BULLETIN NO.: MGR-95-039 TO: All Reinsured Companies CFSA Headquarters, Program Delivery and Field Operations All Risk Management Field Offices FROM: Kenneth D. Ackerman Acting Deputy Administrator SUBJECT: Clarification of 1995 Crop Year Prevented Planting Coverage ISSUE #1: Manager's Bulletin MGR-95-028 issued on June 27, 1995, announced changes in prevented planting coverage for the 1995 crop year. Producers and insurance providers have expressed concerns that the late changes created confusion in the proper reporting of prevented planting acreage. As a result, prevented planting acreage was reported incorrectly on acreage reports. ACTION: For 1995 crop year prevented planting only, if an insured did not properly report a crop as being prevented from planting on the acreage report, insurance providers are authorized to accept the number of prevented planted acres for the crop in accordance with MGR-95-028 and R&D-95-033, including revising acreage reports to reflect the correct amount of acreage for each prevented planting unit for the crop. Note: To assure revisions are not being requested simply to maximize prevented planting benefits, insurance providers may not accept any revisions not supported by prior years' records. Insurance providers must take care in determining if the insured had the means to plant the acreage determined to be prevented from planting (See MGR-95-028). The acreage reports and claims may be processed in accordance with R&D-95-033. (Procedure for revised acreage reports for PLANTED acres have not changed.) ISSUE #2: Questions have been raised regarding whether an insured can receive a prevented planting production guarantee on acreage earning a deficiency payment under the so-called 0/85 and 50/85 provisions of the 1995 wheat, feed grains, upland cotton and rice programs authorized by the Agricultural Act of 1949. This acreage is reported to the Consolidated Farm Service Agency (CFSA) as conserving use (CU) for payment and is generally planted to cover crops. Manager's Bulletin MGR-95-021.1 issued on May 30, 1995, provided that farmers who have been prevented from planting a crop will be permitted to collect a prevented planting payment on the effected acreage if such acreage was also designated as prevented planted for payment under the 50/92 and 0/92 provisions of the 1995 wheat, feed grains, upland cotton and rice programs. In addition, the Federal Crop Insurance Corporation (FCIC) published Interim Rules in the Federal Register at Vol. 60, 29960 dated June 7, 1995, and Vol. 60, 35832 dated July 12, 1995, that indicate a producer may receive a prevented planting payment on such acreage receiving deficiency payments under the 50/92 or 0/92 provisions. Bulletins and Informational Memorandums regarding prevented planting have been specific to prevented planting benefits and 50/92 or 0/92; however, they do not authorize prevented planting payments on 0/85 or 50/85 provisions. ACTION: Producers enrolled in the 1995 Acreage Reduction Program (ARP) for wheat, feed grains, cotton, and rice could voluntarily reduce their plantings of the crop and designate the acreage as CU for payment under the 0/50/85 provisions. (Cotton and rice producers were required to plant at least 50 percent of the acreage). The underplanted acreage maintained as CU for payment earns at least the minimum guaranteed deficiency payment on up to 85 percent of the maximum payment acres for the crop. The underplanting of acreage is voluntary and not due to prevented planting. Therefore, the acreage is not eligible for prevented planting insurance guarantees under the Federal crop insurance program. The situations where a producer enrolled in ARP may earn a guaranteed deficiency payment on up to 92 percent (0/50/92) rather than 85 percent of the maximum payment acres and also qualify for a prevented planting payment are as follows: 1) Producers having an approved ASCS-574, Application for Disaster Credit, for prevented planted or failed acreage of the crop were allowed to designate prevented planted or failed acreage for payment. This acreage is eligible for prevented planting insurance guarantees under the Federal crop insurance program in accordance with MR-95-028. 2) Producers having an approved ASCS-574 for prevented planted or failed acreage of the crop were allowed to plant the acreage to a minor oilseed such as sunflowers or canola or to an industrial crop such as millet or crambe. The prevented planted acreage of the program crop is eligible for prevented planting insurance guarantees under the Federal crop insurance program in accordance with MGR-95-028. If the intended acreage of minor oilseed or industrial crop is also prevented and insurance is available for the crop (such as sunflowers or canola), a prevented planting insurance guarantee would not apply. In accordance with MGR-95-028, only one prevented planting payment will be allowed for each acre for the crop year. 3) Producers who voluntarily reduced the program crop plantings were allowed to plant minor oilseeds such as sunflowers or canola, or industrial crops such as millet or crambe, on the underplanted acres. The underplanting of the program crop is voluntary and not due to prevented planting. Therefore, prevented planting insurance guarantees do not apply to the program crop. However, if the intended acres of the minor oilseed or industrial crop are prevented from being planted and insurance is available for such crop (such as sunflowers or canola), a prevented planting insurance guarantee is available. The ASCS-578, Report of Acreage, will generally reflect only the minor oilseed or industrial oilseed as the initial crop designated for pay. For a producer to declare acreage eligible for the provisions of 0/50/92, an ASCS-574 must have been filed and approved by the county committee. County committees are instructed not to approve an ASCS-574 unless preliminary efforts to plant the crop is evident (land disked, seed and fertilizer delivered or arranged for, etc.) All producers were notified to file an ASCS-574 within 15 calendar days after the final planting date for the crop. Insurance providers should obtain the ASCS-578, Report of Acreage and CCC-477B, 1995 Participation Worksheet. These forms will aid in the proper determination of acreage that was designated as prevented planted, failed or voluntarily reduced planting.