December 18, 1997 INFORMATIONAL MEMORANDUM: R&D-97-092 TO: All Reinsured Companies All Risk Management Field Offices FROM: Tim B. Witt S/ TBW Deputy Administrator SUBJECT: Debt Notification As Required by the Ineligible Tracking System Handbook BACKGROUND: The Ineligible Tracking System (ITS) Handbook provides a debt notification process that must be followed before a producer may be submitted to the Ineligible Tracking System. In Exhibit 9 of the handbook, minimum debt notification periods are specified. For most crops, the procedure provides that debt notification must occur at least 60 days prior to the termination date for the crop and area. However, for some crops in certain areas, the debt notification date is the same as the billing date (e.g., the 1997 billing and debt notification date for wheat in Any County, Any State is October 1, 1997). The Risk Management Agency (RMA) has received comments indicating that the 60-day time period is not workable in such situations because it does not allow any time for the producer to pay the premium before the debt notification is issued. RMA has reviewed all premium billing and termination dates. In many instances, in excess of 90 days exists between premium billing and termination which permits a reasonable premium billing/debt notification process. However, there are a number of county crop programs where the billing date and debt notification date are the same. The principle crop affected is wheat. Reinsured companies have requested that RMA officially revise the 60-day debt notification period to a shorter period. ACTION: RMA has revised the 60-day debt notification time period shown for "All Other Crops" and "Nursery" in Exhibit 9 to 30 days. Exhibit 9 has been updated (see attachment) and should be slipsheeted into the ITS Handbook. This memorandum and attached slipsheets are available on the Reporting Organization Server under 1997 Research and Development Bulletins. December 1997FCIC 24050-01 U. S. DEPARTMENT OF AGRICULTURE WASHINGTON, D. C. 20250 FEDERAL CROP INSURANCE CORPORATION DIRECTIVE NUMBER: 24050-01 SUBJECT: INELIGIBLE TRACKING SYSTEM HANDBOOK DATE: December 1997 OPI: PRODUCT DEVELOPMENT DIVISION APPROVED: /S TBW 12/18/97 l PURPOSE AND OBJECTIVE Revises the dates for the debt notification process on page 24 of the original issuance. 2 CANCELLATION Issuances Rescinded. Rescinds page 24 of the original issuance. DISTRIBUTION RMA Deputy Administrators, Directors, Washington, D.C. and Kansas City; RMA Regional Service and Risk Compliance Offices; National Appeals Division (NAD); Reinsured Companies, and National Crop Insurance Services (NCIS). December 1997 FCIC 24050-01 EXHIBIT 9 DEBT NOTIFICATION TIME PERIODS Minimum Days Notification Crop(s) Required Prior to Termination Date Forage Seeding 15 days Macadamia Nuts 15 days Macadamia Trees Apples, Blueberries, Cranberries, Grapes, 30 days Pears All Other Crops 30 days Nursery ** 30 days * The Macadamia Tree policy provides as a condition for insurance to attach that the premium must be paid. Macadamia Tree policyholders cannot become debtors except in cases of overpayment. Macadamia Tree policyholders will not be issued a Notice of Debt letter. ** The Nursery policy contains multiple premium payment dates. The last payment date is April 1. Policyholders have until the termination date to make the final payment for the policy. NOTE: The Notice of Debt describes various options available to the policyholder in the event of a dispute or disagreement that affects payment of the premium and provides information concerning the consequences of not paying the premium. The dates for issuance of the Notices of Debt follow after the billing date. 24