Popcorn Crop Insurance Regulations; and Common Crop Insurance Regulations, Popcorn Crop Insurance Provisions

Proposed Rules

Federal Register

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Proposed Rules

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DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Parts 447 and 457

Popcorn Crop Insurance Regulations; and Common Crop Insurance

Regulations, Popcorn Crop Insurance Provisions

AGENCY: Federal Crop Insurance Corporation, USDA.

ACTION: Proposed rule.

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SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes

specific crop provisions for the insurance of popcorn. 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 Popcorn

Crop Insurance Regulations with the Common Crop Insurance Policy for

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

current Popcorn Crop Insurance Regulations to the 1997 and prior crop

years.

DATES: Written comments on this proposed rule will be accepted until

close of business May 9, 1997 and will be considered when the rule is

to be made final.

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.

FOR FURTHER INFORMATION CONTACT: Linda Williams, Insurance Management

Specialist, Research and Development, Product Development Division,

Federal Crop Insurance Corporation, at the Kansas City, MO, address

listed above, telephone (816) 926-7730.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

ce

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

Kansas City, MO 64131.

FOR FURTHER INFORMATION CONTACT: Linda Williams, Insurance Management

Specialist, Research and Development, Product Development Division,

Federal Crop Insurance Corporation, at the Kansas City, MO, address

listed above, telephone (816) 926-7730.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

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

to be exempt for the purposes of Executive Order 12866, and therefore,

this rule has not been reviewed by OMB.

Paperwork Reduction Act of 1995

The amendments set forth in this proposed rule contains information

collection that requires clearance by the Office of Management and

Budget (OMB) under the provisions of 44 U.S.C. chapter 35.

The title of this information collection is ``Catastrophic Risk

Protection Plan and Related Requirements including, Common Crop

Insurance Regulations; Popcorn Crop Insurance Provisions.'' The

information to be collected includes a crop insurance application and

an acreage report. Information collected from the application and

acreage report is electronically submitted to FCIC by the reinsured

companies. Potential respondents to this information collection are

producers of popcorn that are eligible for Federal crop insurance.

The information requested is necessary for the reinsured companies

and FCIC to provide insurance and reinsurance, determine eligibility,

determine the correct parties to the agreement or contract, determine

and collect premiums or other monetary amounts, and pay benefits.

All information is reported annually. The reporting burden for this

collection of information is estimated to average 16.9 minutes per

response for each of the 3.6 responses from approximately 1,755,015

respondents. The total annual burden on the public for this information

collection is 2,669,970 hours

or contract, determine

and collect premiums or other monetary amounts, and pay benefits.

All information is reported annually. The reporting burden for this

collection of information is estimated to average 16.9 minutes per

response for each of the 3.6 responses from approximately 1,755,015

respondents. The total annual burden on the public for this information

collection is 2,669,970 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 shall have 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.

OMB is required to make a decision concerning the collections of

information contained in these proposed regulations 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 proposed regulation.

Unfunded Mandates Reform Act of 1995

ired to make a decision concerning the collections of

information contained in these proposed regulations 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 proposed regulation.

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) 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.

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 impact on a substantial

number of small entities. New provisions included in this rule will not

impact small entities to a greater extent than larger 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

t on a substantial

number of small entities. New provisions included in this rule will not

impact small entities to a greater extent than larger 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. The insured also must annually certify to the

previous years production if adequate records are available to support

the certification. The producer must maintain the production records to

support the certified information for at least three years. This

regulation 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

No. 12372, which require intergovernmental consultation with state and

local officials. See the Notice related to 7 CFR 3015, subpart V,

published at 48 FR 29115, June 24, 1983.

Executive Order 12988

The provisions of this rule will not have 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

Order 12988

The provisions of this rule will not have 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

FCIC proposes to add to the Common Crop Insurance Regulations (7

CFR part 457), a new section, 7 CFR 457.126, Popcorn 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 popcorn found at 7 CFR part 447

(Popcorn Crop Insurance Regulations). FCIC also proposes to amend 7 CFR

part 447 to limit its effect to the 1997 and prior crop years. FCIC

will later publish a regulation to remove and reserve 7 CFR part 447.

This rule makes minor editorial and format changes to improve the

Popcorn Crop Insurance Regulations' compatibility with the Common Crop

Insurance Policy. In addition, FCIC is proposing substantive changes in

the provisions for insuring popcorn as follows:

1

rt 447 to limit its effect to the 1997 and prior crop years. FCIC

will later publish a regulation to remove and reserve 7 CFR part 447.

This rule makes minor editorial and format changes to improve the

Popcorn Crop Insurance Regulations' compatibility with the Common Crop

Insurance Policy. In addition, FCIC is proposing substantive changes in

the provisions for insuring popcorn as follows:

1. Section 1--Add definitions for the terms ``base contract

price,'' ``days,'' ``FSA,'' ``final planting date,'' ``good farming

practices,'' ``interplanted,'' ``irrigated practice,'' ``merchantable

popcorn,'' ``planted acreage,'' ``pound,'' ``practical to replant,''

``processor,'' ``processor contract,'' ``production guarantee,''

``timely planted'' and ``written agreement'' for clarification.

2. Section 3--Clarify that an insured may select only one price

election for all the popcorn in the county insured under the policy,

unless the Special Provisions provide different price elections by

type, in which case the insured may select one price election for each

popcorn type designated in the Special Provisions.

3. Section 4--Change the contract change date to November 30 for

all counties that currently have April 15 cancellation and termination

dates. This change is made to maintain an adequate time period between

this date and the cancellation dates revised to correspond to the

changes in the sales closing date to comply with the Federal Crop

Insurance Reform Act of 1994, for producers to make informed risk

management decisions.

4. Section 5--Change the cancellation and termination dates from

April 15 to January 15 for certain Texas counties. The cancellation and

termination dates for all other Texas counties and all other states are

changed from April 15 to March 15. These changes are made to

standardize the cancellation and termination dates with the sales

closing dates.

5

ake informed risk

management decisions.

4. Section 5--Change the cancellation and termination dates from

April 15 to January 15 for certain Texas counties. The cancellation and

termination dates for all other Texas counties and all other states are

changed from April 15 to March 15. These changes are made to

standardize the cancellation and termination dates with the sales

closing dates.

5. Section 6--Require the insured to provide a copy of the

processor contract to the insurance provider on or before on the

acreage reporting date to establish liability and insurability before a

loss is likely to occur.

6. Section 7(a)(4)--Permit consideration for requests for a written

agreement to insure popcorn that is interplanted with another crop or

planted into an established grass or legume.

7. Section 7(c)--Specify the requirements under which a popcorn

producer who is also a processor may establish an insurable interest in

the insured crop.

8. Section 8--Clarify that any acreage damaged prior to the final

planting date to the extent that the majority of growers in the area

would normally not further care for the crop must be replanted unless

the insurance provider agrees that it is not practical to replant.

9. Section 9(a)--Add provisions for the insurance period to end

when the popcorn should have been harvested or when enough popcorn is

delivered to fulfill the producer's processor contract. This

requirement is consistent with other crops produced under a processor

contract.

10. Section 12--Require that representative samples of the

unharvested crop must be 10 feet wide and extend the entire length of

each field in the unit and cannot be harvested or destroyed until the

earlier of our inspection or 15 days after harvest is completed.

11. Section 13(c)(1)(iv)--Require the insured to leave intact, and

provide sufficient care for, representative samples when the insured

does not agree with the appraisal on that acreage

the

unharvested crop must be 10 feet wide and extend the entire length of

each field in the unit and cannot be harvested or destroyed until the

earlier of our inspection or 15 days after harvest is completed.

11. Section 13(c)(1)(iv)--Require the insured to leave intact, and

provide sufficient care for, representative samples when the insured

does not agree with the appraisal on that acreage. Production to count

for such acreage will be determined using the harvested production if

the crop is harvested, or our reappraisal if the crop is not harvested.

12. Section 14--Add provisions for providing insurance coverage by

written agreement. FCIC has a long standing policy of permitting

certain modifications of the insurance contract by written agreement

for some policies. This amendment provides for individual written

agreements consistent with FCIC's usual policy.

List of Subjects in 7 CFR Parts 447 and 457

Crop insurance, Popcorn, Popcorn crop insurance regulations.

Proposed Rule

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

Crop Insurance Corporation hereby proposes to amend 7 CFR parts 447 and

457, as follows:

PART 447--POPCORN CROP INSURANCE REGULATIONS

1. The authority citation for 7 CFR part 447 is revised to read as

follows:

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

2. The subpart heading preceding Section 447.1 is revised to read

as follows:

Subpart--Regulations for the 1987 Through the 1997 Crop Years

3. Section 447.7 is amended by revising the introductory text of

paragraph (d) to read as follows:

Sec. 447.7 The application and policy.

* * * * *

ity citation for 7 CFR part 447 is revised to read as

follows:

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

2. The subpart heading preceding Section 447.1 is revised to read

as follows:

Subpart--Regulations for the 1987 Through the 1997 Crop Years

3. Section 447.7 is amended by revising the introductory text of

paragraph (d) to read as follows:

Sec. 447.7 The application and policy.

* * * * *

(d) The application for the 1987 and succeeding crop years is found

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

400.37, 400.38). The provisions of the Popcorn Insurance Policy for the

1987 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 457.126 is added to read as follows:

Sec. 457.126 Popcorn crop insurance provisions.

The Popcorn Crop Insurance Provisions for the 1998 and succeeding

crop years are as follows:

FCIC policies:

DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

Reinsured policies:

(Appropriate title for insurance provider)

Both FCIC and reinsured policies:

Popcorn Crop Insurance Provisions

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

these crop provisions, and the Special Provisions; the Special

Provisions will control these crop provisions and the Basic

Provisions; and these crop provisions will control the Basic

Provisions.

1. Definitions.

Base contract price--The price stipulated on the contract

executed between you and the processor before any adjustments for

quality.

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

executed between you and the processor before any adjustments for

quality.

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 required by the popcorn processor contract

and recognized by the Cooperative State Research, Education and

Extension Service as compatible with agronomic and weather

conditions in the county.

Harvest--Removing the grain or ear from the stalk either by hand

or by machine.

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.

Merchantable popcorn--Popcorn that meets the provisions of the

processor contract.

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. Popcorn must initially be

placed in rows far enough apart to permit mechanical cultivation.

Acreage planted in any other manner will not be insurable unless

otherwise provided by the Special Provisions or by written

agreement.

Pound--Sixteen (16) ounces avoirdupois

g method, at the correct

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

planting method and production practice. Popcorn must initially be

placed in rows far enough apart to permit mechanical cultivation.

Acreage planted in any other manner will not be insurable unless

otherwise provided by the Special Provisions or by written

agreement.

Pound--Sixteen (16) 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, marketing

windows, condition of the field, and time to crop maturity, 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 unless production from

the replanted acreage can be delivered under the terms of the

processor contract.

Processor--Any business enterprise regularly engaged in

processing popcorn for human consumption, that possesses all

licenses, permits or approved inspections for processing popcorn

required by the state in which it operates, and that possesses

facilities, or has contractual access to such facilities, with

enough equipment to accept and process contracted popcorn within a

reasonable amount of time after harvest.

Processor contract--A written agreement between the producer and

a processor, containing at a minimum:

(a) The producer's commitment to plant and grow popcorn, and to

deliver the popcorn production to the processor;

(b) The processor's commitment to purchase all the production

stated in the contract;

(c) A date, if specified on the processor's contract, by which

the crop must be harvested to be accepted; and

--A written agreement between the producer and

a processor, containing at a minimum:

(a) The producer's commitment to plant and grow popcorn, and to

deliver the popcorn production to the processor;

(b) The processor's commitment to purchase all the production

stated in the contract;

(c) A date, if specified on the processor's contract, by which

the crop must be harvested to be accepted; and

(d) A base contract price.

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 popcorn seed and then replacing the popcorn seed in the

insured acreage with the expectation of growing a successful crop.

Timely planted--Planted on or before the final planting date

designated in the Special Provisions for the insured crop in the

county.

Written agreement--A written document that alters designated

terms of a policy in accordance with section 15.

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),

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

optional unit you meet all the conditions of this section or if a

written agreement to such division exists.

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

basis including, but not limited to, production practice, type,

variety, and planting period, other than as described in this

section.

(c) Optional units will be available only if the processor

contract stipulates the number of acres that are under contract and

not a specific amount of production.

reement to such division exists.

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

basis including, but not limited to, production practice, type,

variety, and planting period, other than as described in this

section.

(c) Optional units will be available only if the processor

contract stipulates the number of acres that are under contract and

not a specific amount of production.

(d) If you do not comply fully with these provisions, we will

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 premium

paid for the purpose of electing optional units will be refunded to

you for the units combined.

(e) All optional units must be identified on the acreage report

for each crop year.

(f) 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:

ch 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:

(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: In addition to, or instead of, establishing

optional units by section, section equivalent, or FSA Farm Serial

Number, optional units may be based on irrigated acreage and non-

irrigated acreage 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

y section, section equivalent, or FSA Farm Serial

Number, optional units may be based on irrigated acreage and non-

irrigated acreage 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 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 popcorn 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

popcorn 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

e price

election for all the popcorn 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

popcorn 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 (100%) of the maximum price

election for one type, you must also choose 100 percent (100%) 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 November 30

preceding the cancellation date.

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

State and county termination dates

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Val Verde, Edwards, Kerr, Kendall, Bexar, Jan. 15.

Wilson, Karnes, Goliad, Victoria, and

Jackson Counties Texas, and all Texas

counties lying south thereof.

All other Texas counties and all other Mar. 15.

states.

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

6. Report of Acreage.

In addition to the provisions of section 6 (Report of Acreage)

of the Basic Provisions (Sec. 457.8), you must provide a copy of the

processor contract to us on or before the acreage reporting date.

7. Insured Crop.

(1) The processor must meet the requirements as defined in these

crop provisions and have an insurable interest in the popcorn crop;

(2) The Board of Directors or officers of the processor must

have instituted a resolution that sets forth essentially the same

terms as a processor contract. Such resolution will be considered a

contract under the terms of the popcorn crop insurance policy; and

(3) Our inspection of the processing facilities determines that

they satisfy the definition of a processor contained in these crop

provisions.

8. Insurable Acreage.

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

of the Basic Provisions (Sec. 457.8), any acreage of the insured

crop damaged before the final planting date, to the extent that the

majority of growers in the area would normally not further care for

the crop, must be replanted unless we agree that it is not practical

to replant.

9. Insurance Period.

In lieu of the provisions contained in section 11 (Insurance

Period) of the Basic Provisions (Sec. 457.8), regarding the end of

the insurance period, insurance ceases on each unit or part of a

unit at the earliest of:

(a) The date the popcorn:

(1) Was destroyed;

(2) Should have been harvested;

(3) Was abandoned; or

(4) Was harvested;

(b) The date you have harvested sufficient production to fulfill

your processor contract;

(c) Final adjustment of a loss; or

(d) December 10 immediately following planting.

10. Causes of Loss.

ce period, insurance ceases on each unit or part of a

unit at the earliest of:

(a) The date the popcorn:

(1) Was destroyed;

(2) Should have been harvested;

(3) Was abandoned; or

(4) Was harvested;

(b) The date you have harvested sufficient production to fulfill

your processor contract;

(c) Final adjustment of a loss; or

(d) December 10 immediately following planting.

10. Causes of Loss.

(a) 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:

(1) Adverse weather conditions;

(2) Fire;

(3) Insects, but not damage due to insufficient or improper

application of pest control measures;

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

improper application of disease control measures;

(5) Wildlife;

(6) Earthquake;

(7) Volcanic eruption; or

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

insured cause of loss that occurs during the insurance period.

(b) In addition to the causes of loss excluded in section 12

(Causes of Loss) of the Basic Provisions (Sec. 457.8), we do not

insure against any loss of production due to:

(1) Damage resulting from frost or freeze after the date

designated by the Special Provisions;

(2) Failure to follow the requirements contained in the

processor contract; or

(3) Damage that occurs to unharvested production after you

deliver the production required by the processor contract.

11. 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 (90%) of

the production guarantee for the acreage and it is practical to

replant.

quired by the processor contract.

11. 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 (90%) 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 (20%) of the production guarantee or 150

pounds, multiplied by your price election, multiplied by your

insured share.

(c) When popcorn is replanted using a practice that is

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

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

amount will not be reduced.

12. 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 destroyed until the earlier of our

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

completed.

13. Settlement of Claim.

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

you are unable to provide acceptable production records:

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

for which such production records were not provided; or

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

production to such units in proportion to our liability on the

harvested acreage for each unit.

aim.

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

you are unable to provide acceptable production records:

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

for which such production records were not provided; or

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

production to such units in proportion to our liability on the

harvested acreage for each 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, by type if applicable;

(2) Multiplying each result of section 13(b)(1) by the

respective price election, by type if applicable;

(3) Totaling the results of section 13(b)(2);

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

if applicable, (see subsection 13(c)) by the respective price

election;

(5) Totaling the results of section 13(b)(4);

(6) Subtracting the result of section 13(b)(5) from the result

in section 13(b)(3); and

(7) Multiplying the result of section 13(b)(6) by your share.

(c) The total production to count (in pounds) from all insurable

acreage on the unit will include:

(1) All appraised production as follows:

(i) Not less than the production guarantee for acreage:

(A) That is abandoned;

(B) Put to another use without our consent;

(C) Damaged solely by uninsured causes; or

(D) For which you fail to provide 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 13(d));

ion guarantee for acreage:

(A) That is abandoned;

(B) Put to another use without our consent;

(C) Damaged solely by uninsured causes; or

(D) For which you fail to provide 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 13(d));

(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.

(3) Any production from yellow or white dent corn will be

counted as popcorn on a weight basis and any production harvested

from plants growing in the insured crop may be counted as popcorn

production on a weight basis.

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.

(3) Any production from yellow or white dent corn will be

counted as popcorn on a weight basis and any production harvested

from plants growing in the insured crop may be counted as popcorn

production on a weight basis.

(4) Any ear production for which we cannot determine a shelling

factor will be considered to have an 80 percent (80%) shelling

factor.

(d) Mature popcorn 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 for moisture in excess of 15 percent (15%). We may

obtain samples of the production to determine the moisture content.

(2) Popcorn production will be eligible for quality adjustment

if, due to an insurable cause of loss that occurs within the

insurance period, it is not merchantable popcorn and is rejected by

the processor. The production will be adjusted by:

(i) Dividing the value per pound of the damaged popcorn by the

base contract price per pound for undamaged popcorn; and

(ii) Multiplying the result by the number of pounds of such

popcorn.

14. Written Agreements.

Designated terms of this policy 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

14(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;

(c) If approved, the written agreement will include all variable

terms of the contract, including, but not limited to, crop type or

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

provided in section

14(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;

(c) If approved, the written agreement will include all 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 April 2, 1997.

Kenneth D. Ackerman,

Manager, Federal Crop Insurance Corporation.

[FR Doc. 97-9008 Filed 4-8-97; 8:45 am]

BILLING CODE 3410-FA-P