Crop Insurance Update: FCIC Finalizes Changes to Federal Crop Insurance

Written by M. Sean High - Staff Attorney

On August 12, 2016, the United States Department of Agriculture (USDA) Federal Crop Insurance Corporation (FCIC) published notice in the Federal Register (81 FR 53657) of a final rule changing the Code of Federal Regulation’s General Administrative Regulation—Subpart V—Submission of Policies, Provisions of Policies, Rates of Premium, and Non-Reinsured Supplemental Policies (7 CFR part 400, subpart V). 

According to FCIC, the final rule provides greater clarity of “existing regulations [and] lessen[s] the burden on submitters of crop insurance policies, provisions of policies, or rates of premium under section 508(h) of the [Federal Crop Insurance] Act (Act).” FCIC stated that the final rule also supplies “guidance on the submission and payment for concept proposals under section 522 of the Act” and furnishes “provisions for submission and approval of index-based weather plans of insurance as authorized by section 523(i) of the Act,” Finally, FCIC declared that the final rule “incorporate[s] changes that are consistent with those made in the Common Crop Insurance Policy Basic Provisions.”  

According to FCIC, the final rule’s changes to 7 CFR part 400, subpart V are the result of a notice of proposed rulemaking published in the Federal Register on February 25, 2015, which provided the public with a 60 day comment period (80 FR 10008—10022).  FCIC stated that the agency received 80 comments on the proposed rule from 10 commenters including: “insurance providers, insurance organizations, grower organizations, crop insurance product developers, and a business council.”

The effective date for the final rule is August 12, 2016.   

Crop Insurance Update: FCIC Issues Final Rule Regarding Double Cropping and Replanting

Written by M. Sean High—Staff Attorney

On June 22, 2016, the United States Department of Agriculture Federal Crop Insurance Corporation (FCIC) published notice in the Federal Register of a final rule and request for comment regarding the agency’s amendment to the Common Crop Insurance Regulations, Basic Provisions (81 FR40477). 

According to FCIC, the purpose of the final rule “is to provide policy changes and to clarify existing policy provisions to better meet the needs of policyholders.” Specifically, the final rule addresses “[i]ssues [that] have arisen regarding: The qualifications for double cropping; and when it is practical to replant.”

Under the final rule, FCIC is revising 7 CFR part 457 “to allow the allocation of comingled first and second crop production to the associated crop acreage in proportion to the liability for the acreage that was and was not double cropped.”  Additionally, under the final rule, FCIC is also revising 7 CFR part 457 regarding the definition of the term “practical to replant.”

Accordingly, the final rule stated that the final rule became effective on June 22, 2016 and “[t]he changes to the policy made in this rule are applicable for the 2017 and succeeding crop years for all crops with a contract change date on or after June 22, 2016, and for the 2018 and succeeding crop years for all crops with a contract change date prior to June 22, 2016.” Finally, the final rule specified that “FCIC will accept written comments on this final rule until close of business August 22, 2016.”

Regulatory Update: FAA Sets New Rules Governing Drone Registration

Written by M. Sean High – Staff Attorney

On December 14, 2015, the U.S. Federal Aviation Administration (FAA) announced an interim final rule (IFR) regulating the registration of drones with the stated purpose of providing “an alternative process that small unmanned aircraft [drone] owners may use to comply with the statutory requirements for aircraft operations [49 U.S.C 44102].” As a result, under IFR, beginning December 21, 2015, in addition to the current paper-based drone registration system (14 CFR part 47), FAA is required to provide an online web-based drone registration system (14 CFR part 48).

IFR applies to drones “weighing less than 55 pounds and more than 0.55 pounds (250 grams) on takeoff, including everything that is on board or otherwise attached to the aircraft and operated outdoors in the national airspace system.”  According to IFR, a drone owned prior to December 21, 2015 must be registered by February 19, 2015.  Comparably, a drone acquired after December 21, 2015 must be registered prior to that drone’s first outdoor flight.  All drone owners age 13 and older must register and if the owner is less than 13 years of age, then the drone must be registered by a person who is at least 13 years of age. 

Under IFR, FAA is to charge drone owners a $5 per drone registration fee.  Drone registration must be renewed every three years with a $5 renewal fee per drone.  Significantly, under IFR, failure to register a drone could result in civil penalties up to $27,500 and/or criminal penalties of up to $250,000 in fines (18 U.S.C. 3571) and/or imprisonment up to 3 years (49 U.S.C. 46306). 

Food Groups Petition for FDA Rule Change for Breaker Eggs

Written by Katharine Richter

On September 29, 2015, The National Chicken Council (NCC), Grocery Manufacturers Association (GMA), and Association for Dressings and Sauces (ADS) wrote a petition to the Food and Drug Administration (FDA) asking “to amend the Final Rule on Prevention of Salmonella Enteritidis in Shell Eggs During Production, Storage, and Transportation, published July 9, 2009 [74 FR 33030].”

The rule requires that any eggs being sent to breaking facilities, which will eventually be pasteurized, must be “kept at 45 degrees F within 36 hours after being laid.”  The NCC originally challenged the rule when it was being proposed in 2010 because the FDA never explained the additional health benefits from requiring the refrigeration and the petition argues there is “no additional food safety value.”  The refrigeration requirements effectively made broiler hatcheries dispose of all excess eggs, which the NCC estimated was around 365 million eggs last year.  Prior to the rule, broiler hatcheries could sell excess eggs they had due to fluctuating market demands.  The excess eggs were sold as “breaker eggs” (eggs broken and sold in liquid form).  With the enactment of the rule, the broiler farms could not sell the excess eggs because they failed to meet the refrigeration requirements.

The petition comes at a time when egg prices have “more than doubled in the period following the HPAI outbreak.”  Many companies have felt the price increase.  The petition states that, “Industry experts estimate that the price of a dozen breaker eggs rose dramatically from 63 cents in late April to $2.15 in early June.”  The petition argues changing the rule to either make breaker eggs exempt from the refrigeration requirement or increasing the refrigeration requirement to 120 hours after being laid, would help meet market demands and stop the need to import eggs from other countries.

WOTUS Rule Effective Date Set for Aug. 28, 2015

On Monday June 29, 2015, the EPA published the final CleanWater Rule, also known as the Waters of the United States (WOTUS) rule, in the federal register setting the effective date for August 28, 2015.

According to the text of the rule, the rule is meant to “clarify the scope of the waters…protected by the Clean Water Act (CWA)…” The rule maintains current exemptions for activities, and in some instances expands the exceptions “to make it clear that this rule does not add any additional permitting requirements on agriculture.” According to an EPA fact sheet, the Clean Water Rule is meant to provide greater clarity for agriculture within the existing requirements.

The American Farm Bureau Federation has claimed that the final WOTUS rule is broader than the original proposed rule, and rather than clarifying the requirements, creates more uncertainty for farmers. The Farm Bureau claims the new exceptions are too narrow to be of use, or so unclear as to be open only to agency interpretation.

The 60-day period for judicial review of the rule is set to begin on July 13, 2015.

Written by Tyler R. Etter- Research Assistant
June 29, 2015

Finalized Waters of the U.S. Rule Announced

On May 27, 2015, the United States Environmental Protection Agency (EPA) and the United States Army Corps of Engineers announced the final version of their rule regarding the Waters of the United States (WOTUS).

Under the Clean Water Act, federal jurisdiction applies to “navigable waters.”  Unfortunately, this term often leads to confusions regarding the federal jurisdiction of many lakes, rivers, streams, and marshes.  According to EPA, the finalized WOTUS rule “ensures that waters protected under the Clean Water Act are more precisely defined and predictably determined.” The announced final rule is scheduled to go into effect sixty days after it is published in the Federal Register.

The final WOTUS rule faces opposition from those that believe the action exceeds the intended scope of the Clean Water Act.  On May 27, 2015 House of Representatives Speaker John Boehner (R-OH) issued a press release denouncing the rule as a “tyrannical power grab.” Relatedly, on May 12, 2015 the House of Representative voted to require the withdrawal of the final WOTUS rule and require the development of a new rule; similar legislation is pending in the Senate.
 
Written by M. Sean High - Staff Attorney
May 28, 2015