2001 Added Land & Added P/T/V for Category B APH Crops.

2001 Added Land & Added P/T/V for Category B APH

Crops

2001 Added Land/P/T/V

• New Procedures– Category B Crops– Detailed in MGR-00-019.1

• Crop Insurance Handbook Revision– Exhibit 36 (9/00)


• First Step– Rework all 2000 APHs in which

“added land” was implemented using a reference yield.•Use of the “L” descriptor to identify

those situations where land was added in the crop year 2000.

– Great American can identify crop year 2000 added land situations with system reports.


• Remember!– Do NOT restructure added land:

•That used variable “T” Yields in 2000; or

•That was added using existing unit’s APH (no averaging); or

•That another person’s records were properly used.


• 2000 APH Rework– Examine the added land for 50% &

640-acre limits.•The added land must not exceed a total

of 640 acres, and•The added land acreage must not be

greater than 50% of the existing acreage, or the basic unit, to which the land is added using a reference database.


• 2000 APH Rework– When checking for the 50% & 640

acre rule, use planted acreage.•If exceeded, use variable “T” Yield or

request a RMA RO review.•If acceptable, replace the existing

reference yield with the added land “T” Yield.

– Simple average of existing APH’s in 2000


• 2000 APH Rework Steps– Apply acreage limits.– Yield limitations do not apply.

• 2001 Updates– Add most recent year’s history.– Apply yield limitations & Added

Land limits.


• Let’s review the examples.


• Reworking 2000 APHFor 2000 Unit Acres Approved Yield

Existing: 00101 200 150

00102 100 164

00103 150 132

***********************************************

Added: 00104 250 L164

00105 185 L164

00102 was the reference unit for the added units.



Existing: 00101 200 150

450 total 00102 100 164

acres 00103 150 132

***********************************************

Added: 00104 250 > 50% of 450

00105 185 < 50% of 450

Examine the planted acres.



Existing: 00101 200 150

450 total 00102 100 164

acres 00103 150 132

_______________________________________________

Take the simple average of the APH yields.

150+164+132=446 446/3 = 149



Existing: 00101 200 150

450 total 00102 100 164

acres 00103 150 132

_______________________________________________

Can I apply the 149 simple average to:

00104 ?

00105 ?



Existing: 00101 200 150

450 total 00102 100 164

acres 00103 150 132

_______________________________________________

00104 250 > 50% of 450 or 225

Request RO review or use variable “T” Yield.



Existing: 00101 200 150

450 total 00102 100 164

acres 00103 150 132

_______________________________________________

00105 185 < 50% of 450 or 225

149 is the simple average of Units 00101, 00102, & 00103

Use the “higher of” the added land “T” Yield (L149) or the variable “T” Yield.


• New Example– Existing units for 2000

00101 124 Approved APH Yield

00102 96

00103 110

00104 added within acreage limits

Added in 2000 as L124

Reworked in 2001 as L110 (124+96+110/3) = 110


• New Example– Existing units for 2000

00104 updated: L110

L110

L110

A 0

330 / 4 = 83

Prior Yield (restructured): 110

Cupped Yield: 110 X .90 = 99

2001 Added Land/P/T/V• Added Land Special Yields

– Added land will not always have “special yields”:•Other person’s records•Variable “T” Yields

– Separate basic unit– Separate optional unit not eligible for Added

Land “T” Yield.– Higher than Added Land “T” Yield

»Separate optional unit– Not eligible for existing unit’s APH– Lower “T” Yield map area


• Added Land - Cropland acreage:– Added to operation for current crop year– Not crop specific

• Added P/T/V– First time anywhere in operation– By crop, by county

• New Database– First time crop/P/T/V on particular unit


• Added Land “T” Yield– Simple average of approved APH

yields for ALL EXISTING optional units within the same basic unit•by P/T/V

– Use for added separate optional unit:•Within 50%/640 acre limits, OR•Approved RMA RO review.


• Added Land “T” Yield– Insured must certify as “Added

Land”•Yield descriptor “L” for Added Land

“T” Yield.•“Set” in subsequent years

– Until replaced by actual/assigned yields.– Unless correction or change to yields on

which the Added Land “T” Yield was initially based.


• “T” Yields for Yield Floors– Published “T” Yields (Actuarial)– Added Land or New P/T/V “T”

Yields– Determined Irrigated “T” Yields– Simple/Weighted average “T”

Yields– RO-assigned “T” Yields


• Land Added to Existing Unit– To use existing unit’s (basic or

optional) APH, added land must:•Be in the same or higher “T” Yield

map area (if applicable)•Meet 50%/640-acre limits:

•Approved by RMA RO review.

< = 50% of existing unit’s cropland acres< = 640 total acres (all units) added to operation, or

2001 Added Land/P/T/V• Land Added to Existing Unit

– If eligible to use the existing APH:•One database for added land and existing

land.•No added land yield indicator.

– If NOT eligible (exceeds limits or RMA RO review rejected):•Separate database with variable “T” Yield•Yield indicator will be “B”•Maintain until all “T” Yields are replaced

2001 Added Land/P/T/VExample of land added to existing unit but separate

database required:

00100-Existing 00100(“B”Indicator)

Year Acres Yield Acres Yield

1996 55.0 A40

1997 0.0 Z T17

1998 40.5 P15 T17

1999 60.0 A42 T17

2000 50.0 A20 T17

Approved APH: 29 17

2001 Added Land/P/T/VExample - Updates for the following year.

00100-Existing 00100(“B”Indicator)

Year Acres Yield Acres Yield

1996 55.0 A40

1997 0.0 Z T17

1998 40.5 P15 T17

1999 60.0 A42 T17

2000 50.0 A20 T17

2001 40.0 A32 150 A22

Approved APH: 30 18


– If separate units are requested in subsequent years when separate databases are required:•Use only the added land’s yield

history for the new unit.•Complete with variable “T” Yields if

needed.

– When existing databases are used:•Use CIH Exhibit 15

50% / 640 Limits– For Yields other than variable “T”

Yields, added land must be:•Within limits:

– less than or equal to 50% of the existing cropland acreage

»Each added optional unit divided by the existing basic unit

»Acreage added divided by the existing unit, AND

– less than or equal to 640 total cropland acres (irrespective of crop) being added to entire farm operation.

– OR RO review requested & approved.

50% / 640 Limits– Cropland acres (CA)

•Owned, leased, cash or share rented•Not crop-specific

– Added CA divided by existing CA (<=50%)

– Existing Cropland Acreage:•Includes CRP land previously in

operation.•Does not include areas absent from

the operation.

50% / 640 Limits– Example 1 – Existing cropland acres

FSN in FSN in operation

#1 300 300 (owned)

#2 700 200 (500 acres leased)

#3 150 150 (cash leased)

Existing Cropland Acres = 650

50% / 640 Limits– Example 2 – “Previous” vs. “Existing”

FSN#1 300 Cropland Acres - existing

FSN#2 200 Cropland Acres - existing

FSN#3 150 Cropland Acres - lost for 2001

FSN#4 310 Cropland Acres - new for 2001

Existing Cropland Acres = 500 (310>50%)

50% / 640 Limits– Example 3 – Total Cropland Acres Added

2 existing units: 00101 400 acres00102 600 acres

1000 acres

3 new units: 00103 200 acres / 100000104 300 acres / 100000105 180 acres / 1000

Each new unit’s cropland acreage divided by 1000 is less than 50% of the existing cropland acreage.

200+300+180= 680 However 680>640 !

50% / 640 Limits– Example 3 50% limit– Total Cropland Acres Added


1000 acres

3 new FSNs: #1 200 acres #2 300 acres #3 80 acres

200+300+80= 600 600<640

50% depends on the decided unit structure.



1000 acres

3 new units 00103 200 acres / 1000 00104 300 acres / 1000 00105 80 acres / 1000

Each new unit’s Cropland acres divided by 1000 is less than 50% of 1000 acres.

Eligible for Added Land “T” Yield.



1000 acres

All 3 FSNs in new FSN#1 200 acres unit 00103 FSN#2 320 acres

FSN#3 80 acres

600 acres of added Cropland Acreage divided by 1000 is greater than 50%.

Variable “T” Yield or request RO review.

50% / 640 Limits– Example 3 50% limit

•Total Cropland Acres Added


1000 acres

New 00103 FSN #1&#2 520 acres New 00104 FSN #3 80 acres

00103 (520 is greater than 50% of 1000): Variable “T” Yield or request RMA RO review.

00104 (80 is less than 50% of 1000): Eligible for Added Land “T” Yield.


• 50%/640 Limits– Apply to Land Added for current

crop year, beginning with the 2000 databases.•Land added as a separate optional unit.•Land added to an existing unit.•New crop for unit IF LAND added in

2000 (restructured) or later.


• 50%/640 Limits– Do NOT apply (unless on added

land) to:•Added P/T/V (first time grown within

county)– Practice, type, variety

•New database for P/T/V – First time grown on unit.

2001 Added Land/P/T/V• Great American’s Responsibilities

– Notify insureds of new Added Land Procedures by production reporting date.

– Calculate APH for added land within 50%/640 acre limits.

– Forward Underwriting Review Requests to RMA’s RO.

– Verify Added Land “T” Yield eligibility•For APH review.•Before paying indemnity.


• The insured may request an RMA RO underwriting review if:– Added land exceeds 50% / 640

acre limits (review unit structure)– The insured wishes to have

something other than the variable “T” Yield, Added Land “T” Yield or existing APH.•Productivity documentation is

provided by the insured.


• Remember:– If the insured’s request is secured

for a special underwriting review of added land, and RMA accepts the documentation and grants a higher “T” Yield value:•The insured will have no choice but to

accept the RMA RO recommendation for the added land “T” Yield.


• Documentation Requirements– The productivity of the added land must

be 85% of existing unit’s (or overall basic unit), based on one or more of the following:•FSA program yield (crop or reference crop)•APH from previous operator•Soil survey maps or other data•Natural Conservation Service projected

yields by soil types


• Requests must include:– Statement on signed request– APH for current crop year– Cropland acreage (578 or other

documentation)– Aerial photos or legal descriptions– Program yield (if available)– APH from previous operator (if

available)


• Required Statement:

“I hereby request an RMA RO underwriting review to determine the appropriate APH calculation method(s) to calculate my insurance guarantee for land added to my farming operation. Insured crops for which this request is being made are as follows: ________ ________ ________”

“I understand that crop(s) not included on the request will use variable “T” Yields for added land unless acceptable acreage and production records are provided.”


• Added Land Forms

Great American will supply agents with appropriate forms to request underwriting reviews for added land.


• Deadlines Apply for Requests– Production Reporting Date

•Most scenarios

– Acreage Reporting Date•If land is added after Production

Reporting Date

– The Following Year if too late for initial year.


• Deadlines Apply for Requests– Great American must provide

information to RMA RO by the Acreage Reporting Date + 20 calendar days. (postmarked)•Received within 10 days thereafter.

– RMA RO will reply within 20 days of receipt.


• Example of other crops in later years:– Added land in 2000 - Corn Planted– Same land in 2001 - Soybeans Planted

•Eligibility for added land “T” Yield (or existing APH) based on initial year land was added.

•If eligible, added land “T” Yield is the simple average of approved APH yields that existed in 2000.

– INCLUDE ALL CROPS IN RMA RO REQUEST


• L: Added Land “T” Yield– Only change previously

referenced yields.

• C:– Added P/T/V “T” Yield– Determined IRR Yield

• S, E, N, & T: Variable “T” Yields


• New identifiers for separate added APHs– A Added Land “T” Yield used– B Variable “T” Yield because:

•Not eligible for Added Land “T”– Separate Optional Unit

•Not eligible for Existing Unit’s APH•Lower “T” Yield map area (all or part)


• New identifiers for separate added APHs– C Variable “T” Yield because:

•Separate Basic Unit•Higher than Added Land “T”

Yield– Separate Optional Unit


• Added Land without Yield Indicators:– Land added to existing unit

and using existing APH.– Land added as a separate unit

using production history from the person sharing.


• Goal is to Track Added Land– Set up on separate database

(not if added to and using existing unit’s APH)

– Retain while Added Land or variable “T” Yields are present in database.


• Example Separate APH requiredYear 1 2 3 4 5

Y Ind B B B B

N90 T100 T100 T100 A110

N90 T100 T100 A110 A120

N90 T100 A110 A120 A 50

N90 A110 A120 A 50 A105

May combine with other APH in Year 5.


• Not previously produced anywhere in existing operation.

• Not on added land.• APH options:

– Other person’s records (standard)– If IRR: Determined IRR Yield– IF Summerfallow: SF-CC APH– Variable “T” Yields (standard)


• If new P/T/V for unit/legal:– NOT on added land; &– Other databases for P/T/V within the

same overall basic unit.

• Use the higher of:– New P/T/V “T” Yield

•50%/640 acre limits DO NOT apply.•Simple average of current year’s APH.

– Variable “T” Yield


• Simple average of approved APH yields for P/T/V “T” Yield Map Area of ALL EXISTING optional units within the same basic unit.– Yield descriptor “C”; indicator “A”– “Set” until replaced by

actual/assigned yields.


• If new crop for unit/legal:– On land in operation before 2000, &– Other databases within same overall basic

unit

• Use higher of:– Added Land “T” Yield

•50%/640 acre limits do not apply•Simple average of current year’s APH



• If new crop for unit/legal:– On land in operation in 2000 or later, &– Other databases within same overall basic

unit for the initial year land added

• Use higher of:– Added Land “T” Yield

•50%/640 acre limits apply (initial year).•Simple average of initial year’s APH.



– If land originally added in 2000 or later, we must determine if:•Limits met or exceeded initial year?•RO review requested (which crops)?•RO review approved or rejected?

– RO review may be required.– If new crop is eligible, use simple

average of approved APH yields that existed the initial year added.


• Same procedure as before:– Initial time IRR on unit/legal, &– NI APH higher than IRR “T”

Yield– Lessor of factored IRR “T” or

IRR Yield– “C” Yield descriptor


• Let’s Summarize Added Land!


• Restructure 2000 reference yield databases.

• Apply 50%/640 acre limits to qualify for Added Land “T” Yield or existing unit’s APH– 50% on individual unit basis– 640 acres on total operation basis


• If exceeded acre limits:– Variable “T” Yield, or– Request RMA RO review

2001 Added Land/P/T/V• Determine Added Land’s Unit Structure

– Added separate basic unit•Variable “T” Yield with “C” indicator

– Added separate optional unit•Added Land “T” Yield & “A” indicator if

appropriate•Variable “T” Yield

– “B” indicator if it does not qualify for Added Land “T” Yield or in lower “T” Yield Map Area.

– “C” indicator if better than Added Land “T” Yield.


• Determine Added Land Unit Structure– Added to existing unit (Basic or

Optional)•Existing APH (no indicator) if qualifies•If it does not qualify(exceeds limits or is in

lower “T” yield map area):– Separate Database– Variable “T” Yield & “B” Indicator


• New Database (After Land Added)– New crop for unit if land added:

•Pre-2000 : P/T/V “T” Yield (no limits)•2000 and later:

– P/T/V “T” Yield if within limits - per initial year land added; or


•New P/T/V for unit:– P/T/V “T” Yield (no limits)


• RMA RO Request– To use Added Land “T” Yield or existing

APH– May involve multiple crops (with existing

databases)– Signed statement by Production Reporting

Date/Acreage Reporting Date– Productivity Comparisons

•85% Documentation

2001 Added Land & Added P/T/V for Category B APH Crops.

Documents

added landptv land

added units

added land acreage

added landptv t yields

added land yield descriptor

added land situations

added landptv reworking

actuarial added land