General Crop Insurance Regulations, Safflower Seed Crop Insurance Endorsement; and Common Crop Insurance Regulations, Safflower Crop Insurance Provisions

Federal RegisterAug 8, 1997

Ask Donna

What actually matters in this document.

Text

DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Parts 401 and 457

RIN 0563-AA79

General Crop Insurance Regulations, Safflower Seed Crop Insurance

Endorsement; and Common Crop Insurance Regulations, Safflower Crop

Insurance Provisions

AGENCY: Federal Crop Insurance Corporation, USDA.

ACTION: Final rule.

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

SUMMARY: The Federal Crop Insurance Corporation (FCIC) finalizes

specific crop provisions for the insurance of safflower. The provisions

will be used in conjunction with the Common Crop Insurance Policy Basic

Provisions, which contain standard terms and conditions common to most

crops. The intended effect of this action is to provide policy changes

to better meet the needs of the insured, include the current safflower

seed crop endorsement under the Common Crop Insurance Policy for ease

of use and consistency of terms, and to restrict the effect of the

current safflower seed crop endorsement to the 1997 and prior crop

years.

EFFECTIVE DATE: August 8, 1997.

FOR FURTHER INFORMATION CONTACT: Ron Nesheim, Insurance Management

Specialist, Research and Development, Product Development Division,

Federal Crop Insurance Corporation, United States Department of

Agriculture, 9435 Holmes Road, Kansas City, MO, 64131, telephone (816)

926-7730.

SUPPLEMENTARY INFORMATION:

Executive Order No. 12866

The Office of Management and Budget (OMB) has determined this rule

to be exempt for the purposes of Executive Order No. 12866, and

therefore, has not been reviewed by OMB.

Paperwork Reduction Act of 1995

Following publication of the proposed rule, the public was afforded

60 days to submit comments and opinions on information collection

requirements currently being reviewed by OMB under OMB control number

0563-0053 through September 30, 1998. No public comments were received.

Unfunded Mandates Reform Act of 1995

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public

Law 104-4, 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) of

State, local, and tribal governments or the private sector. Thus, this

rule is not subject to the requirements of sections 202 and 205 of the

UMRA.

Executive Order No. 12612

It has been determined under section 6(a) of Executive Order No.

12612, Federalism, that this rule does not have sufficient federalism

implications to warrant the preparation of a Federalism Assessment. The

provisions contained in this rule will not have a substantial direct

effect on States or their political subdivisions, or on the

distribution of power and responsibilities among the various levels of

government.

Regulatory Flexibility Act

This regulation will not have a significant economic impact on a

substantial number of small entities. The amount of work required of

insurance companies should not increase because the information used to

determine eligibility is already maintained at their office. The amount

of work required of insurance companies may actually be reduced because

verification with FCIC of a producer's compliance with the controlled

substance regulations, currently done manually, will be automated.

Therefore, this action is determined to be exempt from the provisions

of the Regulatory Flexibility Act (5 U.S.C. 605), and no Regulatory

Flexibility Analysis was prepared.

Federal Assistance Program

This program is listed in the Catalog of Federal Domestic

Assistance under No. 10.450.

Executive Order No. 12372

This program is not subject to the provisions of Executive Order

No. 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 No. 12988

This rule has been reviewed in accordance with Executive Order No.

12988 on civil justice reforms. The provisions of this rule will not

have a retroactive effect prior to the effective date. The provisions

of this rule will preempt State and local laws to the extent such State

and local laws are inconsistent herewith. The administrative appeal

provisions published at 7 CFR part 11 must be exhausted before any

action for judicial review 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.

National Performance Review

This regulatory action is being taken as part of the National

Performance Review Initiative to eliminate unnecessary or duplicative

regulations and improve those that remain in force.

Background

On Friday, April 11, 1997, FCIC published a proposed rule in the

Federal Register at 62 FR 17758 to add to the Common Crop Insurance

Regulations (7 CFR part 457) a new section, 7 CFR 457.125, Safflower

Crop Insurance Provisions. The new provisions will be effective for the

1998 and succeeding crop years. These provisions will replace and

supersede the current provisions for insuring safflower found at 7 CFR

401.123 (Safflower Seed Crop Endorsement). FCIC also amends 7 CFR

401.123 to limit its effect to the 1997 and prior crop years.

Following publication of the proposed rule, the public was afforded

30 days to

[[Page 42648]]

submit written comments, data, and opinions. A total of 13 comments

were received from the reinsured companies and an insurance service

organization. The comments received, and FCIC's responses, are as

follows:

Comment: A reinsured company asked why no late planting period or

prevented planting language was put in the policy. The reinsured

company asked whether the old Late Planting Agreement Option must still

be signed.

Response: The Late Planting Agreement Option, found under 7 CFR

Sec. 401.123 that is currently applicable to safflower provisions, will

no longer apply. FCIC intends to revise the Late and Prevented Planting

provisions for the 1998 crop year. Until the revised rule is published,

FCIC will add the Late and Prevented Planting provisions, in effect for

other crops, to safflower.

Comment: An insurance service organization suggested that in the

definitions of ``final planting date'' and ``good farming practices,''

the term ``production guarantee'' be replaced by ``average yield,'' or

``insured's average yield'' (also in provision 2(e)(1)).

Response: The terms ``average yield'' or ``insured's average

yield'' would not be accurate because the insured's approved yield is

multiplied by the coverage level selected to determine the production

guarantee. Good farming practices and final planting date require that

the crop be able to produce the yield, not the production guarantee.

Therefore, no change has been made.

Comment: A reinsured company and an insurance service organization

expressed a concern that the provision in the definition of ``good

farming practices'' stating that, ``recognized by the Cooperative State

Research, Education and Extension Service as compatible * * *'' there

may be accepted practices not so recognized. They also asked that if

this cannot be dropped, it would at least help to say ``generally

recognized * * *''.

Response: FCIC believes that the Cooperative State Research,

Education, and Extension Service (CSREES) recognizes farming practices

that are considered acceptable for producing safflower. If a producer

is following practices currently not recognized as acceptable by the

CSREES, there is no reason why such recognition cannot be sought by

interested parties. CSREES pertains only to specific areas within a

county. No change has been made.

Comment: A reinsured company suggested that in the definition of

``irrigated practice,'' the words ``and quality'' be added after the

words ``* * * providing the quantity.''

Response: FCIC disagrees. There are no clear criteria regarding the

quality of water necessary to produce a crop. The highly variable

factors involved would make such criteria difficult to develop and

administer. The provisions regarding good farming practices can be

applied in situations in which the insured person failed to exercise

due care and diligence. Therefore, no change has been made.

Comment: An insurance service organization stated that in the

definition of ``practical to replant,'' the addition of marketing

window in several recent proposed rules seems to be applicable to

processor and fresh market crops. It does not appear to be a

consideration for replanting crops like safflower.

Response: FCIC agrees that the concept is most applicable to

processor and fresh market crops. However, the Federal Crop Insurance

Act has mandated that insurance providers consider marketing window,

when determining whether it is practical to replant. Therefore, no

change has been made.

Comment: An insurance service organization suggested that ``value

per pound of damaged safflower'' be changed to read ``value per pound''

since the definition refers to ``damaged safflower.''

Response: FCIC agrees and has made the change.

Comment: An insurance service organization questioned if it is

necessary to include all the language in section 3 (Insurance

Guarantees, Coverage Levels, and Prices) if there are no prices by

type. Since this appears to be standard language for most of the recent

proposed rule crop provisions, perhaps it should be in the Basic

Provisions instead.

Response: While many crops allow separate prices, by type, not all

require the same percentage relationship. The provision is included in

safflower to provide correct coverage as different types are developed.

Therefore, no change has been made.

Comment: An insurance service organization stated that some

policies allow the entire replanting payment to be paid to the person

incurring the entire expense (usually the tenant) when the landlord and

tenant are insured with the same company, but no such language is in

this proposed rule.

Response: It is true that a few Crop Provisions allow the entire

replanting payment to be paid to the person incurring the entire

expense (usually the tenant) when the landlord and tenant are insured

with the same company. However, because of the difficulties of

administering this provision, it is being discontinued as Crop

Provisions are revised. Therefore, no change has been made.

Comment: An insurance service organization suggested that section

12(c)(1)(iv)(A) of the policy should not allow the insured to defer

settlement and wait for a later, generally lower, appraisal, especially

on crops that have a short ``shelf life.''

Response: A later appraisal will be necessary only if the insurance

provider agrees that such an appraisal would result in a more accurate

determination of production to count and if the producer continues to

care for the crop. If the producer does not care for the crop, the

original appraisal will be used. Therefore, no change will be made to

these provisions.

Comment: An insurance service organization stated that section

12(d)(3)(ii) refers to ``net price;'' section 12(d)(4)(ii)(A) refers to

``value per pound;'' and section 12(d)(4)(ii)(B) refers to ``price per

pound.'' All three seem to mean the same thing. Since ``value per

pound'' is defined in the policy, they suggested using it in each item.

Response: FCIC agrees and has made those changes.

Comment: An insurance service organization suggested that in

section 12(d)(4) (i) & (ii), ``qualifying adjustment factor

provisions'' be revised to read ``quality adjustment factors'' in item

(i), and ``quality adjustment factor provisions'' to ``quality

adjustment factors'' in item (ii).

Response: FCIC agrees and has made the changes.

Comment: An insurance service organization suggested that in

section 12(d)(4)(ii)(A), ``local market price of undamaged safflower''

be amended to read ``local market price.''

Response: FCIC agrees and has made the change.

Comment: An insurance service organization and a reinsured company

suggested that written agreements should not be limited to one year.

Written unit agreements are continuous unless there are significant

changes in the farming operation. Some others should also be this way.

Response: Written agreements are intended to change policy terms or

permit insurance in unusual or previously unknown situations. If such

practices continue year to year, they should be incorporated into the

policy or Special Provisions. It is important to keep non-uniform

exceptions to the minimum and to ensure that the insured is well aware

of the specific terms of the policy. Therefore, no change has been

made.

[[Page 42649]]

In addition to the changes described above, FCIC has made minor

editorial changes and has amended the following provisions:

1. The preamble is revised to refer to the Catastrophic Risk

Protection Endorsement for the purpose of clarification.

2. In section 2, the authority to vary the unit structure has been

clarified that only the optional unit guideline, specified in section

2(e)(4) may be revised by written agreement.

3. Section 9(e) has been amended to clarify that wildlife is an

insured cause of loss, unless proper measures to control wildlife have

not been taken to be consistent with other policies.

Good cause is shown to make this rule effective upon publication in

the Federal Register. This rule improves the safflower crop insurance

coverage and brings it under the Common Crop Insurance Policy Basic

Provisions for consistency among policies. The earliest contract change

date that can be met for the 1998 crop year is August 31, 1997, and the

final rule must be published as soon as possible. It is, therefore,

imperative that these provisions be made final so that reinsured

companies may have sufficient time to implement these changes.

Therefore, public interest requires the agency to make the rules

effective upon publication.

List of Subjects in 7 CFR Parts 401 and 457

Crop insurance, Safflower seed.

Final Rule

Accordingly, for the reasons set forth in the preamble, the Federal

Crop Insurance Corporation hereby amends 7 CFR Parts 401 and 457 as

follows:

PART 401--GENERAL CROP INSURANCE REGULATIONS--REGULATIONS FOR THE

1988 AND SUBSEQUENT CONTRACT YEARS

1. The authority citation for 7 CFR part 401 continues to read as

follows:

Authority: 7 U.S.C. 1506(l), 1506(p).

2. In Sec. 401.123, the introductory paragraph is revised to read

as follows:

Sec. 401.123 Safflower seed crop endorsement.

The provisions of the Safflower Seed Crop Insurance Endorsement for

the 1988 through the 1997 crop year.

* * * * *

3. Section 401.8 is amended by revising the introductory text of

paragraph (d) to read as follows:

* * * * *

Sec. 401.8 The application and policy.

* * * * *

(d) The application for the 1988 and succeeding crop years is found

at subpart D of part 400, General Administrative Regulations (7 CFR

400.37 and 400.38). The provisions of the Safflower Insurance Policy

for the 1988 through 1997 crop years are as follows:

* * * * *

PART 457--COMMON CROP INSURANCE REGULATIONS; REGULATIONS FOR THE

1994 AND SUBSEQUENT CONTRACT YEARS

4. The authority citation for 7 CFR part 457 continues to read as

follows:

Authority: 7 U.S.C. 1506(l), 1506(p).

5. Section 457.125 is added to read as follows:

Sec. 457.125 Safflower crop insurance provisions.

The Safflower Crop Insurance Provisions for the 1998 and succeeding

crop years are as follows:

FCIC policies:

UNITED STATES DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

Reinsured policies:

(Appropriate title for insurance provider)

Both FCIC and reinsured policies:

Safflower Crop Insurance Provisions

If a conflict exists among the Basic Provisions (Sec. 457.8),

these Crop Provisions, the Special Provisions, and the Catastrophic

Risk Protection Endorsement, if applicable, the Special Provisions

will control these Crop Provisions and the Basic Provisions; and

these Crop Provisions will control the Basic Provisions. The

Catastrophic Risk Protection Endorsement, if applicable, will

control all provisions.

1. Definitions

Days. Calendar days.

FSA. The Farm Service Agency, an agency of the United States

Department of Agriculture, or a successor agency.

Final planting date. The date contained in the Special

Provisions for the insured crop by which the crop must initially be

planted in order to be insured for the full production guarantee.

Good farming practices. The cultural practices generally in use

in the county for the crop to make normal progress toward maturity

and produce at least the yield used to determine the production

guarantee, and are those recognized by the Cooperative State

Research, Education, and Extension Service as compatible with

agronomic and weather conditions in the county.

Harvest. Collecting the safflower seed by combining or

threshing.

Interplanted. Acreage on which two or more crops are planted in

a manner that does not permit separate agronomic maintenance or

harvest of the insured crop.

Irrigated practice. A method of producing a crop by which water

is artificially applied during the growing season by appropriate

systems and at the proper times, with the intention of providing the

quantity of water needed to produce at least the yield used to

establish the irrigated production guarantee on the irrigated

acreage planted to the insured crop.

Local market price. The cash price per pound for undamaged

safflower (test weight of 35 pounds per bushel or higher and seed

damage less than 25 percent) offered by buyers.

Nurse crop (companion crop). A crop planted into the same

acreage as another crop, that is intended to be harvested

separately, and which is planted to improve growing conditions for

the crop with which it is grown.

Planted acreage. Land in which seed has been placed by a machine

appropriate for the insured crop and planting method, at the correct

depth, into a seedbed that has been properly prepared for the

planting method and production practice. Safflower must initially be

planted in rows. Acreage planted in any other manner will not be

insurable unless otherwise provided by the Special Provisions or by

written agreement.

Pound. Sixteen ounces avoirdupois.

Practical to replant. In lieu of the definition of ``Practical

to replant'' contained in section 1 of the Basic Provisions

(Sec. 457.8), practical to replant is defined as our determination,

after loss or damage to the insured crop, based on factors,

including but not limited to moisture availability, condition of the

field, time to crop maturity, and marketing window, that replanting

the insured crop will allow the crop to attain maturity prior to the

calendar date for the end of the insurance period. It will not be

considered practical to replant after the end of the late planting

period unless replanting is generally occurring in the area.

Production guarantee (per acre). The number of pounds determined

by multiplying the approved APH yield per acre by the coverage level

percentage you elect.

Replanting. Performing the cultural practices necessary to

replace the safflower seed, including preparing the land and then

replacing the safflower seed in the insured acreage with the

expectation of producing at least the yield used to determine the

production guarantee.

Value per pound. The cash price per pound for damaged safflower

(test weight below 35 pounds per bushel, seed damage in excess of 25

percent, or both).

Written agreement. A written document that alters designated

terms of this policy in accordance with section 13.

2. Unit Division

(a) Unless limited by the Special Provisions, a unit as defined

in section 1 (Definitions) of the Basic Provisions (Sec. 457.8) (a

basic unit) may be divided into optional units if, for each optional

unit you meet all the conditions of this section.

(b) Basic units may not be divided into optional units on any

basis other than as described in this section.

[[Page 42650]]

combine all optional units that are not in compliance with these

provisions into the basic unit from which they were formed. We will

combine the optional units at any time we discover that you have

failed to comply with these provisions. If failure to comply with

these provisions is determined to be inadvertent, and the optional

units are combined into a basic unit, that portion of the additional

premium paid for the optional units that have been combined will be

refunded to you.

(d) All optional units you selected for the crop year must be

identified on the acreage report for that crop year.

(e) The following requirements must be met for each optional

unit:

(1) You must have records, which can be independently verified,

of planted acreage and production for each optional unit for at

least the last crop year used to determine your production

guarantee;

(2) You must plant the crop in a manner that results in a clear

and discernable break in the planting pattern at the boundaries of

each optional unit;

(3) For each crop year, records of marketed production or

measurement of stored production from each optional unit must be

maintained in such a manner that permits us to verify the production

from each optional unit, or the production from each unit must be

kept separate until loss adjustment is completed by us; and

(4) Each optional unit must meet one or more of the following

criteria, as applicable, unless otherwise specified by written

agreement:

(i) Optional Units by Section, Section Equivalent, or FSA Farm

Serial Number: Optional units may be established if each optional

unit is located in a separate legally identified section. In the

absence of sections, we may consider parcels of land legally

identified by other methods of measure including, but not limited to

Spanish grants, railroad surveys, leagues, labors, or Virginia

Military Lands, as the equivalent of sections for unit purposes. In

areas that have not been surveyed using the systems identified

above, or another system approved by us, or in areas where such

systems exist but boundaries are not readily discernable, each

optional unit must be located in a separate farm identified by a

single FSA Farm Serial Number.

(ii) Optional Units on Acreage Including Both Irrigated and Non-

irrigated Practices: Optional units may be based on irrigated

acreage and non-irrigated acreage (in those counties where ``non-

irrigated'' practice is allowed in the actuarial table) if both are

located in the same section, section equivalent, or FSA Farm Serial

Number. To qualify as separate irrigated and non-irrigated optional

units, the non-irrigated acreage may not continue into the irrigated

acreage in the same rows or planting pattern. The irrigated acreage

may not extend beyond the point at which the irrigation system can

deliver the quantity of water needed to produce the yield on which

the guarantee is based, except the corners of a field in which a

center-pivot irrigation system is used will be considered as

irrigated acreage if separate acceptable records of production from

the corners are not provided. If the corners of a field in which a

center-pivot irrigation system is used do not qualify as a separate

non-irrigated optional unit, they will be a part of the unit

containing the irrigated acreage. Non-irrigated acreage that is not

a part of a field in which a center-pivot irrigation system is used

may qualify as a separate optional unit provided that all other

requirements of this section are met.

3. Insurance Guarantees, Coverage Levels, and Prices for Determining

Indemnities

In addition to the requirements of section 3 (Insurance

Guarantees, Coverage Levels, and Prices for Determining Indemnities)

of the Basic Provisions (Sec. 457.8), you may select only one price

election for all the safflower in the county insured under this

policy unless the Special Provisions provide different price

elections by type, in which case you may select one price election

for each safflower type designated in the Special Provisions. The

price elections you choose for each type must have the same

percentage relationship to the maximum price offered by us for each

type. For example, if you choose 100 percent of the maximum price

election for one type, you must also choose 100 percent of the

maximum price election for all other types.

4. Contract Changes

In accordance with section 4 (Contract Changes) of the Basic

Provisions (Sec. 457.8), the contract change date is August 31

preceding the cancellation date for California, and December 31

preceding the cancellation date for all other states.

5. Cancellation and Termination Dates

In accordance with section 2 (Life of Policy, Cancellation, and

Termination) of the Basic Provisions (Sec. 457.8), the cancellation

and termination dates are:

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

Cancellation and termination

State dates

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

California............................. December 31.

All other states....................... March 15.

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

6. Insured Crop

In accordance with section 8 (Insured Crop) of the Basic

Provisions (Sec. 457.8), the crop insured will be all safflower in

the county for which a premium rate is provided by the actuarial

table:

(a) In which you have a share;

(b) That is planted for harvest as safflower seed;

written agreement):

(1) Interplanted with another crop; or

(2) Planted into an established grass or legume.

7. Insurable Acreage

In addition to the provisions of section 9 (Insurable Acreage)

of the Basic Provisions (Sec. 457.8), we will not insure:

(a) Safflower planted on land on which safflower, sunflower

seed, any variety of dry beans, soybeans, mustard, rapeseed, or

lentils were grown the preceding crop year, unless other rotation

requirements are specified in the Special Provisions or we agree in

writing to insure such acreage; or

(b) Any acreage of safflower damaged before the final planting

date, to the extent that the majority of producers in the area would

normally not further care for the crop, unless the crop is replanted

or we agree that it is not practical to replant.

8. Insurance Period

In accordance with the provisions of section 11 (Insurance

Period) of the Basic Provisions (Sec. 457.8), the calendar date for

the end of the insurance period is October 31 immediately following

planting.

9. Causes of Loss

In accordance with the provisions of section 12 (Causes of Loss)

of the Basic Provisions (Sec. 457.8), insurance is provided only

against the following causes of loss that occur during the insurance

period:

(a) Adverse weather conditions;

(b) Fire;

application of pest control measures;

(d) Plant disease, but not damage due to insufficient or

improper application of disease control measures;

(e) Wildlife, unless proper measures to control wildlife have

not been taken;

(f) Earthquake;

(g) Volcanic eruption; or

(h) Failure of the irrigation water supply, if caused by an

insured cause of loss that occurs during the insurance period.

10. Replanting Payment

(a) In accordance with section 13 (Replanting Payment) of the

Basic Provisions (Sec. 457.8), a replanting payment is allowed if

the crop is damaged by an insurable cause of loss to the extent that

the remaining stand will not produce at least 90 percent of the

production guarantee for the acreage and it is practical to replant.

(b) The maximum amount of the replanting payment per acre will

be the lesser of 20 percent of the production guarantee or 160

pounds, multiplied by your price election, multiplied by your

insured share.

uninsurable as an original planting, the liability on the unit will

be reduced by the amount of the replanting payment. The premium

amount will not be reduced.

11. Duties In The Event of Damage or Loss

In accordance with the requirements of section 14 (Duties in the

Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), the

representative samples of the unharvested crop must be at least 10

feet wide and extend the entire length of each field in the unit.

The samples must not be harvested or destroyed until the earlier of

our inspection or 15 days after harvest of the balance of the unit

is completed.

12. Settlement of Claim

(a) We will determine your loss on a unit basis. In the event

you are unable to provide separate acceptable production records:

(1) For any optional unit, we will combine all optional units

for which such production records were not provided; or

[[Page 42651]]

(2) For any basic unit, we will allocate any commingled

production to such units in proportion to our liability on the

harvested acreage for the unit.

(b) In the event of loss or damage covered by this policy, we

will settle your claim by:

(1) Multiplying the insured acreage by its respective production

guarantee;

(2) Multiplying each result in section 12(b)(1) by the

respective price election;

(3) Totaling the results in section 12(b)(2);

(4) Multiplying the total production to be counted of each type

if applicable, (see section 12(c)) by the respective price election;

(5) Totaling the results in section 12(b)(4);

(6) Subtracting the results from the total in section 12(b)(5)

from the results in section 12(b)(3); and

(7) Multiplying the result in section 12(b)(6) by your share.

acreage on the unit will include:

(1) All appraised production as follows:

(i) Not less than the production guarantee per acre for the

acreage:

(A) That is abandoned;

(B) Put to another use without our consent;

(D) For which you fail to provide acceptable production records;

(ii) Production lost due to uninsured causes;

(iii) Unharvested production (mature unharvested production may

be adjusted for quality deficiencies and excess moisture in

accordance with section 12(d)); and

(iv) Potential production on insured acreage that you intend to

put to another use or abandon, if you and we agree on the appraised

amount of production. Upon such agreement, the insurance period for

that acreage will end when you put the acreage to another use or

abandon the crop. If agreement on the appraised amount of production

is not reached:

(A) If you do not elect to continue to care for the crop, we may

give you consent to put the acreage to another use if you agree to

leave intact, and provide sufficient care for, representative

samples of the crop in locations acceptable to us (The amount of

production to count for such acreage will be based on the harvested

production or appraisals from the samples at the time harvest should

have occurred. If you do not leave the required samples intact, or

fail to provide sufficient care for the samples, our appraisal made

prior to giving you consent to put the acreage to another use will

be used to determine the amount of production to count); or

(B) If you elect to continue to care for the crop, the amount of

production to count for the acreage will be the harvested

production, or our reappraisal if additional damage occurs and the

crop is not harvested; and

(2) All harvested production from the insurable acreage.

(d) Mature safflower may be adjusted for excess moisture and

quality deficiencies. If moisture adjustment is applicable, it will

be made prior to any adjustment for quality.

(1) Production will be reduced by 0.12 percent for each 0.1

percentage point of moisture in excess of 8 percent. We may obtain

samples of the production to determine the moisture content.

(2) Production will be eligible for quality adjustment if such

production:

(i) Has a test weight below 35 pounds per bushel;

(ii) Has seed damage in excess of 25 percent; or

(iii) Contains substances or conditions that are identified by

the Food and Drug Administration or other public health

organizations of the United States as being injurious to human or

animal health.

(3) Quality will be a factor in determining your loss only if:

(i) The deficiencies, substances, or conditions resulted from a

cause of loss against which insurance is provided under these crop

provisions and that occurred within the insurance period;

(ii) The deficiencies, substances, or conditions result in a

value per pound that is less than the local market price;

(iii) All determinations of these deficiencies, substances, or

conditions are made using samples of the production obtained by us

or by a disinterested third party approved by us; and

(iv) The samples are analyzed by a grader licensed to grade

safflower under the authority of the Agricultural Marketing Act or

the United States Warehouse Act with regard to deficiencies in

quality, or by a laboratory approved by us with regard to substances

or conditions injurious to human or animal health. Test weight for

quality adjustment purposes may be determined by our loss adjuster.

(4) Safflower production that is eligible for quality

adjustment, as specified in sections 12(d)(2) and (3), will be

reduced as follows:

(i) In accordance with the quality adjustment factors contained

in the Special Provisions; or

(ii) If quality adjustment factors are not contained in the

Special Provisions:

(A) By determining the value per pound and the local market

price on the earlier of the date such quality adjusted production is

sold or the date of final inspection for the unit. Discounts used to

establish the value per pound will be limited to those which are

usual, customary, and reasonable. The value per pound will not be

reduced for:

(1) Moisture content;

(2) Damage due to uninsured causes; or

(3) Drying, handling, processing, or any other costs associated

with normal harvesting, handling, and marketing of safflower. We may

obtain values per pound from any buyer of our choice. If we obtain

values per pound from one or more buyers located outside your local

market area, we will reduce such values per pound by the additional

costs required to deliver the production to those buyers.

(B) Divide the value per pound by the local market price to

determine the quality adjustment factor; and

the damaged production remaining after any reduction due to

excessive moisture to determine the net production to count.

(e) Any production harvested from other plants growing in the

insured crop may be counted as production of the insured crop on a

weight basis.

3. Written Agreement

Terms of this policy which are specifically designated for the

use of written agreement may be altered by written agreement in

accordance with the following:

(a) You must apply in writing for each written agreement no

later than the sales closing date, except as provided in section

13(e);

(b) The application for a written agreement must contain all

variable terms of the contract between you and us that will be in

effect if the written agreement is not approved;

variable terms of the contract, including, but not limited to, crop

type or variety, the guarantee, premium rate, and price election;

(d) Each written agreement will only be valid for one year (If

the written agreement is not specifically renewed the following

year, insurance coverage for subsequent crop years will be in

accordance with the printed policy); and

(e) An application for a written agreement submitted after the

sales closing date may be approved if, after a physical inspection

of the acreage, it is determined that no loss has occurred and the

crop is insurable in accordance with the policy and written

agreement provisions.

Signed in Washington, D.C., on August 4, 1997.

Kenneth D. Ackerman,

Manager, Federal Crop Insurance Corporation.

[FR Doc. 97-20914 Filed 8-7-97; 8:45 am]

BILLING CODE 3410-08-P

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.