Final Agency Determination: FAD-045

Subject: Request dated January 26, 2005, for a Final Agency Determination for the 2005 and succeeding crop years regarding the interpretation of section 15(h)(4) of the Basic Provisions, published at 7 C.F.R. 457.8. This request was submitted pursuant to 7 C.F.R. part 400, subpart X.

Section 15(h)(4) of the Basic Provisions states:

15. Production Included in Determining an Indemnity and Payment Reductions.
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(h) You may receive a full indemnity, or a full prevented planting payment for a first insured crop when a second crop is planted on the same acreage in the same crop year, regardless of whether or not the second crop is insured or sustains an insurable loss, if each of the following conditions are met:

(1) * * *

(2) * * *

(3) * * *

(4) You provide records acceptable to us of acreage and production that show you have double cropped acreage in at least two of the last four crop years in which the first insured crop was planted, or that show the applicable acreage was double cropped in at least two of the last four crop years in which the first insured crop was grown on it; and

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The requestor interprets section 15(h)(4) to mean the insured producer must provide records of acreage and production specific to the tracts of land the insured is claiming were double cropped in two of the last four years. The first requirement in section 15(h)(4) requires the insured producer to provide records of acreage and production that show the insured producer has double cropped acreage in at least two of the four crop years in which the first insured crop was planted.

The second provision in section 15(h)(4) continues to require that the insured producer show records of acreage and production for "applicable acreage" that was double cropped in two of the last four years. Applicable acreage means the acreage on which an indemnity or prevented planting payment is being claimed for a first insured crop when a second crop is planted on the same acreage. The requestor indicates it is clear that the policy intends for the insured producer to show double cropping records for acreage and production pertinent to the tracts of land that were double cropped in two of the last four crop years. Further, the provisions clearly imply records by field are required because the provision requires records from acreage where the first insured crop was grown. The required records of acreage and production are for the first insured crop that was grown on the acreage in the county or the applicable acreage that was claimed to have been double cropped.

The requestor provided an example in which an insured producer's actual production history is comprised of acreage and production from 20 fields. Seven of the 20 fields were double cropped in two of the last four years. In this case, the requestor interprets the provisions to require records of acreage and production from the seven fields to meet double cropping requirements.

The Federal Crop Insurance Corporation (FCIC) agrees in part with the interpretation. There are two ways the producer can prove double cropping in two of the last four crop years in which the first insured crop was planted. First, the producer can provide the producer's own records of acreage and production to show the producer double cropped acreage of the first insured crop in two of the last four crop years in which the first insured crop was planted. Second, if the acreage was double cropped for two of the last four crop years in which the first insured crop was grown on it by someone else and the producer acquires the acreage, the other producer's records of acreage and production can be used.

This means if the producer did not double crop any acreage but another producer did, section 15(h)(4) requires the producer to provide records of acreage and production of double cropped acreage from the specific acreage, or tract of land, that was actually double cropped in the past. FCIC agrees there is a requirement that the double cropping records required in section 15(h)(4) be from the same acreage the producer intends to double crop in the current year. Section 508A(d)(3) of the Federal Crop Insurance Act (Act) provides that a producer without a history of double cropping may receive full indemnity payments on two or more crops planted for harvest in the same crop year if the applicable acreage has historically had two or more crops planted for harvest in the same crop year. In this case "applicable acreage" can only be interpreted to mean the acreage for which indemnities are being claimed in the current year. Therefore, if, like in the example, seven of the 20 fields in the producer's operation this year were previously double cropped in two of the last four years in which the first insured crop was grown on it, the producer would have to provide the production records for the seven fields showing they were double cropped.

However, if the producer's own records are being used, the producer only needs to provide production and acreage records to show the producer double cropped any acreage in two of the last four years in which the first insured crop was planted. Contrary to the interpretation of the requestor, there is no requirement that the double cropping records of the producer required in section 15(h)(4) be from the same acreage the producer intends to double crop in the current year. However, all other conditions stated in section 15(h) for such acreage must be met.

In accordance with 7 CFR 400.765 (c) this constitutes the Final Agency Determination and is binding on all participants in the Federal crop insurance program for the 2005 and subsequent crop years, unless such provisions are revised. Any appeal of this decision must be in accordance with 7 C.F.R. 400.768(g).

Date of Issue: May 2, 2005