INFORMATIONAL MEMORANDUM: R&D-97-032
    
TO:       All Reinsured Companies
          All Risk Management Field Offices
               
FROM:     Tim B. Witt      /S/ ROBERTA E. WAGGONER (for)
          Deputy Administrator
     
SUBJECT:  Clarification of Nonstandard Classification System (NCS) for
          Crop Revenue Coverage (CRC) and Revenue Assurance (RA)
     
BACKGROUND:
     
Research and Development has received several requests for clarification
of issues related to the impact of NCS on the availability of CRC and RA
coverage and determination of CRC.
     
CLARIFICATION - NCS Determinations
     
The CRC and RA insurance policies state that a producer who is also
identified in NCS is not eligible to participate in these programs.  A
producer is considered identified in NCS when:
     
    1. Listed under NCS.
     
    2. Sharing with a person listed under NCS.
     
    3. An entity that contains a person listed under NCS who holds a
       substantial beneficial interest in the entity and is actively
       engaged in the farming operation.
     
    4. Farming land listed under NCS.  A High Risk Land Exclusion Option
       to exclude such land may not be used in order to qualify for CRC or
       RA coverage.
     
A producer who cash rents lands (100 percent interest) from a person
identified in NCS is not affected by the NCS classification of the
listed person.  The producer is therefore eligible for CRC and RA
coverage.