Irrigated Cropland Insurance Eligibility and Drought
May 14, 2012
The Kansas Department of Agriculture is implementing new water allocation options for irrigated producers for the 2012 crop year. The Kansas Legislature made several changes to the water right flex account program through Senate Bill 272, which was signed by Governor Brownback on March 5, 2012. A summary of the changes made by Senate Bill 272 is attached.
The Risk Management Agency Topeka Regional Office has received a number of questions concerning how water right flex account program changes may affect their eligibility for irrigated coverage under their Federal crop insurance policy. While the following is being provided as a general response to the questions received insured producers are reminded to contact your crop insurance agent to fully discuss your particular circumstances and how it may or may not impact you Federal crop insurance coverage.
Q: If I apply for a 5-year flex allocation, my overall water allocation will be lower, yet in three out of the five years I could have a full annual allocation with a reduced allocation in the 4th and fifth year, will I still be able to plant and report all my acres as irrigated?
A: Under current crop insurance policies and procedures, to insure cropland as irrigated, you must apply at the appropriate time and have a reasonable expectation of receiving the quantity of water needed to produce at least the yield used to establish your irrigated production guarantee or the amount of insurance on the irrigated acreage planted to the insured crop.
If you have a reasonable expectation, at the time of planting, that the new allocation will provide sufficient water to produce the Actual Production History (APH) average yield, you can plant and insure all the acres as irrigated. Sources of information to make this determination include but are not limited to: historical irrigation water use, expected precipitation during the growing season, and soil moisture conditions at the time of planting.
Producers may look to sources such as Kansas State University Extension for assistance in predicting the amount of irrigation needed given existing soil moisture conditions to achieve APH. The following site may provide useful documentation using the Crop Yield Predictor: www.mobileirrigationlab.com
If the new allocation requires you to apply less water than used to establish your irrigated practice production guarantee or amount of insurance on the irrigated acreage planted to the insured crop, regardless of the reason, you have the following options:
- apply the amount of water needed to produce the irrigated APH yield on a reduced number of acres and report the remaining acres as non-irrigated;
- apply less water to the total acreage than used to establish your irrigated APH yield and report the total acreage as non-irrigated.
Q: My previous water allocation was much higher than what I normally apply to irrigate my crop. However, I did exceed that allocation under the extreme hot and dry summer of 2011. I am not going to apply for the 5 year flex program so I have a reduced allocation for crop year 2012. Can I still plant and insure all my acres as irrigated?
A: The same information as identified above would need to be evaluated when determining the number of acres that can be reported as irrigated. However, as a general rule provided you apply the same amounts of water that you normally have applied and that were used to establish your irrigated APH average yield, even if such was less than your actual allocation, there should be no issue with reporting your acreage as irrigated.
Q: I intend to apply less water than can support my irrigated APH yield in 2012. How do I report this on my acreage report and how would my APH yield be determined? I intend to go back to a fully irrigated practice and fully nonirrigated practice in 2013.
A: In these types of situations, the acres must be reported as nonirrigated. If there is not already a nonirrigated APH database for the unit, then a new APH database would have to be established for the now nonirrigated practice.
If you already have a nonirrigated APH database for that unit, then the acreage with the reduced irrigation will be included in the existing nonirrigated APH database for the unit.
For the 2013 crop year, if the nonirrigated database will no longer include any supplemental irrigation, there are yield adjustment procedures that may apply. Producers are strongly encouraged to discuss any impact this may have on their crop insurance coverage with their agent.
Q: I am applying for the 5 year flex plan that allows me to use my water as needed to irrigate my crops in any year as long as I donít exceed the 5 year total. If I end up needing to irrigate more than the average yearly amount for 1 or more years, I may be short of water for the last year of the flex plan. How does this affect my crop insurance?
A: If the water allocation remaining for any year within the 5 year flex plan is not sufficient to produce the irrigated APH average yield, the acres cannot be reported and insured under an irrigated practice. The producer would need to either reduce the number of acres planted and reported as an irrigated practice or report the entire acreage as nonirrigated.
Producers in this situation should work closely with their insurance company to ensure their crop insurance coverage is properly established.
Q: If I use all my 5-year allocation in years 1 through 4, am I eligible for a prevented planting guarantee for the final year of my flex plan?
For more information, please contact John Shea.