Noninsured Crop Disaster Assistance Program

DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

7 CFR Part 1437

RIN 0560-AF23

Noninsured Crop Disaster Assistance Program

AGENCY: Commodity Credit Corporation, USDA.

ACTION: Interim rule.

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

SUMMARY: This interim rule includes provisions for providing assistance

under the Noninsured Crop Disaster Assistance Program (NAP) for:

aquacultural species; floriculture; forage; ornamental nursery; seed

crops; reseeding or replanting of the same crop; and value loss crops.

Amendments include redefining some existing terms and adding new terms

and changes of applicability, eligibility, assistance, yield

determinations, acreage and production reports, loss requirements, and

payments for reduced yields and prevented planting.

EFFECTIVE DATE: October 17, 1997.

FOR FURTHER INFORMATION CONTACT: Sean O'Neill, Chief, Noninsured

Assistance Branch (NAB), Production, Emergencies, and Compliance

Division (PECD), Farm Service Agency (FSA), United States Department of

Agriculture, STOP 0526, 1400 Independence Avenue, SW, Washington, D.C.

20250-0526; telephone (202) 720-9003.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

This proposed rule is issued in conformance with Executive Order

12866 and has been determined to be not significant and therefore has

not been reviewed by OMB.

Regulatory Flexibility Act

It has been determined that the Regulatory Flexibility Act is not

applicable to this rule because neither FSA nor the CCC is required by

5 U.S.C. 553 or any other provision of law to publish a notice of

proposed rulemaking with respect to the subject matter of this rule.

Environmental Evaluation

It has been determined by an environmental evaluation that this

action will have no significant impact on the quality of the human

environment. Therefore, neither an environmental assessment nor an

environmental impact statement is needed.

Executive Order 12988

The proposed rule has been reviewed in accordance with Executive

Order 12988. The provisions of this proposed rule preempt State laws to

the extent such laws are inconsistent with the provisions of this rule.

Before any judicial action may be brought concerning the provisions of

this rule, the administrative remedies must be exhausted.

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).

Unfunded Mandates

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. Thus, this rule is not subject to

the requirements of sections 202 and 205 of the UMRA regulations.

Paperwork Reduction Act

Title: Noninsured Crop Disaster Assistance Program.

OMB Control Number: 0560-0175.

Expiration Date: May 31, 1998.

Type of Request: Extension and revision of a currently approved

information collection.

Abstract: The information collected under OMB control number 0560-

0175, as identified above, allows CCC to effectively administer

noninsured crop disaster assistance authorized by the Federal

Agriculture Improvement and Reform Act of 1996. The information

collected allows CCC to provide assistance under the noninsured crop

disaster assistance program for losses of commercial crops or other

agricultural commodities that are produced for food or fiber. The

information collected is necessary to provide those charged with

determining eligibility for CCC a basis to determine whether the

producer meets applicable conditions for assistance and to determine

compliance with existing rules.

Estimate of Burden: Public reporting burden for this information

collection is estimated to average .2 hours per response.

Respondents: Commercial agricultural producers of food or fiber.

Estimated Number of Respondents: 1,575,000.

Estimated Number of Responses per Respondent: 5.

Estimated Total Annual Burden on Respondents: 1,711,250 hours.

Proposed topics for comment include: (a) Whether the continued

collection of information is necessary for the proper performance of

the functions of the agency, including whether the information will

have practical utility; (b) the accuracy of the CCC's estimate of

burden including the validity of the methodology and assumptions used;

(c) enhancing the quality, utility, and clarity of the information

collected; or (d) minimizing the burden of the collection of the

information on those who are to respond, including the use of

appropriate automated, electronic, mechanical, or other technological

collection techniques or other forms of information technology.

Comments should be sent to the Desk Officer for Agriculture, Office of

Information and Regulatory Affairs, Office of Management and Budget,

Washington, D.C. 20503, and to Sean O'Neill, Chief, Noninsured

Assistance Branch (NAB), Production, Emergencies, and Compliance

Division (PECD), Farm Service Agency (FSA), United States Department of

Agriculture, STOP 0526, 1400 Independence Avenue, SW, Washington, D.C.

20250-0526. All comments will become a matter of public record.

OMB is required to make a decision concerning the collection(s) of

information contained in these proposed regulations between 30 and 60

[[Page 53930]]

days after publication of this document in the Federal Register.

Therefore, a comment to OMB is best assured of having its full effect

if OMB receives it within 30 days of publication.

Executive Order 12612

It has been determined 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.

Federal Assistance Programs

This program is listed in the Catalog of Federal Domestic

Assistance under No. 10.450.

Background

The regulation reflects changes in existing definitions, additional

definitions, eligibility, assistance, yield determinations, acreage and

production reporting requirements, loss requirements, and payments for

reduced yields and prevented planting. Major changes include:

(1) Section 1437.4 is amended to specify that except for ornamental

nursery and species or types and varieties of forage determined by CCC

to be predominantly grazed, different species or types and varieties

may be treated as separate crops.

(2) Section 1437.5 is amended to include a method for CCC to

establish the value of an animal unit day.

(3) Section 1437.7 is amended to specify that CCC will establish

expected area yields, or an equivalent measure in the event yield data

are not available.

(4) Section 1437.8 is amended to include that, for forage, acreage

reports must include the species or type and variety of forage

reported, and the intended harvest method, i.e. grazing or mechanically

harvested.

(5) Section 1437.9 is amended to require reseeding or replanting

where it is practicable.

(6) Section 1437.11 is amended to include payments for losses of

forage determined by CCC to be predominantly grazed.

List of Subjects in 7 CFR Part 1437

Agricultural commodities, Disaster assistance, Reporting and

recordkeeping requirements.

For the reasons set out in the Preamble, 7 CFR Chapter XIV is

amended as set forth below.

PART 1437--NONINSURED CROP DISASTER ASSISTANCE PROGRAM REGULATIONS

FOR THE 1997 AND SUCCEEDING CROP YEARS

1. The authority citation continues to read as follows:

Authority: 15 U.S.C. 714b and 714c and 7 U.S.C. 7333.

1a. Revise the heading for part 1437 to read as set forth above.

2. Revise Sec. 1437.1 to read as follows:

Sec. 1437.1 Applicability.

(a) For the 1997 and subsequent crop years, NAP is intended to

provide eligible producers of eligible crops with protection comparable

to the catastrophic risk protection plan of crop insurance. NAP is also

designed to help reduce production risks faced by producers of crops

for which Federal crop insurance under the Federal Crop Insurance Act,

as amended is not available. NAP will reduce financial losses that

occur when natural disasters cause a catastrophic loss of production or

prevented planting of an eligible crop. Payment eligibility is based on

an expected yield for the area and the producer's approved yield based

on actual production history, or a transitional yield if sufficient

production records are not available. In the case of forage determined

by CCC to be predominantly grazed in accordance with Sec. 1437.7(j),

payment eligibility is based on an expected stocking level for the area

and unit and the actual number of animals grazed and days grazing

occurred. Production for both the applicable area expected yield and

the individual producer approved yield for the unit or for forage

determined by CCC to be predominantly grazed, area and unit expected

stocking level must each fall below specified percentages in order to

be eligible for payments under this part.

(b) The provisions contained in this part are applicable to each

eligible producer and each eligible crop for which catastrophic

coverage is not otherwise available.

3. Amend Sec. 1437.3 to add new definitions for Animal unit, Animal

unit day, Carrying Capacity, Floriculture, Grazing days, Ornamental

Nursery, Stocking rate, Type and weight range, and Value loss crop, in

alphabetical order, and revise existing definitions for Aquacultural

species, Average market price, Eligible crop, Forage, Harvested, and

Unit to read as follows:

Sec. 1437.3 Definitions.

* * * * *

Animal unit (AU) means an animal with daily energy requirement

equating to 15.7 pounds of corn.

Animal unit day (AUD) means an expression of an expected or actual

stocking rate.

* * * * *

Aquacultural species means any species of aquatic organism grown as

food for human consumption, or fish raised as feed for fish that are

consumed by humans, or ornamental fish propagated and reared in an

aquatic medium by a commercial operator on private property in water in

a controlled environment. Eligible aquacultural species must be seeded

in the aquacultural facility and not be growing naturally in the

facility and must be planted or seeded in containers, wire baskets, net

pens, or similar devices designed for the protection and containment of

the seeded aquacultural species.

* * * * *

Average market price means the price, or dollar equivalent on an

appropriate basis for an eligible crop established by CCC for

determining payment amounts under NAP; for example, pound, bushel, ton,

and AUD (for forage determined by CCC to be predominantly grazed). Such

price will be on a harvested basis without the inclusion of

transportation, storage, processing, packing, marketing or other post-

harvest expenses and will be based, in part, on historical data.

Carrying Capacity means the stocking rate, as determined by CCC,

expressed as acres per animal unit (AC/AU) or reciprocal, which is

consistent with maintaining or improving vegetation or related

resources.

* * * * *

Eligible crop means an agricultural commodity for which

catastrophic coverage is not available and which is commercially

produced for food or fiber as specified in this part. Eligible crop

will also include floriculture, ornamental nursery, and Christmas tree

crops, turfgrass sod, seed crops, aquaculture (including ornamental

fish), and industrial crops. In the case of a crop that historically

has multiple plantings in the same crop year that are planted or are

prevented from being planted, each planting may be considered a

different crop for determining payments under this part as determined

by CCC. In the case of a crop, except for forage determined by CCC to

be predominantly grazed, that has different varieties or types, each

variety or type may be considered a separate crop for determining

payments under this part, if CCC determines there

[[Page 53931]]

is a significant difference in price or yield between the varieties or

types.

* * * * *

Floriculture means cut flowers or similar products of annual and

perennial flowering plants grown under glass, fiberglass and other

rigid plastics, film plastic, shade cloth, natural shade, other shade,

and outdoor in a container or controlled environment for commercial

sale.

Forage means land covered with grass or other similar herbaceous

vegetation not of a woody plant species, produced under such range

management practices as are necessary to sustain sufficient quality and

quantity of grass or similar vegetation each year to be suitable for

grazing or mechanical harvest to feed livestock in a commercial

operation. NAP benefits for forage produced on Federal or State owned

lands are available only for seeded forage.

* * * * *

Grazing days means the number of days used in the calculation of

the carrying capacity for each forage species or type or variety

determined by CCC to be predominantly grazed.

Harvested means a single harvest crop is considered harvested when

the producer has, by hand or mechanically, or by grazing of livestock,

removed the crop from the field. Crops with multiple harvests in 1 year

or harvested over multiple years are considered harvested when the

producer has, by hand or mechanically removed at least one mature crop

from the field. The mechanically harvested crop is considered harvested

once it is removed from the field and placed in a truck or other

conveyance, except hay is considered harvested when in the bale,

whether removed from the field or not. Grazing is not considered

harvesting for the purpose of determining an unharvested or prevented

planting payment factor.

* * * * *

Ornamental Nursery means decorative plants grown in a container or

controlled environment for commercial sale.

* * * * *

Stocking rate means the number of animal units grazing or utilizing

specific crop acreage for a specific number of days, expressed as

animal unit days.

Type and weight range means the identification of animals according

to the daily energy requirement, as determined by CCC, necessary to

provide the daily maintenance ration, as determined by CCC, of the

specific animal.

* * * * *

Unit means, for NAP, all acreage of the eligible crop or for

ornamental nursery, all eligible plant species and sizes except plant

species or sizes for which catastrophic coverage is available, in the

county for the crop year:

(1) In which the person has 100 percent crop share; or

(2) Which is owned by one person and operated by another person on

a share basis.

Value loss crop means ornamental nursery, Christmas trees,

aquaculture, or other crops as determined by CCC that, due to their

unique nature do not lend themselves to yield calculations or expected

yield loss situations. Eligibility for a crop categorized as value loss

shall be determined based on a loss of value at time of disaster, as

determined by CCC.

4. Amend Sec. 1437.4 to revise the second sentence of paragraph (a)

and paragraph (b)(10) to read as follows:

Sec. 1437.4 Eligibility.

(a) * * * Except for ornamental nursery and species or type or

variety of a species of forage determined by CCC to be predominantly

grazed, different types or varieties of a crop or commodity, may be

treated as a separate eligible crop, if CCC determines there is a

significant difference in price or yield.

(b) * * *

(10) Seed crops, where the propagation stock is commercially

produced for sale as seed stock for other eligible NAP crop production;

and

* * * * *

5. In Sec. 1437.5 add paragraph (f) to read as follows:

Sec. 1437.5 Assistance.

* * * * *

(f) Animal Unit Day value will be established by CCC on the basis

of a 5 year national average corn price per pound, as determined by

CCC, and the daily energy requirement of one beef cow, as determined by

CCC.

6. Amend Sec. 1437.7 to revise the first sentence of paragraph (a)

and add paragraphs (k) and (l) to read as follows:

Sec. 1437.7 Yield determinations.

(a) CCC will establish expected area yields or an equivalent

measure in the event yield data are not available, for eligible crops

for each county or area for which the NAP is available, using available

information, which may include, but is not limited to, National

Agricultural Statistics Service data, Cooperative State Research,

Education, and Extension Service records, Federal Crop Insurance

Corporation data, credible nongovernment studies, yields in similar

areas, and reported approved yield data. * * *

* * * * *

(k) Prior to the beginning of the crop year, CCC in its own

discretion will with respect to forage:

(1) Identify each species or type and variety of forage found in

the county;

(2) Categorize each species or type and variety of forage

identified as either:

(i) Predominantly mechanical harvested, or

(ii) Predominantly grazed;

(3) Establish a carrying capacity for each forage species or type

and variety identified and determined by CCC to be predominantly

grazed;

(4) Determine total acreage of forage determined by CCC to be

predominantly grazed; and

(5) Calculate expected Animal Unit Day by dividing the total acres

of forage in the county categorized by CCC as predominantly grazed by

the approved carrying capacity and multiplying the result by the number

of days of grazing used to determine the carrying capacity.

(l) In the event CCC receives a notice of loss of forage determined

by CCC to be predominantly grazed, CCC will:

(1) Calculate utilized Animal Unit Day by dividing the total acres

of forage reported to FSA determined by CCC to be predominantly grazed

by the reported number of animal units grazed and multiplying the

result by the number of days grazing occurred;

(2) Subtract the value of supplemental feed fed to the grazing

livestock during the grazing period from the value of the utilized

Animal Unit Day, as determined by CCC;

(3) Determine area utilization by dividing total area utilized

Animal Unit Day by the expected Animal Unit Day; and

(4) Determine unit utilization by dividing the unit utilized Animal

Unit Day by the expected unit Animal Unit Day.

7. Amend Sec. 1437.8 to revise paragraph (b)(4) and add paragraphs

(e) and (f) to read as follows:

Sec. 1437.8 Acreage and production reports.

* * * * *

(b) * * *

(4) The crop, practice, intended use, and for forage, the

predominant species or type and variety and the intended harvest

method, i.e. grazing or mechanical harvest.

* * * * *

(e) In lieu of a production report, producers of forage that is

predominantly grazed shall, in the crop year in which the producer

files a notice of loss, report grazing animals by type

[[Page 53932]]

and weight range and the number of days grazing occurred, and the

amount and type of feed fed such grazing animals during any grazing

period within the crop year.

(f) Animal Unit Day adjustments, as determined by CCC, may be

calculated when a producer of forage predominantly grazed, provides

adequate evidence, as determined by CCC, that unit forage management

and maintenance practices provide different carrying capacity than

practices generally provided forage acreage used to calculate the

approved county expected carrying capacity.

8. Amend Sec. 1437.9 to revise paragraph (b)(2) to read as follows:

Sec. 1437.9 Loss Requirements.

* * * * *

(b) * * *

(2) The failure of the producer to reseed or replant to the same

crop in the county where it is practicable to reseed or replant;

* * * * *

9. Amend Sec. 1437.11 to revise the introductory text and add

paragraph (c) to read as follows:

Sec. 1437.11 Payments for reduced yields and prevented planting.

In the event that the area loss requirement has been satisfied for

the crop and:

* * * * *

(c) The producer has sustained a loss of forage determined by CCC

to be predominantly grazed in accordance with Sec. 1437.7(l), in excess

of 50 percent of the producer's expected Animal Unit Day established

for the unit, the NAP payment will be determined by:

(1) Dividing the unit acreage for each species or type or variety

identified on the unit by the approved carrying capacity and

multiplying the result by the corresponding grazing days used as the

basis for determination of the carrying capacity, totaling the result

for each species or types and varieties.

(2) Multiplying the result of paragraph (c)(1) of this section by

50 percent.

(3) Multiplying the number of animals grazed by the daily allowance

of corn according to type and weight range and divide the result by

pounds of corn CCC determines is necessary to provide the daily energy

requirement for one animal unit.

(4) Multiplying the result of paragraph (c)(3) of this section by

the number of days grazing occurred to determine gross actual AUD.

(5) Adding AUD for ineligible causes of loss and incidental

mechanically harvested Category 1 forage to the result of paragraph

(c)(4) of this section.

(6) Subtracting AUD or equivalent value of supplemental feed fed to

the grazing livestock during the crop year from the result of paragraph

(c)(5) of this section.

(7) Subtracting the result of paragraph (c)(6) of this section from

the result of paragraph (c)(2) of this section. If a zero or negative

number results, payment cannot be calculated.

(8) Multiplying the positive result of paragraph (c)(7) of this

section by:

(i) For the 1997 through 1998 crop years, 60 percent of the average

market price, as determined by CCC, or any comparable coverage, as

determined by CCC; or

(ii) For the 1999 and subsequent years, 55 percent of the average

market price, as determined by CCC, or any comparable coverage, as

determined by CCC.

Signed at Washington, DC, on October 8, 1997.

Keith Kelly,

Executive Vice President, Commodity Credit Corporation.

[FR Doc. 97-27432 Filed 10-16-97; 8:45 am]

BILLING CODE 3410-01-P