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Common Crop Insurance Regulations; Peanut Crop Insurance Provisions
Note: EPA no longer updates this information, but it may be useful as a reference or resource.
[Federal Register: October 29, 2004 (Volume 69, Number 209)]
[Rules and Regulations]
[Page 63041-63043]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29oc04-2]
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DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
7 CFR Part 457
RIN 0563-AB93
Common Crop Insurance Regulations; Peanut Crop Insurance Provisions
AGENCY: Federal Crop Insurance Corporation, USDA.
ACTION: Final rule.
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SUMMARY: The Federal Crop Insurance Corporation (FCIC) finalizes
amendments to the Peanut Crop Insurance Provisions. The intended
effects of this action are to provide policy changes and clarify
existing policy provisions to better meet the needs of the insured and
to restrict the effect of the current Peanut Crop Insurance Regulations
to the 2004 and prior crop years.
EFFECTIVE DATE: November 29, 2004.
FOR FURTHER INFORMATION CONTACT: Gary Johnson, Risk Management,
Specialist, Research and Development, Product Development Division,
Risk Management Agency, United States Department of Agriculture, 6501
Beacon Drive, Stop 0812, Room 421, Kansas City, MO 64133-4676,
telephone (816) 926-7730.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This rule has been determined to be non-significant for the
purposes of Executive Order 12866 and, therefore, it has not been
reviewed by the Office of Management and Budget (OMB).
Paperwork Reduction Act of 1995
Pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. chapter
35), the collections of information in this rule have been approved by
OMB under control number 0563-0053 through February 28, 2005.
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
[[Page 63042]]
not have a substantial direct effect on States, or on the relationship
between the national government and the States, or on the distribution
of power and responsibilities among the various levels of government.
Regulatory Flexibility Act
FCIC certifies that this regulation will not have a significant
economic impact on a substantial number of small entities. Program
requirements for the Federal crop insurance program are the same for
all producers regardless of the size of their farming operation. For
instance, all producers are required to submit an application and
acreage report to establish their insurance guarantees and compute
premium amounts, or a notice of loss and production information to
determine 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
small entities are given the same opportunities 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
under the terms of the crop insurance policy, the administrative appeal
provisions published at 7 CFR part 11 and 7 CFR part 400, subpart J for
the informal administrative review process of good farming practices,
as applicable, must be exhausted before any action for judicial review
of any determination or action by FCIC may be brought.
Environmental Evaluation
This action is not expected to have a significant impact on the
quality of the human environment, health, and safety. Therefore,
neither an Environmental Assessment nor an Environmental Impact
Statement is needed.
Background
On May 17, 2004, FCIC published a notice of proposed rulemaking in
the Federal Register at 69 FR 27864-27865 to revise 7 CFR 457.134
Peanut Crop Insurance Provisions. Following publication of the proposed
rule, the public was afforded 30 days to submit written comments and
opinions. Comments were received from reinsured companies, agents,
trade associations, producers, and insurance service organization and
other interested parties. The comments received and FCIC's responses
are as follows:
Comment: A total of 30 commenters recommended that FCIC should
allow optional units for peanuts to be established in accordance with
section 34 of the Common Crop Insurance Policy Basic Provisions (Basic
Provisions).
Response: FCIC agrees and has made the change accordingly.
Comment: An insurance service organization suggested that actual
production history (APH) procedures should be revised in accordance
with how existing units by farm serial number (FSN) can be converted to
a section or section equivalent basis, in areas where that is
appropriate. The commenter asks if peanut databases that still contain
the ``F'' classification yield from the APH conversion process will be
allowed to retain the yield in the new section databases that were part
of the FSN for which that classification was established.
Response: FCIC revised the APH procedures in the Crop Insurance
Handbook (CIH) effective for the 2003 crop year when peanuts were
converted to a Category B APH crop. Classification ``F'' yields that
were used to establish approved APH yields were removed by adding an
actual or assigned yield to the affected databases for the 2003 crop
year. In subsequent crop years, this process will continue until all
classification yields in the database have been replaced by actual or
assigned yields. Databases will be updated using acceptable production
records under standard APH procedures.
Comment: An insurance service organization commented to the
proposed rule that to allow optional units for peanuts in accordance
with the Basic Provisions would not result in imposing optional units
by section in parts of the country, such as some southeastern States.
The southeastern States have optional units by FSN for other Category B
crops. In those areas, the proposed rule would allow optional units by
irrigated and non-irrigated practices as well as by FSN.
Response: FCIC agrees that in those states without sections,
optional units will be by FSN or irrigated and non-irrigated practices.
Comment: An insurance service organization asked if FCIC has any
estimates by State on how the number of optional units are affected so
rates can be adjusted accordingly.
Response: An analysis of the number of potential optional units
that may be generated by the proposed rule change was completed. FCIC
will apply the rate surcharge for optional units as administered for
other Category B crops in the applicable States. A study is being
conducted regarding the premium rates for optional units to determine
the appropriate rates and such rates will be applied to peanuts.
Comment: A total of 30 comments supported modifying the Peanut Crop
Provisions to provide for a price election for peanuts based on a
contract price for those peanuts that are grown under contract.
However, an insurance service organization opposed insuring peanuts at
a contract price election. The insurance service organization comment
indicated many years ago a contract price was used to establish the
price election for non-quota peanuts. Those contracts did not enforce
delivery, which then resulted in some buying points being too generous.
Peanuts do not have to be grown under contract to be insured. Allowing
for a contract price would in effect establish two prices for peanuts
similar to the quota/non-quota system. The pounds per acre grown under
contract would have one price and those that are not grown under
contract would default to the price established in the actuarial
documents. Other insured crops such as corn, soybeans, and wheat can
also be contracted at set prices without this type of price option
available.
Response: FCIC only requested public comment regarding the
feasibility and possible approaches for insuring peanuts at a contract
price. FCIC will consider all the comments when it looks at the
feasibility of allowing a price
[[Page 63043]]
election by contract price. However, until such evaluation is complete,
no changes will be made to the Peanut Crop Provisions.
List of Subjects in 7 CFR Part 457
Crop insurance, Peanut, reporting and recordkeeping requirements.
Final Rule
? Accordingly, as set forth in the preamble, the Federal Crop Insurance
Corporation proposes to amend 7 CFR part 457, Common Crop Insurance
Regulations, for the 2005 and succeeding crop years as follows:
PART 457--COMMON CROP INSURANCE REGULATIONS
? 1. The authority citation for 7 CFR part 457 continues to read as
follows:
Authority: 7 U.S.C. 1506(l) and 1506(p).
? 2. Amend Sec. 457.134 as follows:
? a. Remove and reserve section 2 under the heading ``Peanut Crop
Insurance Provisions.''
? b. Revise the introductory text to read as follows:
Sec. 457.134 Peanut crop insurance provisions.
* * * * *
The peanut crop insurance provisions for the 2005 and succeeding
crop years are as follows:
* * * * *
Signed in Washington, DC, on October 25, 2004.
Ross J. Davidson, Jr.,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 04-24177 Filed 10-28-04; 8:45 am]
BILLING CODE 3410-08-P