[Federal Register Volume 76, Number 222 (Thursday, November 17, 2011)]
[Proposed Rules]
[Pages 71271-71276]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-29218]


========================================================================
Proposed Rules
                                                Federal Register
________________________________________________________________________

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. 222 / Thursday, November 17, 2011 / 
Proposed Rules

[[Page 71271]]



DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 457

[Docket No. FCIC-11-0006]
RIN 0563-AC32


Common Crop Insurance Regulations; Fresh Market Tomato (Dollar 
Plan) Crop Provisions

AGENCY: Federal Crop Insurance Corporation, USDA.

ACTION: Proposed rule.

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

SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes to 
amend the Common Crop Insurance Regulations, Fresh Market Tomato 
(Dollar Plan) Crop Provisions. The intended effect of this action is to 
provide policy changes, to clarify existing policy provisions to better 
meet the needs of insured producers, and to reduce vulnerability to 
program fraud, waste, and abuse. 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 December 19, 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-11-0006, 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 email 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 Office of Management and Budget (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 OMB under control number 0563-0053.

E-Government Act Compliance

    FCIC is committed to complying with the E-Government Act, 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), 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. 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 compute 
premium amounts, 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. Whether a 
producer has 10 acres or 1000 acres, there is no difference in the

[[Page 71272]]

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 requires 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 Common Crop Insurance Regulations (7 CFR 
part 457) by revising Sec.  457.139 Fresh Market Tomato (Dollar Plan) 
Crop Provisions, to be effective for the 2013 and succeeding crop 
years. Several requests have been made for changes to improve the 
coverage offered, address program integrity issues, simplify program 
administration, and improve clarity of the policy provisions.
    The proposed changes are as follows:
    1. FCIC proposes to remove the paragraph immediately preceding 
section 1 which refers to the order of priority in the event of a 
conflict. This same information is contained in the Common Crop 
Insurance Policy Basic Provisions (Basic Provisions). Therefore, it is 
duplicative and no longer necessary in the Crop Provisions. Also FCIC 
proposes to remove all references to section titles of the Basic 
Provisions. This information is currently contained in parenthesis 
following references to section numbers of the Basic Provisions 
throughout the Crop Provisions. The section numbers should provide 
sufficient guidance to locate the applicable provision.
    2. Section 1--FCIC proposes to add a new definition of ``allowable 
cost'' to specify the dollar amount per carton for harvesting, packing 
and handling costs (as shown in the Special Provisions) for the purpose 
of computing the total value of production to be counted. The allowable 
cost per carton contained in the Special Provisions will be subtracted 
from the price received for each carton of sold harvested production to 
obtain the value of production to count.
    FCIC proposes to add a new definition of ``amount of insurance per 
acre'' because the term is currently used in the Crop Provisions but 
was not previously defined. The definition specifies the dollar amount 
of coverage per acre is obtained by multiplying the reference maximum 
dollar amount shown in the actuarial documents by the coverage level 
percentage you elect. In the settlement of claim section, the amount of 
insurance per acre minus the total dollar value of production to count 
per acre determines if an indemnity is payable to the insured.
    FCIC proposes to add a new definition of ``fresh market tomatoes'' 
because the term is currently used in the Crop Provisions but was not 
previously defined. The definition specifies they are field grown 
mature green or ripe fresh market tomatoes that meet the Agricultural 
Marketing Service United States Standards for Grades of Fresh Tomatoes; 
and the applicable Florida Federal Marketing Order and Florida Tomato 
Committee Regulations, or their successors. The above Florida Federal 
Marketing Order and Florida Tomato Committee rules and regulations that 
currently apply to these field grown fresh market tomato types and 
varieties do not include ``greenhouse'', ``hydroponic, ``heirloom'' and 
other varieties of tomatoes that are not field grown and do not comply 
with these rules and regulations.
    FCIC proposes to add a new definition of ``minimum value'' because 
the minimum value amount shown in the Special Provisions and used in 
the Settlement of Claim provisions was not previously defined. Minimum 
value is used to value appraised and unsold harvested production to 
count. In calculating the total value of all sold harvested production 
to count, the price received for each carton of fresh market tomatoes 
minus the allowable costs per carton cannot be less than the minimum 
value, unless the Minimum Value Option is elected.
    FCIC proposes to add a new definition of ``penhookers'' because 
these are individuals who purchase the right to salvage fresh market 
tomatoes remaining in the field after the insureds complete their 
harvests on the unit. Any salvage value paid to the insured will be 
added to the final dollar value of the production to count.
    FCIC proposes to add a new definition of ``price received'' to 
clarify that it is the gross dollar amount per carton received by the 
producer before deductions for allowable costs.
    FCIC proposes to add a new definition of ``registered handler'' to 
identify those individuals who are specifically certified by the 
Florida Tomato Committee or successor entity to inspect and enforce all 
the handling regulations for shipment of fresh market tomatoes.
    FCIC proposes to revise and clarify the definition of ``acre'' by 
removing the phrase ``43,560 square feet of land'' and replacing it 
with the phrase ``43,560 square feet of planted acreage.'' This change 
helps clarify that substantial square footage being used for other 
purposes such as roadways or irrigation canals should not be included 
in the calculation of planted acreage.
    FCIC proposes to revise the definition of ``direct marketing'' to 
include ``registered handler'' in the list of examples of an 
intermediary.
    FCIC proposes to revise the definition of ``harvest'' by replacing 
the phrase ``on the unit'' with the phrase ``from the plants'' and 
clarifying that any fresh market tomatoes salvaged by penhookers is not 
considered a harvest since the grower does not incur any picking or 
harvesting costs. However, any salvage value paid to the producer by 
the penhooker will be included in the total dollar value of production 
to count.
    FCIC proposes to revise and clarify the definition of ``plant 
stand'' by replacing the word ``insurable'' with the word ``insured''.

[[Page 71273]]

    FCIC proposes to revise and clarify the definition of ``potential 
production'' by removing paragraphs (a) and (b) in the current policy 
definition. The current crop provisions use the terminology 
``classification size'' and ``6 x 7 (2-8/32 inch minimum diameter) or 
larger'' which excludes all other size classifications under the 
Agricultural Marketing Service United States Standards for Grades of 
Fresh Tomatoes, the Florida Federal Marketing Order, and the Florida 
Tomato Committee Regulations. FCIC also proposes to replace the phrase 
``mature green or ripe tomatoes'' with the phrase ``field grown mature 
green or ripe fresh market tomatoes'' to clarify this is the primary 
growing practice recognized and governed by the Florida Tomato 
Committee Regulations, or successor entity. FCIC proposes to revise 
section 8 to limit insurability to field grown tomatoes.
    FCIC proposes to remove the definition of ``planted acreage'' 
because this definition is contained in the Basic Provisions. 
Therefore, this definition is duplicative and no longer necessary in 
the Crop Provisions.
    FCIC proposes to remove the definition of ``practical to replant'' 
because this definition is contained in the Basic Provisions. 
Therefore, this definition is duplicative and no longer necessary in 
the Crop Provisions.
    3. Section 3--FCIC proposes to revise the table under section 
(3)(d) by removing the column ``Length of time if Direct Seeded'' 
because the use of transplanted tomatoes is now the primary planting 
method being used in the Florida Tomato Committee regulated area. FCIC 
historical data indicates only one ``direct seeded'' policy was insured 
in the regulated area in the last decade. However, a new provision is 
being proposed in section 8(c)(4) for direct seeded tomatoes to be 
insured by written agreement only. FCIC proposes to remove all other 
references to direct seeded from the policy.
    FCIC proposes to revise section 3(e) to clarify any acreage of 
fresh market tomatoes damaged in the first, second, or third stage to 
the extent that the majority of producers in the area would not 
normally further care for the crop, the indemnity payable for such 
acreage will be based on the stage guarantee the plants achieved when 
the insured cause of loss occurred, even if the producer continues to 
care for the damaged tomatoes. This is consistent with the provisions 
of other similar crops policies. If the producer continues to care for 
the damaged tomato acreage, any appraised or harvested production will 
be included in the dollar value of production to count.
    4. Section 8--FCIC proposes to revise the introductory paragraph to 
clarify only field grown mature green or ripe fresh market tomato types 
and varieties will be insurable as specified in the Special Provisions 
for which a premium rate is provided in the actuarial documents, and 
allowed by the Florida Tomato Committee.
    Also, FCIC proposes to remove the current language in section 
8(c)(4) because cherry, grape and plum field grown fresh market 
tomatoes will now be insurable if allowed by Special Provisions and 
premium rates are listed in the actuarial documents.
    FCIC also proposes adding new language in section 8(c)(4) allowing 
direct seeded field grown fresh market tomatoes to be insured by 
written agreement.
    5. Section 9--FCIC proposes to revise section 9(b)(1)(iii) by 
removing the direct seeded reference ``or 60 days of direct seeding'' 
because such tomatoes are only insurable by written agreement, which 
will contain the terms and conditions of insurance.
    FCIC also proposes to add ``strawberries'' in section 9(b)(3) to 
the list of crops that require soil fumigation before planting fresh 
market tomatoes. Strawberries are susceptible to nematode damage and 
pose the same risk of nematodes to new fresh market tomato planted 
acreage as these other crops.
    6. Section 10--FCIC proposes to clarify section 10(e) by stating 
``Final harvest on the unit'' since this policy allows additional basic 
units by planting period and some counties have multiple planting 
periods.
    FCIC also proposes to revise section 10(f) to remove the reference 
to direct seeding since the practice is proposed to be only insurable 
by written agreement.
    7. Section 11--FCIC proposes to revise and clarify section 11(b)(2) 
by revising the current language to clarify that insurance will not be 
provided against any loss of production due to the failure to harvest 
in a timely manner or failure to market the tomatoes, unless such 
failure is due to an insured cause of loss that occurs during the 
insurance period. For example, the policy does not cover the inability 
to market the insured crop due to quarantine, boycott, or refusal of 
any person to accept production.
    8. Section 14(b)(4)(ii)--FCIC proposes to remove the provisions 
pertaining to the 1998 and 1999 crop years because they are obsolete. 
This change allows the catastrophic risk percentage of coverage to be 
changed if necessary.
    FCIC proposes to add an example of a claim for indemnity after 
section 14(b)(5).
    FCIC proposes to revise the language in section 14(c)(2)(i) to 
explain appraised potential production will be determined for claim 
purposes on any fresh market tomato acreage that has not been harvested 
the required number of times as specified in the Special Provisions. 
FCIC also proposes removing the reference to ``ground-culture'' tomato 
planting since this planting practice is no longer used.
    FCIC proposes to revise section 14(c)(3) by adding a new section 
14(c)(4) to separate and clarify the settlement of claims procedures 
for sold harvested and unsold harvested production. Section 14(c)(3) 
describes the total value of all sold harvested production and the use 
of allowable costs in determining the total dollar value of production 
to count. The last sentence currently in section (14)(c)(3) is now the 
last sentence in section (14)(c)(4). Section 14(c)(4) as proposed will 
describe the total value of all unsold harvested production and using 
the minimum value shown in the Special Provisions in determining the 
total dollar value of production to count.
    FCIC proposes adding a new section 14(c)(5) to clarify any salvage 
value paid to the insured by penhookers will be added to the total 
dollar value of production to count.
    9. Section 16--FCIC proposes revising section 16(a)(1) and 16(b)(2) 
of the current policy Minimum Value Option by removing the Minimum 
Value Option II. Allowing the Minimum Value Option II price to go down 
to zero has resulted in unfavorable loss experience and program abuse. 
This change will improve the integrity of the Minimum Value Option 
benefit.
    FCIC also proposes revising section (16)(b)(1)(ii) by changing the 
phrase ``For marketable production that is not sold,'' to ``For unsold 
harvested production,''. The new wording is consistent with the wording 
in section (14)(c)(4).
    FCIC proposes to add an example of a claim for indemnity after 
paragraph 16(c).
    Other minor changes have been made to make the provisions more 
effective and consistent with other similar Crop Provisions.

List of Subjects in 7 CFR Part 457

    Crop insurance, Fresh market tomato (dollar plan), Reporting and 
recordkeeping requirements.

[[Page 71274]]

Proposed Rule

    Accordingly, as set forth in the preamble, the Federal Crop 
Insurance Corporation proposes to amend 7 CFR part 457 effective for 
the 2013 and succeeding crop years as follows:

PART 457--COMMON CROP INSURANCE REGULATIONS

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

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

    2. Amend Sec.  457.139 as follows:
    a. Revise the introductory text;
    b. Remove the paragraph immediately preceding section 1;
    c. Amend section 1 by:
    i. Adding definitions for ``allowable cost,'' ``amount of insurance 
per acre,'' ``fresh market tomatoes,'' ``minimum value,'' 
``penhookers,'' ``price received,'' and ``registered handler;''
    ii. Removing the definitions of ``planted acreage'' and ``practical 
to replant;''
    iii. Revising the definitions of ``acre,'' ``direct marketing,'' 
``harvest,'' ``plant stand,'' and ``potential production;'' and
    iv. Amending the definition of ``crop year'' by removing the phrase 
``of `crop year' contained in section 1 (Definitions) of the Basic 
Provisions (Sec.  457.8)'' and adding the phrase ``contained in the 
Basic Provisions'' in its place.
    d. Amend section 3 by:
    i. Removing the phrases ``(Insurance Guarantees, Coverage Levels, 
and Prices for Determining Indemnities)'' and ``(Sec.  457.8)'' in 
paragraphs (a) and (c);
    ii. Revising the table in paragraph (d); and
    iii. Revising paragraph (e).
    e. Amend section 4 by removing the phrases ``(Contract Changes)'' 
and ``(Sec.  457.8).''
    f. Amend section 5 by removing the phrases ``(Life of Policy, 
Cancellation, and Termination)'' and ``(Sec.  457.8).''
    g. Amend section 6 introductory text by removing the phrases 
``(Report of Acreage)'' and ``(Sec.  457.8).''
    h. Amend section 7 by:
    i. Removing the phrases ``(Annual Premium)'' and ``(Sec.  457.8);'' 
and
    ii. Removing the phrase ``(e.g., fall direct-seeded irrigated))'' 
and adding the phrase ``(e.g., fall transplanted irrigated)'' in its 
place.
    i. Amend section 8 by:
    i. Revising the introductory text; and
    ii. Revising paragraph (c)(4).
    j. Amend section 9 by:
    i. Removing the phrases ``(Insurable Acreage)'' and ``(Sec.  
457.8)'' in paragraphs (a) and (b);
    ii. Removing the phrase ``or 60 days of direct seeding'' in 
paragraph (b)(1)(iii);
    iii. Removing the word ``satisfied'' and adding the word ``met'' in 
its place in paragraph (b)(2); and
    iv. Revising paragraph (b)(3).
    k. Amend section 10 by:
    i. Revising the introductory paragraph;
    ii. Revising paragraph (e); and
    iii. Revising paragraph (f).
    l. Amend section 11 by:
    i. Removing the phrases ``(Causes of Loss)'' and ``(Sec.  457.8)'' 
in paragraphs (a) and (b);
    ii. Revising paragraph (b)(2).
    m. Amend section 12(a) and 12(c) by removing the phrases 
``(Replanting Payment)'' and ``(Sec.  457.8).''
    n. Amend section 13 by removing the phrases ``(Duties in the Event 
of Damage or Loss)'' and ``(Sec.  457.8).''
    o. Amend section 14 by:
    i. Revising paragraph (b)(4)(ii);
    ii. Adding an example following paragraph (b)(5);
    iii. Revising paragraph (c)(2)(i);
    iv. Revising paragraph (c)(3);
    v. Adding a new paragraph (c)(4); and
    vi. Adding a new paragraph (c)(5).
    p. Revise section 16.
    q. Adding an example following paragraph 16(c).
    The revised and added text reads as follows:


Sec.  457.139  Fresh market tomato (dollar plan) crop insurance 
provisions.

    The fresh market tomato (dollar plan) crop insurance provisions for 
the 2013 and succeeding crop years are as follows:
* * * * *
1. Definitions
    Acre. 43,560 square feet of planted acreage when row widths do not 
exceed six feet. If row widths exceed six feet, the land area on which 
at least 7,260 linear feet of rows are planted.
    Allowable cost. The dollar amount per carton for harvesting, 
packing, and handling as stated in the Special Provisions.
    Amount of insurance per acre. The dollar amount of insurance per 
acre obtained by multiplying the reference maximum dollar amount shown 
in the actuarial documents by the coverage level percentage you elect.
* * * * *
    Direct marketing. The sale of the insured crop directly to 
consumers without the intervention of an intermediary such as a 
registered handler, wholesaler, retailer, packer, processor, shipper or 
buyer. Examples of direct marketing include selling through an on-farm 
or roadside stand, farmer's market, and permitting the general public 
to enter the field for the purpose of picking all or a portion of the 
crop.
* * * * *
    Fresh Market Tomatoes. Field grown mature green or ripe fresh 
market tomatoes that meet the Agricultural Marketing Service United 
States Standards for Grades of Fresh Tomatoes; and the applicable 
Federal Marketing Order and Florida Tomato Committee Regulations, or 
their successors.
    Harvest. The picking of tomatoes from the plants, excluding fresh 
market tomatoes salvaged by penhookers.
* * * * *
    Minimum value. The dollar amount per carton shown in the Special 
Provisions we will use to value appraised and marketable production to 
count.
    Penhookers. Individuals who purchase the right to salvage tomatoes 
remaining in the field after commercial harvests are completed.
    Plant stand. The number of live plants per acre prior to the 
occurrence of an insured cause of loss.
* * * * *
    Potential production. The number of cartons of mature green or ripe 
field grown fresh market tomatoes that the tomato plants will or would 
have produced per acre assuming normal growing conditions and practices 
by the end of the insurance period.
    Price received. The gross dollar amount per carton received by the 
producer before deductions of allowable costs.
    Registered handler. A person or entity officially certified by the 
Florida Tomato Committee, or successor entity, to inspect and enforce 
all the handling regulations for fresh market tomatoes, and report the 
required packout data to the Florida Tomato Committee.
* * * * *
3. Amounts of Insurance and Production Stages
* * * * *
    (d) * * *

[[Page 71275]]



------------------------------------------------------------------------
                                  Percent of the
                                    amount of
             Stage                insurance per      Length of time if
                                  acre that you         transplanted
                                     selected
------------------------------------------------------------------------
1.............................  50...............  From planting through
                                                    the 29th day after
                                                    planting.
2.............................  75...............  From the 30th day
                                                    after planting until
                                                    the beginning of
                                                    stage 3.
3.............................  90...............  From the 60th day
                                                    after planting until
                                                    the beginning of the
                                                    final stage.
Final.........................  100..............  Begins the earlier of
                                                    75 days after
                                                    planting, or the
                                                    beginning of
                                                    harvest.
------------------------------------------------------------------------

    (e) Any acreage of fresh market tomatoes damaged in the first, 
second, or third stage to the extent that the majority of producers in 
the area would not normally further care for the crop, the indemnity 
payable for such acreage will be based on the stage the plants had 
achieved when the insured damage occurred, even if the producer 
continues to care for the damaged tomatoes.
* * * * *
8. Insured Crop
    In accordance with section 8 of the Basic Provisions, the crop 
insured will be all the field grown fresh market tomato types and 
varieties in the county as specified in the Special Provisions for 
which a premium rate is provided in the actuarial documents:
* * * * *
    (c) * * *
    (4) Direct seeded fresh market tomatoes, unless insured by written 
agreement.
* * * * *
9. Insurable Acreage
* * * * *
    (3) We will not insure any acreage on which tomatoes (except for 
replanted tomatoes in accordance with sections 9(b)(1) and (2)), 
peppers, eggplants, strawberries or tobacco have been grown and the 
soil was not fumigated or otherwise properly treated before planting 
the insured tomatoes.
10. Insurance Period
    In lieu of section 11 of the Basic Provisions, coverage begins on 
each unit or part of a unit the later of the date we accept your 
application, or when the tomatoes are planted in each planting period. 
Coverage ends on each unit at the earliest of:
* * * * *
    (e) Final harvest on the unit; or
    (f) The calendar date for the end of insurance period that is 125 
days after the date of transplanting or replanting with transplants.
11. Causes of Loss
* * * * *
    (b) * * *
    (2) Failure to harvest in a timely manner or failure to market the 
tomatoes, unless such failure is due to actual physical damage caused 
by an insured cause of loss that occurs during the insurance period. 
For example, we will not pay an indemnity if you are unable to market 
the insured crop due to quarantine, boycott, or refusal of any person 
to accept production.
* * * * *
14. Settlement of Claim
* * * * *
    (b) * * *
    (4) * * *
    (ii) For catastrophic risk protection coverage, the result of 
multiplying the total value of production to count determined in 
accordance with section 14(c) by the percentage contained in the 
Special Provisions.
    (5) * * *

------------------------------------------------------------------------
 
------------------------------------------------------------------------
 For Example: You have a 100 percent share in 10.0 acres of fresh market
   tomatoes. You select a 70% coverage level of the reference maximum
 dollar amount of $7,500 per acre. The average price received is $10.00
  per carton of tomatoes. Allowable costs are $4.25 per carton. Minimum
 value is $5.00 per carton. Your total production sold is 5,000 cartons
 (5,000 / 10.0 = 500 cartons per acre) and you have an additional 1,000
 cartons of unsold harvested production (1,000 / 10.0 = 100 cartons per
acre). Your loss is in the final stage of production. Your indemnity per
                     acre is calculated as follows:
------------------------------------------------------------------------
                           $7,500 x 70% = dollar amount           $5,250
                            of insurance per acre.
14(c)(3).................  500 cartons x $5.75 = value             2,875
                            of sold production.
                           ($10 selling price minus
                            $4.25 allowable cost).
14(c)(4).................  100 cartons of unsold                    +500
                            harvested production x $5
                            minimum value per carton.
                           Value of production to count.           3,375
14(b)(5).................  Indemnity per acre = ($5,250-           1,875
                            $3,375) x 100% share.
                           $1,875 x 10.0 acres = $18,750          18,750
                            indemnity payment.
------------------------------------------------------------------------

     (c) * * *
    (2) * * *
    (i) Potential production on any fresh market tomato acreage that 
has not been harvested the required number of times as specified in the 
Special Provisions.
* * * * *
    (3) The total value of all sold harvested production from the 
insurable acreage will be the dollar amount obtained by subtracting the 
allowable cost contained in the Special Provisions from the price 
received for each carton of fresh market tomatoes in the load (this 
result may not be less than the minimum value shown in the Special 
Provisions for any carton of tomatoes), and multiplying this result by 
the number of cartons of fresh market tomatoes harvested.
    (4) The total value of all unsold harvested production will be the 
dollar amount obtained by multiplying the number of cartons of such 
tomatoes on the unit by the minimum value shown in the Special 
Provisions for the planting period. Harvested production that is 
damaged or defective due to insurable causes and is not marketable or 
sold will not be counted as production to count.
    (5) Any penhooker salvage value paid to you will be added to the 
total dollar value of production to count.
* * * * *
16. Minimum Value Option
    (a) The provisions of this option are continuous and will be 
attached to and made a part of your insurance policy, if:
    (1) You elect the Minimum Value Option on your application, or on a 
form approved by us, on or before the sales closing date for the 
initial crop year in which you wish to insure fresh market tomatoes 
(dollar plan) under this option, and pay the additional premium 
indicated in the actuarial documents for this optional coverage; and
    (2) You have not elected coverage under the Catastrophic Risk 
Protection Endorsement.

[[Page 71276]]

    (b) In lieu of the provisions contained in section 14(c)(3) of 
these Crop Provisions, the total value of harvested production will be 
determined as follows:
    (1) For sold harvested production, the dollar amount obtained by 
subtracting the allowable cost contained in the Special Provisions from 
the price received for each carton of fresh market tomatoes in the load 
(this result may not be less than the minimum value option price 
contained in the Special Provisions for any carton of tomatoes sold), 
and multiplying this result by the number of cartons of fresh market 
tomatoes sold; and
    (2) For unsold harvested production, the dollar amount obtained by 
multiplying the number of cartons of such fresh market tomatoes on the 
unit by the minimum value shown in the Special Provisions for the 
planting period (harvested production that is damaged or defective due 
to insurable causes and is not marketable or sold will not be counted 
as production to count).
    (c) This option may be canceled by either you or us for any 
succeeding crop year by giving written notice on or before the 
cancellation date preceding the crop year for which the cancellation of 
this option is to be effective.

------------------------------------------------------------------------
 
------------------------------------------------------------------------
 Example with Minimum Value Option: You have a 100 percent share in 10.0
 acres of fresh market tomatoes. You select a 70% coverage level of the
  reference maximum dollar amount of $7,500 per acre. The average price
 received is $6.00 per carton of tomatoes. Allowable costs are $4.25 per
   carton. Minimum value is $5.00 per carton. The Minimum Value Option
 price is $2.00 per carton. Your total production sold is 5,000 cartons
 (5,000 / 10.0 = 500 cartons per acre) and you have an additional 1,000
 cartons of unsold harvested production (1,000 / 10.0 = 100 cartons per
 acre of unsold marketable production). Your loss is in the final stage
    of production. Your indemnity per acre is calculated as follows:
------------------------------------------------------------------------
                           7,500 x 70% = dollar amount            $5,250
                            of insurance per acre.
16(b)(1).................  500 cartons x $2 = value of             1,000
                            sold production ($6 price
                            received minus $4.25
                            allowable costs = $1.75.
                           $2.00 minimum value option is
                            greater than $1.75).
16(b)(2).................  100 cartons of unsold                    +500
                            harvested production x $5
                            minimum value per carton.
                           Value of production to count.           1,500
16(b)....................  Indemnity per acre = $5,250-            3,750
                            $1,500 = $3,750 x 100% share.
                           $3,750 x 10.0 acres = $37,500          37,500
                            indemnity payment.
------------------------------------------------------------------------

* * * * *

    Signed in Washington, DC, on November 7, 2011.
William J. Murphy,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 2011-29218 Filed 11-16-11; 8:45 am]
BILLING CODE 3410-08-P