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    Crop Insurance News and Analysis – April 24, 2019

    April 24, 2019 By //  by Kim Arrigo

    The 2014 Farm Bill contained restrictions regarding the election of Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) and the Stacked Income Protection Plan (STAX). Producers who elect STAX are not eligible for the Supplemental Coverage Option SCO. In addition, STAX cannot cover any acreage on land that has been enrolled in ARC or PLC for cotton seed.

    MGR-19-007 states that, for the 2019 crop year only, producers who purchase STAX and SCO were not required to designate acres coverage by STAX and acres covered by SCO by the sales closing date. RMA gave producers until they file and ARC/PLC intended acreage intention report by the acreage reporting date. Producers who purchase STAX may include whether they intend to enroll a farm number in ARC or PLC on the crop insurance acreage intention report. The crop insurance acreage intention report will adjust the acreage report by specifying intended ARC or PLC enrollment. The number of acres on farms not enrolled in ARC or PLC, will be the number of acres insured for STAX regardless of the actual enrollment made with FSA. If the producer does not file an ARC/PLC crop insurance acreage intention report, the STAX will over all acres as though the producer did not enroll in ARC or PLC. If the producer does not file an ARC/PLC crop insurance acreage intention report and has both STAX and SCO, then in lieu of MGR-19-003, STAX will cover all acres as though the producer did not enroll in ARC or PLC.

    ANALYSIS – Maybe I have missed something but in reviewing the 2014 Farm Bill and the STAX Cotton Crop Provisions, it is not clear why ARC or PLC are referenced in relation to STAX. There is no preclusion against producer who have purchased STAX from enrolling in ARC or PLC. The only provision that references STAX and ARC in any provision is in section 11003 of the 2014 Farm Bill, which states: ” Crops for which the producer has elected under section 1116 of the Agricultural Act of 2014 to receive agriculture risk coverage and acres that are enrolled in the stacked income protection plan under section 508B shall not be eligible for supplemental coverage under this subparagraph.” As drafted, this states that a producer who has SCO is not eligible for ARC for the crop or STAX for the specific acreage. Nowhere could I find any provision that states that a producer who has STAX is not eligible for ARC or PLC. Maybe RMA is interpreting the provision differently but If so, they have failed to state the basis for this interpretation.

    In addition, it is not clear what the last sentence of the bulletin means. It states that “If the producer does not file an ARC/PLC crop insurance acreage intention report and has both STAX and SCO, then in lieu of MGR-19-003, STAX will cover all the acres as though the producer did not enroll in ARC or PLC.” It appears to read that if the producer has STAX and SCO and does not file the ARC/PLC crop insurance acreage intention report, all the acreage defaults to STAX. However, both STAX and SCO are available as long as it is on different acreage. The ARC/PLC crop insurance acreage intention report would affect the eligibility of acreage under SCO but it should not affect the acreage insured under STAX. The acreage intention report would affect the eligibility of acreage under SCO but it should not affect the acreage insured under STAX.

    All statements made are opinions of the author and are not intended to provide legal opinions or legal advice.

    Filed Under: Blog

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