Common Crop Insurance Regulations; Florida Citrus Fruit Crop Insurance Provisions

SUMMARY: The Federal Crop Insurance Corporation (FCIC) finalizes the Common Crop Insurance Regulations, Florida Citrus Fruit Crop Insurance Provisions. The intended effect of this action is to provide policy changes and clarify existing policy provisions to better meet the needs of insured producers, and to reduce vulnerability to program fraud, waste, and abuse. The proposed changes will apply for the 2014 and succeeding crop years.

EFFECTIVE DATE: This rule is effective January 22, 2013.

FOR FURTHER INFORMATION CONTACT: Tim Hoffmann, Director, Product Administration and Standards Division, Risk Management Agency, United States Department of Agriculture, Beacon Facility, Stop 0812, Room 421, P.O. Box 419205, Kansas City, MO, 64141-6205, telephone (816) 926-7730.

SUPPLEMENTARY INFORMATION: This rule has been determined to be non-significant for the purposes of Executive Order 12866 and, therefore, it has not been reviewed by the Office of Management and Budget.

Paperwork Reduction Act of 1995

Pursuant to the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), the collections of information in this rule have been approved by OMB under control number 0563-0053.

E-Government Act Compliance

FCIC is committed to complying with the E-Government Act, to promote the use of the Internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes.

Unfunded Mandates Reform Act of 1995

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. This rule contains no Federal mandates (under the regulatory provisions of title II of the UMRA) for State, local, and tribal governments or the private sector. Therefore, this rule is not subject to the requirements of sections 202 and 205 of UMRA.

Executive Order 13132

It has been determined under section 1(a) of Executive Order 13132, Federalism, that this rule does not have sufficient implications to warrant consultation with the States. The provisions contained in this rule will not have a substantial direct effect on States, or on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

Executive Order 13175

This rule has been reviewed in accordance with the requirements of Executive Order 13175, Consultation and Coordination with Indian Tribal Governments. The review reveals that this regulation will not have substantial and direct effects on Tribal governments and will not have significant Tribal implications.

Regulatory Flexibility Act

FCIC certifies that this regulation will not have a significant economic impact on a substantial number of small entities. Program requirements for the Federal crop insurance program are the same for all producers regardless of the size of their farming operation. For instance, all producers are required to submit an application and acreage report to establish their insurance guarantees and compute premium amounts, and all producers are required to submit a notice of loss and production information to determine the amount of an indemnity payment in the event of an insured cause of crop loss. Whether a producer has 10 acres or 1000 acres, there is no difference in the kind of information collected. To ensure crop insurance is available to small entities, the Federal Crop Insurance Act authorizes FCIC to waive collection of administrative fees from limited resource farmers. FCIC believes this waiver helps to ensure that small entities are given the same opportunities as large entities to manage their risks through the use of crop insurance. A Regulatory Flexibility Analysis has not been prepared since this regulation does not have an impact on small entities, and, therefore, this regulation is exempt from the provisions of the Regulatory Flexibility Act (5 U.S.C. 605).

Federal Assistance Program

This program is listed in the Catalog of Federal Domestic Assistance under No. 10.450.

Executive Order 12372

This program is not subject to the provisions of Executive Order 12372, which require intergovernmental consultation with State and local officials. See the Notice related to 7 CFR part 3015, subpart V, published at 48 FR 29115, June 24, 1983.

Executive Order 12988

This final rule has been reviewed in accordance with Executive Order 12988 on civil justice reform. The provisions of this rule will not have a retroactive effect. The provisions of this rule will preempt State and local laws to the extent such State and local laws are inconsistent herewith. With respect to any direct action taken by FCIC or action by FCIC directing the insurance provider to take specific action under the terms of the crop insurance policy, the administrative appeal provisions published at 7 CFR part 11, or 7 CFR part 400, subpart J for determinations of good farming practices, as applicable, must be exhausted before any action against FCIC for judicial review may be brought.

Environmental Evaluation

This action is not expected to have a significant economic impact on the quality of the human environment, health, or safety. Therefore, neither an Environmental Assessment nor an Environmental Impact Statement is needed.

Background

This rule finalizes changes to the Common Crop Insurance Regulations (7 CFR part 457), Florida Citrus Fruit Crop Insurance Provisions that were published by FCIC on July 16, 2012, as a notice of proposed rulemaking in the Federal Register at 77 FR 41709-41716. The public was afforded 30 days to submit comments after the regulation was published in the Federal Register .

A total of 80 comments were received from 6 commenters. The commenters were insurance providers, an insurance service organization, and a grower organization.

The public comments received regarding the proposed rule and FCIC's responses to the comments are as follows:

General

Comment: A commenter asked that FCIC conduct at least one public forum meeting, with current citrus growers, insurance provider loss adjustment management, agents, and grower groups, before all the proposed changes are implemented and binding in regards to the 2014 Florida Citrus Fruit policy.

Response: FCIC representatives have been present at several meetings where Florida citrus fruit stakeholders, including loss adjusters and grower groups have been present. At these meetings some of the proposed changes to the Florida Citrus Fruit Crop Provisions (Crop Provisions) were discussed and the stakeholders provided valuable input. The information gathered at these meetings was considered when drafting the proposed rule. FCIC regrets if all interested parties were not in attendance at these meetings or if the topics covered did not encompass all of the proposed changes. Further, all interested parties have had an opportunity to comment on all the proposed changes. Therefore, FCIC does not intend to conduct any additional meetings to discuss the proposed changes prior to finalizing the Crop Provisions.

Comment: A few commenters stated FCIC's proposed system for reclassifying citrus fruit is more cumbersome than the one currently used by the agency. The commenters stated they can find no reason to change the system and doing so will only cause confusion. Growers are familiar with the current system as it has been in place for over 50 years. Changing such a widely accepted, time tested system simply for the purpose of standardization with other commodities makes no sense.

Response: FCIC understands the concerns of the commenters that the proposed changes to terminology and policy structure could initially create confusion for stakeholders. However, these changes are necessary in order to meet the objectives of the Acreage Crop Reporting Streamlining Initiative, which has a broader goal of simplifying reporting requirements for producers. Currently, different USDA programs have different reporting requirements and terminology. In order to streamline the reporting process, accommodations have been made within all the affected programs to standardize their reporting. In the long run, producers will benefit from this streamlined process. Stakeholders should become more comfortable with the changes to terminology and policy structure over time. No change has been made to the final rule.

Comment: A commenter stated the proposed changes within the policy for reclassifying citrus into commodities have their purpose and could be perceived as a move in the right direction. However, instead of renaming all Florida citrus and citrus fruit nationwide, the commenter suggested that FCIC align and broaden coverage. The commenter stated that claims should be separated at the variety level and not offset another variety. If unit structures and coverage were enhanced and broadened, then growers that only purchase catastrophic coverage would be inclined to analyze their risk and management thereof and purchase better protection.

Response: FCIC appreciates the commenter's suggestion that allowing units to be separated at the varietal level would be more desirable to producers and would result in producers selecting higher levels of coverage on the varieties with a higher perceived risk. While the proposed "citrus fruit groups" could be used to allow separate basic units and coverage levels by variety, no such changes were proposed and such changes would be significant, requiring the public to receive an opportunity to comment. In considering such changes in the future, more research would be necessary to determine the impact on premium rates and the producers' willingness to pay for any increased rates. No change has been made to the final rule.

--This is a summary of a Federal Register article originally published on the page number listed below--

Final rule.

CFR Part: "7 CFR Part 457"

RIN Number: "RIN 0563-AC39"

Citation: "77 FR 75509"

Document Number: "Docket No. FCIC-12-0006"

Federal Register Page Number: "75509"

"Rules and Regulations"