On January 16, 2020, the Risk Management Agency (RMA) issued several documents related to changes made to the Florida Fruit Tree Crop Provisions. Those documents included a Product Management Bulletin: PM-20-004 announcing the changes, the Florida Fruit Tree Crop Provisions, and Florida Fruit Tree National Fact Sheet. https://www.rma.usda.gov/en/Fact-Sheets/National-Fact-Sheets/Florida-Fruit-Tree; https://www.rma.usda.gov/-/media/RMAweb/Policies/Florida-Fruit-Tree/2021/Florida-Fruit-Tree-Crop-Provisions-21-0014.ashx; https://www.rma.usda.gov/en/Policy-and-Procedure/Bulletins-and-Memos/2020/PM-20-004. PM-20-004 simply states that the Florida Fruit Tree crop Provisions are revised to clarify the optional Unit Structure provisions and procedures. The brief description of the changes contained in the Florida Fruit Tree Crop Provisions states that section 2(c) was revised to clarify that in addition to or instead of establishing optional units in accordance with the Basic Provisions, optional units may be established either no non-contiguous land or by the contiguous land method but not both. The Florida Fruit Tree National Fact Sheet briefly references “optional units” and states:
“Optional Units — May be elected if minimum qualifications are met. You may qualify for optional units if you have fruit tree groves on two or more parcels of non-contiguous land, or you have separate identifiable blocks on contiguous land. Separate optional units on contiguous land must meet the minimum number of acres of trees specified in the actuarial documents.”
ANALYSIS – As an initial matter, the summary of changes that preludes the Florida Fruit Tree Crop Provisions states that section 2(c) has been revised. A look at the actual Florida Fruit Tree Crop Provisions reveals there is no section 2(c). RMA has revised section 2(b) of the Florida Fruit Tree Crop Provisions and the provisions are contained in section 2(b)(3).
It appears that RMA has revised its Florida Fruit Tree Crop Provisions to revise the unit structure but it is unclear how this change works. It appears that producers can elect optional units by non-contiguous land or contiguous land but not both. A literal reading means that if the producer has 10 blocks of trees, 3 blocks are contiguous to each other but each meets the requirements for optional units in section 2(b)(3) and 7 blocks are each located on non-contiguous acreage, the producer can elect optional units for the 7 non-contiguous blocks but the remaining 3 blocks are in a basic unit or alternatively the producer can elect 3 optional units from the contiguous blocks but the other 7 blocks are in a basic unit. It is unclear why if all of the blocks meets the requirements for optional units they cannot receive all 10 optional units. It is possible that RMA may have meant something different and all 10 blocks could have optional units but that is not what the actual policy provisions allow.
As has been stated previously, Fact Sheets are not part of the policy although they reference policy provisions, they only discuss coverages at a high level, which may leave producers confused as to all their rights and obligations, and they could potentially conflict with the terms of the policy. The Florida Fruit Tree National Fact Sheet is a good example. It references the optional units by contiguous and non-contiguous but it fails to state the producer must elect one or the other, not both. While it may seem convenient to have these one page summaries of coverage, creating a document of policy provisions that is not part of the policy creates ambiguity and can adversely affect the producer who relies upon the Fact Sheet instead of the documents that make up the policy.
All statements made are opinions of the author and are not intended to provide legal opinions or legal advice.