[Federal Register Volume 76, Number 159 (Wednesday, August 17, 2011)]
[Proposed Rules]
[Pages 50929-50931]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-20850]
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Proposed Rules
Federal Register
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This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 76, No. 159 / Wednesday, August 17, 2011 /
Proposed Rules
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DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
7 CFR Part 402
[Docket No. FCIC-11-0003]
RIN 0563-AC31
Catastrophic Risk Protection Endorsement
AGENCY: Federal Crop Insurance Corporation, USDA.
ACTION: Proposed rule.
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SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes to
amend the Catastrophic Risk Protection Endorsement. The intended effect
of this action is to clarify existing policy provisions and to
incorporate changes that are consistent with those made in the Common
Crop Insurance Policy Basic Provisions and to incorporate provisions
regarding catastrophic risk protection coverage for area yield plans
from the Group Risk Plan (GRP) of Insurance Basic Provisions. The
proposed changes will be effective for the 2013 and succeeding crop
years.
DATES: Written comments and opinions on this proposed rule will be
accepted until close of business October 17, 2011 and will be
considered when the rule is to be made final.
ADDRESSES: FCIC prefers that comments be submitted electronically
through the Federal eRulemaking Portal. You may submit comments,
identified by Docket ID No. FCIC-11-0003, by any of the following
methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Mail: Director, Product Administration and Standards
Division, Risk Management Agency, United States Department of
Agriculture, P.O. Box 419205, Kansas City, MO 64133-6205.
All comments received, including those received by mail, will be posted
without change to http://www.regulations.gov, including any personal
information provided, and can be accessed by the public. All comments
must include the agency name and docket number or Regulatory
Information Number (RIN) for this rule. For detailed instructions on
submitting comments and additional information, see http://www.regulations.gov. If you are submitting comments electronically
through the Federal eRulemaking Portal and want to attach a document,
we ask that it be in a text-based format. If you want to attach a
document that is a scanned Adobe PDF file, it must be scanned as text
and not as an image, thus allowing FCIC to search and copy certain
portions of your submissions. For questions regarding attaching a
document that is a scanned Adobe PDF file, please contact the RMA Web
Content Team at (816) 823-4694 or by e-mail at
rmaweb.content@rma.usda.gov.
Privacy Act: Anyone is able to search the electronic form of all
comments received for any dockets by the name of the individual
submitting the comment (or signing the comment, if submitted on behalf
of an association, business, labor union, etc.). You may review the
complete User Notice and Privacy Notice for Regulations.gov at http://www.regulations.gov/#!privacyNotice.
FOR FURTHER INFORMATION CONTACT: Director, Product Administration and
Standards Division, Risk Management Agency, United States Department of
Agriculture, Beacon Facility, Stop 0812, Room 421, P.O. Box 419205,
Kansas City, MO 64141-6205, telephone (816) 926-7730.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This rule has been determined to be non significant for the
purposes of Executive Order 12866 and, therefore, it has not been
reviewed by the OMB.
Paperwork Reduction Act of 1995
Pursuant to the provisions of the Paperwork Reduction Act of 1995
(44 U.S.C. chapter 35), the collections of information in this rule
have been approved by the Office of Management and Budget (OMB) under
control number 0563-0053.
E-Government Act Compliance
FCIC is committed to complying with the E-Government Act of 2002,
to promote the use of the Internet and other information technologies
to provide increased opportunities for citizen access to Government
information and services, and for other purposes.
Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA)
establishes requirements for Federal agencies to assess the effects of
their regulatory actions on State, local, and tribal governments and
the private sector. This rule contains no Federal mandates (under the
regulatory provisions of title II of the UMRA) for State, local, and
tribal governments or the private sector. Therefore, this rule is not
subject to the requirements of sections 202 and 205 of UMRA.
Executive Order 13132
It has been determined under section 1(a) of Executive Order 13132,
Federalism, that this rule does not have sufficient implications to
warrant consultation with the States. The provisions contained in this
rule will not have a substantial direct effect on States, or on the
relationship between the national government and the States, or on the
distribution of power and responsibilities among the various levels of
government.
Executive Order 13175
This rule has been reviewed in accordance with the requirements of
Executive Order 13175, Consultation and Coordination with Indian Tribal
Governments. The review reveals that this regulation will not have
substantial and direct effects on Tribal governments and will not have
significant Tribal implications.
Regulatory Flexibility Act
FCIC certifies that this regulation will not have a significant
economic impact on a substantial number of small entities. Program
requirements for the Federal crop insurance program are the same for
all producers regardless of the size of their farming operation. For
instance, all producers are required to submit an application and
acreage report to establish their insurance guarantees and all
producers are required to submit a notice of loss and production
information to determine the amount of an indemnity payment in the
event of an insured cause of crop loss.
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Whether a producer has 10 acres or 1000 acres, there is no difference
in the kind of information collected. To ensure crop insurance is
available to small entities, the Federal Crop Insurance Act authorizes
FCIC to waive collection of administrative fees from limited resource
farmers. FCIC believes this waiver helps to ensure that small entities
are given the same opportunities as large entities to manage their
risks through the use of crop insurance. A Regulatory Flexibility
Analysis has not been prepared since this regulation does not have an
impact on small entities, and, therefore, this regulation is exempt
from the provisions of the Regulatory Flexibility Act (5 U.S.C. 605).
Federal Assistance Program
This program is listed in the Catalog of Federal Domestic
Assistance under No. 10.450.
Executive Order 12372
This program is not subject to the provisions of Executive Order
12372, which require intergovernmental consultation with State and
local officials. See the Notice related to 7 CFR part 3015, subpart V,
published at 48 FR 29115, June 24, 1983.
Executive Order 12988
This proposed rule has been reviewed in accordance with Executive
Order 12988 on civil justice reform. The provisions of this rule will
not have a retroactive effect. The provisions of this rule will preempt
State and local laws to the extent such State and local laws are
inconsistent herewith. With respect to any direct action taken by FCIC
or to require the insurance provider to take specific action under the
terms of the crop insurance policy, the administrative appeal
provisions published at 7 CFR part 11 must be exhausted before any
action against FCIC for judicial review may be brought.
Environmental Evaluation
This action is not expected to have a significant economic impact
on the quality of the human environment, health, or safety. Therefore,
neither an Environmental Assessment nor an Environmental Impact
Statement is needed.
Background
FCIC proposes to amend the Catastrophic Risk Protection Endorsement
(7 CFR part 402), to be effective for the 2013 and succeeding crop
years. The proposed changes are as follows:
1. FCIC proposes to revise the paragraph immediately preceding
section 1 which refers to the order of priority in the event of a
conflict to include the actuarial documents and the Commodity Exchange
Price Provisions, if applicable, in the order of priority.
2. Section 1--FCIC proposes to remove the definitions of ``approved
yield,'' ``county,'' ``FSA,'' ``household,'' ``limited resource
farmer,'' and ``USDA'' because these terms are already defined in the
applicable Basic Provisions.
FCIC also proposes to remove the definition of ``expected market
price'' because the term is no longer applicable to any plan of
insurance for which catastrophic risk protection coverage is available
(e.g., the Yield Protection plan of insurance uses a projected price).
FCIC proposes to remove the definition of ``Secretary'' because the
term is not used in the Endorsement.
3. Section 2--FCIC proposes to revise section 2(a)(1) to clarify
catastrophic risk protection coverage is not available under individual
revenue plans of insurance such as Revenue Protection and Revenue
Protection with Harvest Price Exclusion plans of insurance.
FCIC proposes to revise section 2(a)(2) to allow the Group Risk
Plan of Insurance Basic Provisions, or its successor provisions, to
elect the Catastrophic Risk Protection Endorsement. FCIC also proposes
to clarify that catastrophic risk protection coverage is not available
under area revenue plans of insurance such as Group Risk Income
Protection--Harvest Price Option or Group Risk Income Protection plans
of insurance or successor plans of insurance.
4. Section 3--FCIC proposes to revise section 3(a) to clarify this
section is not applicable if the policyholder elected catastrophic risk
protection coverage under the Group Risk Plan of Insurance Basic
Provisions (7 CFR 407.9) and Crop Provisions, or its successor
provisions. The Group Risk Plan of Insurance Basic Provisions and Crop
Provisions do not have unit provisions. Therefore, the unit division
provisions in section 3 cannot be used in lieu of the unit provisions
of the Group Risk Plan of Insurance Basic Provisions.
5. Section 4--FCIC proposes to revise section 4(a) to allow the
actuarial documents to revise the amount of protection offered under
catastrophic risk protection coverage in the event this amount is
changed in the future by Congress.
FCIC proposes to revise section 4(a) to replace the reference to
``expected market price'' with ``price election or projected price, as
applicable.''
FCIC also proposes to revise section 4(a) to include information
regarding the amount of protection a policyholder would receive if they
elected catastrophic risk protection coverage under the Group Risk Plan
of Insurance Basic Provisions or successor provisions. Currently,
section 4(a) simply contains the catastrophic risk protection amount of
coverage for policyholders insured under the Common Crop Insurance
Policy. The information regarding the amount of catastrophic risk
protection coverage for area yield plans is contained in the Group Risk
Plan of Insurance Basic Provisions because section 4(a) of the
Endorsement allows FCIC to determine a comparable amount of coverage.
This change will place all the provisions regarding the catastrophic
risk protection amount of coverage in one place.
FCIC proposes to revise section 4(b) to replace the reference to
``expected market price'' with ``price election.''
FCIC proposes to revise section 4(c) to replace the reference to
``Actuarial Table or the Special Provisions'' with ``actuarial
documents.'' With the implementation of the new information technology
system, FCIC will no longer have actuarial tables; all the information
previously contained in the actuarial tables will now be contained in
the actuarial documents filed electronically on RMA's Web site.
FCIC proposes to remove section 4(d) because information regarding
the percentage of loss in applicable yield a policyholder must have
suffered to be eligible for an indemnity is contained in section 4(a)
which contains the coverage level. The amount determined by subtracting
the coverage level from 100 percent is the amount of loss a
policyholder must suffer before an indemnity is paid under catastrophic
risk protection coverage.
6. Section 6--FCIC proposes to revise sections 6(b) and 6(b)(1) to
replace the reference to ``Special Provisions'' with ``actuarial
documents.''
Section 7--FCIC proposes to remove section 7(b) because undivided
interest will no longer be available as a result of the USDA Acreage
Crop Reporting Streamlining Initiative to establish common USDA data
standards to support producer commodity reporting in support of USDA
programs. FCIC also proposes to remove those provisions that suggest
that approved insurance providers have the option to not offer
catastrophic risk protection coverage. All approved insurance providers
must offer catastrophic risk protection coverage for the policies they
sell.
7. Section 9--FCIC proposes to revise section 9 to clarify the
price references to include projected prices, dollar amounts of
insurance, or dollar amounts
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of protection because the term ``price election'' is not applicable to
all plans of insurance.
List of Subjects in 7 CFR Part 402
Crop insurance, Reporting and recordkeeping requirements.
Accordingly, as set forth in the preamble, the Federal Crop
Insurance Corporation proposes to amend 7 CFR part 402 as follows:
PART 402--CATASTROPHIC RISK PROTECTION ENDORSEMENT
1. The authority citation for 7 CFR part 402 continues to read as
follows:
Authority: 7 U.S.C. 1506(l), 1506(o).
2. Amend Sec. 402.4 as follows:
a. Revise introductory text preceding section 1;
b. Remove the definitions in section 1 for ``approved yield,''
``county,'' ``expected market price,'' ``FSA,'' ``household,''
``limited resource farmer,'' ``Secretary,'' and ``USDA;''
c. Revise section 2(a) introductory text;
d. Revise section 3(a);
e. Revise section 4(a);
f. Amend section 4(b) by removing the phrase ``expected market
price'' and adding the phrase ``price election'' in its place;
g. Amend section 4(c) by removing the phrase ``Actuarial Table or
the Special Provisions'' and adding the phrase ``actuarial documents''
in its place;
h. Remove section 4(d);
i. Amend section 6(b) introductory text by removing the phrase
``Special Provisions'' and adding the phrase ``actuarial documents'' in
its place;
j. Amend section 6(b)(1) by removing the phrase ``Special
Provisions'' and adding the phrase ``actuarial documents'' in its
place;
k. Revise section 7; and
l. Amend section 9 by adding the phrase ``, projected prices,
dollar amounts of insurance, or dollar amounts of protection'' after
the phrase ``multiple price elections'' in the two instances that it
appears.
The revised text reads as follows:
Sec. 402.4 Catastrophic Risk Protection Endorsement Provisions.
* * * * *
If a conflict exists among the policy provisions; the order of
priority is: (1) This Endorsement; (2) the Special Provisions; (3) any
other Actuarial Documents except the Special Provisions; (4) the
Commodity Exchange Price Provisions, if applicable; and (5) any of the
policies specified in section 2, with (1) controlling (2), etc.
* * * * *
2. Eligibility, Life of Policy, Cancellation, and Termination.
(a) You must have one of the following policies in force to elect
this Endorsement:
(1) The Common Crop Insurance Policy Basic Provisions (7 CFR 457.8)
and applicable Crop Provisions (Catastrophic risk protection coverage
is not available under individual revenue plans of insurance such as
the Revenue Protection and Revenue Protection with Harvest Price
Exclusion plans of insurance);
(2) The Group Risk Plan of Insurance Basic Provisions (7 CFR 407.9)
and applicable Crop Provisions, or its successor provisions, if
available for catastrophic risk protection coverage (Catastrophic risk
protection coverage is not available under area revenue plans of
insurance such as Group Risk Income Protection--Harvest Price Option or
Group Risk Income Protection plans of insurance or successor plans of
insurance); or
(3) Other crop policy only if catastrophic risk protection coverage
is provided in the applicable crop policy.
* * * * *
3. Unit Division.
(a) This section is in lieu of the unit provisions specified in the
applicable crop policy and is not applicable if you are insured under
the Group Risk Plan of Insurance Basic Provisions (7 CFR 407.9) and
applicable Crop Provisions, or its successor provisions.
* * * * *
4. Insurance Guarantees, Coverage Levels, and Prices for
Determining Indemnities.
(a) Unless otherwise specified in the actuarial documents,
catastrophic risk protection coverage will offer protection equal to:
(1) Fifty percent (50%) of your approved yield indemnified at
fifty-five percent (55%) of the price election or projected price, as
applicable, if you are insured under the Common Crop Insurance Policy
Basic Provisions (7 CFR 457.8) and applicable Crop Provisions;
(2) Sixty-five percent (65%) of the expected county yield
indemnified at forty-five percent (45%) of the maximum protection per
acre if you are insured under the Group Risk Plan of Insurance Basic
Provisions (7 CFR 407.9) and applicable Crop Provisions, or its
successor provisions; or
(3) A comparable coverage as established by FCIC for other crop
policies only if catastrophic risk protection coverage is provided in
the applicable crop policy.
* * * * *
7. Insured Crop.
(a) The crop insured is specified in the applicable crop policy,
however notwithstanding any other policy provision requiring the same
insurance coverage on all insurable acreage of the crop in the county,
if you purchase additional coverage for a crop, you may separately
insure acreage under catastrophic risk protection coverage that has
been designated as ``high-risk'' land by FCIC, provided that you
execute a High-Risk Land Exclusion Option and obtain a catastrophic
risk protection coverage policy with the same approved insurance
provider on or before the applicable sales closing date.
(b) You will be required to pay a separate administrative fee for
both the additional coverage policy and the catastrophic risk
protection coverage policy.
* * * * *
Signed in Washington, DC, on August 10, 2011.
William J. Murphy,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 2011-20850 Filed 8-16-11; 8:45 am]
BILLING CODE 3410-08-P