Final Agency Determination: FAD-224

Subject: Request dated August 6, 2014, to the Risk Management Agency (RMA) requesting a Final Agency Determination for the 2013 crop year regarding the interpretation of section 17(f)(8)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. § 400, subpart X.

Background:

Section 17 of the Basic Provisions states, in relevant part:

17. Prevented Planting.

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(f) Regardless of the number of eligible acres determined in section 17(e), prevented planting coverage will not be provided for any acreage:

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(8) That exceeds the number of eligible acres physically available for planting;

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Special Provisions statement for counties in the Prairie Pothole National Priority Area state:

In accordance with section 17(f)(8) of the Basic Provisions, “physically available for planting” means land is free of trees, rocky outcroppings, or other factors that would prevent proper and timely preparation of the seedbed for planting and harvest of the crop for the crop year. Additionally, acreage not considered physically available for planting includes, but is not limited to, the following:

1. Acreage enrolled in CRP;

2. Perennial crop acreage (i.e., trees or vines visibly on the acreage or not removed from the acreage in a proper or timely manner to allow for planting a crop for the crop year);

3. Acreage where pasture, rangeland or forage is in place (Refer to section 17(f)(6) of the Basic Provisions for what constitutes established pasture, rangeland or forage acreage that is in place);

4. Acreage that has or recently had marsh vegetation (e.g., cattails, bulrushes, and pondweeds), coarse emergent plants, or submerged aquatics;

5. Any acreage not planted to a crop that is insured under the authority of the Federal Crop Insurance Act, that is grown in the county on insurable acreage, and harvested in at least one of the four most recent crop years, using recognized good farming practices, unless such acreage was planted to an insured crop that was damaged by an insured cause of loss and adjusted for purposes of a claim under the Federal crop insurance program; or

6. Acreage that has any other condition, as determined by us, that would prevent the proper and timely planting of the crop when weather and other conditions are normal for the area in which the acreage is located. For example, acreage that is normally too wet to plant in the spring may be dry enough to till or plant and even insure a crop in the fall. Such acreage would not be available for planting a spring crop even though such acreage may have been tilled, planted and/or insured the previous fall.

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Interpretation Submitted

The requestor interprets that item 5 of the Special Provisions for counties in the Prairie Pothole National Priority Area is part of a larger definition of acreage that is not considered physically available for planting. In turn, acreage that is not “physically available for planting” is not available for prevented planting coverage under section 17 of the Basic Provisions.

The requestor interprets item 5 of the Special Provisions to mean that in at least one of the four most recent crop years immediately preceding the current insured crop year, the acres must have been planted to a crop:

(a) Using good farming practices;

(b) Insured under the authority of the Federal Crop Insurance Act (Act); and

(c) That was harvested, or, if not harvested, was adjusted for claim purposes under the authority of the Act due to an insured cause of loss (other than a cause of loss related to flood or excess moisture).

Relative to paragraph (b) immediately above, the requestor contends that this does not require that said preceding crop was actually insured under the Act, but rather, that the preceding crop was a crop that could have been insured under the Act, or in other words, the preceding crop was a crop that was insurable under the Act.

For example, corn is a crop insured under the authority of the Act. In fact, there are more than 100 crops that are insured under the Act. Conversely, there are also many crops that are not insured or insurable under the Act.

Thus, if a farmer planted corn in one or more of the four most recent crop years immediately preceding the current insured crop year using recognized good farming practices, an if the farmer harvested that corn (or if not harvested the crop was adjusted for a claim under the Act due to an insured cause of loss other than flood or excess moisture), then that acreage would be considered physically available for planting, at least as far as that criterion was concerned. The requestor acknowledges that each of the six criteria must be evaluated separately and that the acreage must pass each of the tests for the acreage to be considered physically available for planting.

In contrast, if a farmer had planted a crop of raspberries (i.e., a crop that is not presently insured or insurable under the authority of the Act) on that same acreage in one or more of the four most recent crop years immediately preceding the current insured crop year using recognized good farming practices, and if the farmer harvested those raspberries (or if not harvested, the crop was adjusted for a claim under the Act due to an insured cause of loss other than flood or excess moisture), then that acreage would not be considered physically available for planting under this criterion - since it was not planted with an insurable crop.

Final Agency Determination

FCIC does not agree with the requestor’s interpretation. The requirements in item 5 of the Special Provisions must be read collectively. In order for acreage to be considered physically available for planting as specified in item 5, the acreage must have been planted to a crop that is insured under the authority of the Act, that is grown in the county on insurable acreage using good farming practices, and harvested in at least one of the four most recent crop years (planted, harvested, and insured). One exception exists for acreage that was planted to a crop and insured, but was subsequently damaged by an insured cause of loss and adjusted for claim purposes (planted, insured, and adjusted for claim purposes).

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 crop years the policy provisions are in effect. Any appeal of this decision must be in accordance with 7 C.F.R. § 400.768(g).

Date of Issue: September 22, 2014