INFORMATIONAL MEMORANDUM:    R&D-96-045

TO:      All Reinsured Companies
         All Risk Management Field Offices
         FSA Headquarters, Program Delivery and Field Operations

FROM:    Tim B. Witt
         Director
         Research and Development Division

SUBJECT: Texas Citrus Fruit Crop Insurance Provisions


Attached is the Texas Citrus Fruit Crop Provisions.  These provisions are
effective for the 1998 and succeeding crop years.  Following is a brief 
description of the significant changes to these provisions.  Please refer to 
the provisions for more complete information.

Section 2 allows basic units to be divided into optional units by section, 
section equivalent or FSA Farm Serial Number; or by non-contiguous land.  
The previous endorsement allowed unit division by section if each unit was
non-contiguous.  

Section 3(e) specifies that the yield used to compute the producers' 
production guarantee will be determined in accordance with Actual Production 
History (APH) regulations and applicable policy provisions unless previous 
damage or changes to the grove or trees,  require establishment of the yield 
by another method.  In the event of such damage or changes the yield will be 
based on FCIC's appraisal of the potential of the insured acreage for the 
crop year.  This change will provide the flexibility needed to allow yield 
determination by appraisals when past production history is not adequate.  
For the 1998 crop year the yield will be based on the appraisal of the yield 
potential due to the lingering effects of the 1989 freeze.

Section 3(f) allows for a 1-year lag period for the producer to report citrus
production for APH because all of the fruit will not be harvested until after 
the production reporting date.

Section 5 changed the cancellation and termination dates from November 30 to
November  20.

Sections 7(f) and 11(a) add provisions to make citrus sold by direct 
marketing insurable if allowed by the Special Provisions or by written 
agreement.  The producer must give notice at least 15 days before any 
production from any unit will be sold by direct  marketing.

Section 8 makes citrus interplanted with another perennial crop insurable 
unless the  insurance provider inspects the acreage and determines it does 
not meet the requirements contained in the producer's policy.

Section 9(a)(1) specifies that insurance coverage begins on November 21 of 
each crop year, except that for the year of application if the producer's 
application is received after  November 11 but prior to November 21, 
insurance will attach on the 10th day after the  properly completed 
application is received in the insurance provider's local office, unless  
the insurance provider inspects the acreage during the 10-day period and 
determines that it does not meet insurability requirements.  Under the 
current policy if the application is  submitted on or before November 30, 
but the application is not accepted until after November 30, insurance will 
attach on the 30th day after the producer signs and submits a properly 
completed application, unless acreage was inspected and determined to be  
unacceptable.

Section 9(b)(1) specifies that if the producer acquires an insurable share 
in any insurable acreage after coverage begins, but on or before the acreage 
reporting date for the crop year, and after an inspection the insurance 
provider considers the acreage acceptable, insurance will be considered to 
have attached to such acreage on the calendar date for the beginning of the 
insurance period.

Section 9(b)(2) specifies that if the producer relinquishes an insurable 
share on any insurable acreage of citrus on or before the acreage reporting 
date for the crop year, insurance will not be considered to have attached to,
and no premium will be due for, such acreage for that crop year unless a
transfer form is completed by all affected parties, the insurance provider 
is notified in writing on or before the acreage reporting date, and the 
transferee is eligible for crop insurance.

Section 10(a)(8) specifies that failure of the irrigation water supply must 
be caused by an insured peril that occurs during the insurance period. 

Section 10(b)(1) specifies that damage or loss of production due to disease 
or insect infestation, will not be insurable unless an insured cause of loss 
prevents the proper application of control measures, causes properly applied 
control measures to be ineffective, or causes disease or insect infestation 
for which no effective control mechanism is available.

Section 12(d) Adds a provision to clarify that if individual records of 
juice content are not available, the average juice content will be obtained 
from the nearest juice plant if available.  If not available, a field 
appraisal will be made to determine the average juice content.

Section 13 adds provisions for providing insurance coverage by written 
agreement.  The provision which allowed the contract price to be an 
applicable price for undamaged citrus fruit if the contract was executed 
between the producer and buyer before damage occurred was deleted because 
it allowed a potential for abuse and was seldom used.