Financing Issues in Federal Agricultural Programs

AMERICAN BAR ASSOCIATION

BUSINESS LAW SECTION

Financing Issues in Federal Agricultural Programs

Jeffrey A. Streiffer, Attorney

UNITED STATES DEPARTMENT OF AGRICULTURE

Office of the General Counsel

Pacific Regional Office

[email protected]

Jeffrey A. Peterson

GRAY PLANT MOOTY

[email protected]

The views expressed by Jeffrey Streiffer in this presentation are his own and not necessarily those

of the USDA Office of the General Counsel or the U.S. Department of Agriculture.

I. Recent Case Law Summaries II. �$�U�W�L�F�O�H��&�U�H�G�L�W�R�U�V�¶��5�L�J�K�W�V��L�Q��&�U�R�S��,�Q�V�X�U�D�Q�F�H��3��.�X�Q�N�H�O�� III. Select Materials

A. Excerpts from 2014 Crop Insurance Handbook; B. Excerpts from Document and Supplemental Standards Handbook (DSSH) C. Final Agency Determination FAD -111 (March 9, 2010) D. Form Assignment of Indemnity Application (with Assignment of

Indemnity) E. Form Assignment of Indemnity (ProAg) F. Form Assignment of Indemnity (NAU Country)

G. Title 7 CFR Part 1404 �– Assignment of Payments

H. USDA Fact Sheet (June 2010)

I. Electronic Code of Federal Regulations (ECFR); Title 7, Subtitle B, Chapter XIV, Subchapter B, Table of Contents (March 30, 2015)

J. Assignment of Payment (CCC-36) (September 9, 2009)

K. Notice of Assignment (CCC-251) (June 11, 1998)

L. Instrument of Assignment (CCC-252) (June 11, 1998)

M. Commodity Credit Corporation Charter Act; 15 U.S.C. 714 (as effective May 22, 2008)

RECENT CASE LAW SUMM ARIES

A. Perfection of Crop Insurance Proceeds.

1. �’�H�E�W�R�U�¶�V�� U�L�J�K�W�V�� W�R�� F�U�R�S�� L�Q�V�X�U�D�Q�F�H�� S�U�R�F�H�H�G�V�� D�U�H�� R�X�W�V�L�G�H�� W�K�H��V�F�R�S�H�� R�I�� 5�H�Y�L�V�H�G��Article 9. The Federal Crop Insurance Act (FCIA) pre-empts Revised Article 9 as to a security interest in federal crop insurance proceeds.1 Relying on In re Cook, 169 F. 3d 271 (5th Cir. 1999), the Court held the exclusive means to properly perfect a security interest in crop proceeds is to take an assignment of the federal crop insurance proceeds on the in�V�X�U�H�U�¶�V��I�R�U�P��D�Q�G��D�S�S�U�R�Y�H�G��L�Q��Z�U�L�W�L�Q�J��E�\��W�K�H��L�Q�V�X�U�H�U��$�Q��$�U�W�L�F�O�H��V�H�F�X�U�L�W�\��L�Q�W�H�U�H�V�W��W�K�D�W��identifies the crop insurance proceeds is insufficient. In re Duckworth, 2012 Bankr. LEXIS 1219 (Bankr. C. D. Ill. 2012), �U�H�Y�¶�G�� D�Q�G�� U�H�P�D�Q�G�H�G�� R�Q�� R�W�K�H�U�� J�U�R�X�Q�G�V, 776 F.3d 453 (7th Cir. 2014).2 2. Crop insurance proceeds are within the scope of Revised Article 9 after the proceeds are in the possession of the debtor. In re Cook, 169 F. 3d 271 (5th Cir. 1999) also held that once the crop insurance proceeds are in the hands of the debtor (and the assignee has endorsed the check), the proceeds are not preempted under federal law may be encumbered by an earlier properly perfected security interest.

1. Although outside the scope of this presentation, the Duckworth holding is consistent with a number of recent cases that have held the Federal Food Security Act also pre-empts Revised Article 9. The Illinois Court of Appeals affirmed a trial court decision that the Food Security Act preempts Revised Article 9, relying on the Supremacy Clause of the Constitution, the language of UCC § 9-��‡�7�K�L�V��$�U�W�L�F�O�H��G�R�H�V��Q�R�W��D�S�S�O�\��W�R��W�K�H��H�[�W�H�Q�W��W�K�D�W��D��V�W�D�W�X�W�H�� R�I�� W�K�H�� 8�Q�L�W�H�G�� 6�W�D�W�H�V�� S�U�H�H�P�S�W�V�� W�K�L�V�� $�U�W�L�F�O�H��·�� D�Q�G�� W�K�H�� O�D�Q�J�X�D�J�H�� R�I�� W�K�H�� )�R�R�G�� 6�H�F�X�U�L�W�\�� $�F�W�� G��‡�Q�R�W�Z�L�W�K�V�W�D�Q�G�L�Q�J��D�Q�\��R�W�K�H�U��S�U�R�Y�L�V�L�R�Q��R�I��)�H�G�H�U�D�O��6�W�D�W�H��R�U��O�R�F�D�O��O�D�Z�>��@�·��L�Q��V�X�S�S�R�U�W��R�I��L�W�V��G�H�F�L�V�L�R�Q�� See State Bank of Cherry v. CGB Enterprises, Inc., 964 N.E.2d 604 (Ill. Ct. App. 2012); (affirmed by State Bank of Cherry v. CGB Enters., 984 N.E.2d (Ill. 2013)) (citing Farm Credit Midsouth, PCA v. Farm Fresh Catfish Co., 371 F.3d 450 (8th Cir. 2004). These, and other recent Food Security Act cases, have also held the secured creditor must strictly comply with the Federal Food Security Act and the statutory notice and filing requirements. State Bank of Cherry v. CGB Enterprises, Inc., 964 N.E.2d 604 (Ill. Ct. App. 2012) (affirmed by State Bank of Cherry v. CGB Enters., 984 N.E.2d (Ill. 2013)) (failure to identify county where crops were grown invalidates Federal Food Security Act direct notice); CNH Capital v. Trainor Grain and Supply Co. (In re Printz), 2012 LEXIS 4506 (Bankr. C.D. Ill. Sept. 27, 2012) (failure to identify debto�U�¶�V��V�R�F�L�D�O��V�H�F�X�U�L�W�\�� Q�X�P�E�H�U��D�Q�G��S�U�R�S�H�U��G�H�V�F�U�L�S�W�L�R�Q��R�I��F�U�R�S�V��L�Q�Y�D�O�L�G�D�W�H�V��)�H�G�H�U�D�O��)�R�R�G��Security Act direct notice); In re Moore, 2013 Bankr. LEXIS 2060 (Bankr. N.D. Miss. May 17, 2013) (priority limited to locations specified in the Federal Food Security Act central filing; the county were the crops are processed is not relevant for purposes of the Food Security Act central filing). 2��7�K�H��W�K��&�L�U�F�X�L�W��U�H�Y�H�U�V�H�G��W�K�H��O�R�Z�H�U��F�R�X�U�W�V�¶��F�R�Q�F�O�X�V�L�R�Q�V��W�K�D�W��W�K�H��F�U�H�G�L�W�R�U�¶�V��V�H�F�X�U�L�W�\��D�J�U�H�H�P�H�Q�W��Z�D�V��H�Q�I�R�U�F�H�D�E�O�H��when it identif�L�H�G��W�K�H��S�U�R�P�L�V�V�R�U�\��Q�R�W�H��D�V��G�D�W�H�G��‡�’�H�F�H�P�E�H�U��·��Z�K�H�Q��L�Q��I�D�F�W��W�K�H��S�U�R�P�L�V�V�R�U�\��Q�R�W�H��Z�D�V��G�D�W�H�G��‡�’�H�F�H�P�E�H�U��·

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B. Priority Considerations. 1. Competing Article 9 secured creditors: deposit accounts. A junior secured creditor may set off against a deposit account in the control of the junior creditor even if the proceeds deposited into the account were derived from the sale of collateral pledged to a senior secured creditor. UCC § 9-327(1) provides that a secured creditor with a security in, and the control of, a deposit account as priority to that of a super-priority claim to the proceeds deposited into the deposit account. Platte Valley Bank v. Tetra Financial Group, LLC, 2011 WL 335595 (D. Neb. 2011).3 Comment. In light of In re Cook, In re Duckworth, and Platte Valley Bank v. Tetra Financial Group, LLC, an assignee/secured creditor should require that the insurance proceeds be deposited into a deposit account with the assignee/secured creditor to ensure the continued perfection of the crop insurance proceeds with proceeds advances from the deposit account for operating needs.

C. Enforceability of Transfer of Indemnity / Assignment of Indemnity Under Crop Insurance Policy

1. Creditor cannot maintain APA challenge against crop insurance company on �W�K�H��)�H�G�H�U�D�O��&�U�R�S��,�Q�V�X�U�D�Q�F�H��&�R�U�S�R�U�D�W�L�R�Q�¶�V��L�Q�W�H�U�S�U�H�W�D�W�L�R�Q��R�I��S�R�O�L�F�\�¶�V��D�V�V�L�J�Q�P�H�Q�W��D�Q�G��transfer provisions. The Federal Crop Insurance Act (FCIA) pre-empts Revised Article 9 as to a security interest in federal crop insurance proceeds. Creditor/transferee challenged FCIC interpretation that it is not entitled to a transfer of indemnity under crop insurance policy when debtor/transferor attempted to transfer rights under policy to creditor after the debtor defaulted on its lease of land where crops were grown. The challenged FCIC interpretation held that a transfer of coverage is not effective until and unless the crop insurance company approves such transfer and, further, that the company has discretion to deny such a request for transfer based on legitimate business reasons. The FCIC interpretation also ruled on questions regarding appeal rights, priority of transferees v. �S�U�L�R�U�� D�V�V�L�J�Q�H�H�V�� ‡�E�D�F�N�� G�D�W�L�Q�J�·�� R�I�� W�U�D�Q�V�I�H�U�� G�R�F�X�P�H�Q�W�V�� D�Q�G�� W�K�H�� D�W�W�D�F�K�P�H�Q�W�� R�I�� O�L�H�Q�V�� R�U��garnishments to indemnities. Creditor joined crop insurance company in federal suit �V�H�H�N�L�Q�J�� $�3�$�� U�H�Y�L�H�Z�� R�I�� )�&�,�&�¶�V�� L�Q�W�H�U�S�U�H�W�D�W�L�R�Q�� D�Q�G�� F�R�X�U�W�� G�L�V�P�L�V�V�H�G�� 1�$�8�� I�Rr lack of �V�X�E�M�H�F�W�� P�D�W�W�H�U�� M�X�U�L�V�G�L�F�W�L�R�Q�� &�U�H�G�L�W�R�U�¶�V�� F�K�D�O�O�H�Q�J�H�� W�R�� )�&�,�&�¶�V�� L�Q�W�H�U�S�U�H�W�D�W�L�R�Q�� U�H�P�D�L�Q�V��pending; cross motions for summary judgment have been filed. Midland Farms, LLC v. USDA Risk Management Agency, Federal Crop Ins. Corp, NAU Country Ins., 35 F.Supp.3d 1056 (D.S.D. 2014) (Civ. 13-3029-RAL).

3. On appeal the 8th Circuit stated, in dicta, that the junior secured creditor failed to have a properly perfected security interest in the deposit account and, therefore, it failed to get the benefits of UCC § 9-327. The security agreement failed to include the deposit accounts of the debtor. The 8th Circuit held that, even though the junior secured creditor failed to have a security interest in the deposit account, the action to set off against the deposit account did not constitute conversion. Although the District Court apparently failed to make proper findings of fact, its legal interpretation of UCC § 9-327 was not reversed on appeal.

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assignment is accepted by the FCIC. Unless the properly executed assignment of indemnity is used, no payment to a lienholder will be made even if the secured lender has filed or recorded a “lien or other assignment” elsewhere. Policy ¶ 29. The policy contemplates multiple assignments to more than one creditor. If the insured fails to file a claim within the time period provided by the policy, the assignee may file a claim on behalf of the insured if it does so within 30 days of after the period for filing a claim has expired. Id. If multiple assignments are provided the FCIC, any assignee may submit a claim, but only one payment, issued jointly to the insured and all assignees, will be made. Id.

The scope of these restrictions on assignability has been examined in several cases in which the courts have reached reasonably consistent results. If the FCIC or one of its agents has not disbursed proceeds to the insured, a secured lender’s perfected security interest will be insufficient to require the FCIC or its agents to issue jointly payable checks to the insured and the lender. See Rolling Plains PCA v. Cook (In re Cook), 169 F.3d 271 (5th Cir. 1999); In re Duckworth, No. 10-83603 (Bankr. C.D. Ill., March 22, 2012). If, however, the debtor has already received such proceeds, the regulations may not preclude a creditor from enforcing its state law rights against the proceeds in the hands of the insured. See Rolling Plains PCA, supra; In re Rees, 216 B.R. 551 (Bankr. N.D. Tex. 1998). While the standard policy and regulations contemplate multiple assignments to multiple creditors, nothing in the FCIA or regulations addresses the priority of competing claims to such policies. Since the UCC generally excludes a transfer of an interest in or an assignment of a claim under an insurance policy, presumably the priority rules of Article 9 are not applicable to such disputes. See UCC § 9-109(d)(8). The FCIC has opined that nothing in the FCIA, regulations or policy require either the debtor or the FCIC to notify the holder of an assignment upon its receipt of a second assignment. Rather, state law will determine if notice is required. FCIC Final Agency Determination, FAD-111 (March 9, 2010) (available at www.rma.usda.gov/regs/533/2010/fad-111.html. Exercise of Remedies Against Crop Insurance Policies Prior to 1990, the FCIC was confronted with multiple instances where creditors of insured parties attempted to garnish, levy or otherwise attempt to intercept payments under crop insurance policies. In response, the FCIC adopted regulations which specifically limit the effect of such collection efforts. See, 55 Fed. Reg. 23,066 (1990); 7 C.F.R. §§ 400.351-2. The authority for these regulations is found in the Federal Crop Insurance Act (“FCIA”) which provides that claims under that statute “shall not be liable to attachment, levy, garnishment, or any other legal process before payment to the insured or to deduction on account of the indebtedness of the insured or the estate of the insured to the United States except claims of the United States or the FCIC….” 7 U.S.C. § 1509 (emphasis added). The validity of these regulations has been upheld over a challenge by the Kansas Commissioner of Insurance in State of Kansas, ex rel Todd v. United States, 995 F.2d 1505 (10th Cir. 1993); see also Alliance Insurance Co. v. Wilson, 384 F. 3d 547 (8th Cir. 2004). The standard policy similarly provides “State and local laws and regulations in conflict with federal statutes, this policy, and the applicable regulations do not apply to this policy.” 7 CFR § 457.8. As a result, it is clear that if a lender does not obtain an assignment of the crop insurance policy of its debtor pursuant to the relevant FCIC regulations and the policy, it will not be able to compel any payments due under the policy. See also, Buttonwillow Ginning Company v. Federal Crop Insurance Corporation, 767 F.2d 612 (9th Cir. 1985).

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Bankruptcy of Insured Should an insured under a crop insurance policy file bankruptcy, it is not certain how the insurance proceeds will be distributed. If a secured lender has obtained an assignment of indemnity under the policy, it is likely it will be able to realize upon the crop insurance proceeds when they are otherwise payable to the insured debtor. It may be necessary for the lender to negotiate a release or abandonment of the proceeds from the trustee, but under the terms of the policy and regulations, that should, in most cases, be possible. If a secured lender has not obtained an assignment of indemnity for the policy, it will likely have a very difficult time persuading a trustee that it holds an interest in the policy in light of the FCIC regulations noted above. In such cases, crop insurance proceeds could be available to satisfy the claims of all creditors, not just that of the secured lender. If no assignment has been obtained from the debtor, the lender could be faced with a second problem. Under the Bankruptcy Code there are two separate exemption schemes available for a debtor in many (but not all) states, including Minnesota. Debtors may choose to take either the (i) exemptions set forth in § 522(d) of the Bankruptcy Code or (ii) the exemptions found in state law and federal law other than § 522(d). Bankruptcy Code § 522(b)(1). The debtor may choose either of these options, depending upon which is more advantageous, but may not combine the two. As noted above, the FCIA expressly provides claims for indemnity under its provisions are not subject to attachment, levy or garnishment. 7 U.S.C. § 1509. Such protections are the essence of an exemption statute. At least one court has held that claims for indemnity under the FCIA are exempt under the predecessor to Bankruptcy Code § 522(b)(3)(A). As a result, the bankruptcy trustee’s objection to the debtor’s claimed exemption was overruled. In re Clark, 186 B.R. 249 (Bankr. W.D. Mo. 1995). See also Carpenter v. Ries (In re Carpenter), 614 F.3d 930 (8th Cir. 2010). While the Clark case did not involve a secured creditor’s claim to the proceeds of a crop insurance policy, if it is followed in a dispute relating to the scope of a secured lender’s security interest, a debtor could assert a claim to exempt all undisbursed crop insurance proceeds to which she may be entitled on the date she files her bankruptcy petition. The possible outcomes in the case of a bankruptcy case should provide strong incentives for lenders to always obtain assignments of crop insurance policies. Complying with the terms of the policies and regulations by obtaining such assignments will not only increase the likelihood the lender will be able to obtain the insurance proceeds, they will permit the lender to submit claims under the policy and otherwise take the appropriate steps to protect its interests. Conclusions Given the uncertainties presented by crop insurance statutes, regulations and policies, secured lenders which finance crop production should specifically include a reference to crop insurance policies and their proceeds in their security agreements. While a strong argument may be made such insurance proceeds are included in the definition of “proceeds” in UCC § 9-102(a)(64), including crop insurance policies and their proceeds in the collateral description will enhance the secured lender’s position in any such disputes.

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Such secured lenders should also obtain, as a matter of course, an assignment of indemnity from their borrowers in order to secure distributions from the FCIC or its agents. Assignments of indemnity should not be reserved for weaker credits, or borrowers who are not completely trusted by the lender. All crop production loan documentation should include an assignment of crop insurance policies. Failure to do so may expose lenders to potential disputes with their borrower, a bankruptcy trustee or other creditors. In addition, lenders should not simply endorse any insurance checks which are made jointly payable to their borrowers and the lender. Rather, in order to monitor the use of such funds, insurance proceeds should be used to reduce the outstanding operating financing with expenses paid via advances on those facilities. Finally, lenders should include loan covenants in their standard loan documents which (i) prohibit the debtor from granting additional assignments of crop insurance policies or their proceeds; (ii) require the debtor to timely file all claims under crop insurance policies and provide copies of all proofs of loss to the lender; and (iii) require all insurance proceeds to be deposited into accounts over which the lender has control under the UCC. While such covenants are not completely effective, they serve to remind borrowers of their obligations under the loan documents and provide the lender with additional negotiating leverage upon the debtor’s breach of such a covenant.

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United States Department of Agriculture

Federal Crop Insurance Corporation

Risk Management Agency Product Administration & Standards Division FCIC 18010 (06-2013)

2014 CROP INSURANCE HANDBOOK

Underwriting and Actual Production History Standards for FCIC Programs Administered under the Common Crop Insurance Policy Basic Provisions and APH Administrative Regulations for 2014 and Succeeding Crop Years.

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Section 3 Policy Servicing Requirements

June 2013 FCIC 18010 28

251 Policy Change

When changes to the insurance policy are needed a Policy Change is used to make such change without creating a new application. Some changes can be made after the SCD, such as changing an insured’s physical address. A Policy Change may be used to request the following. (1) On or before the SCD for changes in plan of insurance (within APH-based plans of

insurance), percentage of projected price/price election or coverage level.

Exception: In counties with either fall or winter and spring crop type SCDs, the change must be requested on or before the fall or winter SCD. However, the insured may elect or change options, plan of insurance, coverage level, percentage of projected price or price election on or before the spring SCD, if the fall or winter type is not planted.

(2) On or before the cancellation date, the insured may cancel all crop policies in a county or a

specific crop(s) in a county following the initial crop year insured.

(3) At any time, the insured may correct its identification number or its SBIs identification number if the criteria in [Part 4 Section 2] are met. Correction of identification numbers will not be allowed and the policy will be void if these criteria are not met.

(4) At any time, the insured may correct its name, its SBIs names, address(es), phone numbers

or add or change their authorized representative.

(5) On or before the date specified in the applicable policy, the insured may add or cancel options, elections and endorsements. See [Exhibit 5] for a summary of deadlines.

(6) On or before the SCD, the insured may elect, revoke, or change its primary county for the

election. 252 Assignment of Indemnity

An insured may assign the right to an indemnity payment for a crop(s) under a policy to a creditor(s) or other persons to whom the insured has a financial debt or other pecuniary obligation by using an Assignment of Indemnity. The assignment(s) applies for all acreage of the crop covered by the policy. A. Effective Date

The Assignment is effective upon approval in writing by an authorized representative of the AIP. The AIP may request proof of debt or other pecuniary obligation before an assignment of indemnity is accepted. If the Assignment of Indemnity is not approved in writing by the AIP, the assignment is not effective and the proposed assignee does not obtain rights under the policy. An Assignment executed prior to the date of a Transfer of Coverage and Right to an Indemnity, remains effective after the Transfer of Coverage and Right to an Indemnity.

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June 2013 FCIC 18010 29

252 Assignment of Indemnity (Continued)

B. Number of Assignees

The insured has the option of executing more than one assignee and/or executing multiple assignments. It is the insured’s responsibility to notify parties of multiple executed assignments. A single Assignment may contain more than one assignee. Similarly, multiple Assignments may be executed by the insured if approved in writing by the AIP.

C. Timing of Assignment

For an Assignment to be effective for a crop year, it must be made: (1) after acceptance of the Application, but (2) before a loss claim is submitted to the AIP for payment of the indemnity. Issuance of a replant payment for any insured unit will not affect the insured's ability to assign an indemnity to another party.

D. Cancellation or Termination

An Assignment is effective only for the crop(s) and the crop year specified on the Assignment.

(1) The Assignment may be canceled during the crop year. The AIP will cancel the

Assignment(s) only if the assignee(s) submits a signed written statement discharging the Assignment.

The discharge must indicate the insured's name, mailing address, policy number and crop(s)/county(ies) released. The AIP representative(s) will retain a copy of the discharge; or

(2) The Assignment will terminate at the end of the crop year.

E. Payment Issuance

Any indemnity payments will be made payable to the assignee(s) and the insured jointly, subject to any administrative fee deduction or any other unpaid balance, not to exceed the total amount of indemnity due. Payments will not be made to any lien holder or other person to whom the insured has a financial debt or other pecuniary obligation, and not identified on the AIP approved Assignment of Indemnity, even if there is a lien or other assignment recorded elsewhere.

F. Notice Submission by Assignee

Any assignee has the right to submit all loss notices or other forms as required by the policy.

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Exhibit 2

June 2013 FCIC 18010 505

A. Definitions (Continued)

Appraised Production - Production determined by the AIP for unharvested acreage, reflecting the potential production for the crop at the time of the appraisal. Appraisals made for production LOST due to insured or uninsured cause(s) of loss are not considered production for APH purposes. Only potential production remaining in the field at the time of the appraisal is used for APH purposes. (Applies to both APH appraisals and appraisals made to determine a loss.) Approved APH Yield (Approved Yield) - The yield, calculated and approved by the verifier, used to determine the production guarantee by summing the yearly actual, assigned, adjusted or unadjusted T-yields and dividing the sum by the number of yields contained in the database, which will always contain at least four yields. The database may contain up to 10 consecutive crop years of actual or assigned yields. The approved yield may have yield adjustments elected under applicable policy provisions, yield revisions/reductions or other limitations according to FCIC approved procedures applied when calculating the approved yield. Approved Insurance Provider - A legal entity, including the Company, which has entered into a Standard Reinsurance Agreement with FCIC for the applicable reinsurance year. Area - Land surrounding the insured acreage with geographic characteristics, topography, soil types and climatic conditions similar to the insured acreage. Assigned Yield - A yield assigned (by the verifier) for the most recent APH crop year in the base period (by database) if carryover insureds do not file acceptable production reports by the PRD, as required by the crop insurance policy. The assigned yield is 75 percent of the previous year's approved APH yield. Assigned yields are used in the same manner as actual yields when calculating APH yields. Assignment of Indemnity – A transfer of policy rights, made on the AIP’s form, and effective when approved in writing by the AIP. It is the arrangement whereby the insured assigns his/her right to an indemnity payment for the crop year only to creditors or other persons to whom the insured has a financial debt or other pecuniary obligation. Authorized Representative (Insured’s) - Any person authorized by the insured to conduct crop insurance business on behalf of the insured (e.g., Power of attorney, or authorized representative of a corporation, etc.). The authorization must be a legally executed agreement in writing which indicates the representative’s name and details the authority granted. Average APH Yield - The yield, calculated by totaling the yearly actual yields; assigned yields due to: failure to provide production report, excessive yields, and second crop planted without double crop history on prevented planted acreage, and, adjusted or unadjusted T-Yields and dividing the total by the number of yields contained in the database.

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United States Department of Agriculture

Federal Crop Insurance Corporation

Risk Management Agency Product Administration & Standards Division FCIC 24040 (05-2011) FCIC 24040-01 (06-2012) FCIC 24040-02 (02-2013) FCIC 24040-03 (06-2013)

Document and Supplemental Standards Handbook (DSSH)

2013 and Succeeding Crop Years

http://www.rma.usda.gov/handbooks/24000/2013/24040-03.pdf

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JUNE 2011 TABLE OF CONTENTS FCIC 24040

21 ASSIGNMENT OF INDEMNITY ....................................................................................71

1 INSURED INFORMATION ............................................................................... 71

2 TERMS AND CONDITIONS ............................................................................ 71

3 OTHER INFORMATION AND SIGNATURES ...................................................... 72

4 REQUIRED STATEMENTS ............................................................................. 72

22 CONTINUOUS HAIL AND FIRE EXCLUSION OPTION ...............................................73


2 CROP INFORMATION ................................................................................... 73


4 OTHER INFORMATION AND SIGNATURE ........................................................ 75


23 ANNUAL REQUEST TO EXCLUDE HAIL AND FIRE ..................................................76




4 OTHER INFORMATION AND SIGNATURE ........................................................ 78


24 TRANSFER OF COVERAGE AND RIGHT TO AN INDEMNITY ...................................79

1 GENERAL INFORMATION ............................................................................. 79


3 OTHER INFORMATION ................................................................................. 80


5 REQUIRED SIGNATURES ............................................................................. 81


25 HIGH-RISK LAND EXCLUSION OPTION .....................................................................82




4 REQUIRED SIGNATURES ............................................................................. 83


26 PRODUCTION REPORT...............................................................................................84



4 OTHER INFORMATION AND SIGNATURES ...................................................... 86

TC5

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JUNE 2011 EXHIBIT 21 FCIC 24040

21 ASSIGNMENT OF INDEMNITY An insured may assign the right to an indemnity payment for a crop(s) under a policy to a creditor(s) or other persons to whom the insured has a financial debt or other pecuniary obligation by using an Assignment of Indemnity. The assignment(s) applies for all acreage of the crop covered by the policy. [See Sec. 6 of the CIH for further information].

1 INSURED INFORMATION

A "Insured’s Name" (Substantive)

B "Insured’s Authorized Representative" (Substantive)

C "Street or Mailing Address" (Substantive)

D "City and State" (Substantive)

E "Zip Code" (Substantive)

F "Policy Number" (Substantive)

G "Effective Crop Year" (Substantive)

2 TERMS AND CONDITIONS

A "The assignment must read as follows": (Substantive)

"The Insured assigns to (Name of Creditor) of (Mailing Address) (City, State and Zip) the right and interest of any indemnity payment(s) which may be payable to the insured under the insurance policy for the county/commodity (ies) shown:” e.g., (1st Crop Name and County Name) (2nd Crop Name and County Name) (Substantive)

The Name and Address of Creditor must be contained in above statement unless listed on the form.

“CONDITIONS

(1) This assignment will be binding upon the person(s) who succeed the

insured’s interest in the insurance policy. (2) Indemnity payments made under the insurance policy will be subject to a

deduction for any indebtedness due this Approved Insurance Provider by the insured.

(3) This assignment will not grant the Creditor any greater rights than

originally held by the insured.

71

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JUNE 2011 EXHIBIT 21 FCIC 24040

ASSIGNMENT OF INDEMNITY (4) The Creditor’s interest will be recognized upon Approved Insurance

Provider’s approval of this assignment and the Creditor will have the right to submit the loss notices and other forms as required by the insurance policy.

(5) The Approved Insurance Provider will determine the person(s) entitled to

any indemnity payment(s) and the payment(s) will be by joint check.

(6) Cancellation of this assignment prior to and during the crop year stated above will be accepted by the Approved Insurance Provider only upon notification in writing by the above identified Creditor(s). It is understood and agreed that this assignment will be subject to the terms and conditions of the insurance policy.” (Followed by signatures of the Insured, Creditor and Witnesses)

(7) “If the assignment is not canceled according to item (6), the assignment

will cease at the end of the effective crop year.” (Substantive)

B "The Approved Insurance Provider hereby approves the foregoing assignment” (Followed by the Authorized Representative’s signature for the Approved Insurance Provider and date) (Substantive)

C "This assignment was filed with the Approved Insurance Provider on , (YEAR)

at _ a.m. /p.m." (Substantive)

3 OTHER INFORMATION AND SIGNATURES

A "Insured’s Printed Name, Signature and Date" (Substantive)

B "Creditor’s Printed Name, Signature and Date" (Substantive)

C "Witness Printed Name, Signature and Date" (Substantive) – Both the Insured’s and Creditor’s signature and date as provided in item A & B must contain a Witness signature and date.

D "AIP’s Authorized Representative Printed Name, Signature and Date"

(Substantive)

4 REQUIRED STATEMENTS

A Privacy Act Statement [(Substantive) See Exhibit 3]

B Nondiscrimination Statement [(Substantive) See Exhibit 4]

72

III-B-4

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Final Agency Determination: FAD-111

Index of Final Agency Determinations | About Final Agency Determinations

FAD-111

Subject: Request dated December 29, 2009, requesting a Final Agency Determination for the 2008 cropyear regarding the interpretation of Section 29 of the Common Crop Insurance Policy Basic Provisions (BasicProvisions), published at 7 C.F.R. 457.8. This request is pursuant to 7 C.F.R. part 400, subpart X.

BackgroundSection 29 of the Basic Provisions states, as here pertinent:

29. Assignment of Indemnity.

You may assign to another party your right to an indemnity for the crop year. Theassignment must be on our form and will not be effective until approved in writingby us. The assignee will have the right to submit all loss notices and forms asrequired by the policy. If you have suffered a loss from an insurable cause and failto file a claim for indemnity within 60 days after the end of the insurance period,the assignee may submit the claim for indemnity not later than 15 days after the60-day period has expired. We will honor the terms of the assignment only if wecan accurately determine the amount of the claim. However, no action will lieagainst us for failure to do so.

The Risk Management Agency (RMA) is requested to provide an interpretation that clarifies if an insured mayenter into more than one Assignment of Indemnity per crop per county for a given crop year. Does theperson or entity to whom the previous Assignment of Indemnity given to have to be notified and agree tothe subsequent Assignment of Indemnity. Additionally it is requested the FAD also apply to Crop RevenueCoverage (CRC) Insurance Policy and the Revenue Assurance (RA) Insurance Policy.

Interpretation SubmittedRegarding the insureds ability to assign an indemnity to more than one person or entity, the requestorinterprets Section 29 “Assignment of Indemnity” of the Basic Provisions as using the word party in singularcontext. This implies that only one assignment of indemnity is permissible. The requestor states RMAprocedure found in the Section 4F(3) of the 2008 Crop Insurance Handbook (CIH) reads as though aninsured may enter into more than one assignment of indemnity per crop per county for a particular cropyear.

Section 4F(3) of the 2003 CIH contained the statement that, “Only one assignment per crop per county isallowed.” This statement was omitted from the 2004 CIH and has not appeared in any versions of the CIHsince. The deletion of the directive that there can be only one assignment of indemnity per crop per countyappears to be strong evidence the Federal Crop Insurance Corporation (FCIC) no longer restricts the numberof assignments of indemnity per crop per county in a crop year. This position is enhanced further by the useof the terms “assignment(s)” and “party(ies)” in subsequent versions of the CIH. Nonetheless, the policy stillspeaks in terms of an assignment to a “party.”

It is the requestor’s interpretation of the policy provision and procedures that an insured may enter intomore than one assignment of indemnity per crop per county for a single crop year. However, if the insureddoes so, the insured must notify and obtain the approval of the prior assignee, or possibly assignees.

For example, if an insured enters into an assignment of indemnity with Bank A early in the crop year, BankA has a legitimate expectation that any indemnity payment will be made payable jointly to the insured andBank A. If the insured later adds a second assignment of indemnity to Bank B, Bank A’s rights have arguablybeen diminished as an indemnity draft would then be made payable not only to the insured and Bank A, butto Bank B as well. The requestor does not believe this to be appropriate under FCIC policy and procedure.

Final Agency DeterminationThe Federal Crop Insurance Corporation (FCIC) agrees with the requestor’s interpretation that section 29“Assignment of Indemnity” of the Basic Provisions and section 4F(3) of the 2008 CIH allow an insured toassign their right to an indemnity to more than one party. While section 29 may use the singular form, thepreamble to the Basic Provisions makes it clear that the singular form of a word also includes the plural formof the word. Therefore, there is no conflict between the Basic Provisions and the procedures.

However, the crop insurance policy and the CIH are silent with respect to whether the producer must notifyan existing assignee when an additional assignment is made. Since the provisions are silent, state lawregarding notification would apply to such assignments. It is the responsibility of the policyholder and AIP toensure that state laws are followed.

Even though 7 C.F.R. part 400, subpart X is only applicable to provisions of the Federal Crop Insurance Actand the regulations promulgated hereunder, and the CRC and RA policies have not yet been codified in theCode of Federal Regulations, to the extent those provisions are identical or nearly identical, this Final AgencyDetermination applies accordingly to assure consistent, uniform, and equitable treatment to all producersinsured under the same policy provisions.

In accordance with 7 C.F.R. 400.765 (c), this Final Agency Determination is binding on all participants in theFederal crop insurance program for the 2008 and subsequent crop years. Any appeal of this decision mustbe in accordance with 7 C.F.R. 400.768(g).

Date of Issue: Mar 9, 2010

Final Agency Determination: FAD-111 http://www.rma.usda.gov/regs/533/2010/fad-111.html

1 of 2 3/31/2015 5:05 PMIII-C-1

III-D-1

B CROP-HAIL INSURANCE and/or MULTIPLE PERIL CROP INSURANCE

2012-NCIS 757_Rev. 07-2012

ASSIGNMENT OF INDEMNITY

Approved Insurance Provider's Name & Address:

Insured's Name

Insured's Authorized Representative

Street or Mailing Address Crop(s) Polley Number

City State Zip Code County(ies) Effective Crop Year

The insured assigns to

(Name of Creditor)

of (Mailing Address)

(City, State and Zip Code)

the right and interest of any indemnity payment(s) which may be payable to the insured under the insurance policy for the county(ies)/commodity(ies) shown above.

CONDITIONS

1. This assignment will be binding upon the person(s) who succeed the Insured's interest in the insurance policy. 2. Indemnity payments made under the insurance policy will be subject to a deduction for any indebtedness due this Approved

Insurance Provider by the Insured. 3. This assignment will not grant the Creditor any greater rights than originally held by the Insured. 4. The Creditor's interest will be recognized upon Approved Insurance Provider's approval of this assignment and the Creditor win

have the right to submit the loss notices and other forms as required by the insurance policy. 5. The Approved Insurance Provider will determine the person{s) entitled to any indemnity payment{s) and the payment{s) will be

by joint check. 6. If the assignment is not cancelled according to item 7 below, the assignment will cease at the end of the effective crop year. 7. Cancellation of this assignment prior to and during the crop year stated above will be accepted by the Approved Insurance

Provider only upon notification in writing by the above identified Creditor(s).

It Is understood and agreed that this assignment will be subject to the tenns and conditions of the Insurance policy.

Insured's Printed Name Creditor's Printed Name

Insured's Signature Date Creditor's Signature Date

Witness' Printed Name Witness' Printed Name

Witness' Signature Date Witness' Signature Date

The Approved Insurance Provider hereby approves the foregoing assignment.

AlP's Authorized Representative's Printed Name This assignment was filed with the Approved Insurance Provider on:

at AlP's Authorized Representative's Signature Date (Month, Day, Year) Oa.m. Op.m.

(See Reverse Side for Required Statements)

© 2012 National Crop Insurance Services, Inc.

III-D-2

COLLECTION OF INFORMATION AND DATA (PRIVACY ACT) STATEMENT Agents, Loss Adjusters and Policyholders

The following statements are made in accordance with the Privacy Act of 1974 (5 U.S.C. 552a): The Risk Management Agency (RMA) is authorized by the Federal Crop Insurance Act (7 U.S.C. 1501-1524) or other Acts, and the regulations promulgated thereunder. to solicit the information requested on documents established by RMA or by approved insurance providers (AlPs) that have been approved by the Federal Crop Insurance Corporation (FCIC) to deliver Federal crop insurance. The information is necessary for AlPs and RMA to operate the Federal crop insurance program. determine program eligibility, conduct statistical analysis, and ensure program integrity. Information provided herein may be furnished to other Federal, State. or local agencies, as required or permitted by law, law enforcement agencies. courts or adjudicative bodies. foreign agencies. magistrate, administrative tribunal, AlP's contractors and cooperators, Comprehensive Information Management System (CIMS), congressional offices, or entities under contract with RMA. For insurance agents, certain information may also be disclosed to the public to assist interested individuals in locating agents in a particular area. Disclosure of the information requested is voluntary. However, failure to correctly report the requested information may result in the rejection of this document by the AlP or RMA in accordance with the Standard Reinsurance Agreement between the AlP and FCIC, Federal regulations, or RMA-approved procedures and the denial of program eligibility or benefits derived therefrom. Also, failure to provide true and correct information may result in civil suit or criminal prosecution and the assessment of penalties or pursuit of other remedies.

NONDISCRIMINATION STATEMENT

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, age, disability, and where applicable, sex, marital status, familial status, parental status, religion, sexual orientation, genetic information, political beliefs, reprisal, or because all or a part of an individual's income is derived from any public assistance program. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means for communication of program information {Braille, large print, audiotape, etc.) should contact USDA's TARGET Center at 202-720-2600 {voice and TDD).

To file a complaint of discrimination write to:

USDA Office of Adjudication 1400 Independence Avenue, S.W. Washington, D.C. 20250, Mail Stop 9410 E-mail: [email protected] Phone: 800- 795-3272 (voice) or 202-720-6382 {TOO).

USDA is an equal opportunity provider and employer. For more information, contact the RMA Civil Rights Office at 202-690-3578 (main line).

III-D-3

The I

nsu

red

ass

igns

toof

(Nam

e o

f Cre

ditor)

(Maili

ng A

ddre

ss)

(City,

Sta

te a

nd Z

ip C

ode)

the r

ight

and inte

rest

of

any indem

nity p

aym

ent(

s) w

hic

h m

ay b

e p

aya

ble

to t

he insu

red u

nder

the insu

rance

polic

y f

or

the c

ounty

/com

modity(ies)

show

n.

CO

ND

ITIO

NS

1.

This

ass

ignm

ent

will

be b

indin

g u

pon t

he p

ers

on(s

) w

ho s

ucc

eed t

he insu

red‘s

inte

rest

in t

he insu

rance

polic

y.

2.

Indem

nity p

aym

ents

made u

nder

the insu

rance

polic

y w

ill b

e s

ubje

ct t

o a

deduct

ion f

or

any indebte

dness

due t

his

Appro

ved I

nsu

rance

Pro

vid

er

by t

he I

nsu

red.

3.

This

ass

ignm

ent

will

not

gra

nt

the C

reditor

any g

reate

r rights

than o

rigin

ally

held

by t

he I

nsu

red.

4.

The C

reditor‘s

inte

rest

will

be r

eco

gniz

ed u

pon A

ppro

ved I

nsu

rance

Pro

vid

er‘s

appro

val of

this

ass

ignm

ent

and t

he C

reditor

will

have t

he r

ight

to s

ubm

it t

he loss

notice

s and o

ther

form

s as

required b

y t

he insu

rance

polic

y.

5.

The A

ppro

ved I

nsu

rance

Pro

vid

er

will

dete

rmin

e t

he p

ers

on(s

) entitled t

o a

ny indem

nity p

aym

ent(

s) a

nd t

he p

aym

ent(

s) w

ill b

e b

y join

t ch

eck

.

6.

Cance

llation o

f th

is a

ssig

nm

ent

prior

to a

nd d

uring t

he c

rop y

ear

state

d a

bove w

ill b

e a

ccepte

d b

y t

he A

ppro

ved I

nsu

rance

Pro

vid

er

only

upon n

otifica

tion in

writing b

y t

he a

bove identified C

reditor(

s).

It i

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nd

ers

too

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en

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su

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ct

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co

nd

itio

ns o

f th

e

insu

ran

ce

po

licy.

7.If

the a

ssig

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ent

is n

ot

cance

led a

ccord

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o ite

m (

6),

the a

ssig

nm

ent

will

cease

at

the e

nd o

f th

e e

ffect

ive c

rop y

ear.

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III-E-1

Policy N

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______________

Cro

p Y

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______________

Date

______________

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CO

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ION

OF I

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AN

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A (

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gen

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ct o

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.S.C

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ent

Agency

(RM

A)

is a

uth

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l Cro

p I

nsu

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Act

(7 U

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rmation r

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ablis

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MA o

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ppro

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rance

pro

vid

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hat

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pIn

sura

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FCIC

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rance

. The info

rmation is

nece

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MA t

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l, S

tate

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ssio

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with R

MA. For

insu

rance

agents

, ce

rtain

info

rmation m

ay a

lso b

e d

iscl

ose

d t

o t

he p

ublic

to a

ssis

t in

tere

sted indiv

iduals

in loca

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gents

in a

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r are

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volu

nta

ry. H

ow

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r, f

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re t

o c

orr

ect

lyre

port

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ay r

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tandard

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sura

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orr

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ivil

suit o

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secu

tion a

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ssess

ment

of

penal-

ties

or

purs

uit o

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rem

edie

s.

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call

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let-

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by m

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to t

he U

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epart

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Pers

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Indiv

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who a

re d

eaf, h

ard

of

hearing o

r have

speech

dis

abili

ties

and w

ish t

o f

ile e

ither

an E

EO

or

pro

gra

m c

om

pla

int

ple

ase

conta

ct U

SD

A t

hro

ugh t

he F

edera

l Rela

y S

erv

ice a

t (8

00)

877-8

339 o

r (8

00)

845-6

136 (

in S

panis

h).

Pers

ons

with d

isabili

ties,

who w

ish t

o f

ile a

pro

gra

m c

om

pla

int, p

lease

see info

rmation a

bove

on h

ow

to c

onta

ct t

he D

epart

ment

by m

ail

direct

ly o

r by e

mail.

If

you r

equire a

ltern

ative

means

of

com

munic

ation f

or

pro

-gra

m info

rmation (

e.g

., B

raill

e, la

rge p

rint, a

udio

tape, etc

.) p

lease

conta

ct U

SD

A's

TARG

ET C

ente

r at

(202)

720-2

600 (

voic

e a

nd T

DD

).

PR

OD

UC

ER

S A

G I

NS

UR

AN

CE

GR

OU

P P

RIV

AC

Y N

OT

ICE

The P

roduce

rs A

g I

nsu

rance

Gro

up (

Pro

Ag G

roup)

is c

om

mitte

d t

o r

esp

ect

ing t

he indiv

idual priva

cy o

f our

polic

yhold

ers

and t

heir s

ignific

ant

benefici

al in

tere

st o

wners

(Cust

om

ers

). W

e c

olle

ct n

onpublic

pers

onal

info

rmation a

bout

Cust

om

ers

fro

m info

rmation w

e r

ece

ive f

rom

them

such

as

info

rmation p

rovid

ed o

n a

pplic

ations

or

oth

er

form

s, w

hic

h m

ay incl

ude n

am

e, addre

ss a

nd s

oci

al se

curity

num

bers

and f

rom

third p

art

ies

such

as

a c

onsu

mer

report

ing a

gency

. To

serv

e o

ur

Cust

om

ers

and t

o s

erv

ice o

ur

busi

ness

our

em

plo

yees

have

acc

ess

to C

ust

om

ers

pers

onal in

form

ation in t

he c

ours

e o

f doin

g t

heir jobs

and w

e m

ay s

hare

or

dis

close

non-p

ublic

pers

onal in

form

ation a

bout

the C

ust

om

ers

to a

ffili

ate

s w

ithin

the P

roAg G

roup o

r w

ith n

on a

ffili

ate

d t

hird p

art

ies

with w

hom

we h

ave

a c

ontr

act

ual re

lationsh

ip s

uch

as

agenci

es

within

the U

nited

Sta

tes

Depart

ment

of

Agricu

lture

, w

ith y

our

insu

rance

agent

and o

ther

insu

rance

com

panie

s or

with b

anks

where

a w

ritt

en p

erm

issi

on t

o t

ransf

er

such

info

rmation h

as

been g

rante

d b

y t

he p

olic

yhold

er. W

e m

ay a

lso

share

non-p

ublic

pers

onal in

form

ation w

ith a

ffili

ate

s and w

ith n

on-a

ffili

ate

d t

hird p

art

ies

as

perm

itte

d b

y law

. The P

roAg G

roup w

ill n

ot

sell

or

share

your

pers

onal in

form

ation w

ith a

nyo

ne f

or

purp

ose

s unre

late

d t

o o

ur

busi

ness

funct

ions

with o

ut

our

offering t

o t

he C

ust

om

er

the o

pport

unity t

o “

opt-

out”

or

to “

opt-

in”

as

required b

y law

.

Insu

red’s P

rinte

d N

am

eIn

sure

d’s S

ignatu

reD

ate

Cre

ditor’s

Printe

d N

am

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ditor’s

Sig

natu

reD

ate

Appro

ved I

nsu

rance

Pro

vider’s

Auth

orize

d R

epre

senta

tive

’s S

ignatu

reD

ate

The A

ppro

ved I

nsu

rance

Pro

vid

er

here

by a

ppro

ves

the f

ore

goin

g a

ssig

nm

ent.

This

ass

ignm

ent

was

file

d w

ith t

he A

ppro

ved I

nsu

rance

Pro

vid

er

on _

____________________ a

t _______________AM

/PM

(Month

, D

ay,

Year)

Ass

ign

men

t o

f In

dem

nit

y

Witness

’ Printe

d N

am

eW

itness

’ Sig

natu

reD

ate

Witness

’ Printe

d N

am

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itness

’ Sig

natu

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ate

Appro

ved I

nsu

rance

Pro

vid

er’s

Auth

orize

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epre

senta

tive’s P

rinte

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am

e

Pro

du

cers

Ag

In

su

ran

ce G

rou

pT

M,

Inc.,

2025 S

ou

th H

ug

hes, A

mari

llo

, T

X 7

9109

Vers

ion 1

.8Revis

ed:

July

22,

2013

© 2

013 P

roAg®

. All

Rig

hts

Rese

rved.

PRO

AG

-16062

The insu

rance

pro

duct

s offere

d b

y P

roduce

rs A

g I

nsu

rance

Gro

upTM

, In

c. d

/b/a

Pro

Ag®

may n

ot

be a

com

ple

te lis

t of

all

pro

duct

s offere

d a

nd m

ay n

ot

be o

ffere

d in a

llst

ate

s.

Pro

Ag p

rohib

its

dis

crim

ination o

n t

he b

asi

s of

race

, co

lor, n

ational origin

, se

x,

relig

ion,

dis

abili

ty,

polit

ical belie

fs,

and m

arita

l or

fam

ilial st

atu

s.

III-E-2

Ass

ign

me

nt o

f In

de

mn

ity

~NAU C

OU

NTR

Y

Mul

tiple

Per

il C

rop

Insu

ranc

e, N

amed

Per

il , C

rop

Hai

l & L

ives

tock

Insu

red

Info

rma

tio

n

Age

ncy

Info

rma

tio

n

Po

licy

Nu

mb

er:

C

rop

Yea

r N

ame:

C

ode:

N

AU

Co

un

try

Offi

Ce:

Au

tho

rize

d R

epre

sent

ativ

e:

Sta

te:

Nam

e:

I N

AU

Co

un

try

Add

ress

: A

ddre

ss:

Add

ress

: C

ou

nty

: C

ity, S

tate

, Zip

: C

ity, S

tate

, Zip

: C

ity, S

tate

, Z

ip

I

Eff

ectiv

e C

rop

Yea

r C

ou

nty

C

rop

C

ondi

tion

s:

The

insu

red

ass

igns

to

: m

Thli

as.

lgn .

... n

t wiM

be

bind

ing

up

on

the

peB

On(

l) w

ho

IUC

tHd

tM in

sure

trs i

ntt

!Mt I

n th

e ln

wra

nte

pol

icy.

Na

me

of C

red

itor:

m

Indem

nity

pay

men

U I

Nd

tun

dtr

thel

nsur

anc:

e po

licy

wiD

be

su

b)K

t to

a d

tdu

ttlo

n fo

r an

y ln

dtb

ted

nes

. du

e th

is A

ppro

ved

insu

nn

te f1

0111

der b

y th

e In

sure

d.

I (]

I lh

li U

llg

nm

ent w

ll n

ot g

ran

t tM

Cre

d~or

an

y g

ruto

r ri

ghts

than

ori

gina

lly

hel

d b

y th

eln1

11no

d.

Cre

dito

r's A

ddre

ss:

Of

141

The Cr

edit

m'sl

nte~

Mt w

il b

e re

togn

ized

Up

on

App

rove

d ln

1ura

nte

Pro

vlde

r1ap

prov

al o

fth

il

I as

.lgn

rMnt

an

d I

M Cr~orwill h

avet

M ri

ght t

o s

ub

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u n

otl

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nd

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s a1

I

roqu

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by

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iUto

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olic

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(5Jl

M A

ppro

ved

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ran<

e fr

ovid

ef w

ill d

eter

min

e tM

pen

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•l e

ntit

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to a

ny

Inde

mni

ty p

aym

ent(

s)

City

, Sta

te, Z

ip:

and

IM p

oym

ent(

s) w

ill b

e b

y jo

int <

Mtk

. (6

1 C

anc .

... i

on o

f th

k a

ulg

nrn

ent p

rlof

to a

nd

dur

ing

the

ao

p y

ear s

tate

d ~ w

ill b

e a

«""

ted

by

the

abo

ve

lden

tlfo

td C

redi

lorh

l. I

I k u

ndtr

1too

d a

nd

09fH

d th

at th

is a

ulg

nm

on

t will

be

lllb

jKt t

o

tM te

rms a

nd

con

diti

ons o

f \h

e In

sura

nce

poli

cy.

(fol

owed

by

1ign

a1ur

01 o

ltM

inw

rtd

, Cro

dito

rls)

, th

e r

igh

t an

d in

tere

st o

f an

y in

de

mn

ity

paym

ent(

s) w

hic

h m

ay

be

an

dWrt

nt11

01l

pa

yab

le to

the

insu

red

un

de

r th

e in

sura

nce

po

licy

for t

he

co

un

ty/

(7) I

f IM

an

lgn

rMn

t k n

ot a

nce

locl

acc

ordi

ng to

lt..

., 16

L tM

mig

nrM

nt w

ill c

ea1e

a ti

M e

nd

ol t

he

com

mo

dity

(ie

s) s

ho

wn

: ef

fecl

lve c

rop

yea

r.

o.g

.lls

t Oo

p N

o""'

and

Cou

nty

Na

me

) (2n

d C

rop

PQm

o an

d C

ount

y N

arno

l

CO

LLE

CT

ION

OF

INF

OR

MA

TIO

N A

ND

DA

TA

(PR

IVA

CY

Acn

ST

AT

EM

EN

T-A

gent

s, lo

ss A

dju

ste

rs a

nd

Pol

icyh

olde

rs

The

follo

win

g s

tate

me

nts

are

ma

de

in a

ccor

danc

e w

ith

the

Priv

acy

Act

of 1

974

(5 U

.S.C

. 552

a):

Th

e R

isk

Ma

na

ge

me

nt A

ge

ncy

(RM

A)

is a

uth

ori

zed

by th

e F

eder

al C

rop

Insu

ranc

e A

ct (7

U.S

.C. 1

501-

1524

) or o

the

r A

cts,

an

d th

e

I

reg

ula

tion

s p

rom

ulg

ate

d th

ere

un

de

r, to

so

licit

the

info

rma

tio

n r

eque

sted

on

do

cum

en

ts e

stab

lishe

d b

y R

MA

or

by

ap

pro

ved

insu

ranc

e p

rovi

de

rs (A

lPs)

th

at h

ave

bee

n a

pp

rove

d b

y th

e F

eder

al C

rop

Insu

ranc

e C

orp

ora

tio

o

(FC

IC) t

o d

eliv

er F

eder

al c

rop

insu

ranc

e. T

he

info

rma

tio

n is

nec

essa

ry fo

r AlP

s a

nd

RM

A t

o o

pe

rate

the

Fed

eral

cro

p in

sura

nce

pro

gra

m, d

ete

rmin

e p

rog

ram

elig

ibili

ty, c

on

du

ct s

tatis

tical

ana

lysi

s, a

nd

ens

ure

pro

gra

m in

teg

rity

. In

form

ati

on

pro

vid

ed

he

rein

ma

y b

e fu

rnis

he

d t

o o

the

r Fed

eral

, Sta

te o

r lo

cal a

genc

ies,

as

req

uir

ed

or

pe

rmit

ted

by

law

, la

w e

nfo

rce

me

nt a

genc

ies,

co

urt

s o

r ad

jud

ica

tive

bod

ies,

fo

reig

n a

genc

ies,

ma

gis

tra

te, a

dm

inis

tra

tive

tr

ibu

na

l, A

lP's

co

ntr

act

ors

an

d c

oo

pe

rato

rs, C

om

pre

he

nsi

ve In

form

ati

on

Ma

na

ge

me

nt S

yste

m (C

IMS

), co

ngre

ssio

nal o

ffice

s, o

r en

titie

s u

nd

er c

on

tra

ct w

ith

RM

A.

For

insu

ranc

e a

ge

nts

, ce

rta

in in

form

ati

on

ma

y a

lso

be

disc

lose

d to

the

pu

blic

to a

ssis

t in

tere

ste

d in

div

idu

als

in lo

cati

ng

ag

en

ts in

a p

art

icu

lar a

rea.

Dis

clos

ure

of t

he

Info

rma

tio

n re

qu

est

ed

is v

olu

nta

ry.

Ho

we

ver,

failu

re to

co

rre

ctly

rep

ort

the

requ

este

d in

form

ati

on

ma

y re

sult

in

the

re

ject

ion

of t

his

do

cum

en

t by

the

AlP

or

RM

A i

n a

cco

rda

nce

wit

h th

e S

tan

da

rd R

eins

uran

ce A

gre

em

en

t be

twe

en

the

AlP

an

d F

CIC

. Fed

eral

re

gu

latio

ns,

or

RM

A-a

ppro

ved

pro

ced

ure

s a

nd

th

e d

en

ial o

f pro

gra

m e

ligib

ility

or

be

ne

fits

de

rive

d th

ere

fro

m.

Als

o, f

ailu

re to

pro

vid

e tr

ue

an

d c

orr

ect

info

rma

tio

n m

ay

resu

lt in

civ

il su

it o

r cri

min

al p

rose

cutio

n a

nd

the

ass

essm

ent o

f pe

na

ltie

s o

r p

urs

uit

of o

the

r rem

edie

s.

NO

ND

ISC

RIM

INA

nO

N S

TA

TE

ME

NT

T

he U

.S. D

ep

art

me

nt o

f Ag

ricu

ltu

re (U

SD

A)

pro

hib

its

dis

crim

ina

tio

n in

all

its p

rog

ram

s a

nd

act

iviti

es

on

the

bas

is o

f rac

e, c

olo

r, n

ati

on

al o

rig

in, a

ge

, d~a

bili

ty,

an

d w

he

re a

pp

lica

ble

, sex

. ma

rita

l sta

tus,

fa

mili

al s

tatu

s, p

are

nta

l st

atus

, re

ligio

n, s

exua

l ori

en

tati

on

. ge

ne

tic

info

rma

tio

n, p

olit

ica

l bel

iefs

, rep

risa

l, o

r bec

ause

all

or p

art

of a

n in

div

idu

al's

inco

me

is d

eri

ved

fro

m a

ny

pu

blic

ass

ista

nce

pro

gra

m.

(No

t all

pro

hib

ite

d b

ases

ap

ply

to a

ll p

rog

ram

s.)

Per

sons

wit

h d

isab

ilitie

s w

ho

re

qu

ire

alte

rna

tive

mea

ns fo

r co

mm

un

ica

tio

n o

f pro

gra

m in

form

ati

on

(Bra

ille,

larg

e p

rin

t. a

ud

iota

pe

, etc

.) s

ho

uld

co

nta

ct U

SD

A's

TA

RG

ET

Ce

nte

r at (

202)

720-

2600

)vo

ice

an

d T

OO

).

To

file

a c

om

pla

int o

f dis

crim

ina

tion

, wri

te to

: US

DA

. Dir

ect

or,

Off

tce

of C

ivil

Rig

hts,

140

0 In

de

pe

nd

en

ce A

venu

e, S.W~ W

ash

ing

ton

, D.C

. 20

250.

.941

0, o

r cal

l (80

0) 7

95-3

272

(voi

ce) o

r (20

2) 7

20..6

382

(TO

O).

US

DA

is a

n e

qu

al

op

po

rtu

nit

y p

rovi

de

r an

d e

mp

loye

r.

Insu

red'

s P

rin

ted

Nam

e, S

ign

atu

re

Da

te

Cre

dito

r's P

rin

ted

Nam

e, S

ign

atu

re

Da

te

Thi

s a

ssig

nm

en

t was

file

d w

ith

the

T

he

Ap

pro

ve

d In

sura

nce

Pro

vid

er h

ere

by

Ap

pro

ved

Insu

ranc

e P

rovi

de

r on

: a

pp

rove

s th

e fo

reg

oin

g a

ssig

nm

en

t.

NA

U C

ou

ntr

y A

uth

ori

zed

Rep

. Pri

nte

d N

ame,

'D

ate

W

itnes

s P

rin

ted

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e, S

ign

atu

re

Dat

e W

itnes

s P

rin

ted

Nam

e, S

ign

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re

Da

te

at

a.m

/p.m

. S

ign

atu

re

(MM

IDD

IYY

YY

)

2011

.3.A

OI.M

HN

L do

cum

ents

@ln

auco

untr

y.co

m

Fax

to: 7

63-2

33-4

400

Pag

e_

of

_

III-F-1

US COVEANMCN~ INIORMATK1H

CPO

Commodity Credit Corporation, USDA

(e) CCC shall not offset. In each of the crop years 1990, 1991, and 1992. more than II.! of the Carm program payments otherwise due a producer, as a result or the producer's delinquency in repaying the overpayment.

(0 CCC shatl permit producers to repay the overpayment In three equal installments during each of the crop years 1990, 1991. and 1992, If the producers document to CCC that they have entered into agreements to obtain multlperU crop Insurance policies for the 1991 and 1992 crop years.

(56 FR 32319, July 16, 1991)

Sec.

PART 1404-ASSIGNMENT OF PAYMENTS

1404.1 General statement. 1404.2 Definitions. 1404.3 Payments which may be assigned. 1401.4 Execution of aselgnment Corm. 1404.5 (Reserved) 1404.6 Payment to the assignee. 1404.7 Misrepresentations. 1404.8 Liability of the secretary or dls

bul'81ng agents. 1404.9 OMB Control Numbers assigned pur

suant to the Paperwork Reduction Act.

AUTHoRrrY: 15 U.S.C. 714b and 714c; 16 u.s.c. 590b(g).

SoURCE: 54 FR 52883, Dec. 22, 1989, unless otherwise noted.

§ 1404.1 General statement. This part sets forth the manner in

which a person may assign a cash payment which is made by the Farm Service Agency (FSA) or the Commodity Credit Corporation {CCC). Such payments may only be assigned In the manner set forth in this part.

§ 1404.2 Definitions. (a)(1) Assignee means any person, in

cluding any agency of the Federal Government, to whom an assignment of an FSA or CCC payment is made In ac· cordance with this part.

{2} Assignor means any person who is the recipient of a payment from FSA or CCC who assigns the payment to another person in accordance with this part.

(3) Payment means a cash payment and excludes

§ 1404.4

(I) Any payment made in accordance with part 1470 of this title:

(1) Price support loan or purchase agreement proceeds; and

(Ul) Any payments made in accordance with parts 1487, 1488, 1491, 1492, and 1493 of this title.

(b) The terms defined in parts 719, 1413, 1421 and 1427 shall also be applicable to this part.

§ 1404.3 Payments which may be as· signed.

Except as otherwise provided in this part or In individual program regulations, contracts and agreements entered into by FSA or CCC, any payment due a person from FSA or CCC may be assigned.

[54 FR 52883, Dec. 22, 1989, as amended at 56 FR 361, Jan. 4, 1991]

§ 1404.4 Execution of assignment form.

(a)(l) The assignment of any FSA or CCC payment must be made by the execution of Form CCC-36 or Forms CCC-251 and CCC-252. Form CCC-36 is applicable to payments made under programs administered In accordance with 7 CFR parts 701, 704, 1413. 1430, 1468, 1472 and 1475. Such form is also applicable to any other program which is administered by a county ASC committee. Forms CCC-251 and 252 are applicable to all other CCC or FSA programs and contracts.

(2){1) To be recognized by FSA or CCC. Form CCC-36 must be filed ln the county FSA office prior to the time the county committee approves the makIng of the payment covered by the assignment. To be recognized by FSA or CCC, Forms CCC-251 and 252 must be filed with the FSA or CCC office from which the payment wUI be made prior to the making of the payment.

(11) Form CCC-36 or Forms CCC-251 and 252 must be signed by both the assignor and the assignee.

(3) The assignor and the assignee shall promptly notify the appropriate FSA or CCC office of any change affecting the assignment.

{b) (Reserved]

[54 FR 52883, Dec. 22, 1989, aa amended at 56 FR 361, Jan. 4, 1991]

455

III-G-1

§ 1404.5

§ 1404.5 [Reserved]

§ 1404.6 Payment to the assignee. (a) The assignee shall be paid the

smaller of the amount specified on Form CCC-36 or CCC-251 or the amount of the payment earned under the program or contract covered by the assignment. Any indebtedness owed by the assignor to CCC, FSA, or any other agency of the United States shall be subject to offset.

(bl Any indebtedness owed by the assignor to CCC or FSA shall be offset from any payment which is owed by CCC or FSA without regard to the date or filing or a Form CCC-36 with t:.he applicable FSA or CCC oCCice. Except as provided In paragraph (d) of this section, any Indebtedness owed by the assignor to CCC or FSA shall be offset from any payment which Is owed by CCC or FSA If such Indebtedness was entered on the debt record of the applicable FSA or CCC office prior to the date of the flllng of Forms CCC-251 and 252 with the applicable FSA or CCC ofnee.

(c) Any indebtedness owed by the assignor to any agency of the United States other than CCC or FSA which was entered on the debt record of the applicable FSA or CCC office prior to the date or filing of the Form CCC-36 or Forms CCC-251 and 252 with such offlce shall be offset prior to the making or any payment to the assignee.

(d) Any Indebtedness arising under a contract between the assignor and FSA or CCC which Is the subject of the assignment shall be offset from the payment prior to the making or any payment to the assignee under such contract without regard to the date or the flUng of Form CCC-36 or Forms CCC-251 and 252 with the appropriate FSA or CCC office.

§1404.7 Misrepresentations. If FSA or CCC bas reason to believe

that any material misrepresentation was made by the assignor or the assignee In executing Forms CCC-36, CCC-251 or CCC-252, FSA or CCC shall give notice thereof to the assignor and the assignee. If, after Investigation and opportunity for the assignor and assignee to be beard, FSA or CCC finds that any material misrepresentation

7 CFR Ch. XIV (1-1-14 Edition)

was In fact made, FSA or CCC shall notH'y the assignor and the assignee or such Clndlng, and void such assignment, and Insofar as concerns FSA, CCC or any other agency or the United States. the assignment shaH be of no effect.

§ 1404.8 Liability of the Secretary or disbursing agents.

Neither the United States, the CCC, the Secretary nor any disbursing agent shall be Hable In any suit if payment Is made to the assignor without regard to the existence of any assignment, and nothing contained herein shaH be construed to authorize any suit against the United States, the CCC, the Secretary or any disbursing agent If payment Is not made to the assignee, or if payment Is made to only one of several assignees.

§ 1404.9 OMB Control Numbers assiped pursuant to the Paperwork Reduction Act.

The Information collection requirements contained in this part have been approved by the Office of Management and Budget under the provisions of 44 U.S.C. 35 and have been assigned OMB control number 0560-0004.

PART 1405-LOANS, PURCHASES, AND OTHER OPERATIONS

Sec. 1405.1 Interest. 1405.2 Basic rule or fractions. 1405.3 Effect of changes In regulations. 1405.4 Delegations o! authority. 1405.5 Notice and comment. 1405.6 Crop Insurance requirement. 1405.7 Uruguay Round Agreements Act. 1405.8 Dlsquallflcatton due to crop lnsur·

ance violation. 1405.9 Commodity assessments.

AUTHORITY: 7 U.S.C. 1615; 7 U.S.C. 7416a; 7 U.S.C. 7991(e); 15 U.S.C. 714b and 714c.

SOURCE: 61 FR 37575, July 18, 1996, unleSII otherwise noted.

§ 1405.1 InteresL (a) Except as may otherwise be deter

mined by CCC as provided in individual program regulations, program contracts or such other means as deemed appropriate by CCC the rate of interest that is applicable to CCC loans shall be equal to the rate or Interest charged by

456

III-G-2

FACT SHEETUNITED STATES DEPARTMENT OF AGRICULTURE

Page 1

June 2010

Assigning FSA and CCC Payments

Overview

An “assignment of payment” is a service provided by the Farm Ser-vice Agency (FSA) for producers. Producers who are eligible to re-ceive specified program payments from FSA or Commodity Credit Corporation (CCC) programs may arrange to have all or part of their payments assigned directly to another party either by electronic funds transfer (EFT) using the Automated Clearing House (ACH) method or by check. This allows a third party, such as a person or en-tity, to receive a selected program payment directly from FSA/CCC in lieu of receiving the payment from a producer.

How to Assign a Program Payment

To assign eligible FSA or CCC program payments, producers must either use the web-based As-signment application or submit a completed form CCC-36, Assign-ment of Payments, and CCC-252, Instrument of Assignment form.

Payments issued to assignees (third parties) can be processed through the Electronic Funds Transfer (EFT) system. The as-signee must complete and sign SF-3881, ACH Vendor/Miscellaneous Payment Enrollment, to initiate EFT transactions.

Eligible Programs for Assigned Payments

Many FSA and CCC programs are eligible for assignment of payments. Producers may assign program payments, as specified

by program law or regulation, for FSA and CCC programs that have been publicly announced except for FSA or CCC loans or purchase agreement proceeds.

Assignment Conditions

An assignment of payment may be for any purpose and must be for a specific amount, but cannot be used:

for a reassigned payment• when the assigned payment is • the subject of an administra-tive appealwhen the dollar amount being • assigned is not stated.

Producers must inform the FSA county office immediately of any changes affecting an assigned pay-ment, such as when an assigned amount needs to be reduced or an assignment needs to be ter-minated. After the assignment is established, the assignee must concur before a change is applied or an assignment is terminated.

Overpayments of Assigned Payments

The assignee agrees to repay promptly to the Federal Govern-ment any amount by which the assigned payment exceeds the amount secured by the assign-ment. The assignor (producer) and assignee agree that they will promptly notify the county FSA office of a change affecting an assignment. The assignment may be revoked at any time by written request signed by the assignee.

Assignment Payment Priority

If there is any indebtedness owed by the producer to the Federal government on the day a payment is being made, the amount may be subtracted from the assigned payment before it is made to the assignee according to the special provision related to assignments as stated on the reverse side of form CCC-36, Assignment of Payment.

Reproducing Electronic Form CCC-36

Form CCC-36, is available at USDA Service Centers. Produc-ers, financial institutions, or third parties can also print the form by accessing the USDA eForms Web site at http://forms.sc.egov.usda.gov/

A financial institution may create an electronic version of CCC-36. However, the created electronic version must:

be the mirror image of the • most current version of the formcontain all privacy act infor-• mationinclude the following verbiage • along the bottom margin of the form: “Electronic version reproduced by (insert name of company) using (insert name of software used)”be registered with the U.S. • Department of Agriculture, Farm Service Agency, Man-agement Services Division, Information Management Branch, Forms, Graphics, and Records Management Section.

III-H-1

FACT SHEETAssigning FSA and CCC Payments June 2010

Gaining Access to the Web Based Assignment Application

In order to protect personal iden-tity, an assignor or assignee must first register for a level 2 account with USDA’s e-Authentication system to obtain a user ID and password. The process is easy and starts on-line by creating a user ID and password and confirming the user’s e-mail address. On the USDA Web site at www.usda.gov, click on the link to “View USDA Customer Statement.” From there, the user can request to get a log on ID.

Once an assignor or assignee has obtained a level 2 e-Authentica-tion ID, the secured FSA Financial Services Web site becomes avail-able to complete an assignment for the assignor or assignee registered to the user ID. Log on to the FSA Web site at www.fsa.usda.gov, and select “Online Services” from the top banner. From the “Online Services” page, select “Financial Services” under the “Related Top-ics” banner.

For additional information to gain access to the web-based as-signment application, and other FSA financial services, including “Financial Inquiries for FSA Pro-ducers,” contact your local FSA county office.

For More Information

For additional information on assigning FSA and CCC program payments and other FSA programs and services, contact your FSA county office, or visit FSA’s Web site at http://www.fsa.usda.gov.

Page 2

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, age, disability, and where applicable, sex, marital status, familial status, parental status, religion, sexual orientation, genetic information, political beliefs, reprisal, or because all or part of an individual’s income is derived from any public assistance program. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact USDA’s TARGET Center at (202) 720-2600 (voice and TDD). To file a complaint of Discrimination, write to USDA, Director, Office of Civil Rights, 1400 Independence Ave. SW, Washington, DC 20250-9410, or call (800) 795-3272 (voice) or (202) 720-6382 (TDD). USDA is an equal opportunity provider and employer.

III-H-2

ELECTRONIC CODE OF FEDERAL REGULATIONS

e-CFR Data is current as of March 30, 2015

Title 7 → Subtitle B → Chapter XIV → Subchapter B

TITLE 7—Agriculture

Subtitle B—REGULATIONS OF THE DEPARTMENT OF AGRICULTURE(CONTINUED)

CHAPTER XIV—COMMODITY CREDIT CORPORATION, DEPARTMENTOF AGRICULTURE

SUBCHAPTER B—LOANS, PURCHASES, AND OTHER OPERATIONS

Part Table ofContents

Headings

1410 1410.1 to1410.64

CONSERVATION RESERVE PROGRAM

1412 1412.1 to1412.89

AGRICULTURE RISK COVERAGE, PRICELOSS COVERAGE, AND COTTONTRANSITION ASSISTANCE PROGRAMS

1413 1413.101 to1413.114

COMMODITY INCENTIVE PAYMENTPROGRAMS

1415 1415.1 to1415.20

GRASSLANDS RESERVE PROGRAM

1416 1416.1 to1416.407

EMERGENCY AGRICULTURAL DISASTERASSISTANCE PROGRAMS

1421 1421.1 to1421.421

GRAINS AND SIMILARLY HANDLEDCOMMODITIES—MARKETINGASSISTANCE LOANS AND LOANDEFICIENCY PAYMENTS

1423 1423.1 to COMMODITY CREDIT CORPORATION

eCFR — Code of Federal Regulations http://www.ecfr.gov/cgi-bin/text-idx?SID=533475db1b9acca4b8131c10...

1 of 3 3/31/2015 5:07 PMIII-I-1

1423.13 APPROVED WAREHOUSES

1424 1424.1 to1424.14

BIOENERGY PROGRAM

1425 1425.1 to1425.25

COOPERATIVE MARKETINGASSOCIATIONS

1427 1427.1 to1427.1208

COTTON

1429 1429.101 to1429.115

ASPARAGUS REVENUE MARKET LOSSASSISTANCE PAYMENT PROGRAM

1430 1430.100 to1430.304

DAIRY PRODUCTS

1434 1434.1 to1434.22

NONRECOURSE MARKETINGASSISTANCE LOANS AND LOANDEFICIENCY PAYMENTS FOR HONEY

1435 1435.1 to1435.607

SUGAR PROGRAM

1436 1436.1 to1436.19

FARM STORAGE FACILITY LOANPROGRAM REGULATIONS

1437 1437.1 to1437.505

NONINSURED CROP DISASTERASSISTANCE PROGRAM

1450 1450.1 to1450.215

BIOMASS CROP ASSISTANCEPROGRAM (BCAP)

1455 1455.1 to1455.31

VOLUNTARY PUBLIC ACCESS ANDHABITAT INCENTIVE PROGRAM

1463 1463.1 to1463.201

2005-2014 TOBACCO TRANSITIONPROGRAM

1465 1465.1 to1465.36

AGRICULTURAL MANAGEMENTASSISTANCE

1466 1466.1 to1466.36

ENVIRONMENTAL QUALITY INCENTIVESPROGRAM

1467 1467.1 to1467.20

WETLANDS RESERVE PROGRAM

1468 1468.1 to1468.35

CONSERVATION FARM OPTION

1469 1469.1 to1469.36

CONSERVATION SECURITY PROGRAM

1470 1470.1 to1470.37

CONSERVATION STEWARDSHIPPROGRAM

1471 1471.1 to1471.14

PIMA AGRICULTURE COTTON TRUSTFUND (AGRICULTURE PIMA TRUST) AND


2 of 3 3/31/2015 5:07 PMIII-I-2

For questions or comments regarding e-CFR editorial content, features, or design, email [email protected].

For questions concerning e-CFR programming and delivery issues, email [email protected].

AGRICULTURE WOOL APPARELMANUFACTURERS TRUST FUND(AGRICULTURE WOOL TRUST)


3 of 3 3/31/2015 5:07 PMIII-I-3

This form is available electronically. Form Approved - OMB No. 0560-0183

CCC-36(09-09-09)

U.S. DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

ASSIGNMENT OF PAYMENTSee Page 2 for Privacy Act and Public Burden Statements.

PART A - GENERAL INFORMATION1. Producer's (Assignor's) Name and Address (Including Zip Code) 2. Assignee's Name and Address (Including Zip Code)

3. Producer's (Assignor's) Tax Identification Number (9 Digit Number) 4. Assignee's Tax Identification Number (9 Digit Number)

PART B - APPLICABLE PROGRAM(S)5.

Program6.

Assigned Amount for Each Applicable Year7.

State, County, andReference Number,

If ApplicableYEAR YEAR YEAR YEAR YEAR

AMOUNT AMOUNT AMOUNT AMOUNT AMOUNT

YEAR YEAR YEAR YEAR YEAR

ConservationReserve Program

Annual Rental (CRP)

AMOUNT AMOUNT AMOUNT AMOUNT AMOUNT


Milk Income Loss

Contract (MILC) AMOUNT AMOUNT AMOUNT AMOUNT AMOUNT


Direct and Counter-Cyclical Payment (DCP) AMOUNT AMOUNT AMOUNT AMOUNT AMOUNT


Loan DeficiencyPayment (LDP) AMOUNT AMOUNT AMOUNT AMOUNT AMOUNT

8.Other Program Name

(All CRP, other than annual rental)

9.Program Year or

Payment Year

10.Assigned Amount

11.State, County, and Reference Number, If Applicable

$

$

$

$

PART C - REPRESENTATION OF ASSIGNOR AND ASSIGNEEIn order to assign a cash payment in accordance with the programs specified by the assignor in Items 5 and 8, this form must be completed by both the assignor and the assignee. Assignment is effective for all counties unless specify on Item 7 or Item 11. This assignment is applicable only to programs publicly announced before this form is filed and is subject to the terms stated in this form and the provisions of 7 CFR Part 1404.

The assignee agrees to repay promptly to the Federal Government any amount by which the assigned payment exceeds the amount secured by the assignment. The assignor and the assignee agree that they will promptly notify the county FSA office of any change affecting this assignment. This assignment may be revoked at any time by written request signed by the assignee.12A. Producer's (Assignor's) Signature (By) 12B. Title/Relationship of the Individual if Signing in a

Representative Capacity

12C. Date (MM-DD-YYYY)

13A. Assignee's Signature (By) 13B. Title/Relationship of the Individual if Signing in a Representative Capacity


PART D - REVOCATION OF ASSIGNMENTAssignment of payment authorization above is hereby revoked.

14A. Assignee's Signature (By) 14B. Title/Relationship of the Individual if Signing in a Representative Capacity


FOR COUNTY OFFICE USE ONLY15. Receiving State and County 16. Date Filed (MM-DD-YYYY) 17. Time Filed

COUNTY FSA COMMITTEE ASSIGNEE PRODUCER

III-J-1

CCC-36 (09-09-09) Page 2

SPECIAL PROVISIONS RELATING TO ASSIGNMENTS

A. Assignment is effective for all counties unless a specific county is entered in Item 7 or Item 11.

B. If the assignor assigns a specified value of payments to more than one assignee:

1. CCC and FSA will recognize assignments for each program per program year or group of years if multi-year is selected.

2. Assignments will be honored in chronological sequence based on the order of filing with the county FSAoffice.

C. The payment due the producer may be applied first against indebtedness owing by the producer to the United States, including debts arising after the execution of a Form CCC-36, which may be offset in accordance with the regulationsgoverning, 7 CFR Parts 3, 1403, and 1951, and any balance will be subject to assignment.

D. Neither the United States of America, the Commodity Credit Corporation, the Secretary of Agriculture, any disbursing officer, nor any other Government employee or official shall be subject to any suit or liable for payment of any amount if payment is inadvertently made to the assignor without regard to this assignment.

E. This assignment does not extend to any successor of the assignee, nor may the assignee re-assign this assignment.

F. The assignee’s payment is subject to offset for any delinquent Federal debt owed by the assignee.

18A. COUNTY FSA OFFICE NAME AND ADDRESS (Including Zip Code)

18B. TELEPHONE NO. (Including area code):

NOTE: The following statement is made in accordance with the Pr ivacy Act of 1974 (5 USC 552a –as amended). The authority for requesting the information identified on this form is 7 CFR Part 1404 and the Commodity Credit Corporat ion Charter Act (15 U.S.C. 714). The information will be used to allow the producer to authorize CCC to make a program payment to an assignee. The information collect ed on this form may be disclosed to other Federal, Stat e, Local government agencies, Tribal agencies, and nongovernment al entities that have been authorized access to the information by statute or regulation and/or as described in applicable Routine Uses identified in t he System of Records Notice for USDA/FSA-2, Farm Records File (Automated). Providing the requested information is voluntary. However, failure to furnish t he requested information will result in a determination that a payment to t he assignee cannot be made.

According to the Paperwork Reduction Act of 1995, an agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid OMB control number. The valid OMB control number for this information collection is 0560-0183. The time required to complete this information collection is estimated to average 10 minutes per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. RETURN THIS COMPLETED FORM TO YOUR COUNTY FSA OFFICE.

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, age, disability, and where applicable, sex, marital status, familial status, parental status, religion, sexual orientation, genetic information, political beliefs, reprisal, or because all or part of an individual's income is derived from any public assistance program. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact USDA's TARGET Center at (202) 720-2600 (voice and TDD). To file a complaint of Discrimination, write to USDA, Director, Office of Adjudication and Compliance, 1400 Independence Avenue, SW., Washington, DC 20250-9410, or call toll-free at (866) 632-9992 (English) or (800) 845-6136 (Spanish) or (800) 877-8339 (TDD) or (866) 377-8642 (Federal-relay). USDA is an equal opportunity provider and employer.

III-J-2

Form Approved - OMB No. 0560-0183This form is available electronically.

CCC-251 U.S. DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation(06-11-98)

NOTICE OF ASSIGNMENT

7. INSTRUCTIONS:

Monies payable from the U.S. under a USDA or CCC contract may be assigned to a bank, trust company, federal lending agency, or other recognized lending institution.However, if such contract was made with a corporation whose stock is wholly owned by the federal government, such contract may be assigned to a prior lienholder, or, withthe prior approval of the contracting officer, to an individual.

Further, the rights of the assignee to the proceeds of a USDA or CCC contract are subject to, inter alia, defenses arising under the contract which the government could haveasserted against the assignor absent the assignment.Unless expressly permitted by the contract, that any assignment shall cover all amounts payable under the contract and not already paid and shall not be made to more thanone party, except that any assignment may be made to one party as agent or trustee for two or more parties participating in such financing. If the contract was made withCCC, it shall not be subject to further assignment.

Since such assignment shall be recognized only if and when the assignee thereof files written notice of the assignment, these instructions shall be followed carefully in order toavoid delay, inconvenience, and possible impairment of the validity of the assignment.

A. Upon execution of an assignment, the assignee shall prepare, sign and forward the original signed copy of this notice, together with the original signed copy of the instrument of Assignment to the addressee. Photocopies of each executed form shall be sent to the surety or sureties upon the bond or bonds (if any) in connection with the contract.

B. The addressee shall acknowledge receipt of this notice, if in order, in the space provided and return photocopies of each acknowledged form to the assignee.

D. CCC or USDA may offset any amounts for which the assignor is indebted to the United States for taxes with respect to which a notice of lien was filed, or a Notice of Levy was served, in accordance with the provisions of the Internal Revenue Code of 1954 (26 U.S.C. 6323; 6331), prior to acknowledgement by CCC or USDA of receipt of the notice of assignment.

E. Such assignment shall remain in force until addressee receives written advice from the assignee to release this assignment.

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race color, national origin gender, religion age disability, political beliefs sexual Persons withdisabilities who require alternative means for communication of program information (Braille, large, print, audiotape, etc.) should contact USDA's TARGET Center at (202) 720-2600 (voice and TDD). To file acomplaint of discrimination, write USDA, Director, Office of Civil Rights, Room 326-W, Whitten Building, 1400 Independence Avenue, SW, Washington, DC 20250-9410 or call (202) 720-5964 (voice or TDD).USDA is an equal opportunity provider and employer.

IMPORTANT: This document is used to make assignments for both the Commodity Credit Corporation (CCC) and the United States Department of Agriculture (USDA).

Assignments for the two Agencies are similar, but the rules governing them are not identical. Please make sure you know whether CCC or USDA is the agency named in thecontract before completing this form.

C. It is the policy of CCC and USDA to notify the assignee of the amount of any indebtedness of the contractor which is to be collected by CCC or USDA by offset from payments due under the contract. The assignee will generally receive such offset notice when receipted copies of the Notice of Assignment are returned to him or her. Whenever the assignee is given an offset notice by CCC or USDA, the amounts payable under the contract will be the amounts remaining to be paid after offset.

NOTE: Payment due or to become due under the contract identified above will be made to the undersigned assignee.

See Page 2 for Privacy Act and Public Burden Statements.

1. DATE OF NOTICE (MM-DD-YYYY)

2. CONTRACT MADE BY (Check one) 3. CONTRACT

Commodity CreditCorporation

United States DepartmentOf Agriculture

8. NAME AND ADDRESS OF ASSIGNEE (Please limit name to one line (30 spaces) and limit address to two lines (30 spaces each).

9A. STATUS OF ASSIGNEE AT TIME OF ASSIGNMENT (Check appropriate box)

FINANCIAL INSTITUTION

PERSON OR FIRM HOLDING A LIEN OR ENCUMBRANCE (Valid for CCC Contracts only.)

10C. BY (Signature) 10D. TITLE

5. CONTRACT MADE WITH (Name and address of contractor and warehouse code, if applicable) 6. TYPE OF CONTRACT

DATE (MM-DD-YYYY)CONTRACT NUMBER

4. RETURN TO (Name and address of addressee) (For CCC contracts, this is the USDA office to which invoices will be submitted for payment. For USDA contracts, this the contracting officer.)

PERSON OR FIRM NOT HOLDING A LIEN OR ENCUMBRANCE (Valid for CCC Contracts only. Assignee understands a valid assignment for all

purposes in this case requires the contractor to obtain approval of the contracting officer or other designated official of CCC in writing before the assignmentwill be recognized by CCC.)

Receipt is acknowledged of this notice and a signed copy of the above-mentioned instrument of assignment. Date and time of receipt is as follows:

9B. BY (Name of Signing Officer for Assignee) 9C. TITLE 9D. DATE (MM-DD-YYYY)

10. ACKNOWLEDGMENT

10A. TIME 10B. DATE (MM-DD-YYYY)

III-K-1

CCC-251 (Page 2) (06-11-98)

NOTE: The following statement is made in accordance with the Privacy Act of 1974 (5 USC 552a) and the Paperwork Reduction Act of 1995, as amended.The authority for requesting the following information is the Food Security Act of 1985 (Pub. L. 99-198), as amended, and the regulationspromulgated under 7 CFR Part 1400 for Payment Eligibility Review requirements. The information will be used to determine eligibility for programbenefits and other financial assistance administered by USDA agencies. Furnishing the requested information is voluntary. Failure to furnish therequested information will result in a determination of ineligibility for certain program benefits and other financial assistance administered by USDAagencies. This information maybe provided to other agencies, IRS, Department of Justice or other State and Federal Law enforcement agenciesand in response to a court magistrate or administrative tribunal. The provisions of criminal and civil fraud statutes, including 18 USC 286, 287, 371,651, 1001, 15 USC 714m; and 31 USC 3729, may be applicable to the information provided.

According to the Paperwork Reduction Act of 1995, an agency may not conduct or sponsor, and a person is not required to respond to, a collectionof information unless it displays a valid OMB control number. The valid OMB control number for this information collection is 0560-0183. The timerequired to complete this information collection is estimated to average 5 minutes per response, including the time for reviewing instructions,searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. RETURNTHIS COMPLETED FORM TO YOUR COUNTY FSA OFFICE.

III-K-2

Form Approved - OMB No. 0560-0183

See Page 2 for Privacy Act and burden statements.This form is available electronically.

DATED (b)CONTRACT NUMBERED (a)

KNOW ALL MEN BY THESE PRESENTS: That (c)

I (We) (d)

day of (f)this (e) , for value

received, do hereby assign to (g)

of (h)

all right, title, and interest, to all monies due or to become due from the United States or from any agency or department thereof, or

any corporation whose stock is wholly owned by the federal government, under Contract No. (i)

dated (j)

I (We) stipulate that such monies payable from the U.S. under such contract are being assigned to a bank, trust company, federal lendingagency, or other recognized lending institution, unless such contract was made with a corporation whose stock is wholly owned by thefederal government, in which case such contract may be assigned to a prior lienholder, or, with the prior approval of the contracting officer,to an individual.

I (We) further stipulate that the rights of the assignee to the proceeds of this contract are subject to, inter alia, defenses arising under thecontract which the government could have asserted against the assignor absent the assignment.

I (We) further stipulate that no previous assignment has been made and agree that no additional assignments will be made under thiscontract; that payments thereunder will be made by checks drawn to the order of the assignee; that the assignment shall remain in forceuntil released on written advice by the assignee.

(k) Contractor

(l) By

(m) Title

(n) ATTEST:

(SECRETARY)

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, gender, religion, age, disability, political beliefs, sexualorientation, and marital or family status. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means for communication of program information (Braille, large print,audiotape, etc.) should contact USDA's TARGET Center at (202) 720-2600 (voice and TDD). To file a complaint of discrimination, write USDA, Director, Office of Civil Rights, Room 326-W, Whitten Building,1400 Independence Avenue, SW, Washington, D. C. 20250-9410 or call (202) 720-5964 (voice or TDD). USDA is an equal opportunity provider and employer.

CCC-252(06-11-98)

U.S. DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

INSTRUMENT OF ASSIGNMENT

.

(o) RETURN TO:

(Affix Corporate Seal)

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CCC-252 (Page 2) (06-11-98)

The following statement is made in accordance with the Privacy Act of 1974 (5 USC 552a) and the Paperwork Reduction Act of 1995, asamended. The authority for requesting the following information is 7 CFR 1404.4 and the Commodity Credit Corporation (CCC) Charter Act. Theinformation will be used to establish the parties to which a payment received under a USDA or CCC contract will be assigned. Furnishing therequested information is voluntary; however, without it monies payable from the U.S. under a USDA or CCC contract will not be assigned.. Thisinformation may be provided to other agencies, IRS, Department of Justice, or other State and Federal Law enforcement agencies, and inresponse to a court magistrate or administrative tribunal. The provisions of criminal and civil fraud statutes, including 18 USC 286, 287, 371, 641,651, 1001; 15 USC 714m; and 31 USC 3729, may be applicable to the information provided.

According to the Paperwork Reduction Act of 1995, an agency may not conduct or sponsor, and a person is not required to respond to, acollection of information unless it displays a valid OMB control number. The valid OMB control number for this information collection is 0560-0183.The time required to complete this information collection is estimated to average 5 minutes per response, including the time for reviewinginstructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection ofinformation. RETURN THIS COMPLETED FORM TO YOUR COUNTY FSA OFFICE.

NOTE:

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Q: \ COMP\AGCOM\ CCCACT

May 22, 2008

7-3 COMMODITY CREDIT CORPORATION CHARTER ACT Sec. 4

the defendant shall not be awarded a judgment on any such set-off or counterclaim for any amount in excess of the amount of the plaintiffs claim established in the suit. All suits against the Corporation shall be tried by the court without a jury. Notwithstanding any other provision of this Act, the Federal Tort Claims Act (Public Law 601, Seventy-ninth Congress) shall be applicable to the Corporation. Any suit by or against the United States as the real party in interest based upon any claim by or against the Corporation shall be subject to the provisions of this subsection (c) to the same extent as though such suit were by or against the Corporation, except that (1) any such suit against the United States based upon any claim of the type enumerated in title 28, section 1491, of the United States Code, may be brought in the United States Claims Court, and (2) no such suit against the United States may be brought in a district court unless such suit might, without regard to the provisions of this Act, be brought in such court.

(d) :rvia:y adopt, amend, and repeal b~yla\vs, rules, and regulations governing the manner in which its business may be conducted and the powers vested in it may be exercised.

(e) Shall have all the rights, privileges, and immunities of the United States with respect to the right to priority of payment with respect to debts due from insolvent, deceased, or bankrupt debtors. The Corporation may assert such rights, privileges, and immunities in any suit, action, or proceeding.

(f) Shall be entitled to the use of the United States mails in the same manner and upon the same conditions as the executive departments of the Federal Government.

(g) May enter into and carry out such contracts or agreements as are necessary in the conduct of its business, except that obliga>tions under all such contracts or agreements (other than reimbursable agreements under section 11) for equipment or services relating to automated data processing, information technologies, or related items (including telecommunications equipment and computer hardware and software) may not exceed $170,000,000 in fiscal year 1996 and not more than $193,000,000 in the 6-fiscal year period beginning on October 1, 1996, unless additional amounts for such contracts and agreements are provided in advance in appropriation Acts. State and local regulatory laws or rules shall not be applicable with respect to contracts or agreements of the Corporation or the parties thereto to the extent that such contracts or agreements provide that such laws or rules shall not be applicable, or to the extent that such laws or rules are inconsistent with such contracts or agreements.

(h) May contract for the use, in accordance with the usual customs of trade and commerce, of plants and facilities for the physical handling, storage, processing, servicing, and transportation of the agricultural commodities subject to its control. The Corporation shall not have power to acquire real property or any interest therein except that it may (a) rent or lease office space necessary for the conduct of its business and (b) acquire real property or any interest therein for the purpose of providing storage adequate to carry out effectively and efficiently any of the Corporation's programs, or of securing or discharging obligations owing to the Corporation, or of otherwise protecting the financial interests of the Corporation: Provided, That the authority contained in this subsection (h) shall not be utilized by the Corporation for the purpose of acquiring real

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Financing Issues in Federal Agricultural Programs

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Transcript of Financing Issues in Federal Agricultural Programs