Rule2023-25123
Early Harvest Insurance Flexibility for Sugar Beets
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
November 15, 2023
Effective
November 30, 2023
Issuing agencies
Agriculture DepartmentFederal Crop Insurance Corporation
Abstract
The Federal Crop Insurance Corporation (FCIC) is amending the Common Crop Insurance Regulations, Sugar Beet Crop Insurance Provisions. This rule makes the early harvest adjustment an option, providing producers with maximum flexibility to tailor their insurance policy to meet the unique risk management needs of their operation. This rule also incorporates comments to improve the early harvest adjustment that were received on a prior final rule amending the Sugar Beet Crop Insurance Provisions, published in the Federal Register on November 29, 2019. The changes will be effective for the 2024 and succeeding crop years for counties with a contract change date on or after November 30, 2023, and for the 2025 and succeeding crop years for counties with a contract change date prior to November 30, 2023.
Full Text
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<title>Federal Register, Volume 88 Issue 219 (Wednesday, November 15, 2023)</title>
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[Federal Register Volume 88, Number 219 (Wednesday, November 15, 2023)]
[Rules and Regulations]
[Pages 78226-78230]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-25123]
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DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
7 CFR Part 457
[Docket ID FCIC-23-0007]
RIN 0563-AC84
Early Harvest Insurance Flexibility for Sugar Beets
AGENCY: Federal Crop Insurance Corporation, U.S. Department of
Agriculture (USDA).
ACTION: Final rule with request for comments.
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SUMMARY: The Federal Crop Insurance Corporation (FCIC) is amending the
Common Crop Insurance Regulations, Sugar Beet Crop Insurance
Provisions. This rule makes the early harvest adjustment an option,
providing producers with maximum flexibility to tailor their insurance
policy to meet the unique risk management needs of their operation.
This rule also incorporates comments to improve the early harvest
adjustment that were received on a prior final rule amending the Sugar
Beet Crop Insurance Provisions, published in the Federal Register on
November 29, 2019. The changes will be effective for the 2024 and
succeeding crop years for counties with a contract change date on or
after November 30, 2023, and for the 2025 and succeeding crop years for
counties with a contract change date prior to November 30, 2023.
DATES:
Effective date: November 30, 2023.
Comment date: We will consider comments that we receive by the
close of business January 16, 2024. FCIC will consider the comments
received and may conduct additional rulemaking in the future based on
the comments.
ADDRESSES: We invite you to submit comments on this rule. You may
submit comments by going through the Federal eRulemaking Portal as
follows:
<bullet> Federal eRulemaking Portal: Go to <a href="http://www.regulations.gov">http://www.regulations.gov</a> and search for Docket ID FCIC-23-0007. Follow the
instructions for submitting comments.
All comments will be posted without change and will be publicly
available on <a href="http://www.regulations.gov">www.regulations.gov</a>.
FOR FURTHER INFORMATION CONTACT: Francie Tolle; telephone (816) 926-
7829; or email <a href="/cdn-cgi/l/email-protection#3e584c5f505d575b104a5152525b7e4b4d5a5f10595148"><span class="__cf_email__" data-cfemail="98feeaf9f6fbf1fdb6ecf7f4f4fdd8edebfcf9b6fff7ee">[email protected]</span></a>. Persons with disabilities who
require alternative means for communication should contact the USDA
Target Center at (202) 720-2600 (voice) or (844) 433-2774 (toll-free
nationwide).
SUPPLEMENTARY INFORMATION:
Background
FCIC serves America's agricultural producers through effective,
market-based risk management tools to strengthen the economic stability
of agricultural producers and rural communities. FCIC is committed to
increasing the availability and effectiveness of Federal crop insurance
as a risk management tool. Approved Insurance Providers (AIPs) sell and
service Federal crop insurance policies in every state through a
public-private partnership. FCIC reinsures the AIPs who share the risks
associated with catastrophic losses due to major weather events. FCIC's
vision is to secure the future of agriculture by providing world class
risk management tools to rural America.
Federal crop insurance policies typically consist of the Basic
Provisions, the Crop Provisions, the Special Provisions, the Commodity
Exchange Price Provisions, if applicable, other applicable endorsements
or options, the actuarial documents for the insured agricultural
commodity, the Catastrophic Risk Protection Endorsement, if applicable,
and the applicable regulations published in 7
[[Page 78227]]
CFR chapter IV. Throughout this rule, the terms ``Crop Provisions,''
``Special Provisions,'' and ``policy'' are used as defined in the
Common Crop Insurance Policy (CCIP) Basic Provisions in 7 CFR part
457.8. Additional information and definitions related to Federal crop
insurance policies are in 7 CFR 457.8.
In this rule, FCIC is making the early harvest adjustment an option
and making other improvements to the early harvest adjustment in
response to public comments and other input from the American Sugarbeet
Growers Association (ASGA) and AIPs. The FCIC has a long history of
working closely with the ASGA and AIPs in tailoring this program to the
unique risk management needs of sugar beet growers.
Early Harvest Adjustment Option
For the 2019 crop year, FCIC added an early harvest adjustment to
the Crop Provisions in the Common Crop Insurance Regulations; Sugar
Beet Crop Insurance Provisions final rule, published in the Federal
Register on September 10, 2018 (83 FR 45535-45539). In response to
public comments, FCIC made additional changes in the Common Crop
Insurance Regulations; Sugar Beet Crop Insurance Provisions final rule
published in the Federal Register on November 29, 2019 (84 FR 65627-
65639). The early harvest adjustment, as amended, was created to limit
the effects to producers' Approved Production History (APH) databases
from processor requirements to harvest sugar beets before they reach
full maturity. Sugar beets that are harvested early are smaller in size
and have a lower percent of sugar than beets harvested at full
maturity, resulting in a lower net weight in the producer's APH
database for that year. The lower yield remains in the producer's APH
database for a minimum of 10 years, reducing their future potential
insurance guarantee.
Prior to this rule, the early harvest adjustment applied if the
threshold in the Special Provisions was exceeded. For those acres
harvested early, the producer's yield in their APH database was
automatically adjusted upwards by one percent per day covering the time
until the sugar beets would have reached full maturity. This adjustment
was intended to protect their future guarantee.
With the publication of the 2019 final rule, concerns were raised
during the public comment period by ASGA that the early harvest
adjustment could affect a producer's claim or possible claim in the
event of an insurable cause of loss. For example, if some acres were
early harvested and the yield was adjusted upwards, but the producer
subsequently had an insured cause of loss that reduced their yield, the
upward early harvest adjustment could have an offsetting effect on the
claim for indemnity.
ASGA requested that the early harvest adjustment be made an
optional feature of the Crop Provisions. Making the early harvest
adjustment optional will allow producers greater flexibility and limit
the possible negative impacts to a producer's APH due to technological
yield improvements.
In this rule, FCIS is making the early harvest adjustment optional,
which allows producers to opt-in to the early harvest adjustment.
Producers choosing this option will be required to select the option by
the sales closing date. The producer will be able to choose which years
from their APH database to apply the early harvest adjustment for
production that was harvested early. The producer's premium will
reflect the additional coverage between the adjusted yields and actual
yields selected by the producer. The producer may have a higher
approved yield and insurance coverage when an actual yield is adjusted
in an APH database. If adjusting a yield will result in an increased
approved yield, a higher insurance guarantee and greater indemnity
payment could occur due to the early harvest adjustment. The producer
will pay a higher premium for the increase in coverage. For example, a
producer with a 65 percent coverage level may get a yield guarantee
equivalent to a higher coverage level, such as 70 percent. Because of
the early harvest adjustment option, the premium charged will reflect
the higher effective coverage level (70 percent for this example) and
higher risk of loss. If a producer elects the early harvest adjustment
option, their premium will be adjusted while other producers who did
not elect the option will not pay additional premium. It will be the
AIP's responsibility to ensure that the approved yield is calculated
correctly, which determines the appropriate premium amount.
In making the early harvest adjustment an option, all producers
will be required to recertify their APH database with their AIP to
remove those yields from their database from the years that the
adjustment was automatically applied. This will ensure that only those
producers who elect the option going forward, will be charged the
additional premium associated with the adjusted yields.
To elect the early harvest adjustment option, producers must choose
the option by the sales closing date and must have additional coverage
(that is, not a Catastrophic Risk Protection Endorsement). The option
will remain in effect for future years, unless cancelled. On or before
the production reporting date, the producer can replace actual yields
with early harvested adjusted yields. The adjustment will only be made
if a threshold of at least 15 percent of the insured acreage in the
unit is early harvested, unless the Special Provisions specify a
different threshold. The adjustment will not be made if the sugar beets
are damaged by an insurable cause of loss and leaving the crop in the
field would reduce production.
During the decision-making process for this rule, FCIC was
committed to reaching a desirable outcome for all program stakeholders.
FCIC regularly communicated with ASGA, on behalf of their grower
constituency, and AIPs to gain consensus on the framework of the
proposed changes and overcome challenges and points of disagreement.
AIPs expressed concerns regarding additional administrative burdens
on producers who will be required to recertify their APH databases.
FCIC worked closely with ASGA to confirm, on behalf of their producer
constituency, their support for these changes, including the
requirement for producers to recertify their APH databases to implement
these requested changes.
Additionally, ASGA requested to exclude the adjustments to early
harvested productions on acreage with a claim. However, as identified
by AIPs, due to the discretion producers have in choosing which acreage
to early harvest, waiving adjustments on acreage with a claim would
have introduced unwanted moral hazard in the program. FCIC believes it
has landed on common, middle ground, as these choices give the producer
maximum flexibility to tailor their insurance to their operation, while
maintaining the actuarial soundness of the Federal crop insurance
program.
Early Harvest Adjustment Cap
Following the comment period for the 2019 final rule, AIPs raised
additional concerns, on behalf of their insured producers, with the
limits (commonly referred to as a ``cap'') on the early harvest
adjustment. The cap is the maximum amount a particular actual yield can
be adjusted to. The early harvest adjustment was capped at the higher
of the approved yield (the average of all yields in an APH database and
the basis for which the unit guarantee is calculated) or the actual
yield of the production harvested after
[[Page 78228]]
full maturity from the unit. Due to improvements in sugar beet
technology, yield potential has increased, and it is possible that a
producer's early harvested actual yield exceeds the limit even before
the adjustment was applied. In these cases, the actual yield was capped
at the approved yield even though the actual yield was higher than the
approved yield.
In this rule, FCIC is modifying the limits to the early harvest
adjustment to account for situations where early harvested actual
yields would have surpassed the previous cap. The changes address the
cases where the actual early harvest yield prior to the early harvest
adjustment exceeds the approved yield. The cap was intended to ensure
adjustments don't exceed realistic yields; it was never the intent of
the cap to reduce an actual yield.
Clarifications and Grammatical Corrections
In this rule, FCIC is capitalizing ``Crop Provisions'' in two
places to be consistent with the CCIP Basic Provisions. In section 17,
FCIC is clarifying that the Stage Removal Option is only available if
provided in the actuarial documents.
Effective Date, Notice and Comment, and Exemptions
The Administrative Procedure Act (APA, 5 U.S.C. 553) provides that
the notice and comment and 30-day delay in the effective date
provisions do not apply when the rule involves specified actions,
including matters relating to contracts. This rule governs contracts
for crop insurance policies and therefore falls within that exemption.
This rule is exempt from the regulatory analysis requirements of
the Regulatory Flexibility Act (5 U.S.C. 601-612), as amended by the
Small Business Regulatory Enforcement Fairness Act of 1996. The
requirements for the regulatory flexibility analysis in 5 U.S.C. 603
and 604 are specifically tied to the requirement for a proposed rule
under 5 U.S.C. 553 or any other law; in addition, the definition of
rule in 5 U.S.C. 601 is tied to the publication of a proposed rule.
For major rules, the Congressional Review Act requires a delay of
the effective date of 60 days after publication to allow for
Congressional review. This rule is not a major rule under the
Congressional Review Act, as defined by 5 U.S.C. 804(2). Therefore,
this final rule is effective on November 30, 2023. Although not
required by APA or any other law, FCIC has chosen to request comments
on this rule.
Executive Orders 12866 and 13563
Executive Order 12866, ``Regulatory Planning and Review,'' and
Executive Order 13563, ``Improving Regulation and Regulatory Review,''
direct agencies to assess all costs and benefits of available
regulatory alternatives and, if regulation is necessary, to select
regulatory approaches that maximize net benefits (including potential
economic, environmental, public health and safety effects, distributive
impacts, and equity). Executive Order 13563 emphasized the importance
of quantifying both costs and benefits, of reducing costs, of
harmonizing rules, and of promoting flexibility. The requirements in
Executive Orders 12866 and 13563 for the analysis of costs and benefits
apply to rules that are determined to be significant or economically
significant.
The Office of Management and Budget (OMB) has designated this rule
as not significant under Executive Order 12866, ``Regulatory Planning
and Review,'' and therefore, OMB has not reviewed this rule and
analysis of the costs and benefits is not required under either
Executive Order 12866 or 13563.
Clarity of the Regulation
Executive Order 12866, as supplemented by Executive Order 13563,
requires each agency to write all rules in plain language. In addition
to your substantive comments on this rule, we invite your comments on
how to make the rule easier to understand. For example:
<bullet> Are the requirements in the rule clearly stated? Are the
scope and intent of the rule clear?
<bullet> Does the rule contain technical language or jargon that is
not clear?
<bullet> Is the material logically organized?
<bullet> Would changing the grouping or order of sections or adding
headings make the rule easier to understand?
<bullet> Could we improve clarity by adding tables, lists, or
diagrams?
<bullet> Would more, but shorter, sections be better? Are there
specific sections that are too long or confusing?
<bullet> What else could we do to make the rule easier to
understand?
Environmental Review
The environmental impacts of this final rule have been considered
in a manner consistent with the provisions of the National
Environmental Policy Act (NEPA, 42 U.S.C. 4321-4347), the regulations
of the Council on Environmental Quality (40 CFR parts 1500-1508), and
because USDA will be making the payments to producers, the USDA
regulation for compliance with NEPA (7 CFR part 1b). As specified in 7
CFR 1b.4(b)(4), FCIC is categorically excluded from the preparation of
an Environmental Analysis or Environmental Impact Statement unless the
FCIC Manager (agency head) determines that an action may have a
significant environmental effect. The FCIC Manager has determined this
rule will not have a significant environmental effect. Therefore, FCIC
will not prepare an environmental assessment or environmental impact
statement for this action and this rule serves as documentation of the
programmatic environmental compliance decision.
Executive Order 12988
This rule has been reviewed under Executive Order 12988, ``Civil
Justice Reform.'' This rule will not preempt State or local laws,
regulations, or policies unless they represent an irreconcilable
conflict with this rule. Before any judicial actions may be brought
regarding the provisions of this rule, the administrative appeal
provisions of 7 CFR part 11 are to be exhausted.
Executive Order 13175
This rule has been reviewed in accordance with the requirements of
Executive Order 13175, ``Consultation and Coordination with Indian
Tribal Governments.'' Executive Order 13175 requires Federal agencies
to consult and coordinate with Tribes on a government-to-government
basis on policies that have Tribal implications, including regulations,
legislative comments or proposed legislation, and other policy
statements or actions that have substantial direct effects on one or
more Indian Tribes, on the relationship between the Federal Government
and Indian Tribes or on the distribution of power and responsibilities
between the Federal Government and Indian Tribes.
The Risk Management Agency (RMA) has assessed the impact of this
rule on Indian Tribes and determined that this rule does not, to our
knowledge, have Tribal implications that require Tribal consultation
under Executive Order 13175. The regulation changes do not have Tribal
implications that preempt Tribal law and are not expected have a
substantial direct effect on one or more Indian Tribes. If a Tribe
requests consultation, RMA will work with the USDA Office of Tribal
Relations to ensure meaningful consultation is provided where changes,
additions and modifications identified in this rule are not expressly
mandated by Congress.
[[Page 78229]]
The Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA, Pub. L.
104-4) requires Federal agencies to assess the effects of their
regulatory actions of State, local, and Tribal governments, or the
private sector. Agencies generally must prepare a written statement,
including cost benefits analysis, for proposed and final rules with
Federal mandates that may result in expenditures of $100 million or
more in any 1 year for State, local or Tribal governments, in the
aggregate, or to the private sector. UMRA generally requires agencies
to consider alternatives and adopt the more cost effective or least
burdensome alternative that achieves the objectives of the rule. This
rule contains no Federal mandates, as defined in Title II of 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.
Federal Assistance Program
The title and number of the Assistance Listing,\1\ to which this
rule applies is No. 10.450--Crop Insurance.
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\1\ See <a href="https://sam.gov/content/assistance-listings">https://sam.gov/content/assistance-listings</a>.
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Paperwork Reduction Act of 1995
The purpose of the Paperwork Reduction Act of 1995 (44 U.S.C.
chapter 35, subchapter I), among other things, are to minimize the
paperwork burden on individuals, and to require Federal agencies to
request and receive approval from the Office of Management and Budget
(OMB) prior to collecting information from ten or more persons. This
rule does not change the information collection approved by OMB under
control numbers 0563-0053.
USDA Non-Discrimination Policy
In accordance with Federal civil rights law and U.S. Department of
Agriculture (USDA) civil rights regulations and policies, USDA, its
Agencies, offices, and employees, and institutions participating in or
administering USDA programs are prohibited from discriminating based on
race, color, national origin, religion, sex, gender identity (including
gender expression), sexual orientation, disability, age, marital
status, family or parental status, income derived from a public
assistance program, political beliefs, or reprisal or retaliation for
prior civil rights activity, in any program or activity conducted or
funded by USDA (not all bases apply to all programs). Remedies and
complaint filing deadlines vary by program or incident.
Individuals who require alternative means of communication for
program information (for example, braille, large print, audiotape,
American Sign Language, etc.) should contact the responsible Agency or
the USDA TARGET Center at (202) 720-2600 (voice and text telephone
(TTY)) or dial 711 for Telecommunications Relay Service (both voice and
text telephone users can initiate this call from any telephone).
Additionally, program information may be made available in languages
other than English.
To file a program discrimination complaint, complete the USDA
Program Discrimination Complaint Form, AD-3027, found online at <a href="https://www.usda.gov/oascr/how-to-file-a-program-discrimination-complaint">https://www.usda.gov/oascr/how-to-file-a-program-discrimination-complaint</a> and
at any USDA office or write a letter addressed to USDA and provide in
the letter all the information requested in the form. To request a copy
of the complaint form, call (866) 632-9992. Submit your completed form
or letter to USDA by: (1) mail to: U.S. Department of Agriculture,
Office of the Assistant Secretary for Civil Rights, 1400 Independence
Avenue SW, Washington, DC 20250-9410; (2) fax: (202) 690-7442; or (3)
email: <a href="/cdn-cgi/l/email-protection#b9c9cbd6decbd8d497d0d7cdd8d2dcf9cccaddd897ded6cf"><span class="__cf_email__" data-cfemail="176765787065767a397e7963767c72576264737639707861">[email protected]</span></a>.
USDA is an equal opportunity provider, employer, and lender.
List of Subjects in 7 CFR Part 457
Acreage allotments, Crop insurance, Reporting and recordkeeping
requirements.
For the reasons discussed in the supplementary information, FCIC
amends 7 CFR part 457, as follows:
PART 457--COMMON CROP INSURANCE REGULATIONS
0
1. The authority citation for part 457 continues to read as follows:
Authority: 7 U.S.C. 1506(l), 1506(o).
0
2. Amend Sec. 457.109 by:
0
a. In the introductory paragraph, remove the words ``for effective for
the 2023 and succeeding crop years in states with a November 30
contract change date and for the 2024'' and add the words ``effective
for the 2024 and succeeding crop years in states with a November 30
contract change date and for the 2025'' in their place;
0
b. In section 1, add definitions of ``Early harvest'' and ``Full
maturity (date of)'' in alphabetical order;
0
c. In section 8, remove the words ``crop provisions'' and add ``Crop
Provisions'' in each place they appear;
0
d. In section 14:
0
i. Remove paragraph (f); and
0
ii. Redesignate paragraphs (g) and (h) as paragraphs (f) and (g);
0
e. In section 17:
0
i. Redesignate paragraphs (a)(1) through (4) as paragraphs (a)(2)
through (5); and
0
ii. Add new paragraph (a)(1); and
0
f. Add a new section 18.
The revisions and additions read as follows:
Sec. 457.109 Sugar Beet Crop Insurance Provisions.
* * * * *
Definitions
* * * * *
Early harvest. Harvest of sugar beets prior to full maturity.
Full maturity (date of). The date the sugar beets would have
reached full maturity is 45 days prior to the calendar date for the end
of the insurance period, unless otherwise specified in the Special
Provisions.
* * * * *
17. Stage Removal Option
(a) * * *
(1) If provided in the actuarial documents, you may elect the Stage
Removal Option.
* * * * *
18. Early Harvest Adjustment Option
(a) Applicability:
(1) If provided in the actuarial documents, you may elect the Early
Harvest Adjustment Option to adjust your actual yield(s) for early
harvested production.
(2) You must have additional coverage to elect this option.
(3) You must elect this option in writing on or before the sales
closing date.
(4) This election is continuous, in accordance with section 2 of
the Basic Provisions, unless canceled by the cancellation date. Your
election of the Catastrophic Risk Protection Endorsement for your sugar
beets will cancel this option.
(b) Insurance Guarantees:
(1) APH database--On or before the production reporting date, you
may replace actual yields with early harvest adjusted yields in your
APH database, if this option is elected.
(i) The early harvest adjusted yields will be used in the same
manner as actual yields for the purpose of calculating the approved
yield.
(ii) Once an early harvest adjusted yield replaces an actual yield,
the early harvest adjusted yield will remain in effect until such time
as that crop year is no longer included in the APH
[[Page 78230]]
database, this option is canceled in accordance with section 18(a)(4),
or the insured chooses to no longer replace that actual yield(s) by the
production reporting date.
(iii) If you cancel the option, the actual yield will be used in
the APH database.
(2) Premium--Your approved yield will be used to determine your
amount of premium owed. The premium will be increased to cover the
additional risk associated with the resulting higher yields.
(3) Adjustment--The adjustment will equal an increase of your
actual yield by 1 percent per day for each day the sugar beets were
harvested prior to full maturity.
(4) Threshold--The adjustment will only be made if the early
harvested percentage of insured acreage in the unit meets or exceeds 15
percent, unless otherwise specified in the Special Provisions.
(5) Cap--The adjustment cannot result in a yield greater than the
higher of:
(i) Your approved yield from the unit;
(ii) The actual yield of the acreage harvested after full maturity
from the unit; or
(iii) The unadjusted actual yield of the early harvested acreage
from the unit.
(6) Processor requirement--The adjustment will only be made if:
(i) Early harvest is required in the production agreement; or
(ii) The processor requests early harvest.
(c) Settlement of Claim--If this option is elected, production to
count from the unit will be determined by:
(1) The adjustment will be made for any early harvested production
if the threshold is exceeded for the unit.
(2) The adjustment will not be made if the sugar beets are damaged
by an insurable cause of loss and leaving the crop in the field would
reduce production.
(3) If the production agreement does not require early harvest and
the processor has not requested early harvest, and the processor:
(i) Accepts the early harvested production, the early harvested
production will be counted but no adjustment will apply.
(ii) Does not accept the early harvested production, the production
to count will be the production guarantee for the acreage harvested
early.
* * * * *
Marcia Bunger,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 2023-25123 Filed 11-14-23; 8:45 am]
BILLING CODE 3410-08-P
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This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.