Final Agency Determination: FAD-101

FAD-101

Subject: Request dated August 14, 2009, requesting a Final Agency Determination for the 2009 and succeeding crop years regarding the interpretation of section 15(h)(4) of the Common Crop Insurance Policy Basic Provisions (Basic Provisions), published at 7 C.F.R. § 457.8. This request is pursuant to 7 C.F.R. part 400, subpart X.

The submitter requests that the Risk Management Agency (RMA) provide an interpretation that clarifies whether the producer is required to maintain separate records for acres that were or were not double cropped according to section 15(h)(4) of the Basic Provisions.

Section 15 of the Basic Provisions states, as here pertinent:

(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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In regards to section 15(h)(4) above stating “records acceptable to us of acreage and production” the requestor interprets the section as requiring the approved insurance provider (AIP) to obtain acreage and production records to verify double cropping history. The Basic Provisions are silent as to whether double crop records must be separately maintained for each crop. The requestor interprets the policy to mean the acreage and production records are not required to be crop specific, and that records from the acreage that was double cropped can be combined with records from acreage that was not double cropped. The requestor stated they have received previous documents and perceived agreement from RMA regarding the documentation requirements, and therefore, the requestor is seeking a Final Agency Determination.

The requestor provided an example where the producer provides records from the previous two years of onion crops. Each year, onions were planted on a 40-acre field; however end rows (turn rows) and every 20th row (to allow for farming equipment to be transported through the field) were skipped. As a result, only 32 actual acres of onions were planted. The producer then plants the entire field (40 acres) with soybeans. The producer provides a satisfactory record of acres and production from the 32 acres of onions, but is unable to provide separate soybean production records for the 32 acres planted to onions and the remaining eight acres that were not double cropped. In this scenario, the requestor interprets the producer to be eligible for 32 acres of double crop insurance coverage.

A second example was provided by the requestor where the producer planted and harvested 40 acres of wheat and intended to plant the full 40 acres with soybeans; however, due to weather conditions was only able to plant 32 acres of soybeans. Due to the original intent of planting the full 40 acres with soybeans, the producer did not maintain and is unable to provide wheat production records for the 32 acres planted with soybeans and the remaining eight acres where soybeans were not planted. However, based on the review of acreage and production records the requestor is able to verify that 32 acres were successfully double cropped. Therefore, the requestor interprets the producer to be eligible for 32 acres of double crop insurance coverage.

A third example was provided by the requestor in which a producer has a wheat policy with an enterprise unit consisting of two farms located several miles apart from each other. The producer’s intent was to plant all wheat acres to soybeans, and therefore the producer does not maintain separate wheat production records for the two farm locations. However, due to a weather event the producer was prevented from planting the second soybean crop on one of the farming locations and cannot provide separate wheat production from the crop acreage that was not double cropped. The requestor interprets that due to the producer’s intent to plant all wheat acres to soybeans, the corresponding records provided for both crops will be acceptable records for double crop history.

The Federal Crop Insurance Corporation (FCIC) agrees in part with the requestor’s interpretation. Normally separate production records for first crop and second crop acreage must be provided to prove double cropping history for the acreage on which double cropping practice is claimed. However, there are exceptions. FCIC has previously provided an informal interpretation stating that the first example was an exception.

In the first example provided by the requestor, the producer provides satisfactory records of acreage and production from the 32 acres of onions. However, the producer is unable to provide separate soybean production records broken down by the 32 acres previously planted to onions and the remaining eight acres that were not originally planted to onions. Consistent with onion planting practices, leaving a reasonable amount of acreage in end rows is a recognized cultural or management practice. In this case, FCIC agrees that it is impractical and unreasonable to expect the producer to keep soybean production on the double cropped acreage separate from production associated with the end rows and equipment lanes where no onions were previously planted. Therefore, past records showing onion production on 32 acres and soybean production from 40 acres will qualify as acceptable double cropping records in this specific example. FCIC agrees acceptable records were provided for 32 double cropped acres in the first example.

With regard to the second example provided by the submitter, FCIC agrees it may provide another exception to the rule that separate records must be provided for first crop and second crop acreage. However, the records for 32 acres where both a first crop and a second crop were planted and harvested are acceptable only if the AIP determines there are acceptable records showing the entire 40 acres were double cropped in one of the past four crop years. Such documentation is necessary to determine the producer usually has a history of planting the entire 40 acres to both wheat and soybeans, but due to weather conditions was unable to do so for the year in question. In this case, the producer planted and harvested 40 acres of wheat and began to plant 40 acres of soybeans following the wheat, but was only able to plant 32 acres of soybeans. The producer is unable to provide separate wheat production records for the 32 acres planted to soybeans and the remaining eight acres where it was not possible to plant soybeans due to weather. If the producer can provide records for one of the past four years showing that all 40 acres were double cropped, FCIC agrees that it is again impractical and unreasonable to require the producer to maintain separate records for the 32 wheat acres considered double cropped from the 8 wheat acres where no second crop was planted so the production records for the 32 acres are considered acceptable.

With respect to the third example, it presents a similar scenario to the second example. Separate production records are normally required for acreage that is double cropped. However, similar to the second example, due to weather conditions the producer was unable to plant soybeans on all acreage previously planted to wheat in the third situation provided by the requestor. Therefore, if the AIP can determine there are acceptable records which show all acreage in both fields were double cropped in one of the past four crop years, the AIP may determine the records for the year in question satisfy the records requirement for proving double cropping history as stated in the Basic Provisions. If both fields were not double cropped in one of the past four crop years, the records provided in example three cannot be used to prove double cropping history.

In accordance with 7 C.F.R. 400.765(c), this Final Agency Determination is binding on all participants in the Federal crop insurance program for the 2009 and succeeding crop years. Any appeal of this decision must be in accordance with 7 C.F.R. 400.768(g).

Date of Issue: Oct 2, 2009