented planting
payment for a first insured crop when a second crop is planted on the
same acreage in the same crop year, if each of the following conditions
are met, regardless of whether or not the second crop is insured or
sustains an insurable loss:
(1) Planting two or more crops for harvest in the same crop year in
the area is generally recognized by agricultural experts or organic
agricultural experts;
(2) The second or more crops are customarily planted after the
first insured crop for harvest on the same acreage in the same crop
year in the area;
(3) Additional coverage insurance offered under the authority of
the Act is available in the county on the two or more crops that are
double cropped;
(4) In the case of prevented planting, the second crop is not
planted on or prior to the final planting date or, if applicable, prior
to the end of the late planting period for the first insured crop;
(5) You provide records, acceptable to us, of acreage and
production specific to the double cropped acreage proving that:
(i) You have double cropped acreage in at least two of the last
four crop years in which the first insured crop was planted and incur
an insurable loss or the first insured crop is prevented from being
planted and a second crop is planted. If you acquired additional land
for the current crop year you may apply the percentage of acres that
you have previously double cropped to the total cropland acres that you
are farming this year (if greater) using the following calculation:
(A) Determine the number of acres of the first insured crop that
were double cropped in each of the years for which double cropping
records are provided (For example, records are provided showing: 100
acres of wheat planted in 2016 and 50 of those acres were double
cropped with soybeans; and 100 acres of wheat planted in 2017 and 70 of
those acres were double cropped with soybeans);
(B) Divide each result of section 15(h)(5)(i)(A) by the number of
acres of the first insured crop that were planted in each respective
year (In the example above, 50 divided by 100 equals 50 percent of the
first insured crop acres that were double cropped in 2016 and 70
divided by 100 equals 70 percent of the first insured crop acres that
were double cropped in 2017);
(C) Add the results of section 15(h)(5)(i)(B) and divide by the
number of years the first insured crop was double cropped (In the
example above, 50 plus 70 equals 120 divided by 2 equals 60 percent);
and
(D) Multiply the result of 15(h)(5)(i)(C) by the number of insured
acres of the first insured crop (In the example above, 60 percent
multiplied by the number of wheat acres insured in 2018); or
(ii) The applicable acreage was double cropped (by one or more
other producers, and the producer(s) will allow you to use their
records) for at least two of the last four crop years in which the
first insured crop was grown on it; and
(6) If you do not have records of acreage and production specific
to the double cropped acreage, as required in section 15(h)(5), but
instead have records that combine production from acreage you double
cropped with records of production from acreage you did not double
crop, we will allocate the first and second crop production to the
specific acreage in proportion to the liability for the acreage that
was and was not double cropped.
* * * * *
Dated: June 20, 2017.
Robert Ibarra,
Acting Administrator.
[FR Doc. 2017-13242 Filed 6-26-17; 8:45 am]
BILLING CODE 3410-08-P