Common Crop Insurance Regulations; Grape Crop Insurance Provisions

DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 457

Common Crop Insurance Regulations; Grape Crop Insurance

Provisions

AGENCY: Federal Crop Insurance Corporation, USDA.

ACTION: Proposed rule.

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

SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes to

amend the Grape Crop Insurance Provisions to: (1) allow grape producers

in Idaho, Oregon, and Washington to select one price election and one

coverage level for each varietal group specified in the Special

Provisions; and (2) provide year-round coverage in California, Idaho,

Mississippi, Oregon, Texas, and Washington for insureds with no break

in coverage from the prior crop year. The intended effect of this

action is to provide policy changes to better meet the needs of the

insured.

DATES: Written comments and opinions on this proposed rule will be

accepted until close of business October 2, 1998 and will be considered

when the rule is to be made final. The comment period for information

collections under the Paperwork Reduction Act of 1995 continues through

November 2, 1998.

ADDRESSES: Interested persons are invited to submit written comments to

the Director, Product Development Division, Federal Crop Insurance

Corporation, United States Department of Agriculture, 9435 Holmes Road,

Kansas City, MO 64131. A copy of each response will be available for

public inspection and copying from 7:00 a.m. to 4:30 p.m., CDT, Monday

through Friday, except holidays, at the above address.

FOR FURTHER INFORMATION CONTACT: Stephen Hoy, Insurance Management

Specialist, 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 12866

This rule has been determined to be exempt for the purposes of

Executive Order 12866 and, therefore, has not been reviewed by the

Office of Management and Budget (OMB).

Paperwork Reduction Act of 1995

This rule proposes to amend the information collection requirements

previously approved by OMB under OMB control number 0563-0053 through

October 31, 2000. This rule proposes to: (1) allow grape producers in

Idaho, Oregon, and Washington to select one price election and one

coverage level for each varietal group specified in the Special

Provisions, and (2) provide year-round crop insurance coverage for

grapes in California, Idaho, Mississippi, Oregon, Texas, and

Washington. All of the forms cleared under OMB control number 0563-0053

represent the minimum information necessary to determine eligibility

and losses qualifying for a payment due to grape coverage.

Revised reporting estimates and requirements for usage of OMB

control number 0563-0053 will be submitted to OMB for approval under

the provisions of 44 U.S.C. chapter 35. The comment period for

information collections under the Paperwork Reduction Act of 1995

continues through November 2, 1998.

The FCIC is seeking comments on the following information

collection request (ICR).

Title: Multiple Peril Crop Insurance.

Respondents/Affected Entities: Parties affected by the information

collection requirements included in this rule are grape producers.

Abstract: This rule improves the existing grape policy by: (1)

allowing grape producers in Idaho, Oregon, and Washington to select one

price election and one coverage level for each varietal group specified

in the Special Provisions, and (2) providing crop insurance coverage in

California, Idaho, Mississippi, Oregon, Texas, and Washington during

the period when no coverage currently exists. FCIC believes the

proposed policy will provide better crop insurance coverage to grape

producers.

Estimate of Burden: Public reporting burden for the collection of

information on all forms for the insurance of grapes is estimated at

51.1 minutes per participant because of the high degree of automation

associated with the data collection.

Respondents: Grape producers.

Estimated Number of Respondents: 11,201.

Estimated Number of Responses Per Respondent: 2.5.

Estimated Total Annual Burden on Respondents: 3,842 hours.

FCIC is requesting comments on the following: (a) whether the

proposed collection of information is necessary for the proper

performance of the functions of the agency, including whether the

information has practical utility; (b) the accuracy of the agency's

estimate of the burden of the proposed collection of information; (c)

ways to enhance the quality, utility, and clarity of the information to

be collected; and (d) ways to minimize the burden of the collection of

information on respondents, including through the use of automated

collection techniques or other forms of information gathering

technology.

Comments regarding paperwork reduction should be submitted to the

Desk Officer for Agriculture, Office of Information and Regulatory

Affairs, Office of Management and Budget, Washington, D.C. 20503.

The Office of Management and Budget (OMB) is required to make a

decision concerning the collections of information contained in this

rule between 30 and 60 days after submission to OMB. Therefore, a

comment to OMB is best assured of having full effect if OMB receives it

within 30 days of publication. This does not affect the deadline for

the public to comment on the rule.

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 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

UMRA.

Executive Order 12612

It has been determined under section 6(a) of Executive Order 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. New provisions included in this

rule will not impact small entities to a greater extent than large

entities. Under the current regulations, a producer is required to

complete an application and an acreage report. If the crop is damaged

or destroyed, the insured is required to give notice of loss and

provide the necessary information to complete a claim for indemnity.

This regulation

[[Page 46707]]

does not alter those requirements. The amount of work required of the

insurance companies delivering and servicing these policies will not

increase significantly from the amount of work currently required. This

rule does not have any greater or lesser impact on the producer.

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 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. The administrative appeal provisions published

at 7 CFR part 11 must be exhausted before any action for judicial

review of any determination made by FCIC may be brought.

Environmental Evaluation

This action is not expected to have a significant economic impact

on the quality of the human environment, health, and safety. Therefore,

neither an Environmental Assessment nor an Environmental Impact

Statement is needed.

Background

FCIC proposes to amend the Common Crop Insurance Regulations (7 CFR

part 457) by revising 7 CFR 457.138 effective for the 2000 and

succeeding crop years. The principal changes to the provisions for

insuring grapes are as follows:

1. Section 3--Add provisions to allow grape producers in Idaho,

Oregon, and Washington to select one coverage level and one price

election for each varietal group designated in the Special Provisions.

Previously, the Special Provisions for these states did not always

allow different price elections or coverage levels by varietal group,

in which case the coverage level and price election designated by the

insured applied to all grapes in the county. In addition, a provision

is added to specify that, in California, Idaho, Mississippi, Oregon,

Texas, and Washington, the insured's elected or assigned coverage level

or the ratio of the insured's price election to the maximum price

election offered may not be increased after coverage begins if a cause

of loss that could or will reduce the yield of the insured crop is

evident prior to the time that the change in coverage is requested.

This limitation will preclude insureds with continuous coverage from

increasing the liability on their insured acreage following a cause of

loss that could or will reduce the yield of the crop.

2. Section 9--Specify that, in California, Idaho, Mississippi,

Oregon, Texas, and Washington, for each subsequent crop year this

policy remains continuously in force (policy cancellation that results

solely from transferring to a different insurance provider for a

subsequent crop year will not be considered a break in continuous

coverage), coverage begins on the day immediately following the end of

the insurance period for the prior crop year. According to the Common

Crop Insurance Policy, the insurance period ends on the earliest of:

(1) total destruction of the insured crop on the unit; (2) harvest of

the unit; (3) the calendar date contained in the Crop Provisions for

the end of the insurance period; (4) abandonment of the crop on the

unit; or (5) as otherwise specified in the crop provisions. The current

Grape Crop Provisions specify calendar dates for the beginning and end

of the insurance period, thereby establishing a minimum time period

during which no insurance coverage exists between crop years in

California, Idaho, Mississippi, Oregon, Texas, and Washington. This

rule proposes to eliminate any lapse in insurance coverage between crop

years regardless of when insurance coverage ends for the crop year.

List of Subjects in 7 CFR Part 457

Crop insurance, Grape.

Proposed Rule

Accordingly, as set forth in the preamble, the Federal Crop

Insurance Corporation proposes to amend 7 CFR part 457 as follows:

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

1998 AND SUBSEQUENT CONTRACT YEARS

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

follows:

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

2. Section 457.138 is revised by amending the introductory text to

read as follows:

Sec. 457.138 Grape Crop Insurance Provisions.

The grape crop insurance provisions for the 2000 and succeeding

crop years are as follows:

* * * * *

3. In Sec. 457.138, sections 3(b) and 3(c) are amended and a new

section 3(f) is added to read as follows:

3. Insurance Guarantees, Coverage Levels, and Prices for

Determining Indemnities.

* * * * *

(b) In Idaho, Oregon, and Washington, you may select only one price

election and only one coverage level for each varietal group specified

in the Special Provisions.

(c) In all states except California, Idaho, Oregon, and Washington,

you may select only one price election and only one coverage level for

all the grapes in the county insured under this policy unless the

Special Provisions provide different price elections by varietal group,

in which case you may select one price election for each varietal group

designated in the Special Provisions. The price elections you choose

for each varietal group must have the same percentage relationship to

the maximum price offered by us for each varietal group. For example,

if you choose 100 percent of the maximum price election for one

varietal group, you must also choose 100 percent of the maximum price

election for all other varietal groups.

(d) * * *

(e) * * *

(f) In California, Idaho, Mississippi, Oregon, Texas, and

Washington, you may not increase your elected or assigned coverage

level or the ratio of your price election to the maximum price election

we offer after coverage begins if a cause of loss that could or will

reduce the yield of the insured crop is evident prior to the time that

you request a change in coverage.

* * * * *

4. In Sec. 457.138, section 9(a)(2) is redesignated as 9(a)(3) and

a new section 9(a)(2) is added to read as follows:

9. Insurance Period.

(a) * * *

(1) * * *

(2) In California, Idaho, Mississippi, Oregon, Texas, and

Washington, for each subsequent crop year that the policy remains

continuously in force, coverage begins on the day immediately following

the end of the insurance

[[Page 46708]]

period for the prior crop year. Policy cancellation that results solely

from transferring to a different insurance provider for a subsequent

crop year will not be considered a break in continuous coverage.

* * * * *

Signed in Washington, D.C., on July 16, 1998.

Kenneth D. Ackerman,

Manager, Federal Crop Insurance Corporation.

[FR Doc. 98-23522 Filed 9-1-98; 8:45 am]

BILLING CODE 3410-08-P