Expanding Options for Specialty and Organic Growers (EOSOG)

<RULE> DEPARTMENT OF AGRICULTURE <SUBAGY>Federal Crop Insurance Corporation</SUBAGY> <CFR>7 CFR Parts 400, 407, and 457</CFR> <DEPDOC>[Docket ID FCIC-24-0003]</DEPDOC> <RIN>RIN 0563-AC85</RIN> <SUBJECT>Expanding Options for Specialty and Organic Growers (EOSOG)</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Federal Crop Insurance Corporation, U.S. Department of Agriculture (USDA). <HD SOURCE="HED">ACTION:</HD> Final rule with request for comments. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The Federal Crop Insurance Corporation (FCIC) is amending its regulations to expand the availability of enterprise and optional units. FCIC is also clarifying double cropping requirements when another plan of insurance does not require records of acreage and production. FCIC is removing burdensome written agreement requirements and setting new yield guarantee limits for new breaking acreage. In this rule, FCIC is providing flexibility and clarifying rules regarding assignment of indemnity and streamlining and shortening good farming practice determinations. FCIC is also clarifying the timing and method of yield reductions for several perennial crops, and allowing sunburn damaged walnuts to be eligible for indemnity payments through quality adjustment. The changes to the crop insurance policies resulting from the amendments in this rule are applicable for the 2025 and succeeding crop years for crops with a contract change date on or after June 30, 2024. For all other crops, the changes to the policies made in this rule are applicable for the 2026 and succeeding crop years. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> <E T="03">Effective date:</E> This final rule is effective June 30, 2024. <E T="03">Comment date:</E> We will consider comments that we receive by the close of business August 26, 2024. FCIC may consider the comments received and may conduct additional rulemaking based on the comments. </EFFDATE> <HD SOURCE="HED">ADDRESSES:</HD> We invite you to submit comments on this rule. You may submit comments by going through the Federal eRulemaking Portal as follows: • <E T="03">Federal eRulemaking Portal:</E> Go to <E T="03">https://www.regulations.gov</E> and search for Docket ID FCIC-24-0003. Follow the instructions for submitting comments. All comments will be posted without change and will be publicly available on <E T="03">www.regulations.gov.</E> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Chandra Place; telephone (816) 926-3875; or email <E T="03">chandra.place@usda.gov.</E> Individuals who require alternative means for communication should contact the USDA Target Center at (202) 720-2600 (voice) or (844) 433-2774 (toll-free nationwide). </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">Background</HD> FCIC serves America's agricultural producers through effective, market-based risk management tools to strengthen the economic stability of agricultural producers and rural communities. FCIC is committed to increasing the availability and effectiveness of Federal crop insurance as a risk management tool. Approved Insurance Providers (AIPs) sell and service Federal crop insurance policies in every state through a public-private partnership. FCIC reinsures the AIPs who share the risks associated with catastrophic losses due to major weather events. FCIC's vision is to secure the future of agriculture by providing world class risk management tools to rural America. Federal crop insurance policies typically consist of the Basic Provisions, the Crop Provisions, the Special Provisions, the Commodity Exchange Price Provisions, if applicable, other applicable endorsements or options, the actuarial documents for the insured agricultural commodity, the Catastrophic Risk Protection Endorsement, if applicable, and the applicable regulations published in 7 CFR chapter IV. Throughout this rule, the terms “Crop Provisions,” “Special Provisions,” and “policy” are used as defined in the Common Crop Insurance Policy (CCIP), Basic Provisions in 7 CFR 457.8. Additional information and definitions related to Federal crop insurance policies are in 7 CFR 457.8. FCIC is amending the following regulations: • Subpart J (7 CFR 400.98); • Area Risk Protection Insurance Basic Provisions (7 CFR 407.9); • Common Crop Insurance Policy Basic Provisions (7 CFR 457.8); • Small grains crop insurance provisions (7 CFR 457.101); • Sunflower seed crop insurance provisions (7 CFR 457.108); • Fig crop insurance provisions (7 CFR 457.110); • Coarse grains crop insurance provisions (7 CFR 457.113); • Arizona-California citrus crop insurance provisions (7 CFR 457.121); • Walnut crop insurance provisions (7 CFR 457.122); • Almond crop insurance provisions (7 CFR 457.123); • Macadamia nut crop insurance provisions (7 CFR 457.131); • Prune crop insurance provisions (7 CFR 457.133); • Dry pea crop insurance provisions (7 CFR 457.140); • Northern potato crop insurance provisions (7 CFR 457.142); • Central and Southern potato crop insurance provisions (7 CFR 457.147); • Dry bean crop insurance provisions (7 CFR 457.150); • Processing bean crop insurance provisions (7 CFR 457.155); • Canola and rapeseed crop insurance provisions (7 CFR 457.161); • Blueberry crop insurance provisions (7 CFR 457.166); • Pecan revenue crop insurance provisions (7 CFR 457.167); and • California avocado crop insurance provisions (7 CFR 457.175). The changes to the crop insurance policies resulting from the amendments in this rule are applicable for the 2025 and succeeding crop years for crops with a contract change date on or after June 30, 2024. For all other crops, the changes to the crop insurance policies resulting from the amendments in this rule are applicable for the 2026 and succeeding crop years. <HD SOURCE="HD1">Enterprise and Optional Units</HD> FCIC is improving crop insurance for specialty crop producers by removing barriers to the adoption of enterprise units (EUs) and organic producers by removing existing restrictions on optional units (OU) availability while also authorizing EUs for organic farming practices in section 34(a) through (c) of the CCIP Basic Provisions. An EU allows a producer to insure all acres of the insured crop in the county together, as opposed to other unit structures that separate the acreage for insurance. EUs are attractive to producers due to lower premium rates offered to recognize the lower risk associated with the geographic diversification. In general, the larger the EU, the lesser the risk, and the greater the EU discount. Prior to this rule, to qualify for an EU, there must be acreage in two or more sections, section equivalents, or Farm Service Agency Farm Numbers (with some exceptions in limited circumstances) which generally follows the primary basis of OUs for the majority of crops. Prior to this rule, many specialty and perennial crop policies established OUs by non-contiguous parcels of land which do not qualify to be aggregated into an EU. This limits the effectiveness of EUs for these policies and creates an additional administrative burden by not following the established OU definition for these crops. FCIC will allow crops that authorize OUs by non-contiguous parcels of land to also qualify for EUs, in section 34(a)(2)(i)(G) of the CCIP Basic Provisions. This will ensure equity in crop insurance availability for all producers because specialty and perennial crop producers will now have access to EUs consistent with row crop producers. Prior to this rule, unlike major row crops, OUs by organic farming practice were not available for most specialty and perennial crops due to language in the Crop Provisions (CP) that superseded the standard OU definition in the CCIP Basic Provisions. FCIC is removing existing OUs by organic limitations from the applicable Crop Provisions while also authorizing EUs by organic farming practice for all crops insured under section 34(a)(2)(i)(G)(vi) of the CCIP Basic Provisions where EUs are available, and the organic farming practice is insurable. These changes are responsive to organic growers and the Climate Smart Initiative. FCIC is also revising section 1 of the CCIP Basic Provisions in the definition of “enterprise unit” to authorize EU for acreage grown under an organic farming practice. In addition to the CCIP Basic Provisions described above, FCIC is making clarifications and edits for consistency with the new EU and OU choices in the following Crop Provisions: • Small grains crop insurance provisions (7 CFR 457.101); • Sunflower seed crop insurance provisions (7 CFR 457.108); • Fig crop insurance provisions (7 CFR 457.110); • Coarse grains crop insurance provisions (7 CFR 457.113); • Arizona-California citrus crop insurance provisions (7 CFR 457.121); • Walnut crop insurance provisions (7 CFR 457.122); • Almond crop insurance provisions (7 CFR 457.123); • Macadamia nut crop insurance provisions (7 CFR 457.131); • Prune crop insurance provisions (7 CFR 457.133); • Dry pea crop insurance provisions (7 CFR 457.140); • Dry bean crop insurance provisions (7 CFR 457.150); • Processing bean crop insurance provisions (7 CFR 457.155); • Canola and rapeseed crop insurance provisions (7 CFR 457.161); and • California avocado crop insurance provisions (7 CFR 457.175). <HD SOURCE="HD1">Double Cropping and Annual Forage</HD> Double cropping is a farming practice for producing two or more crops for harvest on the same acreage in the same crop year. In order for a producer to receive two full indemnity payments or prevented planting payments, several double cropping requirements must be met. The CCIP Basic Provisions and the Annual Forage Crop Provisions (under the Rainfall Index Plan Common Policy, Basic Provisions) have some differences in their double cropping requirements, which has ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 173k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━