Regional Update

1. Regional Update Jay Waechter, Senior Risk Management Specialist Topeka Regional Office

2. This presentation does not replace or supersede any procedures or modify any provisions contained in the complete insurance policies.Note: Much of the content provided in this presentation has not been filed as of this date and is subject to change.

3. 2013 Changes

4. Region-wide changes • Wheat T-Yields were updated • Grain Sorghum T-Yields updated and Rates were reviewed • Corn and Soybeans Rates were reviewed

5. 2013 Proposed Double Crop Statements and FAC/NFAC • Key Criteria in Development of 2013 Statements/Definitions: • Local conditions, notably length of season and soil moisture, primary drivers in setting restrictions. • Continue to rely on university/other research and experience • Increase flexibility in 2013 for haying and grazing of ‘another crop’ and/or cover crop, based on guidance in recent Manager’s Bulletins • Key Proposed Changes in Kansas, Nebraska & Colorado: • Allow harvesting of “another crop” and “cover crop” • Except for West, allow more springtime growth of cover crops. • Define “termination”

6. 2013 Proposed Double Crop StatementsKey changes from 2012 are bolded(additions) or red strikeout (deletions) South Central/Eastern Kansas Insurance shall not attach or be considered to have attached without a written agreement to a planted non-irrigated crop on acreage from which, in the same calendar year: 1) A perennial hay crop was harvested; or 2) A crop (other than a cover crop) reached the headed or budded stage prior to termination, regardless of the percentage of plants that reach the headed or budded stage,or has been harvested; 3) A cover crop is terminated after 50% of the cover crop has headed or budded. For purposes of insurability under this Special Provision, a cover crop is one that meets the definition of a cover crop in the Basic Provisions and was planted within the last 12 months. Termination means growth has ended. To qualify for a written agreement, you must provide a minimum of three years of your double cropping actual production history for the crop in the county.

7. 2013 Proposed Double Crop StatementsKey changes from 2012 are bolded(additions) or red strikeout (deletions) Eastern Kansas, Eastern Nebraska Insurance shall not attach or be considered to have attached to a planted non-irrigated crop on acreage from which, in the same calendar year: 1) A perennial hay crop was harvested; or A crop (other than a cover crop) reached the headed or budded stage prior to termination, regardless of the percentage of plants that reach the headed or budded stage, or has been harvested; A cover crop is terminated after 50% of the cover crop has headed or budded. (Definition of cover crop, termination) Western Kansas. Western Nebraska, Colorado: Insurance shall not attach or be considered to have attached to a planted non-irrigated crop on acreage from which, in the same calendar year: 1) A perennial hay crop was harvested; or A crop, including a cover crop, reached the headed or budded stage prior to termination, regardless of the percentage of plants that reach the headed or budded stage, or has been harvested;. (Definition of cover crop, termination)

8. Double Crop StatementsCorn West – No Written Agreements East – No Written Agreements

9. Double Crop StatementsSoybeans FAC / NFAC West – No Written Agreements East – No Written Agreements Written Agreements allowed

10. Double Crop StatementsGrain Sorghum West – No Written Agreements East – No Written Agreements Written Agreements allowed

11. Cover Crops and Summer Fallow • To qualify for the SF practice, the acreage must not have been planted to a crop the preceding crop year and remain fallow for a full crop year. • Planting a cover crop during the fallow period affects the insurability of your next wheat crop. • If a crop was planted on acreage qualifying as summer fallow the preceding crop year but was terminated by JUNE 1, and any later growth is controlled by mechanical or chemical means, the acreage will qualify as summer fallow the next crop year. • Please see our FAQ at: http://www.rma.usda.gov/help/faq/summerfallow.html

12. New Breaking For the second year in a row a new statement will be added to the actuarial for Corn, Grain Sorghum and Soybeans • The biggest change will be that in most cases the AIP will approve coverage without a Written Agreement • The only cases that will now come to the RO will be when the acreage limitation, date of breaking or, soil criteria are not met

13. New Breaking – Corn, Soybeans, Grain Sorghum Through a new statement in the Special Provisions the AIP can approve without Written Agreement if: • 75% of the acreage by field is composed of soil types defined as Capability Class I, II, III, or IV. • NRCS Web Soil Survey • http://websoilsurvey.nrcs.usda.gov/app/HomePage.htm; and • The land must have been broken/ chemically sprayed… • Either Prior to Planting or Onor before November 30 prior to planting (Depending on the county); and

14. Corn, Soybeans, and Grain Sorghum only

15. November 30

16. New Breaking is insurable without a Written Agreement if: (Continued) • The producer provides a NRCS Conservation Plan, if required by NRCS; and • The newly broken acreage is <320 acres; and If any of the above requirements are not met, this land will be insurable only by Written Agreement. Any new breaking acreage (on a whole field basis) that exceeds the 320 acres requires a written agreement. Only the acreage that exceeds 320 acres requires a written agreement. Up to 320 acres may be approved under the Special Provisions statement.

17. New Breaking – Corn, Soybeans, Grain Sorghum MGR-12-017 sets in place new rules for acreage converted to cropland: • Provide insurance for new breaking acreage at 80 percent of the applicable published county T-Yield in the actuarial documents without a written agreement if the producer and acreage meets all requirements of the Special Provisions statement, including providing documentation that the new breaking acreage has previously been broken and planted to a crop in the past

18. New Breaking – Corn, Soybeans, Grain Sorghum MGR-12-017 sets in place new rules for acreage converted to cropland: • Provide insurance for new breaking acreage at 65 percent of the applicable published county T-Yield in the actuarial documents without a written agreement if the producer cannot provide documentation that the new breaking acreage has been previously broken and planted to a crop in the past, however, the producer does meet all other requirements of the Special Provisions statement

19. New Breaking - Documenting land was previously cropped • What cannot be used: • The producer certification on the request it was cropped.  • Just because the requested ground is terraced is not considered documentation. • What can be used: • The previous crop year’s FSA 578 showing the land as cropland, or • A FSA 578 showing the prior crop the new breaking acreage was planted to.

20. New Breaking MGR-12-017 sets in place new rules for acreage converted to cropland: • New breaking T-Yields established by RMA Regional Office written agreements will be limited to a maximum of 80 percent of the applicable published county T-Yield. Variable T-Yield percentages do not apply to new breaking T-Yields assigned by RMA Regional Office written agreement. This action item will begin with crops that are eligible for new breaking written agreements and have sales closing dates after September 30, 2012 • Remove the requirement to apply variable T-Yield percentages to the resulting new breaking T-Yield

21. New Breaking Remember these rules that were in place for 2012 and remain in place for 2013: • Disallow simple average T-Yields and new producer T-Yields • Require establishment of a separate APH database in the initial crop year the new breaking acreage is insured; and • Disallow prevented planting coverage in the initial year the new breaking acreage is broken out for planting

22. Yield Trend • For 2013 Available on Corn, Soybeans (KS & NE only) and Wheat (KS & NE only) • Could possibly see expansion to other crops

23. Trend Adjustment OptionWheat *Trend Adjustment Option May not be available on all Practices

24. Trend Adjustment Option Wheat *Trend Adjustment Option May not be available on all Practices

25. Pasture Rangeland and Forage • Cancellation and Sales Closing date is now November 15th • Nebraska will be covered under the Rainfall Index • Removed requirement to divide total insured acres by index interval and replaced with allocating a percentage of value to each index interval. • Changed the Contract Change Date to 8/31 • Removed ability to adjust acreage

26. Pasture, Rangeland & ForageVegetative & Rain IndexJune/Aug & July/Aug Intervals Rain Index Veg Index FINAL INDEX VALUES

27. Pasture, Rangeland & ForageVegetative IndexJune/Aug Interval FINAL INDEX VALUES

28. Pasture, Rangeland & ForageRain IndexJuly/Aug Interval FINAL INDEX VALUES

29. Program Deletions Wheat GRP, GRIP, GRIP-HRO programs have been removed

30. Onions Policy Change required an update to references of the New Policy The percent Damage has been updated from 40% to 50%. The percent of damage referenced in section 14(d) of the Onion Crop Provisions will be 50 percent.

31. High-Risk Alternative Coverage Endorsement (HR-ACE) • Provides insureds an opportunity to insure high-risk land on a separate additional coverage policy with coverage greater then CAT but less than the coverage on the base policy • 508(h) submission, AIPs are not required to offer • Must elect the endorsement by the sales closing date • Eligible crops are corn, soybeans, grain sorghum and wheat in the following counties

32. High Risk Alt Coverage Option Available in Counties with Insurance offers applicable to High Risk Maps

33. Breached Levees • Land flooded due to a breach in a levee resulting from prior year(s) flooding is insurable. The applicable rate will be assigned based on conditions of the levee and soils on the latter of the sales closing date or earliest planting date. If, by that date, the levee has not been repaired to prior specifications, or if damaged soil (if any) has not been restored to at least the same crop yield potential as prior to the flood event, the land will be classified as high risk and will have the highest rate classification in the county. However, if the levee has been repaired to prior specifications and the soil has at least the same crop yield potential as before the flood, the land will be classified as shown on the current crop year Actuarial Map • This statement will be removed from the following counties: • Nebraska: Nemaha • Kansas: Leavenworth, Wyandotte

34. Breached Levee StatementsFrom 2011 Flood Removed

35. Colorado

36. Colorado 6/30 Map Changes Updated Map

37. Colorado 11/30 Map Changes Updated Map

38. Colorado Summary of Changes Reviewed and updated T-Yields for Wheat and Grain Sorghum

39. Transitional Yields ChangesWheat – Irrigated PERCENT CHANGE IN T-YIELDS

40. Transitional Yields ChangesWheat – Continuous Crop PERCENT CHANGE IN T-YIELDS

41. Transitional Yields ChangesWheat – Summer Fallow PERCENT CHANGE IN T-YIELDS

42. Transitional Yields ChangesSpring Wheat – Cont. Crop PERCENT CHANGE IN T-YIELDS

43. Transitional Yields ChangesWinter Wheat – Summer Fallow PERCENT CHANGE IN T-YIELDS

44. Transitional Yields ChangesWinter Wheat – Irrigated PERCENT CHANGE IN T-YIELDS

45. Transitional Yields ChangesSpring Wheat – Irrigated PERCENT CHANGE IN T-YIELDS

46. Transitional Yields ChangesSpring Wheat – Summer Fallow PERCENT CHANGE IN T-YIELDS

47. Transitional Yields ChangesGrain Sorghum – Irrigated PERCENT CHANGE IN T-YIELDS

48. Transitional Yields ChangesGrain Sorghum – Non-Irrigated PERCENT CHANGE IN T-YIELDS

49. Nebraska

50. Nebraska Summary of Changes • Program Expansion: • Potato program • Lincoln County