1. U.S. Code
  2. title 7
  3. chapter 36
  4. subchapter I
  5. § 1518

Collapse to view only § 1518. “Agricultural commodity” defined

§ 1501. Short title and application of other provisions

This subchapter may be cited as the “Federal Crop Insurance Act”. Except as otherwise expressly provided the provisions in titles I to IV, inclusive, shall not apply with respect to this subchapter, and the term “Act” wherever it appears in such titles shall not be construed to include this subchapter.

(Feb. 16, 1938, ch. 30, title V, § 501, 52 Stat. 72; Pub. L. 110–234, title XII, § 12033(c), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c), June 18, 2008, 122 Stat. 1664, 2167.)

CITE AS: 7 USC 1501

§ 1502. Purpose; definitions; protection of information; relation to other laws
(a) Purpose
(b) Definitions
As used in this subchapter:
(1) Additional coverage
(2) Approved insurance provider
(3) Beginning farmer or rancher
(4) Board
(5) Corporation
(6) Cover crop termination
(7) Department
(8) Farm financial benchmarking
The term “farm financial benchmarking” means—
(A) the process of comparing the performance of an agricultural enterprise against the performance of other similar enterprises, through the use of comparable and reliable data, in order to identify business management strengths, weaknesses, and steps necessary to improve management performance and business profitability; and
(B) benchmarking of the type conducted by farm management and producer associations consistent with the activities described in or funded pursuant to section 5925f of this title.
(9) Hemp
(10) Loss ratio
(11) Organic crop
(12) Secretary
(13) Transitional yield
The term “transitional yield” means the maximum average production per acre or equivalent measure that is assigned to acreage for a crop year by the Corporation in accordance with the regulations of the Corporation whenever the producer fails—
(A) to certify that acceptable documentation of production and acreage for the crop year is in the possession of the producer; or
(B) to present the acceptable documentation on the demand of the Corporation or an insurance company reinsured by the Corporation.
(14) Veteran farmer or rancher
The term “veteran farmer or rancher” means a farmer or rancher who—
(A) has served in the Armed Forces (as defined in section 101 of title 38); and
(B)
(i) has not operated a farm or ranch;
(ii) has operated a farm or ranch for not more than 5 years; or
(iii) is a veteran (as defined in section 101 of that title) who has first obtained status as a veteran (as so defined) during the most recent 5-year period.
(c) Protection of confidential information
(1) General prohibition against disclosure
(2) Authorized disclosure
(A) Disclosure in statistical or aggregate form
(B) Consent of producer
(3) Violations; penalties
(4) Information
(A) Request
(B) Privacy
(C) Sharing
(d) Relation to other laws
(1) Terms and conditions of policies and plans
The terms and conditions of any policy or plan of insurance offered under this subchapter that is reinsured by the Corporation shall not—
(A) be subject to the jurisdiction of the Commodity Futures Trading Commission or the Securities and Exchange Commission; or
(B) be considered to be accounts, agreements (including any transaction that is of the character of, or is commonly known to the trade as, an “option”, “privilege”, “indemnity”, “bid”, “offer”, “put”, “call”, “advance guaranty”, or “decline guaranty”), or transactions involving contracts of sale of a commodity for future delivery, traded or executed on a contract market for the purposes of the Commodity Exchange Act (7 U.S.C. 1 et seq.).
(2) Effect on CFTC and Commodity Exchange Act
(Feb. 16, 1938, ch. 30, title V, § 502, 52 Stat. 72; June 21, 1941, ch. 214, § 1, 55 Stat. 255; Aug. 1, 1947, ch. 440, § 4, 61 Stat. 719; Pub. L. 103–354, title I, § 102(a), Oct. 13, 1994, 108 Stat. 3180; Pub. L. 106–224, title I, §§ 122, 141, June 20, 2000, 114 Stat. 377, 389; Pub. L. 110–234, title XII, §§ 12001, 12033(c)(2)(B), May 22, 2008, 122 Stat. 1371, 1405; Pub. L. 110–246, § 4(a), title XII, §§ 12001, 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2133, 2167; Pub. L. 113–79, title XI, §§ 11001, 11016(a), 11027(a), Feb. 7, 2014, 128 Stat. 954, 963, 977; Pub. L. 115–334, title XI, § 11101, title XII, § 12306(b)(1), Dec. 20, 2018, 132 Stat. 4919, 4968.)

CITE AS: 7 USC 1502

§ 1503. Federal Crop Insurance Corporation; creation; offices

To carry out the purposes of this subchapter, there is hereby created as an agency of and within the Department a body corporate with the name “Federal Crop Insurance Corporation”. The principal office of the Corporation shall be located in the District of Columbia, but there may be established agencies or branch offices elsewhere in the United States under rules and regulations prescribed by the Board.

(Feb. 16, 1938, ch. 30, title V, § 503, 52 Stat. 72; Pub. L. 103–354, title I, § 102(b)(1), (4)(A), (B), Oct. 13, 1994, 108 Stat. 3180, 3181; Pub. L. 110–234, title XII, § 12033(c)(2)(B), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2167.)

CITE AS: 7 USC 1503

§ 1504. Capital stock of Corporation
(a) Subscription by United States
(b) Appropriations
(c) Issuance of stock to Secretary of the Treasury
(d) Cancellation of receipts; nonliability of Corporation
(Feb. 16, 1938, ch. 30, title V, § 504, 52 Stat. 72; Aug. 25, 1949, ch. 512, §§ 4, 6, 63 Stat. 665; Pub. L. 95–47, June 16, 1977, 91 Stat. 228; Pub. L. 95–181, § 1, Nov. 15, 1977, 91 Stat. 1373; Pub. L. 96–365, title I, § 101, Sept. 26, 1980, 94 Stat. 1312; Pub. L. 103–354, title I, § 102(b)(2), (4)(C), Oct. 13, 1994, 108 Stat. 3180, 3181.)

CITE AS: 7 USC 1504

§ 1504a. Capitalization of Corporation

The payment for capital stock in the Federal Crop Insurance Corporation shall be effected by transfer of funds on the books of the Treasury Department to the credit of the Corporation.

(June 27, 1940, ch. 437, title I, 54 Stat. 640.)

CITE AS: 7 USC 1504a

§ 1505. Management of Corporation
(a) Board of Directors
(1) Establishment
(2) CompositionThe Board shall consist of only the following members:
(A) The manager of the Corporation, who shall serve as a nonvoting ex officio member.
(B) The Under Secretary of Agriculture responsible for the Federal crop insurance program.
(C) One additional Under Secretary of Agriculture (as designated by the Secretary).
(D) The Chief Economist of the Department of Agriculture.
(E) One person experienced in the crop insurance business.
(F) One person experienced in reinsurance or the regulation of insurance.
(G) Four active producers who are policy holders, are from different geographic areas of the United States, and represent a cross-section of agricultural commodities grown in the United States, including at least one specialty crop producer.
(3) Appointment of private sector membersThe members of the Board described in subparagraphs (E), (F), and (G) of paragraph (2)—
(A) shall be appointed by, and hold office at the pleasure of, the Secretary;
(B) shall not be otherwise employed by the Federal Government;
(C) shall be appointed to staggered 4-year terms, as determined by the Secretary; and
(D) shall serve not more than two consecutive terms.
(4) Chairperson
(b) Vacancies
(c) Compensation
(d) Manager of Corporation
(e) Expert review of policies, plans of insurance, and related material
(1) Review by experts
(2) Review of Corporation policies and plansExcept as provided in paragraph (3), the Board shall contract with at least five persons to each conduct a review of the policy or plan of insurance, of whom—
(A) not more than one person may be employed by the Federal Government; and
(B) at least one person must be designated by approved insurance providers pursuant to procedures determined by the Board.
(3) Review of private submissionsIf the reviews under paragraph (1) cover a policy or plan of insurance, or any related material or modification of a policy or plan of insurance, submitted under section 1508(h) of this title—
(A) the Board shall contract with at least five persons to each conduct a review of the policy or plan of insurance, of whom—
(i) not more than one person may be employed by the Federal Government; and
(ii) none may be employed by an approved insurance provider; and
(B) each review must be completed and submitted to the Board not later than 30 days prior to the end of the 120-day period described in section 1508(h)(4)(D) of this title.
(4) Consideration of reviews
(5) Funding of reviews
(6) Relation to other authority
(Feb. 16, 1938, ch. 30, title V, § 505, 52 Stat. 72; Aug. 1, 1947, ch. 440, § 8, 61 Stat. 719; Aug. 25, 1949, ch. 512, § 7, 63 Stat. 665; Pub. L. 96–365, title I, § 102, Sept. 26, 1980, 94 Stat. 1312; Pub. L. 103–354, title I, §§ 102(b)(3), (4), 103, 115(a), Oct. 13, 1994, 108 Stat. 3181, 3204; Pub. L. 106–224, title I, § 142(a)(1), (b), June 20, 2000, 114 Stat. 389, 390; Pub. L. 110–234, title XII, § 12033(c)(2)(B), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2167.)

CITE AS: 7 USC 1505

§ 1506. General powers
(a) Succession
(b) Corporate seal
(c) Property
(d) Suit
(e) Bylaws and regulations
(f) Mails
(g) Assistance
(h) Collection and sharing of information
(1) Surveys and investigations
(2) Data collection
(A) In general
(B) National Agricultural Statistics ServiceData collected by the National Agricultural Statistics Service, whether published or unpublished, shall be—
(i) provided in an aggregate form to the Corporation for the purpose of providing insurance under this subchapter; and
(ii) kept confidential by the Corporation in the same manner and to the same extent as is required under—(I)section 2276 of this title; and(II) the Confidential Information Protection and Statistical Efficiency Act of 2002 (44 U.S.C. 3501 note; Public Law 107–347).2
2 See References in Text note below.
(C) Noninsured crop disaster assistance programIn collecting data under this subsection, the Secretary shall ensure that—
(i) appropriate data are collected through the noninsured crop disaster assistance program established by section 7333 of this title; and
(ii) not less frequently than annually, the Farm Service Agency shares, and the Corporation considers, the data described in clause (i).
(3) Sharing of records
(i) Expenditures
(j) Settling claims
(k) Other powers
(l) Contracts
(m) Submission of certain information
(1) Social security account and employer identification numbers
(2) Notification by policyholders
(3) Identification of holders of substantial interests
(4) “Substantial beneficial interest” defined
(n) Actuarial soundness
(1) Projected loss ratio as of October 1, 1995The Corporation shall take such actions as are necessary to improve the actuarial soundness of Federal multiperil crop insurance coverage made available under this subchapter to achieve, on and after October 1, 1995, an overall projected loss ratio of not greater than 1.1, including—
(A) instituting appropriate requirements for documentation of the actual production history of insured producers to establish recorded or appraised yields for Federal crop insurance coverage that more accurately reflect the associated actuarial risk, except that the Corporation may not carry out this paragraph in a manner that would prevent beginning farmers (as defined by the Secretary) from obtaining Federal crop insurance;
(B) establishing in counties, to the extent practicable, a crop insurance option based on area yields in a manner that allows an insured producer to qualify for an indemnity if a loss has occurred in a specified area in which the farm of the insured producer is located;
(C) establishing a database that contains the social security account and employee identification numbers of participating producers, agents, and loss adjusters and using the numbers to identify insured producers, agents, and loss adjusters who are high risk for actuarial purposes and insured producers who have not documented at least 4 years of production history, to assess the performance of insurance providers, and for other purposes permitted by law; and
(D) taking any other measures authorized by law to improve the actuarial soundness of the Federal crop insurance program while maintaining fairness and effective coverage for agricultural producers.
(2) Projected loss ratio
(3) Nonstandard classification system
(o) Regulations
(p) Purchase of American-made equipment and products
(1) Sense of Congress
(2) Notice requirement
(r)3
3 So in original. Probably should be “(q)”.
Procedures for responding to certain inquiries
(1) Procedures required
(2) ImplementationNot later than 180 days after June 23, 1998, the Corporation shall issue regulations to implement this subsection. At a minimum, the regulations shall establish—
(A) the manner in which inquiries described in paragraph (1) are required to be submitted to the Corporation; and
(B) a reasonable maximum number of days within which the Corporation will respond to all inquiries.
(3) Effect of failure to timely respond
(Feb. 16, 1938, ch. 30, title V, § 506, 52 Stat. 73; June 21, 1941, ch. 214, § 2, 55 Stat. 255; Aug. 1, 1947, ch. 440, § 7, 61 Stat. 719; Aug. 25, 1949, ch. 512, § 8, 63 Stat. 665; Pub. L. 96–365, title I, §§ 103, 107(a), Sept. 26, 1980, 94 Stat. 1313, 1317; Pub. L. 101–624, title XXII, §§ 2201(a), 2202, Nov. 28, 1990, 104 Stat. 3951, 3954; Pub. L. 102–237, title VI, § 601(1), (2), Dec. 13, 1991, 105 Stat. 1878; Pub. L. 103–66, title I, § 1403(a), Aug. 10, 1993, 107 Stat. 333; Pub. L. 103–354, title I, §§ 104, 119(f)(1), Oct. 13, 1994, 108 Stat. 3181, 3208; Pub. L. 105–185, title V, § 533, June 23, 1998, 112 Stat. 583; Pub. L. 106–224, title I, §§ 121(b), 124(b), June 20, 2000, 114 Stat. 377, 378; Pub. L. 110–234, title XII, §§ 12002(a), (b)(1), 12003(a), 12033(c)(2)(B), May 22, 2008, 122 Stat. 1371, 1405; Pub. L. 110–246, § 4(a), title XII, §§ 12002(a), (b)(1), 12003(a), 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2133, 2167; Pub. L. 115–334, title XI, §§ 11102, 11103, Dec. 20, 2018, 132 Stat. 4919, 4920.)

CITE AS: 7 USC 1506

§§ 1506a, 1506b. Omitted

CITE AS: 7 USC 1506a, 1506b

§ 1507. Personnel of Corporation
(a) Appointment; civil service exemption; compensation
(b) Application of employees’ compensation law
(c) Use of associations of producers and private insurance companies; payment of administrative and program expenses; sale of crop insurance through private agents and brokers: renewals, exclusion of compensation from premium rates, indemnification for errors or omissions of Commission or its contractors
(d) Allotment of funds to Federal and State agencies
(e) Utilization of producer cooperative associations
(f) Use of resources, data, boards, and committees of Federal agenciesIf the Board determines it is necessary, the Board shall use, to the maximum extent practicable, the resources, data, boards, and the committees of—
(1) the Natural Resources Conservation Service, in assisting the Board in—
(A) the classification of land as to risk and production capability; and
(B) the consideration of acceptable conservation practices, including good farming practices with respect to conservation (such as cover crop termination);
(2) the Forest Service, in assisting the Board in the development of a timber insurance plan;
(3) the Farm Service Agency, in assisting the Board in—
(A) the determination of individual producer yields;
(B) sharing information on beginning farmers and ranchers and veteran farmers and ranchers;
(C) investigating potential waste, fraud, or abuse;
(D) sharing information to support the transition of crops and counties from the noninsured crop disaster assistance program established by section 7333 of this title to insurance under this subchapter; and
(E) serving as a local point of contact for the dissemination of information on risk management options available to farmers and ranchers; and
(4) other Federal agencies, in assisting the Board in any way the Board determines is necessary in carrying out this subchapter.
(g) Specialty Crops Coordinator
(1)In general.—The Corporation shall establish a management-level position to be known as the Specialty Crops Coordinator.
(2) The Specialty Crops Coordinator shall have primary responsibility for addressing the needs of specialty crop producers, and for providing information and advice, in connection with the activities of the Corporation to improve and expand the insurance program for specialty crops. In carrying out this paragraph, the Specialty Crops Coordinator shall act as the liaison of the Corporation with representatives of specialty crop producers and assist the Corporation with the knowledge, expertise, and familiarity of the producers with risk management and production issues pertaining to specialty crops.
(3) The Specialty Crops Coordinator shall use information collected from Corporation field office directors in States in which specialty crops have a significant economic effect and from other sources, including the extension service and colleges and universities.
(4)Specialty crop liaisons.—The Specialty Crops Coordinator shall—
(A) designate a Specialty Crops Liaison in each regional field office; and
(B) share the contact information of the Specialty Crops Liaisons with specialty crop producers.
(5)Website.—The Specialty Crops Coordinator shall establish a website focused on the efforts of the Corporation to provide and expand crop insurance for specialty crop producers.
(Feb. 16, 1938, ch. 30, title V, § 507, 52 Stat. 73; Aug. 1, 1947, ch. 440, § 6, 61 Stat. 719; Aug. 25, 1949, ch. 512, § 10, 63 Stat. 665; Oct. 28, 1949, ch. 782, title XI, § 1106(a), 63 Stat. 972; Pub. L. 92–310, title II, § 221(b), June 6, 1972, 86 Stat. 205; Pub. L. 96–365, title I, § 104, Sept. 26, 1980, 94 Stat. 1313; Pub. L. 101–624, title XXII, § 2206, Nov. 28, 1990, 104 Stat. 3958; Pub. L. 102–237, title VI, § 601(3), Dec. 13, 1991, 105 Stat. 1878; Pub. L. 103–354, title I, §§ 102(b)(4)(B), (C), 105, 115(b), 119(f)(2), Oct. 13, 1994, 108 Stat. 3181, 3182, 3204, 3208; Pub. L. 106–224, title I, § 143, June 20, 2000, 114 Stat. 391; Pub. L. 110–234, title XII, § 12033(c)(2)(B), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2167; Pub. L. 115–334, title XI, §§ 11104, 11105(a), Dec. 20, 2018, 132 Stat. 4920.)

CITE AS: 7 USC 1507

§ 1508. Crop insurance
(a) Authority to offer insurance
(1) In general
(2) Period
(3) Exclusion of losses due to certain actions of producer
(A) ExclusionsInsurance provided under this subsection shall not cover losses due to—
(i) the neglect or malfeasance of the producer;
(ii) the failure of the producer to reseed to the same crop in such areas and under such circumstances as it is customary to reseed; or
(iii) the failure of the producer to follow good farming practices, including scientifically sound sustainable and organic farming practices.
(B) Good farming practices determination review
(i) Informal administrative process
(ii) Administrative review(I) No adverse decision(II) Reversal or modification
(iii) Judicial review(I) Right to review(II) Reversal or modification
(C) Limitation on revenue coverage for potatoes
(4) Expansion to other areas or single producers
(A) Area expansion
(B) Producer expansion
(5) Dissemination of crop insurance information
(A) Available informationThe Corporation shall make available to producers through local offices of the Department—
(i) current and complete information on all aspects of Federal crop insurance; and
(ii) a listing of insurance agents and companies offering to sell crop insurance in the area of the producers.
(B) Use of electronic methods
(i) Dissemination by Corporation
(ii) Submission to Corporation
(6) Addition of new and specialty crops (including value-added crops)
(A) Annual reviewNot later than 1 year after December 20, 2018, and annually thereafter, the manager of the Corporation shall prepare, to the maximum extent practicable, based on data shared from the noninsured crop disaster assistance program established by section 7333 of this title, written agreements, or other data, and present to the Board not less than 1 of each of the following:
(i) Research and development for a policy or plan of insurance for a commodity for which there is no existing policy or plan of insurance.
(ii) Expansion of an existing policy or plan of insurance to additional counties or States, including malting barley endorsements or contract options.
(iii) Research and development for a new policy or plan of insurance, or endorsement, for commodities with existing policies or plans of insurance, such as dollar plans.
(B) Report
(7) Adequate coverage for States and underserved producers
(A) DefinitionsIn this paragraph:
(i) Adequately served
(ii) Underserved producerThe term “underserved producer” means an individual (including a member of an Indian Tribe) that is—(I) a beginning farmer or rancher;(II) a veteran farmer or rancher; or(III) a socially disadvantaged farmer or rancher.
(B) Review
(C) Report
(i) In general
(ii) Recommendations
(8) Special provisions for cotton and rice
(9) Premium adjustments
(A) Prohibition
(B) ExceptionsSubparagraph (A) does not apply with respect to—
(i) a payment authorized under subsection (b)(5)(B);
(ii) a performance-based discount authorized under subsection (d)(3); or
(iii) a patronage dividend, or similar payment, that is paid—(I) by an entity that was approved by the Corporation to make such payments for the 2005, 2006, or 2007 reinsurance year, in accordance with subsection (b)(5)(B) as in effect on the day before the date of enactment of this paragraph; and(II) in a manner consistent with the payment plan approved in accordance with that subsection for the entity by the Corporation for the applicable reinsurance year.
(C) Publication of violations
(i) Publication required
(ii) Protection of privacy
(10) Commissions
(A) Definition of immediate family
(B) ProhibitionNo individual (including a subagent) may receive directly, or indirectly through an entity, any compensation (including any commission, profit sharing, bonus, or any other direct or indirect benefit) for the sale or service of a policy or plan of insurance offered under this subchapter if—
(i) the individual has a substantial beneficial interest, or a member of the individual’s immediate family has a substantial beneficial interest, in the policy or plan of insurance; and
(ii) the total compensation to be paid to the individual with respect to the sale or service of the policies or plans of insurance that meet the condition described in clause (i) exceeds 30 percent or the percentage specified in State law, whichever is less, of the total of all compensation received directly or indirectly by the individual for the sale or service of all policies and plans of insurance offered under this subchapter for the reinsurance year.
(C) Reporting
(D) Sanctions
(E) Applicability
(i) In general
(ii) Prohibition
(11) Cover crops
(A) In general
(B) Termination
(i) In generalThe termination of a cover crop shall be carried out according to—(I) guidelines established by the Secretary; or(II) an exception to the guidelines approved under clause (ii).
(ii) Exception to guidelinesThe Corporation shall approve an exception to the guidelines under clause (i)(I) if that exception is recommended by—(I) the Natural Resources Conservation Service; or(II) an agricultural expert, as determined by the Corporation, unless the exception is determined to be unreasonable by the Corporation.
(C) Insurability of subsequent crop
(D) Summer fallow
(b) Catastrophic risk protection
(1) Coverage availability
(2) Amount of coverage
(A) In generalSubject to subparagraph (B)—
(i) in the case of each of the 1995 through 1998 crop years, catastrophic risk protection shall offer a producer coverage for a 50 percent loss in yield, on an individual yield or area yield basis, indemnified at 60 percent of the expected market price, or a comparable coverage (as determined by the Corporation); and
(ii) in the case of each of the 1999 and subsequent crop years, catastrophic risk protection shall offer a producer coverage for a 50 percent loss in yield, on an individual yield or area yield basis, indemnified at 55 percent of the expected market price, or a comparable coverage (as determined by the Corporation).
(B) Reduction in actual payment
(3) Alternative catastrophic coverageBeginning with the 2001 crop year, the Corporation shall offer producers of an agricultural commodity the option of selecting either of the following:
(A) The catastrophic risk protection coverage available under paragraph (2)(A).
(B) An alternative catastrophic risk protection coverage that—
(i) indemnifies the producer on an area yield and loss basis if such a policy or plan of insurance is offered for the agricultural commodity in the county in which the farm is located;
(ii) provides, on a uniform national basis, a higher combination of yield and price protection than the coverage available under paragraph (2)(A); and
(iii) the Corporation determines is comparable to the coverage available under paragraph (2)(A) for purposes of subsection (e)(2)(A).
(4) Sale of catastrophic risk coverage
(A) In generalCatastrophic risk coverage may be offered by—
(i) approved insurance providers, if available in an area; and
(ii) at the option of the Secretary that is based on considerations of need, local offices of the Department.
(B) Need
(C) Delivery of coverage
(i) In general
(ii) Coverage by approved insurance providers
(iii) Timing of determinations
(iv) Current policies
(5) Administrative fee
(A) Basic fee
(B) Payment of catastrophic risk protection fee on behalf of producers
(i) Payment authorized
(ii) Selection of provider
(iii) Delivery of insurance
(iv) Additional coverage encouraged
(C) Time for payment
(D) Use of fees
(i) In general
(ii) Limitation
(E) Waiver of fee
(i) In general
(ii) Coordination
(6) Participation requirement
(7) Limitation due to risk
(8) Transitional coverage for 1995 crops
(9) Simplification
(A) Catastrophic risk protection plans
(B) Other plans
(10) Loss adjustment
(c) General coverage levels
(1) Additional coverage generally
(A) In general
(B) Purchase
(2) Transfer of relevant information
(3) Yield and loss basis optionsA producer shall have the option of purchasing additional coverage based on—
(A)
(i) an individual yield and loss basis; or
(ii) an area yield and loss basis;
(B) an individual yield and loss basis, supplemented with coverage based on an area yield and loss basis to cover a part of the deductible under the individual yield and loss policy, as described in paragraph (4)(C); or
(C) a margin basis alone or in combination with the coverages available under subparagraph (A) or (B).
(4) Level of coverage
(A) Dollar denomination and percentage of yieldExcept as provided in subparagraph (C), the level of coverage—
(i) shall be dollar denominated; and
(ii) may be purchased at any level not to exceed 85 percent of the individual yield or 95 percent of the area yield (as determined by the Corporation).
(B) Information
(C) Supplemental coverage option
(i) In generalNotwithstanding subparagraph (A), in the case of the supplemental coverage option described in paragraph (3)(B), the Corporation shall offer producers the opportunity to purchase coverage in combination with a policy or plan of insurance offered under this subchapter that would allow indemnities to be paid to a producer equal to a part of the deductible under the policy or plan of insurance—(I) at a county-wide level to the fullest extent practicable; or(II) in counties that lack sufficient data, on the basis of such larger geographical area as the Corporation determines to provide sufficient data for purposes of providing the coverage.
(ii) Trigger
(iii) CoverageSubject to the trigger described in clause (ii), coverage offered under paragraph (3)(B) and clause (i) shall not exceed the difference between—(I) 86 percent; and(II) the coverage level selected by the producer for the underlying policy or plan of insurance.
(iv) Ineligible crops and acres
(v) Calculation of premiumNotwithstanding subsection (d), the premium for coverage offered under paragraph (3)(B) and clause (i) shall—(I) be sufficient to cover anticipated losses and a reasonable reserve; and(II) include an amount for operating and administrative expenses established in accordance with subsection (k)(4)(F).
(5) Expected market price
(A) Establishment or approval
(B) General rule
(C) Other authorized approachesThe expected market price of an agricultural commodity—
(i) may be based on the actual market price of the agricultural commodity at the time of harvest, as determined by the Corporation;
(ii) in the case of revenue and other similar plans of insurance, may be the actual market price of the agricultural commodity, as determined by the Corporation;
(iii) in the case of cost of production or similar plans of insurance, shall be the projected cost of producing the agricultural commodity, as determined by the Corporation; or
(iv) in the case of other plans of insurance, may be an appropriate amount, as determined by the Corporation.
(D) Grain sorghum price election
(i) In generalThe Corporation, in conjunction with the Secretary (referred to in this subparagraph as the “Corporation”), shall—(I) not later than 60 days after the date of enactment of this subparagraph, make available all methods and data, including data from the Economic Research Service, used by the Corporation to develop the expected market prices for grain sorghum under the production and revenue-based plans of insurance of the Corporation; and(II) request applicable data from the grain sorghum industry.
(ii) Expert reviewers(I) In general(II) RequirementsThe expert reviewers under subclause (I) shall be comprised of agricultural economists with experience in grain sorghum and corn markets, of whom—(aa) 2 shall be agricultural economists of institutions of higher education;(bb) 2 shall be economists from within the Department; and(cc) 1 shall be an economist nominated by the grain sorghum industry.
(iii) Recommendations(I) In general(II) Consideration(III) Publication
(iv) Appropriate pricing methodology(I) In general(II) Interim methodology(III) Availability
(6) Price elections
(A) In general
(B) Minimum price elections
(C) Wheat classes and malting barley
(D) Organic crops
(i) In general
(ii) Annual reportThe Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate an annual report on progress made in developing and improving Federal crop insurance for organic crops, including—(I) the numbers and varieties of organic crops insured;(II) the progress of implementing the price elections required under this subparagraph, including the rate at which additional price elections are adopted for organic crops;(III) the development of new insurance approaches relevant to organic producers; and(IV) any recommendations the Corporation considers appropriate to improve Federal crop insurance coverage for organic crops.
(7) Fire and hail coverage
(8) State premium subsidies
(9) Limitations on additional coverage
(10) Administrative fee
(A) Fee required
(B) Use of fees; waiver
(C) Time for payment
(d) Premiums
(1) Premiums requiredThe Corporation shall fix adequate premiums for all the plans of insurance of the Corporation at such rates as the Board determines are actuarially sufficient to attain an expected loss ratio of not greater than—
(A) 1.1 through September 30, 1998;
(B) 1.075 for the period beginning October 1, 1998, and ending on the day before the date of enactment of the Food, Conservation, and Energy Act of 2008; and
(C) 1.0 on and after the date of enactment of that Act.
(2) Premium amountsThe premium amounts for catastrophic risk protection under subsection (b) and additional coverage under subsection (c) shall be fixed as follows:
(A) In the case of catastrophic risk protection, the amount of the premium established by the Corporation for each crop for which catastrophic risk protection is available shall be reduced by the percentage equal to the difference between the average loss ratio for the crop and 100 percent, plus a reasonable reserve, as determined by the Corporation.
(B) In the case of additional coverage equal to or greater than 50 percent of the recorded or appraised average yield indemnified at not greater than 100 percent of the expected market price, or a comparable coverage for a policy or plan of insurance that is not based on individual yield, the amount of the premium shall—
(i) be sufficient to cover anticipated losses and a reasonable reserve; and
(ii) include an amount for operating and administrative expenses, as determined by the Corporation, on an industry-wide basis as a percentage of the amount of the premium used to define loss ratio.
(3) Performance-based discount
(4) Billing date for premiums
(e) Payment of portion of premium by Corporation
(1) In general
(2) Amount of paymentSubject to paragraphs (3), (6), and (7), the amount of the premium to be paid by the Corporation shall be as follows:
(A) In the case of catastrophic risk protection, the amount shall be equivalent to the premium established for catastrophic risk protection under subsection (d)(2)(A).
(B) In the case of additional coverage equal to or greater than 50 percent, but less than 55 percent, of the recorded or appraised average yield indemnified at not greater than 100 percent of the expected market price, or a comparable coverage for a policy or plan of insurance that is not based on individual yield, the amount shall be equal to the sum of—
(i) 67 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(C) In the case of additional coverage equal to or greater than 55 percent, but less than 65 percent, of the recorded or appraised average yield indemnified at not greater than 100 percent of the expected market price, or a comparable coverage for a policy or plan of insurance that is not based on individual yield, the amount shall be equal to the sum of—
(i) 64 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(D) In the case of additional coverage equal to or greater than 65 percent, but less than 75 percent, of the recorded or appraised average yield indemnified at not greater than 100 percent of the expected market price, or a comparable coverage for a policy or plan of insurance that is not based on individual yield, the amount shall be equal to the sum of—
(i) 59 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(E) In the case of additional coverage equal to or greater than 75 percent, but less than 80 percent, of the recorded or appraised average yield indemnified at not greater than 100 percent of the expected market price, or a comparable coverage for a policy or plan of insurance that is not based on individual yield, the amount shall be equal to the sum of—
(i) 55 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(F) In the case of additional coverage equal to or greater than 80 percent, but less than 85 percent, of the recorded or appraised average yield indemnified at not greater than 100 percent of the expected market price, or a comparable coverage for a policy or plan of insurance that is not based on individual yield, the amount shall be equal to the sum of—
(i) 48 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(G) Subject to subsection (c)(4), in the case of additional coverage equal to or greater than 85 percent of the recorded or appraised average yield indemnified at not greater than 100 percent of the expected market price, or a comparable coverage for a policy or plan of insurance that is not based on individual yield, the amount shall be equal to the sum of—
(i) 38 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(H) In the case of the supplemental coverage option authorized in subsection (c)(4)(C), the amount shall be equal to the sum of—
(i) 65 percent of the additional premium associated with the coverage; and
(ii) the amount determined under subsection (c)(4)(C)(v)(II), subject to subsection (k)(4)(F), for the coverage to cover operating and administrative expenses.
(3) Prohibition on continuous coverage
(4) Premium payment disclosure
(5) Enterprise and whole farm units
(A) In general
(B) Amount
(C) Limitation
(D) Nonirrigated crops
(E) Enterprise units across county linesThe Corporation may allow a producer to establish a single enterprise unit by combining an enterprise unit with—
(i) 1 or more other enterprise units in 1 or more other counties; or
(ii) all basic units and all optional units in 1 or more other counties.
(6) Premium subsidy for area revenue plansSubject to paragraph (4), in the case of a policy or plan of insurance that covers losses due to a reduction in revenue in an area, the amount of the premium paid by the Corporation shall be as follows:
(A) In the case of additional area coverage equal to or greater than 70 percent, but less than 75 percent, of the recorded county yield indemnified at not greater than 100 percent of the expected market price, the amount shall be equal to the sum of—
(i) 59 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(B) In the case of additional area coverage equal to or greater than 75 percent, but less than 85 percent, of the recorded county yield indemnified at not greater than 100 percent of the expected market price, the amount shall be equal to the sum of—
(i) 55 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(C) In the case of additional area coverage equal to or greater than 85 percent, but less than 90 percent, of the recorded county yield indemnified at not greater than 100 percent of the expected market price, the amount shall be equal to the sum of—
(i) 49 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(D) In the case of additional area coverage equal to or greater than 90 percent of the recorded county yield indemnified at not greater than 100 percent of the expected market price, the amount shall be equal to the sum of—
(i) 44 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(7) Premium subsidy for area yield plansSubject to paragraph (4), in the case of a policy or plan of insurance that covers losses due to a loss of yield or prevented planting in an area, the amount of the premium paid by the Corporation shall be as follows:
(A) In the case of additional area coverage equal to or greater than 70 percent, but less than 80 percent, of the recorded county yield indemnified at not greater than 100 percent of the expected market price, the amount shall be equal to the sum of—
(i) 59 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(B) In the case of additional area coverage equal to or greater than 80 percent, but less than 90 percent, of the recorded county yield indemnified at not greater than 100 percent of the expected market price, the amount shall be equal to the sum of—
(i) 55 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(C) In the case of additional area coverage equal to or greater than 90 percent,1
1 So in original. The comma probably should not appear.
of the recorded county yield indemnified at not greater than 100 percent of the expected market price, the amount shall be equal to the sum of—
(i) 51 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage level selected; and
(ii) the amount determined under subsection (d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.
(8) Premium for beginning and veteran farmers or ranchers
(f) Eligibility
(1) In general
(2) Sales closing date
(A) In general
(B) Established dates
(C) Exception
(3) Records and reportingTo obtain catastrophic risk protection under subsection (b) or additional coverage under subsection (c), a producer shall—
(A) provide annually records acceptable to the Secretary regarding crop acreage, acreage yields, and production for each agricultural commodity insured under this subchapter or accept a yield determined by the Corporation; and
(B) report acreage planted and prevented from planting by the designated acreage reporting date for the crop and location as established by the Corporation.
(g) Yield determinations
(1) In general
(2) Yield coverage plans
(A) Actual production history
(B) Assigned yieldIf the producer does not provide satisfactory evidence of the yield of a commodity under subparagraph (A), the producer shall be assigned—
(i) a yield that is not less than 65 percent of the transitional yield of the producer (adjusted to reflect actual production reflected in the records acceptable to the Corporation for continuous years), as specified in regulations issued by the Corporation based on production history requirements;
(ii) a yield determined by the Corporation, in the case of—(I) a producer that has not had a share of the production of the insured crop for more than two crop years, as determined by the Secretary;(II) a producer that produces an agricultural commodity on land that has not been farmed by the producer; or(III) a producer that rotates a crop produced on a farm to a crop that has not been produced on the farm; or
(iii) if the producer is a beginning farmer or rancher or veteran farmer or rancher who was previously involved in a farming or ranching operation, including involvement in the decisionmaking or physical involvement in the production of the crop or livestock on the farm, for any acreage obtained by the beginning farmer or rancher or veteran farmer or rancher, a yield that is the higher of—(I) the actual production history of the previous producer of the crop or livestock on the acreage determined under subparagraph (A); or(II) a yield of the producer, as determined in clause (i).
(C) Area yield
(D) Commodity-by-commodity basis
(E) Sources of yield dataTo determine yields under this paragraph, the Corporation—
(i) shall use county data collected by the Risk Management Agency, the National Agricultural Statistics Service, or both; or
(ii) if sufficient county data is not available, may use other data considered appropriate by the Secretary.
(3) Transitional yields for producers of feed or forage
(A) In generalIf a producer does not provide satisfactory evidence of a yield under paragraph (2)(A), the producer shall be assigned a yield that is at least 80 percent of the transitional yield established by the Corporation (adjusted to reflect the actual production history of the producer) if the Secretary determines that—
(i) the producer grows feed or forage primarily for on-farm use in a livestock, dairy, or poultry operation; and
(ii) over 50 percent of the net farm income of the producer is derived from the operation.
(B) Yield calculationThe Corporation shall—
(i) for the first year of participation of a producer, provide the assigned yield under this paragraph to the producer of feed or forage; and
(ii) for the second year of participation of the producer, apply the actual production history or assigned yield requirement, as provided in this subsection.
(C) Termination of authority
(4) Adjustment in actual production history to establish insurable yields
(A) Application
(B) Election to use percentage of transitional yieldIf, for one or more of the crop years used to establish the producer’s actual production history of an agricultural commodity, the producer’s recorded or appraised yield of the commodity was less than 60 percent of the applicable transitional yield, as determined by the Corporation, the Corporation shall, at the election of the producer—
(i) exclude any of such recorded or appraised yield; and
(ii)(I) replace each excluded yield with a yield equal to 60 percent of the applicable transitional yield; or(II) in the case of beginning farmers or ranchers and veteran farmers or ranchers, replace each excluded yield with a yield equal to 80 percent of the applicable transitional yield.
(C) Election to exclude certain history
(i) In general
(ii) Contiguous counties
(iii) Irrigation practice
(D) Premium adjustment
(5) Adjustment to reflect increased yields from successful pest control efforts
(A) Situations justifying adjustmentThe Corporation shall develop a methodology for adjusting the actual production history of a producer when each of the following apply:
(i) The producer’s farm is located in an area where systematic, area-wide efforts have been undertaken using certain operations or measures, or the producer’s farm is a location at which certain operations or measures have been undertaken, to detect, eradicate, suppress, or control, or at least to prevent or retard the spread of, a plant disease or plant pest, including a plant pest (as defined in section 7759 2
(ii) The presence of the plant disease or plant pest has been found to adversely affect the yield of the agricultural commodity for which the producer is applying for insurance.
(iii) The efforts described in clause (i) have been effective.
(B) Adjustment amount
(6) Continued authority
(A) In generalThe Corporation shall establish—
(i) underwriting rules that limit the decrease in the actual production history of a producer, at the election of the producer, to not more than 10 percent of the actual production history of the previous crop year provided that the production decline was the result of drought, flood, natural disaster, or other insurable loss (as determined by the Corporation); and
(ii) actuarially sound premiums to cover additional risk.
(B) Other authority
(C) Effect
(h) Submission of policies and materials to Board
(1) Authority to submit
(A) In generalIn addition to any standard forms or policies that the Board may require be made available to producers under subsection (c), a person (including an approved insurance provider, a college or university, a cooperative or trade association, or any other person) may prepare for submission or propose to the Board—
(i) other crop insurance policies and provisions of policies; and
(ii) rates of premiums for multiple peril crop insurance pertaining to wheat, soybeans, field corn, and any other crops determined by the Secretary.
(B) Review and submission by Corporation
(i) In generalThe Corporation shall review any policy developed under section 1522(c) of this title or any pilot program developed under section 1523 of this title and submit the policy or program to the Board under this subsection if the Corporation, at the sole discretion of the Corporation, finds that the policy or program—(I) subject to clause (ii), will likely result in a viable and marketable policy consistent with this subsection;(II) would provide crop insurance coverage in a significantly improved form; and(III) adequately protects the interests of producers.
(ii) Waiver for hemp
(2) Submission of policies
(3) Review and approval by the Board
(A) In generalA policy, plan of insurance, or other material submitted to the Board under this subsection shall be reviewed by the Board and shall be approved by the Board for reinsurance and for sale by approved insurance providers to producers at actuarially appropriate rates and under appropriate terms and conditions if the Board determines that—
(i) the interests of producers are adequately protected;
(ii) the proposed policy or plan of insurance will—(I) provide a new kind of coverage that is likely to be viable and marketable;(II) provide crop insurance coverage in a manner that addresses a clear and identifiable flaw or problem in an existing policy; or(III) provide a new kind of coverage for a commodity that previously had no available crop insurance, or has demonstrated a low level of participation or coverage level under existing coverage; and
(iii) the proposed policy or plan of insurance will not have a significant adverse impact on the crop insurance delivery system.
(B) ConsiderationIn approving policies or plans of insurance, the Board shall in a timely manner—
(i) first, consider policies or plans of insurance that address underserved commodities, including commodities for which there is no insurance;
(ii) second, consider existing policies or plans of insurance for which there is inadequate coverage or there exists low levels of participation; and
(iii) last, consider all policies or plans of insurance submitted to the Board that do not meet the criteria described in clause (i) or (ii).
(C) Specified review and approval prioritiesIn reviewing policies and other materials submitted to the Board under this subsection for approval, the Board—
(i) shall make the development and approval of a revenue policy for peanut producers a priority so that a revenue policy is available to peanut producers in time for the 2015 crop year;
(ii) shall make the development and approval of a margin coverage policy for rice producers a priority so that a margin coverage policy is available to rice producers in time for the 2015 crop year;
(iii) may approve a submission that is made pursuant to this subsection that would, beginning with the 2015 crop year, allow producers that purchase policies in accordance with subsection (e)(5)(A) to separate enterprise units by risk rating for acreage of crops in counties; and
(iv) in the case of reviewing policies and other materials relating to the production of hemp, may waive the viability and marketability requirement under subparagraph (A)(ii)(I).
(4) Guidelines for submission and reviewThe Corporation shall issue regulations to establish guidelines for the submission, and Board review, of policies or other material submitted to the Board under this subsection. At a minimum, the guidelines shall ensure the following:
(A) Confidentiality
(i) In general
(ii) Standard of confidentiality
(iii) Application
(B) Personal presentation
(C) Notification of intent to disapprove
(i) Time period
(ii) Modification of application(I) Authority(II) Time period
(iii) Explanation
(D) Determination to approve or disapprove policies or materials
(i) Time period
(ii) Explanation
(iii) Failure to meet deadline
(E) Consultation
(i) Requirement
(ii) Submission to the Board
(iii) Evaluation by the Board
(5) Premium schedule
(A) Payment by CorporationIn the case of a policy or plan of insurance developed and approved under this subsection or section 1522 of this title, or conducted under section 1523 of this title (other than a policy or plan of insurance applicable to livestock), the Corporation shall pay a portion of the premium of the policy or plan of insurance that is equal to—
(i) the percentage, specified in subsection (e) for a similar level of coverage, of the total amount of the premium used to define loss ratio; and
(ii) an amount for administrative and operating expenses determined in accordance with subsection (k)(4).
(B) Transitional schedule
(6) Additional prevented planting policy coverage
(A) In general
(B) Approved insurance providers
(C) Timing of lossA crop loss shall be covered by the additional prevented planting coverage if—
(i) crop insurance policies were obtained for—(I) the crop year the loss was experienced; and(II) the crop year immediately preceding the year of the prevented planting loss; and
(ii) the cause of the loss occurred—(I) after the sales closing date for the crop in the crop year immediately preceding the loss; and(II) before the sales closing date for the crop in the year in which the loss is experienced.
(i) Adoption of rates and coverages
(1) In general
(2) Review of rating methodologies
(3) Analysis of rating and loss history
(4) Premium adjustment
(j) Claims for losses
(1) In general
(2) Denial of claims
(A) In general
(B) Statute of limitations
(3) Indemnification
(4) Marketing windows
(5) Settlement of claims on farm-stored production
(k) Reinsurance
(1) In general
(2) Terms and conditions
(3) Share of risk
(4) Rate
(A) In generalExcept as otherwise provided in this paragraph, the rate established by the Board to reimburse approved insurance providers and agents for the administrative and operating costs of the providers and agents shall not exceed—
(i) for the 1998 reinsurance year, 27 percent of the premium used to define loss ratio; and
(ii) for each of the 1999 and subsequent reinsurance years, 24.5 percent of the premium used to define loss ratio.
(B) Proportional reductions
(C) Other reductions
(D) Time for reimbursement
(E) Reimbursement rate reduction
(F) Reimbursement rate for area policies and plans of insurance
(5) Cost and regulatory reduction
(6) Agency discretion
(7) Plan
(8) Renegotiation of standard reinsurance agreement
(A) In generalExcept as provided in subparagraph (B), notwithstanding section 536 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 1506 note; Public Law 105–185) and section 148 of the Agricultural Risk Protection Act of 2000 (7 U.S.C. 1506 note; Public Law 106–224), the Corporation may renegotiate the financial terms and conditions of each Standard Reinsurance Agreement—
(i) to be effective for the 2011 reinsurance year beginning July 1, 2010; and
(ii) once during each period of 5 reinsurance years thereafter.
(B) Exceptions
(i) Adverse circumstances
(ii) Effect of Federal law changes
(C) Notification requirement
(D) Consultation
(E) 2011 reinsurance year
(i) In general
(ii) Alternative methodsAlternatives considered under clause (i) shall include—(I) methods that—(aa) are graduated and base reimbursement rates in a State on changes in premiums in that State;(bb) are graduated and base reimbursement rates in a State on the loss ratio for crop insurance for that State; and(cc) are graduated and base reimbursement rates on individual policies on the level of total premium for each policy; and(II) any other method that takes into account current financial conditions of the program and ensures continued availability of the program to producers on a nationwide basis.
(F) Budget
(i) In generalThe Board shall ensure that any Standard Reinsurance Agreement negotiated under subparagraph (A)(ii) shall—(I) to the maximum extent practicable, be estimated as budget neutral with respect to the total amount of payments described in paragraph (9) as compared to the total amount of such payments estimated to be made under the immediately preceding Standard Reinsurance Agreement if that Agreement were extended over the same period of time;(II) comply with the applicable provisions of this subchapter establishing the rates of reimbursement for administrative and operating costs for approved insurance providers and agents, except that, to the maximum extent practicable, the estimated total amount of reimbursement for those costs shall not be less than the total amount of the payments to be made under the immediately preceding Standard Reinsurance Agreement if that Agreement were extended over the same period of time, as estimated on February 7, 2014; and(III) in no event significantly depart from budget neutrality unless otherwise required by this subchapter.
(ii) Use of savings
(9) Due date for payment of underwriting gainsEffective beginning with the 2011 reinsurance year, the Corporation shall make payments for underwriting gains under this subchapter on—
(A) for the 2011 reinsurance year, October 1, 2012; and
(B) for each reinsurance year thereafter, October 1 of the following calendar year.
(l) Optional coverages
(m) Quality loss adjustment coverage
(1) Effect of coverage
(2) Additional quality loss adjustment
(A) Producer optionNotwithstanding any other provision of law, in addition to the quality loss adjustment coverage available under paragraph (1), the Corporation shall offer producers the option of purchasing quality loss adjustment coverage on a basis that is smaller than a unit with respect to an agricultural commodity that satisfies each of the following:
(i) The agricultural commodity is sold on an identity-preserved basis.
(ii) All quality determinations are made solely by the Federal agency designated to grade or classify the agricultural commodity.
(iii) All quality determinations are made in accordance with standards published by the Federal agency in the Federal Register.
(iv) The discount schedules that reflect the reduction in quality of the agricultural commodity are established by the Secretary.
(B) Basis for adjustment
(3) Review of criteria and procedures
(A) Review
(B) Procedures
(4) Quality of agricultural commodities delivered to warehouse operatorsIn administering this subchapter, the Secretary shall accept, in the same manner and under the same terms and conditions, evidence of the quality of agricultural commodities delivered to—
(A) warehouse operators that are licensed under the United States Warehouse Act (7 U.S.C. 241 et seq.);
(B) warehouse operators that—
(i) are licensed under State law; and
(ii) have entered into a storage agreement with the Commodity Credit Corporation; and
(C) warehouse operators that—
(i) are not licensed under State law but are in compliance with State law regarding warehouses; and
(ii) have entered into a commodity storage agreement with the Commodity Credit Corporation.
(5) Special provisions for malting barley
(6) Test weight for corn
(A) In general
(B) Implementation
(C) Termination of effectiveness
(n) Limitation on multiple benefits for same loss
(1) In general
(2) Exception
(o) Crop production on native sod
(1) Definition of native sodIn this subsection, the term “native sod” means land—
(A) on which the plant cover is composed principally of native grasses, grasslike plants, forbs, or shrubs suitable for grazing and browsing; and
(B) that has never been tilled, or the producer cannot substantiate that the ground has ever been tilled, for the production of an annual crop as of the date of enactment of this subsection.
(2) Reduction in benefits
(A) In general
(i) First 4 crop years
(ii) Subsequent crop yearsNative sod acreage that has been tilled for the production of an insurable crop after December 20, 2018, shall be subject to a reduction in benefits under this subchapter as described in this paragraph for not more than 4 cumulative years—(I) during the first 10 years after initial tillage; and(II) during each of which a crop on that acreage is insured under subsection (c).
(B) De minimis acreage exemption
(C) Administration
(i) ReductionFor purposes of the reduction in benefits for the acreage described in subparagraph (A)—(I) the crop insurance guarantee shall be determined by using a yield equal to 65 percent of the transitional yield of the producer; and(II) the crop insurance premium subsidy provided for the producer under this subchapter, except for coverage authorized pursuant to subsection (b)(1), shall be 50 percentage points less than the premium subsidy that would otherwise apply.
(ii) Yield substitution
(3) Application
(p) Coverage levels by practice
(Feb. 16, 1938, ch. 30, title V, § 508, 52 Stat. 74; June 22, 1938, ch. 563, 52 Stat. 835; June 21, 1941, ch. 214, §§ 3–7, 10, 55 Stat. 255, 256; Dec. 23, 1944, ch. 713, §§ 1–3, 58 Stat. 918, 919; Aug. 1, 1947, ch. 440, §§ 1–3, 61 Stat. 718; Aug. 25, 1949, ch. 512, §§ 1–3, 63 Stat. 663; Aug. 13, 1953, ch. 431, 67 Stat. 575; Pub. L. 85–111, July 23, 1957, 71 Stat. 309; Pub. L. 86–131, Aug. 4, 1959, 73 Stat. 278; Pub. L. 88–589, Sept. 12, 1964, 78 Stat. 933; Pub. L. 96–365, title I, §§ 105, 106, 107(b), Sept. 26, 1980, 94 Stat. 1314, 1315, 1317; Pub. L. 100–387, title II, § 208(a), Aug. 11, 1988, 102 Stat. 941; Pub. L. 101–624, title XXII, §§ 2203–2205, Nov. 28, 1990, 104 Stat. 3955–3957; Pub. L. 102–237, title VI, § 601(4), (5), Dec. 13, 1991, 105 Stat. 1878; Pub. L. 103–66, title XIV, § 1403(b)(1), (2), Aug. 10, 1993, 107 Stat. 333, 334; Pub. L. 103–354, title I, § 106, Oct. 13, 1994, 108 Stat. 3183; Pub. L. 104–127, title I, §§ 193(a)(1), (2), (c), (d), (f), 195, Apr. 4, 1996, 110 Stat. 943–946; Pub. L. 105–185, title V, §§ 532, 534, June 23, 1998, 112 Stat. 581, 583; Pub. L. 105–277, div. A, § 101(a) [title VIII, § 803(a)], Oct. 21, 1998, 112 Stat. 2681, 2681–38; Pub. L. 106–113, div. B, § 1000(a)(5) [title II, §§ 205(a), 206], Nov. 29, 1999, 113 Stat. 1536, 1501A–294; Pub. L. 106–224, title I, §§ 101–103(b)(1), (c), (d), 104–107, 123, 124(a), 144–146, 161, 162, June 20, 2000, 114 Stat. 360–368, 378, 391, 392, 395; Pub. L. 107–171, title X, §§ 10001–10003, May 13, 2002, 116 Stat. 486; Pub. L. 109–97, title VII, § 780, Nov. 10, 2005, 119 Stat. 2162; Pub. L. 110–234, title XII, §§ 12003(b)–12006(a), 12007–12014(a), 12015–12020(a), 12033(c)(2)(B), May 22, 2008, 122 Stat. 1372–1381, 1405; Pub. L. 110–246, § 4(a), title XII, §§ 12003(b)–12006(a), 12007–12014(a), 12015–12020(a), 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2133–2142, 2167; Pub. L. 113–79, title XI, §§ 11002–11003(c), 11004–11010(a), 11011–11014(a), 11015, 11016(b), 11017(b), 11023(a), 11028(a), title XII, § 12305(b), Feb. 7, 2014, 128 Stat. 954–957, 960, 961, 963, 966, 973, 977, 988; Pub. L. 114–74, title II, § 201, Nov. 2, 2015, 129 Stat. 587; Pub. L. 114–94, div. C, title XXXII, § 32205, Dec. 4, 2015, 129 Stat. 1740; Pub. L. 115–334, title XI, §§ 11105(b)–11109(a), 11110–11114, title XII, § 12306(b)(2), Dec. 20, 2018, 132 Stat. 4921–4924, 4968.)

CITE AS: 7 USC 1508

§ 1508a. Double insurance and prevented planting
(a) Definitions
In this section:
(1) First crop
(2) Second crop
(3) Replanted crop
(b) Double insurance
(1) Options on loss to first crop
Except as provided in subsections (d) and (e), if a first crop insured under this subchapter in a crop year has a total or partial insurable loss, the producer of the first crop may elect one of the following options:
(A) No second crop planted
The producer may—
(i) elect to not plant a second crop on the same acreage for harvest in the same crop year; and
(ii) collect an indemnity payment that is equal to 100 percent of the insurable loss for the first crop.
(B) Second crop planted
The producer may—
(i) plant a second crop on the same acreage for harvest in the same crop year; and
(ii) collect an indemnity payment established by the Corporation for the first crop, but not to exceed 35 percent of the insurable loss for the first crop.
(2) Effect of no loss to second crop
If a producer makes an election under paragraph (1)(B) and the producer does not suffer an insurable loss to the second crop, the producer may collect an indemnity payment for the first crop that is equal to—
(A) 100 percent of the insurable loss for the first crop; less
(B) the amount previously collected under paragraph (1)(B)(ii).
(3) Premium for first crop if second crop planted
(A) Initial premium
(B) Effect of no loss to second crop
If the producer makes an election under paragraph (1)(B) and the producer does not suffer an insurable loss to the second crop, the producer shall be responsible for a premium for the first crop that is equal to—
(i) the full premium owed by the producer for the first crop; less
(ii) the amount of premium previously paid under subparagraph (A).
(c) Prevented planting coverage
(1) Options on loss to first crop
Except as provided in subsections (d) and (e), if a first crop insured under this subchapter in a crop year is prevented from being planted, the producer of the first crop may elect one of the following options:
(A) No second crop planted
The producer may—
(i) elect to not plant a second crop on the same acreage for harvest in the same crop year; and
(ii) subject to paragraph (4), collect an indemnity payment that is equal to 100 percent of the prevented planting guarantee for the acreage for the first crop.
(B) Second crop planted
The producer may—
(i) plant a second crop on the same acreage for harvest in the same crop year; and
(ii) subject to paragraphs (4) and (5), collect an indemnity payment established by the Corporation for the first crop, but not to exceed 35 percent of the prevented planting guarantee for the acreage for the first crop.
(2) Premium for first crop if second planted
(3) Effect on actual production history
(4) Area conditions required for payment
(5) Planting date
(d) Exception for established double cropping practices
A producer may receive full indemnity payments on two or more crops planted for harvest in the same crop year and insured under this subchapter if each of the following conditions are met:
(1) There is an established practice of planting two or more crops for harvest in the same crop year in the area, as determined by the Corporation.
(2) An additional coverage policy or plan of insurance is offered with respect to the agricultural commodities planted on the same acreage for harvest in the same crop year in the area.
(3) The producer has a history of planting two or more crops for harvest in the same crop year or the applicable acreage has historically had two or more crops planted for harvest in the same crop year.
(4) The second or more crops are customarily planted after the first crop for harvest on the same acreage in the same year in the area.
(e) Subsequent crops
(Feb. 16, 1938, ch. 30, title V, § 508A, as added Pub. L. 106–224, title I, § 108, June 20, 2000, 114 Stat. 368; amended Pub. L. 110–234, title XII, § 12033(c)(2)(B), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2167.)

CITE AS: 7 USC 1508a

§ 1508b. Stacked Income Protection Plan for producers of upland cotton
(a) Availability
(b) Required termsThe Corporation may modify the Stacked Income Protection Plan on a program-wide basis, except that the Stacked Income Protection Plan shall comply with the following requirements:
(1) Provide coverage for revenue loss of not less than 10 percent and not more than 30 percent of expected county revenue, specified in increments of 5 percent. The deductible shall be the minimum percent of revenue loss at which indemnities are triggered under the plan, not to be less than 10 percent of the expected county revenue.
(2) Be offered to producers of upland cotton in all counties with upland cotton production—
(A) at a county-wide level to the fullest extent practicable; or
(B) in counties that lack sufficient data, on the basis of such larger geographical area as the Corporation determines to provide sufficient data for purposes of providing the coverage.
(3) Be purchased in addition to any other individual or area coverage in effect on the producer’s acreage or as a stand-alone policy, except that if a producer has an individual or area coverage for the same acreage, the maximum coverage available under the Stacked Income Protection Plan shall not exceed the deductible for the individual or area coverage.
(4) Establish coverage based on—
(A) the expected price established under existing Group Risk Income Protection or area wide policy offered by the Corporation for the applicable county (or area) and crop year; and
(B) an expected county yield that is the higher of—
(i) the expected county yield established for the existing area-wide plans offered by the Corporation for the applicable county (or area) and crop year (or, in geographic areas where area-wide plans are not offered, an expected yield determined in a manner consistent with those of area-wide plans); or
(ii) the average of the applicable yield data for the county (or area) for the most recent 5 years, excluding the highest and lowest observations, from the Risk Management Agency or the National Agricultural Statistics Service (or both) or, if sufficient county data is not available, such other data considered appropriate by the Secretary.
(5) Use a multiplier factor to establish maximum protection per acre (referred to as a “protection factor”) of not less than the higher of the level established on a program wide basis or 120 percent.
(6) Pay an indemnity based on the amount that the expected county revenue exceeds the actual county revenue, as applied to the individual coverage of the producer. Indemnities under the Stacked Income Protection Plan shall not include or overlap the amount of the deductible selected under paragraph (1).
(7) In all counties for which data are available, establish separate coverage levels for irrigated and nonirrigated practices.
(c) PremiumNotwithstanding section 1508(d) of this title, the premium for the Stacked Income Protection Plan shall—
(1) be sufficient to cover anticipated losses and a reasonable reserve; and
(2) include an amount for operating and administrative expenses established in accordance with section 1508(k)(4)(F) of this title.
(d) Payment of portion of premium by corporationSubject to section 1508(e)(4) of this title, the amount of premium paid by the Corporation for all qualifying coverage levels of the Stacked Income Protection Plan shall be—
(1) 80 percent of the amount of the premium established under subsection (c) for the coverage level selected; and
(2) the amount determined under subsection (c)(2), subject to section 1508(k)(4)(F) of this title, for the coverage to cover administrative and operating expenses.
(e) Relation to other coverages
(f) LimitationEffective beginning with the 2019 crop year, a farm shall not be eligible for the Stacked Income Protection Plan for upland cotton for a crop year for which the farm is enrolled in coverage for seed cotton under—
(1) price loss coverage under section 9016 of this title; or
(2) agriculture risk coverage under section 9017 of this title.
(Feb. 16, 1938, ch. 30, title V, § 508B, as added Pub. L. 113–79, title XI, § 11017(a), Feb. 7, 2014, 128 Stat. 964; amended Pub. L. 115–123, div. F, § 60101(a)(10), Feb. 9, 2018, 132 Stat. 310.)

CITE AS: 7 USC 1508b

§ 1508c. Peanut revenue crop insurance
(a) In general
(b) Effective price
(c) Adjustments
(1) In general
(2) Administration
If an adjustment is made under paragraph (1), the Risk Management Agency and the Corporation shall—
(A) make the adjustment in an open and transparent manner; and
(B) submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes the reasons for the adjustment.
(Feb. 16, 1938, ch. 30, title V, § 508C, as added Pub. L. 113–79, title XI, § 11018, Feb. 7, 2014, 128 Stat. 966.)

CITE AS: 7 USC 1508c

§ 1508d. Coverage for forage and grazing

Notwithstanding section 1508a of this title, and in addition to any other available coverage, for crops that can be both grazed and mechanically harvested on the same acres during the same growing season, producers shall be allowed to purchase separate policies for each intended use, as determined by the Corporation, and any indemnity paid under those policies for each intended use shall not be considered to be for the same loss for the purposes of section 1508(n) of this title.

(Feb. 16, 1938, ch. 30, title V, § 508D, as added Pub. L. 115–334, title XI, § 11109(b), Dec. 20, 2018, 132 Stat. 4923.)

CITE AS: 7 USC 1508d

§ 1509. Exemption of indemnities from levy

Claims for indemnities under this subchapter shall not be liable to attachment, levy, garnishment, or any other legal process before payment to the insured or to deduction on account of the indebtedness of the insured or the estate of the insured to the United States except claims of the United States or the Corporation arising under this subchapter.

(Feb. 16, 1938, ch. 30, title V, § 509, 52 Stat. 75; Pub. L. 103–354, title I, § 115(c), Oct. 13, 1994, 108 Stat. 3204; Pub. L. 110–234, title XII, § 12033(c)(2)(B), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2167.)

CITE AS: 7 USC 1509

§ 1510. Deposit and investment of funds; Federal Reserve banks as fiscal agents

All money of the Corporation not otherwise employed may be deposited with the Treasurer of the United States or in any bank approved by the Secretary of the Treasury, subject to withdrawal by the Corporation at any time, or with the approval of the Secretary of the Treasury may be invested in obligations of the United States or in obligations guaranteed as to principal and interest by the United States. Subject to the approval of the Secretary of the Treasury, the Federal Reserve banks are hereby authorized and directed to act as depositories, custodians, and fiscal agents for the Corporation in the performance of its powers conferred by this subchapter.

(Feb. 16, 1938, ch. 30, title V, § 510, 52 Stat. 75; Pub. L. 110–234, title XII, § 12033(c)(2)(B), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2167.)

CITE AS: 7 USC 1510

§ 1511. Tax exemption

The Corporation, including its franchise, its capital, reserves, and surplus, and its income and property, shall be exempt from all taxation on or after February 16, 1938, imposed by the United States or by any Territory, dependency, or possession thereof, or by any State, county, municipality, or local taxing authority. A contract of insurance of the Corporation, and a contract of insurance reinsured by the Corporation, shall be exempt from taxation imposed by any State, municipality, or local taxing authority.

(Feb. 16, 1938, ch. 30, title V, § 511, 52 Stat. 75; Pub. L. 103–354, title I, § 108, Oct. 13, 1994, 108 Stat. 3197.)

CITE AS: 7 USC 1511

§ 1512. Corporation as fiscal agent of Government

(Feb. 16, 1938, ch. 30, title V, § 512, 52 Stat. 75.)

CITE AS: 7 USC 1512

§ 1513. Books of account and annual reports of Corporation

The Corporation shall at all times maintain complete and accurate books of accounts and shall file annually with the Secretary a complete report as to the business of the Corporation.

(Feb. 16, 1938, ch. 30, title V, § 513, 52 Stat. 76; Pub. L. 93–604, title VI, § 603, Jan. 2, 1975, 88 Stat. 1963; Pub. L. 103–354, title I, § 102(b)(4)(C), Oct. 13, 1994, 108 Stat. 3181.)

CITE AS: 7 USC 1513

§ 1514. Crimes and offenses
(a) to (e) Repealed. June 25, 1948, ch. 645, § 21, 62 Stat. 862, eff. Sept. 1, 1948
(f) Application of laws on interest of Members of Congress in contracts
(Feb. 16, 1938, ch. 30, title V, § 514, 52 Stat. 76; June 25, 1948, ch. 645, §§ 4, 21, 62 Stat. 859, 862; Pub. L. 110–234, title XII, § 12033(c)(2)(B), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2167.)

CITE AS: 7 USC 1514

§ 1515. Program compliance and integrity
(a) Purpose
(1) In general
(2) Role of insurance providers
(b) Notification of compliance problems
(1) Notification of errors, omissions, and failures
(2) Time for notification
(3) Effect of failure to timely notify
(c) Reconciling producer information
(1) In general
(2) Frequency
(3) Corrections
(A) In generalIn addition to the corrections permitted by the Corporation as of the day before February 7, 2014, the Corporation shall establish procedures that allow an agent or an approved insurance provider, subject to subparagraph (B)—
(i) within a reasonable amount of time following the applicable sales closing date, to correct errors in information that is provided by a producer for the purpose of obtaining coverage under any policy or plan of insurance made available under this subchapter to ensure that the eligibility information is correct and consistent with information reported by the producer for other programs administered by the Secretary;
(ii) within a reasonable amount of time following—(I) the acreage reporting date, to reconcile errors in the information reported by the producer with correct information determined from any other program administered by the Secretary; or(II) the date of any subsequent correction of data by the Farm Service Agency made as a result of the verification of information, to make conforming corrections; and
(iii) at any time, to correct electronic transmission errors that were made by an agent or approved insurance provider, or such errors made by the Farm Service Agency or any other agency of the Department of Agriculture in transmitting the information provided by the producer for purposes of other programs of the Department to the extent an agent or approved insurance provider relied upon the erroneous information for crop insurance purposes.
(B) LimitationIn accordance with the procedures of the Corporation, correction to the information described in clauses (i) and (ii) of subparagraph (A) may only be made if the corrections do not allow the producer—
(i) to avoid ineligibility requirements for insurance or obtain a disproportionate benefit under the crop insurance program or any related program administered by the Secretary;
(ii) to obtain, enhance, or increase an insurance guarantee or indemnity if a cause of loss exists or has occurred before any correction has been made, or avoid premium owed if no loss is likely to occur; or
(iii) to avoid an obligation or requirement under any Federal or State law.
(C) Exception to late filing sanctions
(D) Late payment of debt
(d) Identification and elimination of fraud, waste, and abuse
(1) FSA monitoring programThe Secretary shall develop and implement a coordinated plan for the Farm Service Agency to assist the Corporation in the ongoing monitoring of programs carried out under this subchapter, including—
(A) at the request of the Corporation or, subject to paragraph (2), on its own initiative if the Farm Service Agency has reason to suspect the existence of program fraud, waste, or abuse, conducting fact finding relative to allegations of program fraud, waste, or abuse;
(B) reporting to the Corporation, in writing in a timely manner, the results of any fact finding conducted pursuant to subparagraph (A), any allegation of fraud, waste, or abuse, and any identified program vulnerabilities;
(C) assisting the Corporation and approved insurance providers in auditing a statistically appropriate number of claims made under any policy or plan of insurance under this subchapter; and
(D) using published aggregate data from the National Agricultural Statistics Service or any other data source to—
(i) detect yield disparities or other data anomalies that indicate potential fraud; and
(ii) target the relevant counties, crops, regions, companies, or agents associated with that potential fraud for audits and other enforcement actions.
(2) FSA inquiry
(3) Use of field infrastructure
(4) Maintenance of provider effort
(A) In general
(B) Notification of providers
(C) Response
(5) Corporation response to provider reports
(A) Prompt response
(B) Cooperative effort
(C) Failure to timely respond
(e) Consultation with State FSA committees
(f) Detection of disparate performance
(1) Covered activitiesThe Secretary shall establish procedures under which the Corporation will be able to identify the following:
(A) Any agent engaged in the sale of coverage offered under this subchapter where the loss claims associated with such sales by the agent are equal to or greater than 150 percent (or an appropriate percentage specified by the Corporation) of the mean for all loss claims associated with such sales by all other agents operating in the same area, as determined by the Corporation.
(B) Any person performing loss adjustment services relative to coverage offered under this subchapter where such loss adjustments performed by the person result in accepted or denied claims equal to or greater than 150 percent (or an appropriate percentage specified by the Corporation) of the mean for accepted or denied claims (as applicable) for all other persons performing loss adjustment services in the same area, as determined by the Corporation.
(2) Review
(A) Review required
(B) Remedial action
(3) Oversight of agents and loss adjusters
(g) Submission of information to Corporation to support compliance efforts
(1) Types of information requiredThe Secretary shall establish procedures under which approved insurance providers shall submit to the Corporation the following information with respect to each policy or plan of insurance offered under this subchapter:
(A) The name and identification number of the insured.
(B) The agricultural commodity to be insured.
(C) The elected coverage level, including the price election, of the insured.
(D) The actual production history to be used to establish insurable yields.
(2) Time for submission
(A) In general
(B) Actual production history
(i) In general
(ii) Correction of errors
(h) Sanctions for program noncompliance and fraud
(1) False information
(2) Compliance
(3) Authorized sanctionsIf the Secretary determines that a person covered by this subsection has committed a material violation under paragraph (1) or (2), the following sanctions may be imposed:
(A) Civil finesA civil fine may be imposed for each violation in an amount not to exceed the greater of—
(i) the amount of the pecuniary gain obtained as a result of the false or inaccurate information provided or the noncompliance with a requirement of this subchapter; or
(ii) $10,000.
(B) Producer disqualificationIn the case of a violation committed by a producer, the producer may be disqualified for a period of up to 5 years from receiving any monetary or nonmonetary benefit provided under each of the following:
(i) This subchapter.
(ii) The Agricultural Market Transition Act (7 U.S.C. 7201 et seq.), including the noninsured crop disaster assistance program under section 196 of that Act (7 U.S.C. 7333).
(iii) The Agricultural Act of 1949 (7 U.S.C. 1421 et seq.).
(iv) The Commodity Credit Corporation Charter Act (15 U.S.C. 714 et seq.).
(v) The Agricultural Adjustment Act of 1938 (7 U.S.C. 1281 et seq.).
(vi) Title XII of the Food Security Act of 1985 (16 U.S.C. 3801 et seq.).
(vii) The Consolidated Farm and Rural Development Act (7 U.S.C. 1921 et seq.).
(viii) Any law that provides assistance to a producer of an agricultural commodity affected by a crop loss or a decline in the prices of agricultural commodities.
(C) Disqualification of other persons
(4) Assessment of sanctionThe Secretary shall consider the gravity of the violation of the person covered by this subsection in determining—
(A) whether to impose a sanction under this subsection; and
(B) the type and amount of the sanction to be imposed.
(5) Disclosure of sanctionsEach policy or plan of insurance under this subchapter shall provide notice describing the sanctions prescribed under paragraph (3) for willfully and intentionally—
(A) providing false or inaccurate information to the Corporation or to an approved insurance provider; or
(B) failing to comply with a requirement of the Corporation.
(6) Insurance fund
(i) Annual report on program compliance and integrity efforts
(1) Report required
(2) Information regarding fraud, waste, and abuse
(j) Information management
(1) Systems maintenance and upgrades
(A) In general
(B) Requirement
(i) In general
(ii) Acreage report streamlining initiative project
(2) Use of available information technologies
(3) Use of private sector
(k) Continuing education for loss adjusters and agents
(1) In general
(2) RequirementsThe requirements for continuing education described in paragraph (1) shall ensure that loss adjusters and agents of approved insurance providers are familiar with—
(A) the policies and plans of insurance available under this subchapter, including the regulations promulgated to carry out this subchapter;
(B) efforts to promote program integrity through the elimination of waste, fraud, and abuse; and
(C) other aspects of adjusting, delivering, and servicing policies and plans of insurance by adjustors and agents, as determined by the Secretary, including conservation activities and agronomic practices (including organic and sustainable practices) that are common and appropriate to the area in which the insured crop being inspected is produced.
(l) Funding
(1) Information technology
(A) In generalFor purposes of subsection (j)(1), the Corporation may use, from amounts made available from the insurance fund established under section 1516(c) of this title, not more than—
(i)(I) for fiscal year 2014, $14,000,000; and(II) for each of fiscal years 2015 through 2018, $9,000,000; or
(ii) if the Acreage Crop Reporting Streamlining Initiative (ACRSI) project is substantially completed by September 30, 2015, not more than $14,000,000 for each of the fiscal years 2015 through 2018.
(B) Notification
(2) Data mining
(Feb. 16, 1938, ch. 30, title V, § 515, as added Pub. L. 103–354, title I, § 109, Oct. 13, 1994, 108 Stat. 3197; amended Pub. L. 106–224, title I, § 121(a), June 20, 2000, 114 Stat. 372; Pub. L. 110–234, title XII, §§ 12021, 12033(c)(2), May 22, 2008, 122 Stat. 1382, 1405; Pub. L. 110–246, § 4(a), title XII, §§ 12021, 12033(c)(2), June 18, 2008, 122 Stat. 1664, 2144, 2167; Pub. L. 110–398, § 1(c), Oct. 13, 2008, 122 Stat. 4214; Pub. L. 113–79, title XI, §§ 11019, 11020, Feb. 7, 2014, 128 Stat. 966, 968; Pub. L. 115–334, title XI, §§ 11115–11117, Dec. 20, 2018, 132 Stat. 4925.)

CITE AS: 7 USC 1515

§ 1516. Funding
(a) Authorization of appropriations
(1) Discretionary expenses
(2) Mandatory expenses
There are authorized to be appropriated such sums as are necessary to cover for each of the 1999 and subsequent reinsurance years the following:
(A) The administrative and operating expenses of the Corporation for the sales commissions of agents.
(B) Premium subsidies, including the administrative and operating expenses of an approved insurance provider for the delivery of policies with additional coverage.
(C) Costs associated with the conduct of livestock and wild salmon pilot programs carried out under section 1523 of this title, subject to the limitations in subsection (a)(3)(E)(ii) of that section.
(D) Costs associated with the reimbursement, contracting, and partnerships for research and development under section 1522 of this title.
(b) Payment of Corporation expenses from insurance fund
(1) Expenses generally
For each of the 1999 and subsequent reinsurance years, the Corporation may pay from the insurance fund established under subsection (c) all expenses of the Corporation (other than expenses covered by subsection (a)(1) and expenses covered by paragraph (2)(A)), including the following:
(A) Premium subsidies and indemnities.
(B) Administrative and operating expenses of the Corporation necessary to pay the sales commissions of agents.
(C) All administrative and operating expense reimbursements due under a reinsurance agreement with an approved insurance provider.
(D) Costs associated with the conduct of livestock and wild salmon pilot programs carried out under section 1523 of this title, subject to the limitations in subsection (a)(3)(E)(ii) of that section.
(E) Costs associated with the reimbursement, contracting, and partnerships for research and development under section 1522 of this title.
(2) Policy consideration and implementation
(A) In general
For each of the 1999 and subsequent reinsurance years, the Corporation may use the insurance fund established under subsection (c), but not to exceed $3,500,000 for each fiscal year, to pay the following:
(i) Costs associated with the consideration and implementation of policies, plans of insurance, and related materials submitted under section 1508(h) of this title or developed under section 1522 or 1523 of this title.
(ii) Costs to contract for the review of policies, plans of insurance, and related materials under section 1505(e) of this title and to contract for other assistance in considering policies, plans of insurance, and related materials.
(B) Dairy options pilot program
(C) Reviews, compliance, and integrity
(i) In general
For each of the 2014 and subsequent reinsurance years, the Corporation may use the insurance fund established under subsection (c), but not to exceed $7,000,000 for each fiscal year, to pay costs—
(I) to reimburse expenses incurred for the operations and review of policies, plans of insurance, and related materials (including actuarial and related information); and(II) to assist the Corporation in maintaining program actuarial soundness and financial integrity.
(ii) Secretarial action
For the purposes described in clause (i), the Secretary may, without further appropriation—
(I) merge some or all of the funds made available under this subparagraph into the accounts of the Risk Management Agency; and(II) obligate those funds.
(iii) Maintenance of funding
(c) Insurance fund
(1) In general
(2) Commodity Credit Corporation funds
If at any time the amounts in the insurance fund are insufficient to enable the Corporation to carry out subsection (b), to the extent the funds of the Commodity Credit Corporation are available—
(A) the Corporation may request the Secretary to use the funds of the Commodity Credit Corporation to carry out subsection (b); and
(B) the Secretary may use the funds of the Commodity Credit Corporation to carry out subsection (b).
(Feb. 16, 1938, ch. 30, title V, § 516, 52 Stat. 77; June 21, 1941, ch. 214, §§ 6, 8, 55 Stat. 255, 256; Aug. 3, 1956, ch. 950, § 10, 70 Stat. 1034; Pub. L. 96–365, title I, §§ 109, 110, Sept. 26, 1980, 94 Stat. 1317, 1318; Pub. L. 97–11, May 22, 1981, 95 Stat. 13; Pub. L. 99–198, title X, § 1021, Dec. 23, 1985, 99 Stat. 1459; Pub. L. 103–354, title I, § 110, Oct. 13, 1994, 108 Stat. 3198; Pub. L. 104–127, title I, § 193(e), Apr. 4, 1996, 110 Stat. 945; Pub. L. 105–185, title V, § 531, June 23, 1998, 112 Stat. 580; Pub. L. 106–224, title I, § 147, June 20, 2000, 114 Stat. 393; Pub. L. 113–79, title XI, § 11021, Feb. 7, 2014, 128 Stat. 968; Pub. L. 115–123, div. F, § 60101(c)(2), Feb. 9, 2018, 132 Stat. 312; Pub. L. 115–334, title XI, § 11118, Dec. 20, 2018, 132 Stat. 4926.)

CITE AS: 7 USC 1516

§ 1517. Separability

The sections of this subchapter and subdivisions of sections are declared to be separable, and in the event any one or more sections or parts of the same of this subchapter be held to be unconstitutional, the same shall not affect the validity of other sections or parts of sections of this subchapter.

(Feb. 16, 1938, ch. 30, title V, § 517, 52 Stat. 77; Pub. L. 110–234, title XII, § 12033(c)(2)(B), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2167.)

CITE AS: 7 USC 1517

§ 1518. “Agricultural commodity” defined

“Agricultural commodity”, as used in this subchapter, means wheat, cotton, flax, corn, dry beans, oats, barley, rye, tobacco, rice, peanuts, soybeans, sugar beets, sugar cane, tomatoes, grain sorghum, sunflowers, raisins, oranges, sweet corn, dry peas, freezing and canning peas, forage, apples, grapes, potatoes, timber and forests, nursery crops, citrus, and other fruits and vegetables, nuts, tame hay, native grass, hemp, aquacultural species (including, but not limited to, any species of finfish, mollusk, crustacean, or other aquatic invertebrate, amphibian, reptile, or aquatic plant propagated or reared in a controlled or selected environment), or any other agricultural commodity, excluding stored grain, determined by the Board, or any one or more of such commodities, as the context may indicate.

(Feb. 16, 1938, ch. 30, title V, § 518, as added June 21, 1941, ch. 214, § 9, 55 Stat. 256; amended Dec. 23, 1944, ch. 713, § 4, 58 Stat. 919; Aug. 25, 1949, ch. 512, § 9, 63 Stat. 665; Pub. L. 96–365, title I, § 111, Sept. 26, 1980, 94 Stat. 1319; Pub. L. 102–237, title VI, § 601(6), Dec. 13, 1991, 105 Stat. 1878; Pub. L. 103–354, title I, § 119(f)(3), Oct. 13, 1994, 108 Stat. 3208; Pub. L. 106–224, title I, § 132(b), June 20, 2000, 114 Stat. 386; Pub. L. 110–234, title XII, § 12033(c)(2)(B), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2167; Pub. L. 115–334, title XI, § 11119, Dec. 20, 2018, 132 Stat. 4926.)

CITE AS: 7 USC 1518

§ 1519. Repealed. Pub. L. 104–127, title I, § 196(j), Apr. 4, 1996, 110 Stat. 950

CITE AS: 7 USC 1519

§ 1520. Producer eligibility
Except as otherwise provided in this subchapter, a producer shall not be denied insurance under this subchapter if—
(1) for purposes of catastrophic risk protection coverage, the producer is a “person” (as defined by the Secretary); and
(2) for purposes of any other plan of insurance, the producer is 18 years of age and has a bona fide insurable interest in a crop as an owner-operator, landlord, tenant, or sharecropper.
(Feb. 16, 1938, ch. 30, title V, § 520, as added Pub. L. 92–357, July 28, 1972, 86 Stat. 501; amended Pub. L. 103–354, title I, § 113, Oct. 13, 1994, 108 Stat. 3203; Pub. L. 110–234, title XII, § 12033(c)(2)(B), May 22, 2008, 122 Stat. 1405; Pub. L. 110–246, § 4(a), title XII, § 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2167.)

CITE AS: 7 USC 1520

§ 1521. Ineligibility for catastrophic risk and noninsured assistance payments

If the Secretary determines that a person has knowingly adopted a material scheme or device to obtain catastrophic risk, additional coverage, or noninsured assistance benefits under this subchapter to which the person is not entitled, has evaded this subchapter, or has acted with the purposes of evading this subchapter, the person shall be ineligible to receive all benefits applicable to the crop year for which the scheme or device was adopted.

(Feb. 16, 1938, ch. 30, title V, § 521, as added Pub. L. 103–354, title I, § 114, Oct. 13, 1994, 108 Stat. 3203; amended Pub. L. 110–234, title XII, §§ 12002(b)(2), 12033(c)(2)(B), May 22, 2008, 122 Stat. 1371, 1405; Pub. L. 110–246, § 4(a), title XII, §§ 12002(b)(2), 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2133, 2167.)

CITE AS: 7 USC 1521

§ 1522. Research and development
(a) Definition of policy
(b) Reimbursement of research, development, and maintenance costs
(1) Research and development payment
(A) In general
(B) Reimbursement
(i) In general
(ii) Reasonable costsFor the purpose of reimbursing research and development and maintenance costs under this section, costs of the applicant shall be considered reasonable costs if the costs are based on—(I) for any employees or contracted personnel, wage rates equal to not more than 2 times the hourly wage rate plus benefits, as provided by the Bureau of Labor Statistics for the year in which such costs are incurred, calculated using the formula applied to an applicant by the Corporation in reviewing proposed project budgets under this section on October 1, 2016; and(II) other actual documented costs incurred by the applicant.
(2) Advance payments
(A) In general
(B) Procedures
(C) Concept proposalAs a condition of eligibility for advance payments, an applicant shall submit a concept proposal for the policy that the applicant plans to submit to the Board under section 1508(h) of this title, consistent with procedures established by the Board for submissions under subparagraph (B), including—
(i) a summary of the qualifications of the applicant, including any prior concept proposals and submissions to the Board under
(ii) a projection of total research and development costs that the applicant expects to incur;
(iii) a description of the need for the policy, the marketability of and expected demand for the policy among affected producers, and the potential impact of the policy on producers and the crop insurance delivery system;
(iv) a summary of data sources available to demonstrate that the policy can reasonably be developed and actuarially appropriate rates established; and
(v) an identification of the risks the proposed policy will cover and an explanation of how the identified risks are insurable under this subchapter.
(D) Review
(i) Experts
(ii) Timing
(E) Approval
(i) In generalThe Board may approve up to 50 percent of the projected total research and development costs to be paid in advance to an applicant, in accordance with the procedures developed by the Board for the making of the payments, if, after consideration of the reviewer reports described in subparagraph (D) and such other information as the Board determines appropriate, the Board determines that—(I) the concept, in good faith, will likely result in a viable and marketable policy consistent with section 1508(h) of this title;(II) at the sole discretion of the Board, the concept, if developed into a policy and approved by the Board, would provide crop insurance coverage—(aa) in a significantly improved form;(bb) to a crop or region not traditionally served by the Federal crop insurance program; or(cc) in a form that addresses a recognized flaw or problem in the program;(III) the applicant agrees to provide such reports as the Corporation determines are necessary to monitor the development effort;(IV) the proposed budget and timetable are reasonable, as determined by the Board; and(V) the concept proposal meets any other requirements that the Board determines appropriate.
(ii) WaiverThe Board may waive the 50-percent limitation and, upon request of the submitter after the submitter has begun research and development activities, the Board may approve an additional 25 percent advance payment to the submitter for research and development costs, if, at the sole discretion of the Board, the Board determines that—(I) the intended policy or plan of insurance developed by the submitter will provide coverage for a region or crop that is underserved by the Federal crop insurance program, including specialty crops; and(II) the submitter is making satisfactory progress towards developing a viable and marketable policy or plan of insurance consistent with section 1508(h) of this title.
(F) Submission of policy
(G) Final payment
(i) Approved policies
(ii) Policies not approvedIf a policy is submitted under subparagraph (F) and is not approved by the Board under section 1508(h) of this title, the Corporation shall—(I) not seek a refund of any payments made in accordance with this paragraph; and(II) not make any further research and development cost payments associated with the submission of the policy under this paragraph.
(H) Policy not submitted
(I) Repeated submissionsThe Board may prohibit advance payments to applicants who have submitted—
(i) a concept proposal or submission that did not result in a marketable product; or
(ii) a concept proposal or submission of poor quality.
(J) Continued eligibility
(K) Waiver for hemp
(3) Marketability
(A) In general
(B) Waiver for hemp
(4) Maintenance payments
(A) Requirement
(B) Duration
(C) Options for maintenanceOn the expiration of the 4-year period described in subparagraph (B), the applicant responsible for maintenance of the policy may—
(i) maintain the policy and charge a fee to approved insurance providers that elect to sell the policy under this subsection; or
(ii) transfer responsibility for maintenance of the policy to the Corporation.
(D) Fee
(i) Amount
(ii) ApprovalThe Board shall approve the amount of a fee determined under clause (i) for maintenance of the policy unless the Board determines that the amount of the fee—(I) is unreasonable in relation to the maintenance costs associated with the policy; or(II) unnecessarily inhibits the use of the policy.
(iii) ReviewAfter the Board approves the amount of a fee under clause (ii), the fee shall remain in effect and not be reviewed by the Board unless—(I) the applicant petitions the Board for reconsideration of the fee;(II) a substantial change is made to the policy, as determined by the Board; or(III) there is substantial evidence that the fee is inhibiting sales or use of the policy, as determined by the Board.
(5) Treatment of payment
(6) Reimbursement amount
(c) Research and development authority
(1) AuthorityThe Corporation may conduct activities or enter into contracts to carry out research and development to maintain or improve existing policies or develop new policies to—
(A) increase participation in States in which the Corporation determines that—
(i) there is traditionally, and continues to be, a low level of Federal crop insurance participation and availability; and
(ii) the State is underserved by the Federal crop insurance program;
(B) increase participation in areas that are underserved by the Federal crop insurance program; and
(C) increase participation by producers of underserved agricultural commodities, including specialty crops.
(2) Underserved agricultural commodities and areas
(A) Authority
(B) Consultation
(3) Qualified persons
(4) Types of contracts
(5) Use of resulting policies
(6) Research and development priorities
(7) Whole farm diversified risk management insurance plan
(A) In general
(B) Eligible producers
(C) DiversificationThe Corporation may provide diversification-based additional coverage payment rates, premium discounts, or other enhanced benefits in recognition of the risk management benefits of crop and livestock diversification strategies for producers that—
(i) grow multiple crops; or
(ii) may have income from the production of livestock that uses a crop grown on the farm.
(D) Market readiness
(E) Review of modifications to improve effectiveness
(i) In generalNot later than 18 months after December 20, 2018—(I) the Corporation shall hold stakeholder meetings to solicit producer and agent feedback; and(II) the Board shall—(aa) review procedures and paperwork requirements on agents and producers; and(bb) modify procedures and requirements, as appropriate, to decrease burdens and increase flexibility and effectiveness.
(ii) FactorsIn carrying out items (aa) and (bb) of subclause (i)(II), the Board shall consider—(I) removing caps on nursery and livestock production;(II) allowing a waiver to expand operations, especially for small and beginning farmers;(III) minimizing paperwork for producers and agents;(IV) implementing an option for producers with less than $1,000,000 in gross revenue that requires significantly less paperwork and recordkeeping;(V) developing and using alternative records such as time-stamped photographs or technology applications to document planting and production history;(VI) treating the different growth stages of aquaculture species as separate crops to recognize the difference in perils at different phases of growth;(VII) moderating the impacts of disaster years on historic revenue, such as—(aa) using an average of the historic and projected revenue;(bb) counting indemnities as historic revenue for loss years;(cc) counting payments under section 7333 of this title as historic revenue for loss years; or(dd) using an assigned yield floor similar to the limitation described in section 1508(g)(6)(A)(i) of this title, as determined by the Secretary;(VIII) improving agent training and outreach to underserved regions and sectors such as small dairy farms; and(IX) providing coverage and indemnification of insurable losses—(aa) after the losses exceed the deductible; and(bb) up to the maximum amount of total coverage.
(F) Beginning farmer or rancher defined
(8) Relation to limitationsA policy developed under this subsection may be prepared without regard to the limitations of this subchapter, including—
(A) the requirement concerning the levels of coverage and rates; and
(B) the requirement that the price level for each insured agricultural commodity must equal the expected market price for the agricultural commodity, as established by the Board.
(9) Tropical storm or hurricane insurance
(A) In general
(B) Research and developmentResearch and development under subparagraph (A) shall—
(i) evaluate the effectiveness of risk management tools for a low frequency and catastrophic loss weather event; and
(ii) result in a policy that provides protection for at least 1 of the following:(I) Production loss.(II) Revenue loss.
(C) ReportNot later than 1 year after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes—
(i) the results of the research and development carried out under this paragraph; and
(ii) any recommendations with respect to those results.
(10) Quality loss
(A) In generalThe Corporation shall carry out research and development, or offer to enter into 1 or more contracts with 1 or more qualified persons to carry out research and development, regarding the establishment of each of the following alternative methods of adjusting for quality losses:
(i) A method that does not impact the actual production history of a producer.
(ii) A method that provides that, in circumstances in which a producer has suffered a quality loss to the insured crop of the producer that is insufficient to trigger an indemnity payment, the producer may elect to exclude that quality loss from the actual production history of the producer.
(iii) 1 or more methods that combine the methods described in clauses (i) and (ii).
(B) RequirementsNotwithstanding subsections (g) and (m) of section 1508 of this title, any method developed under subparagraph (A) that is used by the Corporation shall be—
(i) optional for a producer to use; and
(ii) offered at an actuarially sound premium rate.
(C) ReportNot later than 1 year after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes—
(i) the results of the research and development carried out under subparagraph (A); and
(ii) any recommendations with respect to those results.
(11) Citrus
(A) In generalThe Corporation shall carry out research and development, or offer to enter into 1 or more contracts with 1 or more qualified persons to carry out research and development, regarding the insurance of citrus fruit commodities and commodity types, including research and development of—
(i) improvements to 1 or more existing policies, including the whole-farm revenue protection pilot policy;
(ii) alternative methods of insuring revenue for citrus fruit commodities and commodity types; and
(iii) the development of new, or expansion of existing, revenue policies for citrus fruit commodities and commodity types.
(B) ReportNot later than 1 year after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes—
(i) the results of the research and development carried out under subparagraph (A); and
(ii) any recommendations with respect to those results.
(12) Hops
(A) In general
(B) ReportNot later than 1 year after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes—
(i) the results of the research and development carried out under subparagraph (A); and
(ii) any recommendations with respect to those results.
(13) Subsurface irrigation practices
(A) In general
(B) ReportNot later than 18 months after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes—
(i) the results of the research and development carried out under subparagraph (A); and
(ii) any recommendations with respect to those results.
(14) Grain sorghum
(A) In generalThe Corporation shall carry out research and development, or offer to enter into 1 or more contracts with 1 or more qualified persons to carry out research and development—
(i) regarding improvements to 1 or more policies to insure irrigated grain sorghum;
(ii) regarding alternative methods for producers with not more than 4 years of production history to insure irrigated grain sorghum; and
(iii) to assess, by county, the difference in the rate, average yield, and coverage level of grain sorghum policies compared to policies for other feed grains in that county.
(B) ReportNot later than 18 months after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes—
(i) the results of the research and development carried out under subparagraph (A); and
(ii) any recommendations with respect to those results.
(15) Limited irrigation practices
(A) AuthorityThe Corporation shall—
(i) consider expanding the availability of the limited irrigation insurance program to neighboring and similarly situated States (such as the States of Colorado and Nebraska), as determined by the Secretary;
(ii) carry out research, or offer to enter into 1 or more contracts with 1 or more qualified persons to carry out research, on the marketability of the existing limited irrigation insurance program; and
(iii) make recommendations on how to improve participation in that program.
(B) ResearchIn carrying out research under subparagraph (A), a qualified person shall—
(i) collaborate with researchers on the subjects of—(I) reduced irrigation practices or limited irrigation practices; and(II) expected yield reductions following the application of reduced irrigation;
(ii) collaborate with State and Federal officials responsible for the collection of water and the regulation of water use for the purpose of irrigation;
(iii) provide recommendations to encourage producers to carry out limited irrigation practices or reduced irrigation and water conservation practices; and
(iv) develop web-based applications that will streamline access to coverage for producers electing to conserve water use on irrigated crops.
(C) ReportNot later than 18 months after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes—
(i) the results of the research carried out under subparagraphs (A) and (B);
(ii) any recommendations to encourage producers to carry out limited irrigation practices or reduced irrigation and water conservation practices; and
(iii) the actions taken by the Corporation to carry out the recommendations described in clause (ii).
(16) Insurable irrigation practices for rice
(A) In generalThe Corporation shall carry out research and development, or offer to enter into 1 or more contracts with 1 or more qualified persons to carry out research and development, to include new and innovative irrigation practices under the current rice policy or the development of a distinct policy endorsement rated for rice produced using—
(i) alternate wetting and drying practices (also referred to as “intermittent flooding”); and
(ii) furrow irrigation practices.
(B) ReportNot later than 18 months after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes—
(i) the results of the research and development carried out under paragraph (1); and
(ii) any recommendations with respect to those results.
(17) Greenhouse policy
(A) In general
(i) Research and developmentThe Corporation shall carry out research and development, or offer to enter into 1 or more contracts with 1 or more qualified persons to carry out research and development, regarding a policy to insure in a controlled environment such as a greenhouse—(I) the production of floriculture, nursery, and bedding plants;(II) the establishment of cuttings or tissue culture in a growing medium; or(III) other similar production, as determined by the Secretary.
(ii) Availability of policy
(B) Research and development describedResearch and development described in subparagraph (A)(i) shall evaluate the effectiveness of policies for the production of plants in a controlled environment, including policies that—
(i) are based on the risk of—(I) plant diseases introduced from the environment;(II) contaminated cuttings, seedlings, or tissue culture; or(III) Federal or State quarantine or destruction orders associated with the contaminated items described in subclause (II);
(ii) consider other causes of loss applicable to a controlled environment, such as a loss of electricity due to weather;
(iii) consider appropriate best practices to minimize the risk of loss;
(iv) consider whether to provide coverage for various types of plants under 1 policy or to provide coverage for 1 species or type of plant per policy;
(v) have streamlined reporting and paperwork requirements that take into account short propagation schedules, variable crop years, and the variety of plants that may be produced in a single facility; and
(vi) provide protection for revenue losses.
(C) ReportNot later than 2 years after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes—
(i) the results of the research and development carried out under subparagraphs (A)(i) and (B); and
(ii) any recommendations with respect to those results.
(18) Local foods
(A) In general
(i) Feasibility studyThe Corporation shall carry out a study to determine the feasibility of, or offer to enter into 1 or more contracts with 1 or more qualified persons to carry out a study to determine the feasibility of, a policy to insure production—(I) of floriculture, fruits, vegetables, poultry, livestock, or the products of floriculture, fruits, vegetables, poultry, or livestock; and(II) that is targeted toward local consumers and markets.
(ii) Availability of policyNotwithstanding the last sentence of section 1508(a)(1) of this title, and section 1508(a)(2) of this title, the Corporation shall make available a policy described in clause (i) if—(I) the results of the feasibility study under clause (i) are viable; and(II) the requirements of section 1508(h) of this title are met.
(B) Feasibility study describedThe feasibility study described in subparagraph (A)(i) shall evaluate the effectiveness of policies for production targeted toward local consumers and markets, including policies that—
(i) consider small-scale production in various areas, including urban, suburban, and rural areas;
(ii) consider a variety of marketing strategies;
(iii) allow for production in soil and in alternative systems such as vertical systems, greenhouses, rooftops, or hydroponic systems;
(iv) consider the price premium when accounting for production or revenue losses;
(v) consider whether to provide coverage—(I) for various types of production under 1 policy; and(II) for 1 species or type of plant per policy; and
(vi) have streamlined reporting and paperwork requirements.
(C) ReportNot later than 2 years after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that—
(i) examines whether a version of existing policies such as the whole-farm revenue protection insurance plan may be tailored to provide improved coverage for producers of local foods;
(ii) describes the results of the feasibility study carried out under subparagraph (A)(i); and
(iii) includes any recommendations with respect to those results.
(19) High-risk, highly productive batture land policy
(A) In general
(i) Research and developmentThe Corporation shall carry out research and development, or offer to enter into 1 or more contracts with 1 or more qualified persons to carry out research and development, regarding a policy to insure producers of corn, cotton, and soybeans—(I) with operations on highly productive batture land within the Lower Mississippi River Valley;(II) that have a history of production of not less than 5 years; and(III) that have been impacted by more frequent flooding over the past 10 years due to sedimentation or federally constructed engineering improvements.
(ii) Availability of policy
(B) Research and development describedResearch and development described in subparagraph (A)(i) shall evaluate the feasibility of less cost-prohibitive policies for batture-land producers in high risk areas, including policies that—
(i) consider premium rate adjustments;
(ii) consider automatic yield exclusion for consecutive-year losses; and
(iii) allow for flexibility of final plant dates and prevent plant regulations.
(C) ReportNot later than 2 years after December 20, 2018, the Corporation shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that—
(i) examines whether a version of existing policies may be tailored to provide improved coverage for batture-land producers;
(ii) describes the results of the research and development carried out under subparagraphs (A) and (B); and
(iii) includes any recommendations with respect to those results.
(d) Partnerships for risk management development and implementation
(1) PurposeThe purpose of this subsection is to authorize the Corporation to enter into partnerships with public and private entities for the purpose of either—
(A) increasing the availability of loss mitigation, financial, and other risk management tools for producers, with a priority given to risk management tools for producers of agricultural commodities covered by section 7333 of this title, specialty crops, and underserved agricultural commodities; or
(B) improving analysis tools and technology regarding compliance or identifying and using innovative compliance strategies.
(2) Authority
(3) ObjectivesThe Corporation may enter into a partnership under paragraph (2)—
(A) to enhance the notice and timeliness of notice of weather conditions that could negatively affect crop yields, quality, and final product use in order to allow producers to take preventive actions to increase end product profitability and marketability and to reduce the possibility of crop insurance claims;
(B) to develop a multifaceted approach to pest management and fertilization to decrease inputs, decrease environmental exposure, and increase application efficiency;
(C) to develop or improve techniques for planning, breeding, planting, growing, maintaining, harvesting, storing, shipping, and marketing that will address quality and quantity challenges associated with year-to-year and regional variations;
(D) to clarify labor requirements and assist producers in complying with requirements to better meet the physically intense and time-compressed planting, tending, and harvesting requirements associated with the production of specialty crops and underserved agricultural commodities;
(E) to provide assistance to State foresters or equivalent officials for the prescribed use of burning on private forest land for the prevention, control, and suppression of fire;
(F) to provide producers with training and informational opportunities so that the producers will be better able to use financial management, farm financial benchmarking, crop insurance, marketing contracts, and other existing and emerging risk management tools;
(G) to improve analysis tools and technology regarding compliance or identifying and using innovative compliance strategies; and
(H) to develop other risk management tools to further increase economic and production stability.
(e) Funding
(1) Reimbursements
(2) Contracting
(A) Conducting and contracting for research and developmentOf the amounts made available from the insurance fund established under section 1516(c) of this title, the Corporation may use to conduct research and development and carry out contracting and partnerships under subsections (c) and (d) not more than—
(i) $12,500,000 for each of fiscal years 2008 through 2018; and
(ii) $8,000,000 for fiscal year 2019 and each fiscal year thereafter.
(B) Underserved States
(3) Unused fundingIf the Corporation determines that the amount available under this section for a fiscal year is not needed for such purposes, the Corporation may use—
(A) not more than $5,000,000 for each fiscal year to improve program integrity, including by—
(i) increasing compliance-related training;
(ii) improving analysis tools and technology regarding compliance;
(iii) use of information technology, as determined by the Corporation; and
(iv) identifying and using innovative compliance strategies; and
(B) any excess amounts to carry out other activities authorized under this section.
(Feb. 16, 1938, ch. 30, title V, § 522, as added Pub. L. 106–224, title I, § 131, June 20, 2000, 114 Stat. 379; amended Pub. L. 110–234, title VII, § 7511(c)(1), title XII, §§ 12022–12024, 12033(c)(2)(B), May 22, 2008, 122 Stat. 1267, 1382–1388, 1405; Pub. L. 110–246, § 4(a) title VII, § 7511(c)(1), title XII, §§ 12022–12024, 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2028, 2144–2150, 2167; Pub. L. 113–79, title XI, §§ 11010(b), 11022, 11023(b), 11024, 11027(b), 11028(b), Feb. 7, 2014, 128 Stat. 959, 969, 973, 974, 977; Pub. L. 115–334, title XI, §§ 11120(a), 11121–11123, Dec. 20, 2018, 132 Stat. 4926–4935.)

CITE AS: 7 USC 1522

§ 1523. Pilot programs
(a) General provisions
(1) Authority
(2) Private coverage
(3) Covered activitiesThe pilot programs described in paragraph (1) may include pilot programs providing insurance protection against losses involving—
(A) reduced forage on rangeland caused by drought or insect infestation;
(B) livestock poisoning and disease;
(C) destruction of bees due to the use of pesticides;
(D) unique special risks related to fruits, nuts, vegetables, and specialty crops in general, aquacultural species, and forest industry needs (including appreciation);
(E) after October 1, 2001, wild salmon, except that—
(i) any pilot program with regard to wild salmon may be carried out without regard to the limitations of this subchapter; and
(ii) the Corporation shall conduct all wild salmon programs under this subchapter so that, to the maximum extent practicable, all costs associated with conducting the programs are not expected to exceed $1,000,000 for fiscal year 2002 and each subsequent fiscal year.
(4) Scope of pilot programsThe Corporation may—
(A) approve a pilot program under this section to be conducted on a regional, State, or national basis after considering the interests of affected producers and the interests of, and risks to, the Corporation;
(B) operate the pilot program, including any modifications of the pilot program, for a period of up to 4 years;
(C) extend the time period for the pilot program for additional periods, as determined appropriate by the Corporation; and
(D) provide pilot programs that would allow producers—
(i) to receive a reduced premium for using whole farm units or single crop units of insurance; and
(ii) to cross State and county boundaries to form insurable units.
(b) Livestock pilot programs
(1) Definition of livestock
(2) Programs requiredSubject to paragraph (7), the Corporation shall conduct two or more pilot programs to evaluate the effectiveness of risk management tools for livestock producers, including the use of futures and options contracts and policies and plans of insurance that protect the interests of livestock producers and that provide—
(A) livestock producers with reasonable protection from the financial risks of price or income fluctuations inherent in the production and marketing of livestock; or
(B) protection for production losses.
(3) Purpose of programs
(4) Timing
(5) Relation to other limitations
(6) Assistance
(7) Private insurance
(8) Location
(9) Eligible producers
(c) Revenue insurance pilot program
(1) In general
(2) AdministrationRevenue insurance under this subsection shall—
(A) be offered through reinsurance arrangements with private insurance companies;
(B) offer at least a minimum level of coverage that is an alternative to catastrophic crop insurance;
(C) be actuarially sound; and
(D) require the payment of premiums and administrative fees by an insured producer.
(d) Premium rate reduction pilot program
(1) Purpose
(2) Establishment
(A) In generalBeginning with the 2002 crop year, the Corporation shall establish a pilot program under which approved insurance providers may propose for approval by the Board policies or plans of insurance with reduced rates of premium—
(i) for one or more agricultural commodities; and
(ii) within a limited geographic area, as proposed by the approved insurance provider and approved by the Board.
(B) Determination by BoardThe Board shall approve a policy or plan of insurance proposed under this subsection that involves a premium reduction if the Board determines that—
(i) the interests of producers are adequately protected within the pilot area;
(ii) rates of premium are actuarially appropriate, as determined by the Board;
(iii) the size of the proposed pilot area is adequate;
(iv) the proposed policy or plan of insurance would not unfairly discriminate among producers within the proposed pilot area;
(v) if the proposed policy or plan of insurance were available in a geographic area larger than the proposed pilot area, the proposed policy or plan of insurance would—(I) not have a significant adverse impact on the crop insurance delivery system;(II) not result in a reduction of program integrity;(III) be actuarially appropriate; and(IV) not place an additional financial burden on the Federal Government; and
(vi) the proposed policy or plan of insurance meets other requirements of this subchapter determined appropriate by the Board.
Time limitations and procedures
(e) Adjusted gross revenue insurance pilot program
(1) In general
(2) Additional counties
(A) In general
(B) Selection criteria
(f) Camelina pilot program
(1) In general
(2) Determination by BoardThe Board shall approve a policy or plan of insurance proposed under paragraph (1) if, as determined by the Board, the policy or plan of insurance—
(A) protects the interests of producers;
(B) is actuarially sound; and
(C) meets the requirements of this subchapter.
(3) Timeframe
(g) Sesame insurance pilot program
(1) In general
(2) Terms and conditionsThe multiperil crop insurance offered under the sesame insurance pilot program shall—
(A) be offered through reinsurance arrangements with private insurance companies;
(B) be actuarially sound; and
(C) require the payment of premiums and administrative fees by a producer obtaining the insurance.
(3) Location
(4) Duration
(h) Grass seed insurance pilot program
(1) In general
(2) Terms and conditionsThe multiperil crop insurance offered under the grass seed insurance pilot program shall—
(A) be offered through reinsurance arrangements with private insurance companies;
(B) be actuarially sound; and
(C) require the payment of premiums and administrative fees by a producer obtaining the insurance.
(3) Location
(4) Duration
(i) Underserved crops and regions pilot programs
(1) Definition of livestock commodity
(2) Authorization
(3) Review and approval of submissions
(A) In general
(B) RequirementsTo be eligible for approval under this subsection, the approved insurance provider shall have—
(i) adequate experience underwriting and administering policies or plans of insurance that are comparable to the proposed policy or plan of insurance;
(ii) sufficient assets or reinsurance to satisfy the underwriting obligations of the approved insurance provider, and possess a sufficient insurance credit rating from an appropriate credit rating bureau, in accordance with Board procedures; and
(iii) applicable authority and approval from each State in which the approved insurance provider intends to sell the insurance product.
(C) Review requirements
(D) Prioritization
(4) Payment of premium support
(A) In general
(B) Amount
(C) CalculationThe premium subsidy, as determined by the Corporation, shall be calculated as—
(i) a percentage of premium;
(ii) a percentage of expected loss determined pursuant to a reasonable actuarial methodology; or
(iii) a fixed dollar amount per acre.
(D) Payment
(E) Operating and administrative expense payments
(i) In general
(ii) Limitation
(F) Approved insurance providersAny policy or plan of insurance approved under this subsection may be sold only by the approved insurance provider that submits the application and by any additional approved insurance provider that—
(i) agrees to pay maintenance fees or other payments to the approved insurance provider that submitted the application in an amount agreed to by the applicant and the additional approved insurance provider, on the condition that the fees or payments shall be reasonable and appropriate to ensure that the policies or plans of insurance may be made available by additional approved insurance providers; and
(ii) meets the eligibility criteria of paragraph (3)(B), as determined by the Board.
(G) Relationship to other provisions
(5) OversightThe Corporation shall develop and publish procedures to administer policies or plans of insurance approved under this subsection that—
(A) require each approved insurance provider to report sales, acreage and claim data, and any other data that the Corporation determines to be appropriate, to allow the Corporation to evaluate sales and performance of the product; and
(B) contain such other requirements as the Corporation determines necessary to ensure that the products—
(i) do not have a significant adverse impact on the crop insurance delivery system;
(ii) are in the best interests of producers; and
(iii) do not result in a reduction of program integrity.
(6) Confidentiality
(A) In general
(B) Standard
(7) Ineligible purposes
(8) Funding
(A) Limitation on expenditures
(B) Relation to other programs
(Feb. 16, 1938, ch. 30, title V, § 523, as added Pub. L. 106–224, title I, § 132(a), June 20, 2000, 114 Stat. 383; amended Pub. L. 107–171, title X, § 10004, May 13, 2002, 116 Stat. 487; Pub. L. 110–234, title XII, §§ 12025(a), 12033(c)(2)(B), May 22, 2008, 122 Stat. 1389, 1405; Pub. L. 110–246, § 4(a), title XII, §§ 12025(a), 12033(c)(2)(B), June 18, 2008, 122 Stat. 1664, 2151, 2167; Pub. L. 113–79, title XI, §§ 11025, 11026, Feb. 7, 2014, 128 Stat. 974; Pub. L. 115–123, div. F, § 60101(c)(1), Feb. 9, 2018, 132 Stat. 312; Pub. L. 115–334, title XI, § 11124, Dec. 20, 2018, 132 Stat. 4935.)

CITE AS: 7 USC 1523

§ 1524. Education and risk management assistance
(a) Education assistance
(1) In general
(2) Partnerships for risk management education
(A) Authority
(B) Basis for grants
(C) Obligation period
(D) Administrative costs
(3) RequirementsIn carrying out the program established under paragraph (2), the Secretary shall place special emphasis on farm viability and risk management strategies (including farm financial benchmarking, business planning and technical assistance, market assessment, transfer and succession planning, and crop insurance participation), education, and outreach specifically targeted at—
(A) beginning farmers or ranchers;
(B) legal immigrant farmers or ranchers that are attempting to become established producers in the United States;
(C) socially disadvantaged farmers or ranchers;
(D) farmers or ranchers that—
(i) are preparing to retire;
(ii) are using transition strategies to help new farmers or ranchers get started; 1
1 So in original. Probably should be followed by “and”.
(iii) are converting production and marketing systems to pursue new markets; and 2
2 So in original. The word “and” probably should not appear.
(E) producers that are underserved by the Federal crop insurance program established under this subchapter, as determined by the Corporation; and
(F) veteran farmers or ranchers.
(4) Funding
(b) Agricultural management assistance
(1) Authority
(2) UsesA producer may use financial assistance provided under this subsection to—
(A) construct or improve—
(i) watershed management structures; or
(ii) irrigation structures;
(B) plant trees to form windbreaks or to improve water quality;
(C) mitigate financial risk through production or marketing diversification or resource conservation practices, including—
(i) soil erosion control;
(ii) integrated pest management;
(iii) organic farming; or
(iv) to develop and implement a plan to create marketing opportunities for the producer, including through value-added processing;
(D) enter into futures, hedging, or options contracts in a manner designed to help reduce production, price, or revenue risk;
(E) enter into agricultural trade options as a hedging transaction to reduce production, price, or revenue risk; or
(F) conduct any other activity relating to an activity described in subparagraphs (A) through (E), as determined by the Secretary.
(3) Payment limitation
(4) Commodity Credit Corporation
(A) In general
(B) Funding
(i) In general
(ii) Exception for certain fiscal years
(C) Certain usesOf the amounts made available to carry out this subsection for a fiscal year, the Commodity Credit Corporation shall use not less than—
(i) 50 percent to carry out subparagraphs (A), (B), and (C) of paragraph (2) through the Natural Resources Conservation Service;
(ii) 10 percent to provide organic certification cost share assistance through the Agricultural Marketing Service; and
(iii) 40 percent to conduct activities to carry out subparagraph (F) of paragraph (2) through the Risk Management Agency.
(Feb. 16, 1938, ch. 30, title V, § 524, as added Pub. L. 106–224, title I, § 133, June 20, 2000, 114 Stat. 387; amended Pub. L. 107–171, title II, § 2501, May 13, 2002, 116 Stat. 263; Pub. L. 108–199, div. A, title VII, § 769, Jan. 23, 2004, 118 Stat. 40; Pub. L. 110–234, title I, § 1603(g)(3), title II, § 2801, title VII, § 7511(c)(2), title XII, § 12026, May 22, 2008, 122 Stat. 1011, 1085, 1267, 1390; Pub. L. 110–246, § 4(a), title I, § 1603(g)(3), title II, § 2801, title VII, § 7511(c)(2), title XII, § 12026, June 18, 2008, 122 Stat. 1664, 1739, 1813, 2028, 2152; Pub. L. 112–55, div. A, title VII, § 716(a), Nov. 18, 2011, 125 Stat. 582; Pub. L. 113–79, title I, § 1609(b)(1), title XI, § 11027(c), Feb. 7, 2014, 128 Stat. 709, 977; Pub. L. 115–334, title XI, § 11125(a), title XII, § 12306(b)(3), Dec. 20, 2018, 132 Stat. 4935, 4969.)

CITE AS: 7 USC 1524