Common Crop Insurance Regulations; Apple Crop Insurance Provisions

• Published date: 16 December 2021
• Citation: 86 FR 71396
• Record Number: 2021-26989
• Section: Proposed rules
• Court: Federal Crop Insurance Corporation

This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

71396

Vol. 86, No. 239

Thursday, December 16, 2021

DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 457

[Docket ID FCIC–21–0007]

RIN 0563–AC75

Common Crop Insurance Regulations;

Apple Crop Insurance Provisions

AGENCY

: Federal Crop Insurance

Corporation, U.S. Department of

Agriculture (USDA).

ACTION

: Proposed rule.

SUMMARY

: The Federal Crop Insurance

Corporation (FCIC) proposes to amend

the Common Crop Insurance

Regulations, Apple Crop Insurance

Provisions. The intended effect of this

action is to provide policy changes to

better meet the needs of the apple

producers, to address program

vulnerabilities that have caused

increased loss ratios and rising premium

costs, and to provide safeguards against

fraud, waste, and abuse. The proposed

changes will be effective for the 2023

and succeeding crop years.

DATES

: Written comments and opinions

on this proposed rule will be accepted

until close of business February 14,

2022 and will be considered when the

rule is to be made final.

ADDRESSES

: We invite you to submit

comments on this rule. You may submit

comments by either of the following

methods, although FCIC prefers that you

submit comments electronically through

the Federal eRulemaking Portal:

•Federal eRulemaking Portal: Go to

https://www.regulations.gov and search

for Docket ID FCIC–21–0007. Follow the

instructions for submitting comments.

•Mail: Director, Product

Administration and Standards Division,

Risk Management Agency (RMA), U.S.

Department of Agriculture, P.O. Box

419205, Kansas City, MO 64133–6205.

In your comment, specify docket ID

FCIC–21–0007.

•Comments will be available for

viewing online at www.regulations.gov.

FOR FURTHER INFORMATION CONTACT

:

Francie Tolle; telephone (816) 926–

7829; or email francie.tolle@usda.gov.

Persons with disabilities who require

alternative means for communication

should contact the USDA Target Center

at (202) 720–2600 (voice).

SUPPLEMENTARY INFORMATION

:

Background

The 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 (AIP) 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.

FCIC proposes to amend the Common

Crop Insurance Regulations by revising

7 CFR 457.158 Apple Crop Insurance

Provisions to be effective for the 2023

and succeeding crop years.

The proposed changes to 7 CFR

457.158 Apple Crop Insurance

Provisions are as follows:

1. Throughout the Crop Provisions,

FCIC proposes to include a reference to

a type listed in the actuarial documents.

The type name proposed is ‘‘Fresh

(Combined),’’ which is synonymous

with type ‘‘Fresh 111’’ that

policyholders are likely familiar with.

FCIC proposes no changes to what is

insurable under the type; the only

proposed change is to the type name.

2. Section 1—FCIC proposes to add a

definition of ‘‘Apple Supplemental

Report.’’ This term and its definition are

added because of proposed changes in

section 3 and section 6.

FCIC proposes to add a definition of

‘‘block.’’ This term is used in the Crop

Provisions but had not been defined.

FCIC proposes to revise the definition

of ‘‘damaged apple production.’’ The

current definition defines damaged

apple production in two parts: (1) With

respect to production insured under the

base policy, damaged apple production

is fresh or processing apple production

that fails to grade U.S. No. 1 Processing

or better; and (2) with respect to

production insured under the Fresh

Fruit Quality Adjustment (Quality

Option), damaged apple production is

fresh apple production that fails to

grade U.S. Fancy or better. FCIC is

proposing changes in the Quality

Option that require production that

grades U.S. #1 Processing or better but

less than U.S. Fancy to be included in

production to count at a reduced value;

therefore, the proposed revisions to the

definition of ‘‘damaged apple

production’’ had to be the same for

apples insured under the base policy

and apples insured under the Quality

Option. Due to these proposed changes,

the second part of the definition of

‘‘damaged apple production,’’ which

refers to the Quality Option, is proposed

to be removed.

FCIC proposes to revise the definition

of ‘‘direct marketing.’’ Direct marketing

is the sale of the insured crop directly

to consumers without the intervention

of an intermediary such as a wholesaler,

retailer, packer, processor, shipper,

buyer, or broker. The definition is being

revised to provide two clarifications.

The first is to state that production

records are controlled exclusively by the

policyholder. The second is to add a

sentence clarifying that only the portion

of the crop sold directly to consumers

will be considered direct marketed.

FCIC proposes to revise the definition

of ‘‘fresh apple production.’’ FCIC

proposes to move paragraphs (1)(ii),

(1)(iv) and (2) to Section 7, Insured

Crop, because these paragraphs contain

provisions that are more appropriately

placed in that section. FCIC proposes to

redesignate paragraph (1)(i) as (1),

paragraph (1)(iii) as (3), revise

redesignated paragraphs (1) and (3), and

add a new paragraph (2). In

redesignated paragraph (1), the

definition contains a list of actions that

the apples undergo to change them from

their basic form. Even though ‘‘dicing’’

was not included in the list of actions,

one could maintain that it was included

in the catch-all ‘‘etc.’’ at the end of the

list. However, FCIC received questions

regarding whether ‘‘dicing’’ would be

considered in this list of actions. To

provide clarification, FCIC proposes to

add the word ‘‘dicing’’ to the list of

actions that would constitute changing

apples from their basic form.

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In new paragraph (2), FCIC proposes

to clarify that apples sold for the

processing market are not considered

fresh apple production unless they were

sold with a grade of U.S. Fancy or

better. For example, apples sold for the

slicer market or the hard cider market

that are not sold with a grade of U.S.

Fancy or better. According to the

definition, as here pertinent, ‘‘fresh

apple production’’ is apples that do not

undergo any change in basic form.

Slicer apples are, just as their name

suggests, apples that are sliced, which is

a change in basic form. Sales of slicer

apples are currently allowed to be

considered fresh if the sales price was

commensurate with fresh apple sales.

However, slicers are a processed apple,

meaning they undergo a change in basic

form. Similarly, apples sold to the hard

cider market undergo a change in basic

form. A contracted study completed at

FCIC’s request determined that prices

for slicers are more commensurate with

processing apples. Currently, apples

sold as slicers can be insured as Fresh,

thus qualifying for optional coverage

under the Quality Option; however,

they can be sold without a grade of U.S.

Fancy, thus never being included in

production to count, and contributing to

high loss ratios in some areas. Under

this proposed change, records indicating

apples were sold as slicers or for hard

cider will not be used to determine

whether production meets the one-in-

four fresh requirement under the

Quality Option unless the apples were

sold with a grade of U.S. Fancy or

better.

FCIC also proposes to revise

redesignated paragraph (3). The current

provisions require producers to follow

cultural practices generally in use for

fresh apple acreage in the area in a

manner generally recognized by

agricultural experts. FCIC proposes to

revise this paragraph to provide

flexibility through Special Provisions to

include additional cultural practices

that may be required for acreage to meet

the definition of ‘‘fresh apple

production.’’ Examples of cultural

practices may include specific spraying

programs, hail netting, and wind

machines or misting systems.

FCIC proposes to add a definition of

‘‘fresh fruit factor.’’ This term and its

definition are added because of

proposed changes made in section 14.

FCIC proposes to add a definition of

‘‘graft.’’ This term and its definition are

added because of proposed changes

made in section 7(f).

FCIC proposes to add a definition of

‘‘high density.’’ This term and its

definition are added because of a

proposed change in section 6.

FCIC proposes to add definitions of

‘‘maximum additional value price’’ and

‘‘premium price election’’ because of

proposed changes made in section 3.

FCIC proposes to revise the definition

of ‘‘processing apple production.’’ FCIC

proposes to add the word ‘‘dicing’’ to

the list of actions that would constitute

changing apples from their basic form,

to be consistent with the addition in the

definition of ‘‘fresh apple production.’’

FCIC also proposes to remove the phrase

‘‘failing to meet the insurability

requirements for fresh apple

production’’ and add similar language to

it in Section 7, Insured Crop, because

this language contains provisions that

are more appropriately placed in that

section.

3. Section 2—FCIC proposes to

designate the undesignated paragraph as

paragraph (a) and revise the lead-in

sentence in that paragraph to make two

proposed changes. First, current

provisions reference section 34(b) of the

Basic Provisions. However, section 34(c)

of the Basic Provisions is a more

appropriate reference. Second, the

current provisions are not clear whether

producers can have optional units in

addition to or instead of the optional

unit offerings under the Basic

Provisions. FCIC proposes to clarify that

optional units by non-contiguous land

or type may be established in addition

to or instead of the optional unit

provisions in the Basic Provisions.

FCIC proposes to redesignate

paragraphs (a) and (b) as paragraphs

(a)(1) and (2). FCIC proposes to revise

redesignated paragraph (a)(2). This

section currently allows optional units

by type ‘‘as specified in the Special

Provisions.’’ Currently, every county

where apples are insured includes a

Special Provisions statement that allows

optional units by type. The ‘‘as specified

in the Special Provisions’’ provided the

flexibility to permit optional units by

type by county. Since optional units by

type are permitted in every county,

FCIC proposes to remove the phrase ‘‘as

specified in the Special Provisions’’ and

simply allow optional units by type

through the Crop Provisions. FCIC also

proposes to add the phrase ‘‘unless

otherwise provided in the Special

Provisions’’ to allow flexibility through

Special Provisions to alter this language

if it is determined optional units by type

should not be allowed in certain

counties.

FCIC also proposes to add a new

paragraph (b). Optional units by type are

allowed in the Crop Provisions.

However, the Crop Provisions do not

address situations where more than one

type is planted on the same acreage. For

example, Granny Smith apples are often

planted with other types of apples on

the same acreage. In section 3, FCIC

proposes to allow separate coverage

levels and percentages of price elections

by type. If optional units by type were

not allowed in this situation, there

would be a chance that AIPs would

have to combine units resulting in

different coverage levels and

percentages of price elections within a

single unit. To address this, FCIC

proposes to add language that states the

requirements of section 34 of the Basic

Provisions that require the crop to be

planted in a manner that results in a

clear and discernable break in the

planting pattern at the boundaries of

each optional unit are not applicable for

optional units by type. This will allow

separate optional units for types that do

not have a clear and discernable

planting pattern, such as situations

where more than one type is planted on

the same acreage. However, it is

important that producers maintain

separate records of production for each

optional unit in accordance with section

12(a) of the Apple Crop Provisions.

4. Section 3—FCIC proposes to revise

paragraph (a) to allow separate coverage

levels by type. The current provisions

allow producers who purchase

additional coverage to only select

separate coverage levels by fresh apple

acreage and processing apple acreage.

Fresh and processing are separate types;

however, in addition to the general

‘‘Fresh (Combined)’’ type, there are

three other fresh types listed in the

actuarial documents that are classified

as fresh: Varietal group A, varietal group

B, and varietal group C. Under the

current provisions, producers who

insure apples under any of the fresh

type must select the same coverage level

for all of their fresh types. The proposed

changes will provide producers the

ability to select a separate coverage level

for each fresh type and will allow

producers, who purchase additional

coverage, to structure their coverage

based on the perceived risk associated

with each fresh type. For example, the

producer could select 90 percent

coverage level for varietal group A and

70 percent coverage level for varietal

group B.

FCIC proposes to revise paragraph (b)

to replace the ‘‘Special Provisions’’

reference in two places with a reference

to the ‘‘actuarial documents’’ because

the provisions refer to the location of

price elections. Actuarial documents are

where the price elections are located, so

actuarial documents are a more

appropriate reference. FCIC also

proposes to revise paragraph (b) to allow

the price election percentage to differ

among each type. The types may have

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different characteristics with different

risks. By allowing producers to select a

different percentage of the price election

by type, this change allows producers to

manage premium costs based on their

risks.

FCIC also proposes to add a sentence

in paragraph (b) clarifying that the

percentage of the price election

producers elect must be in accordance

with FCIC approved procedures based

on the level of coverage elected. For

example, if a producer elected 75

percent coverage level, FCIC approved

procedures allow producers to choose a

percentage of price election between 67

and 100 percent. FCIC also proposes to

add similar to language in paragraph (a)

regarding assigning coverage levels to

acreage that is added after the acreage

reporting date. The language added in

paragraph (b) is added for guidance on

assigning price election percentages to

acreage added after the acreage

reporting date.

FCIC proposes to redesignate

paragraphs (c) and (d) as (d) and (e),

respectively, and add a new paragraph

(c) to provide producers an opportunity

to insure at a price, called the premium

price election, greater than the

published price election for apples that

are sold predominantly to a direct

market or a premium processing market.

Direct markets are often niche markets

that demand higher prices than

wholesale markets. FCIC’s processing

price is historically based upon

standard juice processing prices and

market prices for premium processing is

not generally available to establish

prices. The premium processing prices

generally demand higher prices and

include items such as baby food, which

demands high-quality apples; or hard

ciders, which have similar quality

expectations as wineries. Additionally,

slicers, which are apples often sold for

school lunches, are a premium

processing-priced apple and demand a

price, on average, about 20 percent

higher than the standard processing

prices. This change addresses

producers’ concerns regarding the

higher prices they receive for apples

sold via direct marketing and premium

processing apples (such as slicers). The

premium price election will be based on

the producer’s history reported on the

Apple Supplemental Report and the

maximum additional value price

published in the actuarial documents

and only offered in specific areas, via

Special Provision statements, where

premium processors or direct markets

are prevalent. The premium price

election will be greater than the

published price election for type ‘‘Fresh

(Combined)’’ or type ‘‘Processing,’’ as

applicable, and less than or equal to the

maximum additional value price. In

order to obtain the premium price

election, producers must submit an

Apple Supplemental Report to capture

producers’ production by fresh sales

(including direct marketing sales) and

processing sales. For data-gathering

purposes, FCIC is also requiring

producers to submit their revenue by

fresh sales and processing sales to allow

FCIC to maintain the program (e.g.,

transitional yields and price elections)

in light of data collected and reported

by third-party organizations becoming

scarce.

FCIC proposes to revise redesignated

paragraph (e) to revise for clarity. The

current provisions point back to specific

situations that occur as outlined in

redesignated paragraph (e). However,

other situations, not addressed in

redesignated paragraph (e), could occur

that affect the yield used to establish the

production guarantee. The current

language limits the situations to those in

redesignated paragraph (e). FCIC

proposes to revise the language to refer

to situations not necessarily specific to

redesignated paragraph (e).

FCIC proposes to revise redesignated

paragraph (e)(1). This paragraph

addresses situations where any

circumstance that may reduce the

producer’s yields from previous levels

occurs before the insurance period. It is

silent on the timeframe in which the

producer notifies the AIP. However, in

redesignated paragraph (e)(2), the

producer notifies the AIP by the

production reporting date. For

consistency between the two

paragraphs, FCIC proposes to add the

same language in redesignated

paragraph (e)(2) to (e)(1) regarding

notification by the production reporting

date.

FCIC also proposes to revise

redesignated paragraph (e)(1) to remove

the last sentence. This information is

proposed to be incorporated into

redesignated paragraph (e)(3).

FCIC proposes to revise redesignated

paragraphs (e)(2) and (e)(3). The first

sentence in each paragraph requires the

producer to notify the AIP if a situation

occurred or may occur after the

beginning of the insurance period.

While redesignated paragraph (e)(2)

refers to situations when the producer

notifies the AIP by the production

reporting date and redesignated

paragraph (e)(3) refers to situations

when the producer fails to notify the

AIP by the production reporting date,

both paragraphs expect the producer to

be aware of circumstances that have not

occurred yet. Therefore, FCIC proposes

to remove the phrase ‘‘or may occur’’ in

both paragraphs.

FCIC also proposes to revise

redesignated paragraph (e)(3) to add

clarifying language in the last sentence.

The last sentence says, ‘‘We will reduce

the yield used to establish your

production guarantee for the subsequent

crop year.’’ To further clarify the

purpose of the yield reduction in the

subsequent crop year, FCIC proposes to

add language that says the yield

reduction will reflect any reduction in

the productive capacity of the trees or

the yield potential of the insured

acreage. The proposed provisions in

redesignated paragraph (e) consistent

with provisions that FCIC recently

added to other perennial crop policies,

such as the Texas Citrus Fruit Crop

Insurance Provisions. Adding these

provisions is intended to remove

potential ambiguity regarding the

consequences when circumstances

occur that will reduce the yield

potential and to promote consistency

with administration of similar policies.

FCIC proposes to add a new

paragraph (f) to inform producers that

they can insure fresh acreage in

aggregate under type ‘‘Fresh

(Combined)’’ or by other fresh types

identified in the actuarial documents

(e.g., fresh varietal group types), not

both. The type ‘‘Fresh (Combined)’’

includes all fresh varieties insured

under the apple policy and the price

offered for type ‘‘Fresh (Combined)’’ is

an average price of all insurable

varieties. Fresh varieties can also be

insured under other types, either in

groupings of specific varietals identified

in the Special Provisions or individual

varieties, if available in the county’s

actuarial documents. The fresh varieties

insured in groupings of specific

varietals identified in the Special

Provisions or as individual varieties are

insured at prices that are reflective of

those smaller groupings. Under this

proposed change, producers may insure

all of their fresh acreage together under

an umbrella of Fresh for an average

price or they can insure groupings of

fresh varieties and receive better prices

by those groupings, if they have records

to substantiate the separate varieties.

5. Section 6—FCIC proposes to

designate the undesignated paragraph as

paragraph (a). FCIC proposes to revise

newly designated paragraph (a) to

divide the paragraph into subparagraphs

for ease of reading.

In paragraph (a)(1), FCIC proposes to

make two changes. First, the word

‘‘option’’ is removed following

‘‘Optional Coverage for Fresh Fruit

Quality Adjustment’’ because the word

is redundant. Second, the reference to

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‘‘these Crop Provisions’’ is struck for

consistency, whereby only references to

external documents are named by title.

FCIC proposes to revise newly

designated paragraph (a)(2)(i). The

current provisions state if producers

designate fresh acreage on their acreage

report then they are certifying that at

least 50 percent of the production from

fresh apple acreage in each unit was

sold as fresh apples in one or more of

the four most recent crop years in

accordance with the definition of ‘‘fresh

apple production.’’

FCIC also proposes to revise newly-

designated paragraph (a)(2)(i) to replace

the reference to the definition of ‘‘fresh

apple production’’ with the reference to

section 7(d). FCIC is proposing to move

some provisions in the definition of

‘‘fresh apple production’’ to section

7(d). Therefore, the reference in newly-

designated paragraph (a)(2)(i) needs to

be updated to reflect the new location

of the provisions in section 7(d).

FCIC proposes to add a new

paragraph (a)(2)(ii) to require producers

who wish to insure as fresh to submit

an Apple Supplemental Report that

captures their total production by all

fresh types aggregated and the

processing type. This supports the

existing FCIC rule to insure as fresh,

which is that at least one of the prior

four years must have produced at least

50 percent of the fresh guarantee. This

change also allows FCIC to collect data

to assist in determining whether fresh

production requirements under the

policy should be adjusted in the future.

Adjustments could include using the

producer’s historical percent sold as

fresh, replace the one-in-four fresh

requirement with the producer’s

historical percent of fresh sales, etc.

FCIC also proposes to revise newly-

designated paragraph (a) to add a new

paragraph (a)(2)(iii) to complement the

proposed language in new paragraph

(a)(2)(ii) regarding the Apple

Supplemental Report. The language

proposed to be added in new paragraph

(a)(2)(iii) notifies the producer that

failure to submit the Apple

Supplemental Report will result in no

coverage under any fresh types. The

producer will be able to have coverage

under the processing type.

FCIC also proposes to revise newly-

designated paragraph (a) to add a new

paragraph (a)(2)(iv) to an exception to

the fresh apple production requirement

mentioned in the above paragraph for

high density acreage in the first year of

insurability or in other circumstances as

authorized by FCIC. First, high density

acreage is established with the intent of

producing fresh apples and FCIC

recognizes that producers that invest in

high density systems are intending to

grow for fresh, but may not have the

sales records in the first year of

insurability to substantiate sales of fresh

production. Therefore, it is not

necessary to require high density

acreage to meet the fresh apple

production requirement for that first

year of insurability. Second, allowing

exceptions to the fresh apple production

requirement in other circumstances as

authorized by FCIC will provide FCIC to

waive the fresh apple production

requirement on a case-by-case basis if

producers suffer exceptionally bad years

(such as a year in which a natural

disaster or other extreme weather

occurs) which affected the end use of

their apples that they intended to sell as

fresh.

FCIC proposes to add a new

paragraph (b) to require producers to

notify the AIP 15 days prior to harvest

if they intend to sell production via

direct marketing so AIPs can perform

the necessary preharvest inspections.

Producers who sell production via

direct marketing are required to notify

AIPs prior to harvest if there is a loss.

Currently, there is no provision that

requires those producers to notify AIPs

prior to harvest if there is no loss. By

adding this provision, it provides AIPs

an opportunity to conduct a preharvest

appraisal when there is no loss.

6. Section 7—FCIC proposes to revise

paragraph (d) to add language that was

previously contained in the definition of

‘‘fresh apple production.’’ That language

is better suited in this section than in

the definition. Additionally, FCIC is

proposing to revise the language that is

moved to paragraph (d). The first

proposed change is to replace a

reference of ‘‘unit’’ with ‘‘policy or unit,

as applicable’’. Over the years, FCIC

received comments that producers find

it difficult and inappropriate to

maintain separate records by unit after

the apple production has left the field.

Producers pointed out that while they

can and do maintain records of

production by unit, once the apples are

delivered to a warehouse, which is often

a third party, for later sales and

distribution it is virtually impossible

and/or impractical to expect all the

apples to be tracked by unit. In 2011,

FCIC issued a Manager’s Bulletin

(MGR–11–015) that allowed producers

who do not have separate records by

unit of fresh apple production in one of

the last four years but do have records

of total fresh apple production may still

be able to qualify for the fresh apple

production requirement (at least 50

percent of the production from fresh

apple acreage was sold as fresh apples

in one or more of the four most recent

crop years). MGR–11–015 authorized

AIPs to consider records of total

production (e.g., by policy rather than

by unit, if the producer could not

provide records by unit) from one of the

four most recent crop years that reflect

fresh apple sales. FCIC is proposing to

incorporate the guidance in MGR–11–

015 by adding replacing ‘‘unit’’ with

‘‘policy or unit, as applicable’’ in

paragraph (d).

The second proposed change in

paragraph (d) is to add after the phrase

‘‘one or more of the four most recent

crop years’’ the phrase ‘‘preceding the

previous crop year, unless authorized by

FCIC.’’ The proposed phrase aligns the

one-in-four fresh requirement with the

years proposed to be reported on the

Apple Supplemental Report. Under the

current provisions, the one-in-four fresh

requirement is based on the four most

recent crop years. For example, if the

producer is purchasing crop insurance

for the 2023 crop year, then the AIP

would consider records from crop years

2019 through 2022. Under the proposed

provisions, the Apple Supplemental

Report is requesting information for the

crop year prior to the previous crop

year. Therefore, if the producer is

purchasing crop insurance for the 2023

crop year, then producer would report

information based on the 2021 crop

year. The proposed changes in this

paragraph are meant to align the

information the producer reports on the

Apple Supplemental Report with the

last year in the one or more of the four

most recent crop years.

FCIC also proposes to move language

in paragraph (d) regarding ‘‘processing

apple production’’ to a new paragraph

(e) and add language that was

previously contained in the definition of

‘‘processing apple production.’’ That

language is better suited in this section

than in the definitions.

FCIC also proposes to add a new

paragraph (f) to allow for a reduced

premium in certain circumstances.

Currently, producers must report their

acreage by the January 15th acreage

reporting date, which is before they

typically conduct routine orchard

maintenance. Producers typically graft

or remove apple trees after the acreage

reporting date and into March. Those

trees that are grafted or removed will

not produce apples that crop year. This

provision allows producers to either

report the acreage as uninsurable as of

the acreage reporting date; or receive a

reduced premium rate to better reflect

the condition of their orchards if they

submit a revised acreage report by

March 31st that trees were grafted or

removed.

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7. Section 9—FCIC proposes to revise

paragraph (b)(3) to insert the following

phrase at the beginning of the

paragraph: ‘‘Except as provided in

section 28 of the Basic Provisions.’’

Paragraph (b)(3) of the Apple Crop

Provisions speaks only to relinquishing

the producer’s insurable share after the

acreage reporting date and is silent on

whether a transfer of coverage occurred

to relinquish the insurable share. This

paragraph implies that coverage ends on

the date the producer relinquishes their

share. It is not clear, as it is written,

whether a transfer of coverage and right

to indemnity was submitted and

approved in accordance with section 28

of the Basic Provisions. To clarify that

this provision only addresses situations

when a transfer of coverage and right to

indemnity is not approved, FCIC

proposes to add the aforementioned

phrase.

8. Section 11—FCIC proposes to

revise paragraph (b)(2). This paragraph

outlines the requirements for producers

when any portion of the crop is direct

marketed. FCIC proposes to revise this

paragraph to make a few changes. First,

the phrase ‘‘15 days’’ is proposed to be

clarified to ‘‘15 calendar days.’’ Next,

FCIC proposes to require, in the event

any portion of the crop will be direct

marketed, the producer to notify the AIP

at least 15 calendar days before the crop

is harvested. The current provisions

require notification prior to when the

crop is sold. The proposed revision

allows for the AIPs to conduct pre-

harvest appraisals. Lastly, FCIC

proposes to make other changes within

the paragraph for clarification purposes.

9. Section 12—FCIC also proposes to

revise the claim example following

paragraph (b).

FCIC also proposes to redesignate

paragraph (c)(2) as (c)(3) and add a new

paragraph (c)(2) to state that when 65

percent or more of a unit’s processing

apple production is damaged apple

production, the processing apple

production from the unit will not be

considered production to count

provided none of the processing apple

production from the unit will be sold.

Based on engagement with apple

producers, FCIC was made aware that at

certain thresholds of damage, processors

will not accept apple production. In

response to this feedback, FCIC

proposes to allow for adjustments to

processing production that reflect

current industry standards.

10. Section 14—FCIC proposes to

revise paragraph (b). The phrase ‘‘this

option provides for quality adjustment

of fresh apple production’’ reads more

clearly when the word ‘‘coverage’’ is

added between the words ‘‘provides’’

and ‘‘for.’’

FCIC proposes to revise paragraph

(b)(1) to replace the phrase

‘‘Catastrophic Risk Protection (CAT)’’

with the acronym ‘‘CAT.’’ The acronym

is spelled out earlier in the Crop

Provisions, so it is only necessary here

to use the acronym.

FCIC proposes to revise paragraph

(b)(3). The current provisions say that

apple acreage designated on your

acreage report qualifies for the Optional

Coverage for Fresh Apple Quality

Adjustment. FCIC proposes to clarify

that only fresh apple acreage qualifies

for the option.

FCIC proposes to revise paragraph

(b)(5) to make several changes. Where

available, the Quality Option allows

apple producers the option to purchase

additional coverage that compensates

them when their fresh apple production

fails to grade U.S. Fancy or better due

to an insurable cause of loss. The

revisions to this paragraph clarify that

production to count for apples is the

greater of sold production adjusted

according to the sliding scale in

paragraph (b)(5) or adjusted for quality

in paragraph (b)(6), instead of basing the

determination on the sliding scale

alone.

In paragraph (b)(5), FCIC also

proposes to revise the sliding scale

under which production to count is

adjusted due to damage so that it is

linear. A linear sliding scale is more

appropriate than the current sliding

scale which alternates from linear to

non-linear back to linear again. The

current sliding scale adjusts production

in increments beginning at 21 percent

damage and zeroing at 65 percent

damage:

•The first increment is between 21

percent and 40 percent with a reduction

of 2 percent for each full percent of

damage in that range,

•The second 41 percent to 50 percent

with a reduction of 3 percent for each

full percent of damage in that range, and

•The third 51 percent to 64 percent

with a reduction of 2 percent for each

full percent of damage in excess of 50

percent.

The current sliding scale is not

regionally appropriate. As proposed, the

revised sliding scale would begin

adjustments at 15 percent and reduce

production to count by two percent for

each full percent more than 15 percent.

FCIC received producer feedback that

the sliding scale should start at a lesser

threshold of damage (15 percent rather

than 20 percent). The only difference

between the current sliding scale and

the proposed one is when the range of

production not grading U.S. Fancy or

better is greater than 15 percent but less

than 50 percent. After 50 percent, the

current sliding scale and the proposed

sliding scales are identical.

In paragraph (b)(6), the following

proposed changes are necessary to

address concerns regarding the high loss

ratios and rising premium costs under

the Quality Option. The high loss ratios

are a result of producers’ inability to

maintain records to meet the

requirements to qualify for the Quality

Option and to settle claims, and climate

and growing conditions in certain

regions may limit the ability of

producers in these areas to consistently

produce U.S. Fancy grade.

•Production sold with a grade of U.S.

Fancy or better will continue to be

counted on a one-for-one basis.

•Production that grades U.S. #1

Processing or better but less than U.S.

Fancy will be included in production to

count at a reduced value by multiplying

a fresh fruit factor to the sold marketable

production as follows:

ÆThe fresh fruit factor applies to

production sold:

DAs fresh without a grade that

exceeds what appraised as U.S. Fancy or

better (prior to adjustments under the

sliding scale);

DAny production sold for fresh

without a grade will be counted on a

one-to-one basis not to exceed the

production that appraised as U.S. Fancy

or better (prior to adjustments under the

sliding scale).

DAny production sold for a grade

below U.S. Fancy;

DAny production sold as processing,

excluding any production that grades

less than U.S. #1 Processing.

ÆFor the basic coverage, all apples

that are U.S. #1 Processing or better are

included in production to count,

without any further discounts for

quality adjustment. Currently, for the

Quality Option, all apples that are sold

as U.S. Fancy or better are included as

production to count. Not all sales

indicate a grading standard and

therefore a producer could claim that no

fresh apples were sold as U.S. Fancy or

better, even if the apples were sold as

fresh. Therefore, a producer could

‘‘double-dip’’ on indemnity and sales

from these apples. Adjustments to

production under the Quality Option

are not reflected in the producer’s actual

production history (APH); therefore, the

guarantee does not accurately reflect

expected production of fresh apples.

The intent of the fresh fruit factor is to

capture the reduced value of apples sold

for other than U.S. Fancy or better so

that the APH will more accurately

reflect the producer’s guarantee.

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ÆThe fresh fruit factor will not be

applied to any production that grades

less than U.S. #1 Processing or better.

ÆThe fresh fruit factor will be

published in the actuarial documents to

account for regional differences.

FCIC proposes to revise paragraph (c).

The current provisions state any

production not graded or appraised

prior to the earlier of the time apples are

placed in storage or the date the apples

are delivered to a packer, processor, or

other handler will not be considered

damaged apple production. According

to the current definition of ‘‘damaged

apple production,’’ damaged apple

production under the Quality Option is

anything that fails to grade U.S. Fancy

or better. In other words, the

aforementioned production will be

considered U.S. Fancy or better. As

stated earlier, FCIC is proposing to

remove the portion of the definition that

refers to the Quality Option. Therefore,

paragraph (c) needs to be revised so that

the provision has the same meaning as

before: Any production not graded or

appraised prior to the earlier of the time

apples are placed in storage or the date

the apples are delivered will be

considered U.S. Fancy or better.

FCIC proposes to add a new

paragraph (e) to address written

agreements. The Quality Option is

contained within the Crop Provisions,

which confuses whether written

agreements should apply to the Quality

Option when written agreements are

written on the Crop Provisions. The

proposed language allows written

agreements to apply to the Quality

Option with three requirements: (1) The

option may apply to a written agreement

for apples when this option is contained

in the actuarial documents for the

county and crop; (2) the option may

apply to apples in a county which does

not have actuarial documents for the

crop when a written agreement

specifically allows this option; and (3)

FCIC has the right to not allow this

option on a written agreement in

accordance with the provisions in

section 18 of the Basic Provisions. This

requirement also allows the producer to

have coverage by written agreement on

apple production insured under the

Crop Provisions if the requirements for

written agreement are not met on the

Quality Option.

FCIC proposes to revise the claim

example following new paragraph (e) to

align with the proposed changes made

throughout section 14.

Notice and Comment, and Exemptions

The Administrative Procedure Act

(APA, 5 U.S.C. 553) provides that the

notice and comment and 30-day delay

in the effective date provisions do not

apply when the rule involves specified

actions, including matters relating to

contracts. This rule governs contracts

for crop insurance policies and therefore

falls within that exemption. Although

not required by APA or any other law,

FCIC has chosen to propose the

regulatory changes and request

comments on the changes prior to

issuing a final rule.

This rule is exempt from the

regulatory analysis requirements of the

Regulatory Flexibility Act (5 U.S.C.

601–612), as amended by the Small

Business Regulatory Enforcement

Fairness Act of 1996.

Executive Orders 12866 and 13563

Executive Order 12866, ‘‘Regulatory

Planning and Review,’’ and Executive

Order 13563, ‘‘Improving Regulation

and Regulatory Review,’’ direct agencies

to assess all costs and benefits of

available regulatory alternatives and, if

regulation is necessary, to select

regulatory approaches that maximize

net benefits (including potential

economic, environmental, public health

and safety effects, distributive impacts,

and equity). Executive Order 13563

emphasized the importance of

quantifying both costs and benefits, of

reducing costs, of harmonizing rules,

and of promoting flexibility. The

requirements in Executive Orders 12866

and 13563 for the analysis of costs and

benefits apply to rules that are

determined to be significant.

The Office of Management and Budget

(OMB) designated this rule as not

significant under Executive Order

12866, ‘‘Regulatory Planning and

Review,’’ and therefore, OMB has not

reviewed this rule and analysis of the

costs and benefits is not required under

either Executive Order 12866 or 13563.

Clarity of the Regulation

Executive Order 12866, as

supplemented by Executive Order

13563, requires each agency to write all

rules in plain language. In addition to

your substantive comments on this rule,

we invite your comments on how to

make the rule easier to understand. For

example:

•Are the requirements in the rule

clearly stated? Are the scope and intent

of the rule clear?

•Does the rule contain technical

language or jargon that is not clear?

•Is the material logically organized?

•Would changing the grouping or

order of sections or adding headings

make the rule easier to understand?

•Could we improve clarity by adding

tables, lists, or diagrams?

•Would more, but shorter, sections

be better? Are there specific sections

that are too long or confusing?

•What else could we do to make the

rule easier to understand?

Environmental Review

In general, the environmental impacts

of rules are to be considered in a

manner consistent with the provisions

of the National Environmental Policy

Act (NEPA, 42 U.S.C. 4321–4347) and

the regulations of the Council on

Environmental Quality (40 CFR parts

1500–1508). FCIC conducts programs

and activities that have been determined

to have no individual or cumulative

effect on the human environment. As

specified in 7 CFR 1b.4, FCIC is

categorically excluded from the

preparation of an Environmental

Analysis or Environmental Impact

Statement unless the FCIC Manager

(agency head) determines that an action

may have a significant environmental

effect. The FCIC Manager has

determined this rule will not have a

significant environmental effect.

Therefore, FCIC will not prepare an

environmental assessment or

environmental impact statement for this

action and this rule serves as

documentation of the programmatic

environmental compliance decision.

Executive Order 12988

This rule has been reviewed under

Executive Order 12988, ‘‘Civil Justice

Reform.’’ This rule will not preempt

State or local laws, regulations, or

policies unless they represent an

irreconcilable conflict with this rule.

Before any judicial actions may be

brought regarding the provisions of this

rule, the administrative appeal

provisions of 7 CFR part 11 are to be

exhausted.

Executive Order 13175

This rule has been reviewed in

accordance with the requirements of

Executive Order 13175, ‘‘Consultation

and Coordination with Indian Tribal

Governments.’’ Executive Order 13175

requires Federal agencies to consult and

coordinate with Tribes on a

government-to-government basis on

policies that have Tribal implications,

including regulations, legislative

comments or proposed legislation, and

other policy statements or actions that

have substantial direct effects on one or

more Indian Tribes, on the relationship

between the Federal Government and

Indian Tribes or on the distribution of

power and responsibilities between the

Federal Government and Indian Tribes.

RMA has assessed the impact of this

rule on Indian Tribes and determined

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that this rule does not, to our

knowledge, have Tribal implications

that require Tribal consultation under

E.O. 13175. The regulation changes do

not have Tribal implications that

preempt Tribal law and are not expected

have a substantial direct effect on one or

more Indian Tribes. If a Tribe requests

consultation, RMA will work with the

USDA Office of Tribal Relations to

ensure meaningful consultation is

provided where changes, additions and

modifications identified in this rule are

not expressly mandated by Congress.

The Unfunded Mandates Reform Act of

1995

Title II of the Unfunded Mandates

Reform Act of 1995 (UMRA, Pub. L.

104–4) requires Federal agencies to

assess the effects of their regulatory

actions of State, local, and Tribal

governments, or the private sector.

Agencies generally must prepare a

written statement, including cost

benefits analysis, for proposed and final

rules with Federal mandates that may

result in expenditures of $100 million or

more in any 1 year for State, local or

Tribal governments, in the aggregate, or

to the private sector. UMRA generally

requires agencies to consider

alternatives and adopt the more cost

effective or least burdensome alternative

that achieves the objectives of the rule.

This rule contains no Federal mandates,

as defined in Title II of 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.

Federal Assistance Program

The title and number of the Federal

Domestic Assistance Program listed in

the Catalog of Federal Domestic

Assistance to which this rule applies is

No. 10.450—Crop Insurance.

Paperwork Reduction Act of 1995

In accordance with the provisions of

the Paperwork Reduction Act of 1995

(44 U.S.C. chapter 35, subchapter I), the

rule does not change the information

collection approved by OMB under

control numbers 0563–0053.

USDA Non-Discrimination Policy

In accordance with Federal civil

rights law and USDA civil rights

regulations and policies, USDA, its

Agencies, offices, and employees, and

institutions participating in or

administering USDA programs are

prohibited from discriminating based on

race, color, national origin, religion, sex,

gender identity (including gender

expression), sexual orientation,

disability, age, marital status, family or

parental status, income derived from a

public assistance program, political

beliefs, or reprisal or retaliation for prior

civil rights activity, in any program or

activity conducted or funded by USDA

(not all bases apply to all programs).

Remedies and complaint filing

deadlines vary by program or incident.

Persons with disabilities who require

alternative means of communication for

program information (for example,

braille, large print, audiotape, American

Sign Language, etc.) should contact the

responsible Agency or USDA TARGET

Center at (202) 720–2600 or 844–433–

2774 (toll-free nationwide).

Additionally, program information may

be made available in languages other

than English. To file a program

discrimination complaint, complete the

USDA Program Discrimination

Complaint Form, AD–3027, found

online at https://www.usda.gov/oascr/

how-to-file-a-program-discrimination-

complaint and at any USDA office or

write a letter addressed to USDA and

provide in the letter all the information

requested in the form. To request a copy

of the complaint form, call (866) 632–

9992. Submit your completed form or

letter to USDA by mail to: U.S.

Department of Agriculture, Office of the

Assistant Secretary for Civil Rights,

1400 Independence Avenue SW,

Washington, DC 20250–9410 or email:

OAC@usda.gov.

USDA is an equal opportunity

provider, employer, and lender.

List of Subjects in 7 CFR Part 457

Acreage allotments, Crop insurance,

Reporting and recordkeeping

requirements.

Proposed Rule

For the reasons discussed above, FCIC

proposes to amend 7 CFR part 457 to

read as follows:

PART 457—COMMON CROP

INSURANCE REGULATIONS

■1. The authority citation for 7 CFR

part 457 continues to read as follows:

Authority: 7 U.S.C. 1506(l), 1506(o).

■2. Amend § 457.158 by:

■a. Revising the introductory text;

■b. In section 1:

■i. Adding in alphabetical order the

definitions for ‘‘Apple Supplemental

Report,’’ ‘‘block,’’ ‘‘fresh fruit factor,’’

‘‘graft,’’ ‘‘high density,’’ ‘‘maximum

additional value price,’’ and ‘‘premium

price election’’;

■ii. Adding in the definition of ‘‘Area

A’’, a comma after the words ‘‘New

Mexico’’; and

■iii. Revising the definitions for

‘‘damaged apple production,’’ ‘‘direct

marketing,’’ ‘‘fresh apple production,’’

and ‘‘processing apple production’’;

■c. Revising section 2;

■d. Revising section 3;

■e. Revising section 6;

■f. In section 7:

■i. Removing in paragraph (c), the word

‘‘and’’ at the end of the sentence;

■ii. Revising paragraph (d); and

■iii. Adding new paragraphs (e) and (f);

■g. In section 9:

■i. Removing in paragraph (b)(3), the

word ‘‘If’’ at the beginning of the

paragraph and adding the words

‘‘Except as provided in section 28 of the

Basic Provisions, if’’ in its place;

■h. Revising section 11 paragraph

(b)(2);

■i. In section 12:

■i. Revising the example following

paragraph (b) titled ‘‘Basic Coverage

Example’’;

■ii. Removing in paragraph (c)(1)(iv),

the word ‘‘; and’’ at the end of the

sentence and adding ‘‘.’’ in its place;

■iii. Redesignating paragraph (c)(2) as

(3), and adding a new paragraph (c)(2);

and

■j. Revising section 14.

The revisions and additions read as

follows:

§ 457.158 Apple crop insurance

provisions.

The apple crop insurance provisions

for the 2023 and succeeding crop years

are as follows:

* * * * *

1. Definitions

* * * * *

Apple Supplemental Report. A

written report, supported by acceptable

records, submitted as required on our

form and in accordance with section 3

and section 6, as applicable. The

information contained on the report will

be based on your sales history, as

applicable, from the crop year prior to

the previous crop year (e.g., on the

production reporting date for the 2023

crop year, the Apple Supplement Report

reflects total revenue from the 2021 crop

year).

* * * * *

Block. Trees in an orchard of a single

or mixed age and density, distinguished

by applicable practice, type, T-Yield

Map Areas, or other characteristics

shown in the actuarial documents.

* * * * *

Damaged apple production. Fresh or

processing apple production that fails to

grade U.S. No. 1 Processing or better in

accordance with the applicable grade

standards due to an insurable cause of

loss.

Direct marketing. The sale of the

insured crop directly to consumers

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without the intervention of an

intermediary such as a wholesaler,

retailer, packer, processor, shipper,

buyer, or broker. Production records are

controlled exclusively by the

policyholder. Examples of direct

marketing include selling through an

on-farm or roadside stand, a farmer’s

market, or permitting the general public

to enter the field for the purpose of

picking all or a portion of the crop. Only

the portion of the crop sold directly to

consumers will be considered direct

marketed.

Fresh apple production. Apples:

(1) That are sold, or could be sold, for

human consumption without

undergoing any change in the basic

form, such as peeling, juicing, crushing,

dicing, etc.;

(2) That are not sold for the

processing market (e.g., slicer or hard

cider market) except for apples sold

with a grade of U.S. Fancy or better

(unless another grade is specified in the

Special Provisions); and

(3) That follow the recommended

cultural practices generally in use for

fresh apple acreage in the area in a

manner generally recognized by

agricultural experts and any other

practices specified in the Special

Provisions.

Fresh fruit factor. A factor contained

in the actuarial documents that is used

to account for the salvage value of sold

apples for production insured under the

Optional Coverage for Fresh Fruit

Quality Adjustment contained in

section 14.

* * * * *

Graft. To unite a shoot or bud with a

rootstock in accordance with

recommended practices to form a living

union.

* * * * *

High density. The number of trees per

acre and any other characteristics

specified in the Special Provisions.

* * * * *

Maximum additional value price. A

price established by type by FCIC and

published in the actuarial documents

when authorized by the Special

Provisions. It is used to compute the

premium price election.

* * * * *

Premium price election. A price

calculated using your sales history

reported on the Apple Supplemental

Report and the maximum additional

value price. The premium price election

will be no less than the published price

election for type ‘‘Fresh (Combined)’’ or

type ‘‘Processing,’’ as applicable, and no

greater than the maximum additional

value price.

Processing apple production. Apples

from insurable acreage that are sold, or

could be sold for the purpose of

undergoing a change to the basic

structure such as peeling, juicing,

crushing, dicing, etc.

* * * * *

2. Unit Division

(a) In addition to, or instead of,

establishing optional units as provided

in section 34(c) of the Basic Provisions,

optional units may be established if

each optional unit is:

(1) Located on non-contiguous land;

or

(2) By type, unless otherwise

provided in the Special Provisions.

(b) The requirements of section 34 of

the Basic Provisions that require the

crop to be planted in a manner that

results in a clear and discernable break

in the planting pattern at the boundaries

of each optional unit are not applicable

for optional units by type.

3. Insurance Guarantees, Coverage

Levels, and Prices for Determining

Indemnities

In addition to the requirements of

section 3 of the Basic Provisions:

(a) You may select only one coverage

level for each type. For example, if you

choose the 55 percent coverage level for

one type, you may choose the 75

percent coverage level for another type.

However, if you elect the Catastrophic

Risk Protection (CAT) level of coverage

for any of your apple acreage, the CAT

level of coverage will be applicable to

all insured apple acreage in the county.

If you only have fresh apple acreage

designated on your acreage report and

processing apple acreage is added after

the sales closing date, we will assign a

coverage level equal to the lowest

coverage level you selected for your

fresh apple acreage. If you only have

processing apple acreage designated on

your acreage report and fresh apple

acreage is added after the sales closing

date, we will assign a coverage level

equal to the coverage level you selected

for your processing apple acreage.

(b) You may select only one price

election for all the apples in the county

insured under this policy unless the

actuarial documents provide different

price elections by type, in which case

you may select one price election for

each apple type designated in the

actuarial documents. The price elections

you choose for each type are not

required to have the same percentage

relationship to the maximum price

election offered by us for each type.

However, the percentage of the

maximum price election must be in

accordance with FCIC approved

procedures. For example, if you choose

100 percent of the maximum price

election for one type, you may choose

a different percentage of the maximum

price election for all other types. If you

only have fresh apple acreage

designated on your acreage report and

processing apple acreage is added after

the sales closing date, we will assign a

price election percentage equal to the

lowest price election percentage you

selected for your fresh apple acreage. If

you only have processing apple acreage

designated on your acreage report and

fresh apple acreage is added after the

sales closing date, we will assign a price

election percentage equal to the price

election percentage you selected for

your processing apple acreage.

(c) If you elect an additional level of

coverage, you may insure your type

‘‘Fresh (Combined),’’ type ‘‘Processing,’’

or both, at the premium price election

if:

(1) Authorized in the Special

Provisions;

(2) You submit an Apple

Supplemental Report, by policy by the

production reporting date, containing

your total sales (including production

and revenue), differentiated by the

following, as applicable:

(i) Fresh and direct marketing; and

(ii) Processing;

(3) Upon initial election of the

premium price election, you provide

three years of production and revenue

as indicated in section 3(c)(2); and

(4) You meet any additional

requirements specified in the Special

Provisions.

(d) We will reduce the yield used to

establish your production guarantee, as

necessary, based on our estimate of the

effect of any situation listed in sections

3(c)(1) through (4). If the situation

occurred:

(1) Before the beginning of the

insurance period, the yield used to

establish your production guarantee will

be reduced for the current crop year

regardless of whether the situation was

due to an insured or uninsured cause of

loss. If you fail to notify us of any

circumstance that may reduce your

yields from previous levels, we will

reduce the yield used to establish your

production guarantee at any time we

become aware of the circumstance;

(2) Or may occur after the beginning

of the insurance period and you notify

us by the production reporting date, the

yield used to establish your production

guarantee will be reduced for the

current crop year only if the potential

reduction in the yield used to establish

your production guarantee is due to an

uninsured cause of loss; or

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(3) Or may occur after the beginning

of the insurance period and you fail to

notify us by the production reporting

date, production lost due to uninsured

causes equal to the amount of the

reduction in the yield used to establish

your production guarantee will be

applied in determining any indemnity

(see section 12(c)(1)(ii)). We will reduce

the yield used to establish your

production guarantee for the subsequent

crop year.

(e) We will reduce the yield used to

establish your production guarantee, as

necessary, based on our estimate of the

effect of any circumstance that may

reduce your yields from previous levels.

If the circumstance occurred:

(1) Before the beginning of the

insurance period and you notify us by

the production reporting date, the yield

used to establish your production

guarantee will be reduced for the

current crop year regardless of whether

the circumstance was due to an insured

or uninsured cause of loss;

(2) After the beginning of the

insurance period and you notify us by

the production reporting date, the yield

used to establish your production

guarantee will be reduced for the

current crop year only if the potential

reduction in the yield used to establish

your production guarantee is due to an

uninsured cause of loss; or

(3) Before or after the beginning of the

insurance period and you fail to notify

us by the production reporting date, an

amount equal to the reduction in the

yield will be added to the production to

count calculated in section 12(c) due to

uninsured causes. We will reduce the

yield used to establish your production

guarantee for the subsequent crop year

to reflect any reduction in the

productive capacity of the trees or in the

yield potential of the insured acreage.

(f) If the actuarial documents contain

type ‘‘Fresh (Combined),’’ you can elect

to insure your fresh acreage in aggregate

under type ‘‘Fresh (Combined)’’ or by

other fresh types identified in the

actuarial documents, but not both.

* * * * *

6. Report of Acreage

(a) In addition to the requirements

contained in section 6 of the Basic

Provisions, you must report and

designate all acreage by type by the

acreage reporting date.

(1) Any acreage not qualifying for

fresh apple production is not eligible for

the Optional Coverage for Fresh Fruit

Quality Adjustment contained in

section 14.

(2) If you designate fresh apple

acreage on the acreage report:

(i) You are certifying that your fresh

apple acreage meets the requirements in

section 7(d), unless otherwise

authorized by FCIC.

(ii) You must submit an Apple

Supplemental Report on the same basis

you certify your acreage in section

6(a)(2)(i) by the production reporting

date, containing the following, as

applicable.

(A) Production sold as fresh;

(B) Production sold by direct

marketing;

(C) Production sold as processing; and

(D) Production in storage.

(iii) And you fail to submit an Apple

Supplemental Report in accordance

with section 6(a)(2)(ii), you will not

have coverage under any fresh type

listed in the actuarial documents.

(iv) And you have high density

acreage, the requirement in section

6(a)(2)(i) does not apply to high density

acreage in the first year of insurability

or as authorized by FCIC procedure.

(b) If any portion of your crop will be

direct marketed, you must notify us at

least 15 calendar days before any

production will be harvested. We will

conduct an appraisal that will be used

to verify your production records in

accordance with FCIC procedures.

7. Insured Crop

* * * * *

(d) That are grown for fresh apple

production on acreage:

(1) That is designated as fresh apples

on the acreage report; and

(2) That you certify and, if requested

by us, provide verifiable records to

support, that at least 50 percent of the

production from all acreage reported as

fresh apple acreage by policy or unit, as

applicable, was sold as fresh apples in

one or more of the four most recent crop

years preceding the previous crop year

(e.g., for the 2023 crop year, the four

most recent crop years preceding the

previous crop year end in the 2021 crop

year), unless authorized by FCIC

procedures;

(e) That are grown on acreage

designated as processing apple

production on the acreage report. Any

production from acreage not meeting the

requirements in section 7(d) must be

designated on the acreage report as

processing apple production; and

(f) If you anticipate performing any

action that will reduce the productive

capacity of the trees or the yield

potential of the insured acreage (e.g.,

removing or grafting trees) after the

acreage reporting date you:

(1) May report all apple acreage when

you report your acreage for the crop year

and specify any affected acreage as

uninsurable acreage (By doing so, no

coverage will be considered to have

attached on the specified acreage and no

premium will be due for such acreage.

If you do not perform any action that

will reduce the productive capacity of

the trees or the yield potential of the

insured acreage, you will be subject to

the under-reporting provisions

contained in section 6 of the Basic

Provisions); or

(2) May report all apple acreage as

insurable when you report your acreage

for the crop year. Premium will be due

on all the acreage except as set forth

herein.

(i) On acreage for which you perform

actions that will reduce the productive

capacity of the trees or the yield

potential of the insured acreage, you

may qualify for a reduction in premium

only if you notify us in writing on a

revised acreage report on or before

March 31st or the date designated in the

Special Provisions, and do not claim an

indemnity on the acreage. No reduction

in premium will be allowed if the

required notice is not given or if you

claim an indemnity for the acreage.

(ii) Upon receiving timely notice,

insurance coverage on such acreage will

cease and we will process your revised

acreage report to indicate the applicable

reduction in premium. If you do not

perform the actions to the apple acreage

as intended, you will be subject to the

under-reporting provisions contained in

section 6 of the Basic Provisions.

* * * * *

11. Duties in the Event of Damage or

Loss

* * * * *

(b) * * *

* * * * *

(2) If any portion of your crop will be

direct marketed, you must notify us at

least 15 calendar days before any

production will be harvested. We will

conduct an appraisal that will be used

to verify your production records in

accordance with FCIC procedures. If

damage occurs after this appraisal, we

will conduct an additional appraisal.

These appraisals, and any other

acceptable records required to be

provided by you, will be used to

determine your production to count.

Failure to give timely notice that

production will be sold by direct

marketing will result in an appraised

amount of production to count of not

less than the production guarantee per

acre if such failure results in our

inability to make the required appraisal.

* * * * *

12. Settlement of Claim

* * * * *

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(b) * * *

Basic Coverage Example:

You have a 100 percent share in one

basic unit with 10 acres of fresh apples

and 5 acres of processing apples

designated on your acreage report, with

a 600-bushel per acre production

guarantee for both fresh and processing

apples, and you select 100 percent of

the price election on a price election of

$9.10 per bushel for fresh apples and

$2.50 per bushel for processing apples.

You harvest 5,000 bushels of fresh

apples and 1,000 bushels of processing

apples, all grading U.S. No. 1 Processing

or better. Your indemnity will be

calculated as follows:

(A) 10 acres × 600 bushels = 6,000-

bushel production guarantee of fresh

apples;

5 acres × 600 bushels = 3,000-bushel

production guarantee of processing

apples;

(B) 6,000-bushel production guarantee

× $9.10 price election × 100 percent of

price election = $54,600 value of

production guarantee for fresh apples;

3,000-bushel production guarantee ×

$2.50 price election × 100 percent of

price election = $7,500 value of

production guarantee for processing

apples;

(C) $54,600 value of production

guarantee for fresh apples + $7,500

value of production guarantee for

processing apples = $62,100.00 total

value of the production guarantee;

(D) 5,000 bushels of fresh apples are

harvested and 1,000 bushels of

processing apples are harvested.

(E) 5,000 bushels of fresh apple

production to count × $9.10 price

election × 100 percent of price election

= $45,500 value of fresh apple

production to count;

1,000 bushels of processing apple

production to count × $2.50 price

election × 100 percent of price election

= $2,500 value of processing apple

production to count;

(F) $45,500 value of fresh apple

production to count + $2,500 value of

processing apple production to count =

$48,000 total value of production to

count;

(G) $62,100 total value of the

production guarantee¥$48,000 total

value of production to count =

$14,100.00 value of loss; and

(H) $14,100 value of loss × 100

percent share = $14,100 indemnity

payment.

(c) * * *

* * * * *

(2) Notwithstanding section 12(c)(1),

when 65 percent or more of a unit’s

processing apple production is damaged

apple production, the processing apple

production from the unit will not be

considered production to count

provided none of the processing apple

production from the unit will be sold.

* * * * *

14. Optional Coverage for Fresh Fruit

Quality Adjustment

(a) In the event of a conflict between

the Apple Crop Insurance Provisions

and this option, this option will control.

Insureds who select this option cannot

receive less than the indemnity due

under section 12.

(b) In return for payment of the

additional premium designated in the

actuarial documents, this option

provides coverage for quality

adjustment of fresh apple production as

follows:

(1) To be eligible for this option, you

must have elected to insure your apples

at the additional coverage level. If you

elect CAT after this option is effective,

it will be considered as notice of

cancellation of this option by you.

(2) You must elect this option on or

before the sales closing date for the

initial crop year for which you wish to

insure your apples under this option.

This option will continue in effect until

canceled by either you or us for any

succeeding crop year by written notice

to the other party on or before the

cancellation date. (3) This option will

apply to all your fresh apple acreage

designated on your acreage report and

that meets the insurability requirements

specified in the Apple Crop Insurance

Provisions, except any acreage

specifically excluded by the actuarial

documents. Any acreage designated in

your acreage report as grown for

processing apple production is not

eligible for coverage under this option.

(4) In lieu of sections 12(c)(1)(iii), (iv)

and (2), the production to count will

include all appraised and harvested

production from all of the fresh apple

acreage in the unit, adjusted in

accordance with this option.

(5) Except as provided in section

14(b)(6), if the block or unit, as

applicable, is damaged due to an

insurable cause of loss to the extent that

more than 15 percent of the apple

production does not grade U.S. Fancy or

better (unless another grade is specified

in the Special Provisions) the following

adjustments to the production to count

will apply:

(i) When 16 percent through 64

percent of the apple production does

not grade U.S. Fancy or better (unless

another grade is specified in the Special

Provisions), the production to count

will be reduced two percent for each

full one percent in excess of 15 percent.

(ii) When 65 percent or more of the

apple production does not grade U.S.

Fancy or better (unless another grade is

specified in the Special Provisions), the

production will not be considered

production to count.

(6) If you sell any of your fresh apple

production from the block or unit, as

applicable, your production to count

will be the greater of the amount

determined in section 14(b)(5) or the

sum of the amount determined as

follows:

(i) All apples sold with a grade of U.S.

Fancy or better (unless another grade is

specified in the Special Provisions);

(ii) All marketable apple production

sold with a grade of less than U.S. Fancy

(unless another grade is specified in the

Special Provisions) multiplied by the

fresh fruit factor;

(iii) All marketable apple production

sold as fresh without a grade. This

amount is not to exceed what appraised

or graded as U.S. Fancy or better (unless

another grade is specified in the Special

Provisions) prior to the adjustments

under section 14(b)(5);

(iv) All marketable apple production

sold as fresh without a grade that

exceeds what appraised or graded as

U.S. Fancy or better (unless another

grade is specified in the Special

Provisions) prior to the adjustments

under section 14(b)(5) multiplied by the

fresh fruit factor; and

(v) All marketable apple production

sold as processing without a grade

multiplied by the fresh fruit factor.

(7) The grade standards used in

accordance with section 14(b)(6) and

applied during the appraisal process

with be the applicable grade standards

used when evaluating the final

disposition of the apple production.

(c) Any apple production not graded

or appraised prior to the earlier of the

time apples are placed in storage or the

date the apples are delivered to a

packer, processor, or other handler, will

be considered U.S. Fancy or better

(unless another grade is specified in the

Special Provisions) and included in

production to count under this option.

(d) Any adjustments that reduce your

production to count under this option

will not be applicable when

determining production to count for

APH purposes.

(e) Regarding written agreements

under this option:

(1) This option may apply to a written

agreement for apples when this option

is contained in the actuarial documents

for the county and crop.

(2) This option may apply to apples

in a county which does not have

actuarial documents for the crop when

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a written agreement specifically allows

this option.

(3) FCIC has the right to not allow this

option on a written agreement in

accordance with the provisions in

section 18 of the Basic Provisions.

Optional Coverage for Fresh Fruit

Quality Adjustment Example:

You have a 100 percent share in 10

acres of fresh apples designated on your

acreage report, with a 600 bushel per

acre guarantee, and you select 100

percent of the price election on a price

election of $9.10 per bushel. You

harvest 5,000 marketable bushels of

apples from your designated fresh apple

acreage, but only 2,650 of those bushels

grade U.S. Fancy or better. Assuming

you do not sell any of your fresh apple

production, your indemnity would be

calculated as follows:

(A) 10 acres × 600 bushels per acre =

6,000-bushel production guarantee of

fresh apples;

(B) 6,000-bushel production guarantee

of fresh apples × $9.10 price election ×

100 percent of price election = $54,600

value of production guarantee for fresh

apple acreage;

(C) The value of the fresh apple

production to count is determined as

follows:

(i) 5,000 bushels harvested¥2,650

bushels that graded U.S. Fancy or better

= 2,350 bushels of fresh apple

production not grading U.S. Fancy or

better;

(ii) 2,350/5,000 = 47 percent of fresh

apple production not grading U.S.

Fancy or better;

(iii) In accordance with section

14(b)(5)(i): 47 percent¥15 percent = 32

percent in excess of 15 percent;

(iv) 32 percent × 2 = 64 percent;

(v) 5,000 bushels harvested × .64 (64

percent)¥3,200 bushels of fresh apple

production not grading U.S. Fancy or

better;

(vi) 5,000 bushels harvested¥3,200

bushels of fresh apple production not

grading U.S. Fancy or better = 1,800

bushels of adjusted fresh apple

production to count;

(vii) 1,800 bushels of adjusted fresh

apples production to count × $9.10 price

election × 100 percent of price election

= $16,380 value of fresh apple

production to count;

(D) $54,600 value of production

guarantee for fresh apples¥$16,380

value of fresh apple production to count

= $38,220 value of loss;

(E) $38,220 value of loss × 100 percent

share = $38,220 indemnity payment.

Richard Flournoy,

Acting Manager, Federal Crop Insurance

Corporation.

[FR Doc. 2021–26989 Filed 12–14–21; 11:15 am]

BILLING CODE 3410–08–P

DEPARTMENT OF ENERGY

10 CFR Part 430

[EERE–2021–BT–TP–0023]

RIN 1904–AF18

Energy Conservation Program: Test

Procedures for Cooking Products

AGENCY

: Office of Energy Efficiency and

Renewable Energy, Department of

Energy.

ACTION

: Notice of proposed rulemaking;

extension of public comment period and

notification of data availability (NODA).

SUMMARY

: The U.S. Department of

Energy (DOE) is extending the public

comment period for the notice of

proposed rulemaking (‘‘NOPR’’) that

DOE published on November 4, 2021

regarding a proposal for a new test

procedure for conventional cooking

tops, a category of cooking products,

that would replace the procedure that

DOE withdrew on August 18, 2020. DOE

is also publishing a NODA regarding the

results of DOE’s recently completed test

program assessing the repeatability and

reproducibility of the proposed test

procedure. DOE is publishing the results

of its testing and requests comment,

data, and information regarding the

results.

DATES

: The comment period for the

NOPR which published on November 4,

2021 (86 FR 60974), is extended. DOE

will accept comments, data, and

information regarding the NOPR and

NODA on or before January 18, 2022.

ADDRESSES

: Interested persons are

encouraged to submit comments using

the Federal eRulemaking Portal at

www.regulations.gov. Follow the

instructions for submitting comments.

Alternatively, interested persons may

submit comments, identified by docket

number EERE–2021–BT–TP–0023, by

any of the following methods:

1. Federal eRulemaking Portal:

www.regulations.gov. Follow the

instructions for submitting comments.

2. Email: CookingProducts2021@

ee.doe.gov. Include the docket number

EERE–2021–BT–TP–0023 in the subject

line of the message.

No telefacsimilies (‘‘faxes’’) will be

accepted. For detailed instructions on

submitting comments and additional

information on this process, see section

III of this document.

Although DOE has routinely accepted

public comment submissions through a

variety of mechanisms, including postal

mail and hand delivery/courier, the

Department has found it necessary to

make temporary modifications to the

comment submission process in light of

the ongoing coronavirus 2019 (‘‘COVID–

19’’) pandemic. DOE is currently

suspending receipt of public comments

via postal mail and hand delivery/

courier. If a commenter finds that this

change poses an undue hardship, please

contact Appliance Standards Program

staff at (202) 586–1445 to discuss the

need for alternative arrangements. Once

the COVID–19 pandemic health

emergency is resolved, DOE anticipates

resuming all of its regular options for

public comment submission, including

postal mail and hand delivery/courier.

Docket: The docket for this activity,

which includes Federal Register

notices, public meeting attendee lists

and transcripts (if a public meeting is

held), comments, and other supporting

documents/materials, is available for

review at www.regulations.gov. All

documents in the docket are listed in

the www.regulations.gov index.

However, some documents listed in the

index, such as those containing

information that is exempt from public

disclosure, may not be publicly

available.

The docket web page can be found at

www.regulations.gov/docket/EERE-

2021-BT-TP-0023. The docket web page

contains instructions on how to access

all documents, including public

comments, in the docket. See section III

for information on how to submit

comments through

www.regulations.gov.

FOR FURTHER INFORMATION CONTACT

: Dr.

Stephanie Johnson, U.S. Department of

Energy, Office of Energy Efficiency and

Renewable Energy, Building

Technologies Office, EE–2J, 1000

Independence Avenue SW, Washington,

DC 20585–0121. Telephone: (202) 287–

1943. Email:

ApplianceStandardsQuestions@

ee.doe.gov.

Ms. Celia Sher, U.S. Department of

Energy, Office of the General Counsel,

GC–33, 1000 Independence Avenue SW,

Washington, DC 20585–0121.

Telephone: (202) 287–6122. Email:

Celia.Sher@hq.doe.gov.

SUPPLEMENTARY INFORMATION

:

Table of Contents

I. Background

II. Summary of Additional Testing Performed

by DOE

III. Extension of the Comment Period

I. Background

DOE originally established test

procedures for cooking products in a

final rule published in the Federal

Register on May 10, 1978. 43 FR 20108,

20120–20128. In the years following,

DOE amended the test procedure for

conventional cooking tops on several

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