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Final Agency Determination: FAD-001


Subject: Section 9(a)(1) of the Basic Provisions, 7 C.F.R. § 457.8, paragraph 9(a)(1)


On February 10, 2000, the Risk Management Agency was asked for a final agency determination on an interpretation of a term of the policy for the 2000 crop year: Section 9(a)(1) of the Basic Provisions, 7 C.F.R. § 457.8, paragraph 9(a)(1), which states:

(a) Acreage planted to the insured crop in which you have a share is insurable except acreage:
(1) That has not been planted and harvested within one of the 3 previous crop years, unless:
    (i) Such acreage was not planted:
    (A) To comply with any other USDA program;
Interpretation Submitted

It is our interpretation that land set aside under the Conservation Reserve Program, 7 C.F.R. Part 1410, until the end of 1997 and not planted in crop years 1998 and 1999 may be planted in crop year 2000. In addition, it is our interpretation that any crop that is insurable may be planted and insured now, even if the crop was never planted before, provided that the terms and conditions of the applicable insurance regulations, including all yield guarantee limitations, are observed.

Agency Response

Under the submitted interpretation, if the producer was excused from planting for one year because the acreage was enrolled in a USDA program, there is no need for an excuse for not planting the other two years. While this may not have been the intent of the provision, it is a reasonable interpretation of the provision as drafted.

With respect to the crop that can be planted when the acreage becomes eligible for insurance, the submitted interpretation is correct that the insured crop need not have been the one that was planted in one of the three previous crop years. As long as any crop was planted or the acreage was enrolled in a USDA program for at least one crop year, the acreage is eligible for insurance if a crop is planted that is insurable in the county, and all other conditions of eligibility are met, even if the crop has never been planted before on the acreage.

In accordance with 7 C.F.R. §400.765(c), this constitutes the final agency determination and is binding on all participants in the Federal crop insurance program.

Date of Issue: May 6, 2000