Yield Exclusion (YE)

Overview

The System supports the APH Yield Exclusion (YE) provision introduced with the 2014 Farm Bill. The provision allows farmers to exclude eligible bad yields (such as those that occur from a natural disaster or other extreme weather occurs) from their production history when calculating the yields used to establish their crop insurance coverage. The amount of insurance available to a farmer is based on the farmer's average historical yields.

To apply YE to an APH, the Insured must have an active coverage where Yield Exclusion is an option in the ADM and a qualifying APH database must exist and the Insured must select the databases and/or years within the database to exclude by the PRD for the current crop year.

Consult the actuarial documents for YE availability and Sales Closing Dates by state/county/crop.

• When a crop year is determined to be eligible for YE for a crop in a county, producers in contiguous counties will also be eligible to exclude their actual yield for that crop year under YE.
• Due to limited data availability, the earliest year that RMA may identify as being eligible to be excluded will be 1995, which will use data from 1985 thru 1994 to determine the 10-year average. A crop year will not be eligible if there is not sufficient information to determine the average per planted acre yield for the county or the 10 year average did not have enough years of sufficient data.
• When data is available, separate determinations will be made for Irrigated and Non-Irrigated acreage. The YE option will be listed in the county actuarial documents showing the crop and eligible crop year(s) for exclusion.
• The level of insurance coverage available to a producer is based on the producer’s average yields over the 4 to 10 most recent crop years.
• The YE option must be elected by the applicable SCD, and it is continuous (it does not have to be re-elected) and will continue to apply until you cancel it.

To accommodate this provision, the Add New/Maintain Coverage and Add/Maintain APH pages have been updated as well as the Trend Adjustment Comparison and Forms and Reports.

To allow a user to elect Yield Exclusion on the APH, a “YE – Yield Exclusion”option is available in the Crop Options selection box when available for the State/County/Crop in the ADM.

When this option is elected on a coverage, YE will be an available option in the APH for all eligible years.

If YE exists in the Crop Options on the APH and any year in the database (prior to YE being applied) includes a selected YA checkbox, "YA" is added to the Crop Options and the Yield Limitation Code is set to "09". This includes databases where the Adjusted Yield is the Average Yield.

Also, when a user has selected Yield Exclusion for the coverage, in the APH database, a new grid is available called “APH Utilities”. To open this grid, click the APH Utilities banner (a).

This grid displays the Total Production, Acres, Annual Yield, Yield Used, and Yield Type as indicated in the Production History grid. However, an additional YE column (b) is also available to allow a user to determine which years to apply Yield Exclusion to.

In the YE column, the System determines all years in the APH that are eligible for YE and applies a checkmark to the YE column for those years (c). The Actual Yields eligible for YE are: A, AC, AY, NA, PA, DA, NW, PW, WY, R, PR, NR, RY, BF, G, GC, GY, NG, PG, DG, GW, NO, OY, V, VY, NV, PV, DV, VC, VW, NU, and UY.

• To accept YE on the years the System determined as eligible, the checkbox should remain marked.
• To reject YE, or opt out, for eligible years in the APH, clear the checkbox for the corresponding year(s).

NOTE: If YA was previously selected for a year that is also eligible for YE, the System will remove YA and apply the YE selection. To keep YA and opt out of a YE eligible year, clear the checkbox in the YE column for the corresponding year. When a year in the Production History changes and becomes eligible for Yield Exclusion, the System defaults the YE checkbox to marked, but a user can make changes as needed.

When the Insured elects to apply Yield Exclusion to the years the System determined as eligible by keeping the YE checkbox marked, the System performs the following on save (Preliminary Save, Recalc, Save) of the APH:

a. For any year that is excluded from the database, a “YE” displays next to the Yield Used in the Production History grid of the APH. If at least 4 years of actual yields exist in the APH database, the Yield Used for the year(s) excluded is set to “0”. If fewer than 4 years exist, the Yield Used will be set to the Variable T-Yield and Yield type will be set to S, E, N, or T as applicable. For the Variable T-Yield, the System will use the four most recent years in the APH that do not include an Actual Yield value after YE is applied.
b. The YE Yield Total displays the sum of all Annual Yields after Yield Exclusion is applied.
c. The YE Avg. Yield displays the YE Yield Total (from b) divided by the number of Annual Yields in the APH database after YE is applied.
d. The CUP displays standard calculation; however, CUP is not applicable if YE is applied or if the Prior Year Yield Limitation is “09” or “15”.
e. The Yield Floor displays standard calculation; however, Yield Floor is not applicable if YE is applied.
f. The Yield Total displays the sum of all Annual Yields prior to Yield Exclusion being applied.
g. The Avg. Yield displays the Total Yield (from f) divided by the total number of yields contained with the 10 year database prior to Yield Exclusion.
h. The Adj. Yield displays the 60% Yield Adjustment (YA) applied to the database prior to Yield Exclusion.
i. The Rate Yield is the Average Yield (unless yield reductions apply).
j. For the App’d Yield, the System compares the Adjusted Yield to the YE Average Yield:
• If the YE Average Yield is greater than the Adjusted Yield, the Approved Yield is the YE Average Yield.
• If the YE Average Yield is less than the Adjusted Yield, the Approved Yield is the Adjusted Yield.

For any eligible year that is deselected for YE (the YE checkbox on the APH Utilities grid is cleared), the System removes the Yield Indicator of “YE” next to the Yield Used on the APH grid and the YE Opt Out indicator is set in the database. This indicator isn’t shown in the user interface, but it prints in the YE Opt Column of these forms in the System: APH Database and Production Report.

On save of the APH, if YE has been applied to at least one year in the APH database, the System will also:

a. Display the “YE” option in the Crop Options field on the APH.
b. Determine Reference Years using Standard Procedures. The System totals the number of actual yields for the Crop/County (or database if applicable), including those years selected for YE.
c. Set the Current Year Yld Limitation to “09” if both YA & YE (and any other options, like TA) exist in the Crop Options field or “15” if YE (and any other option, like TA) exists in the Crop Options field.

The System was updated to correctly display and calculate the Approved Yield when the YE is elected on the coverage and is applied to one or more yields within a selected APH database that also includes a Master Yields (MY), CC/SF election, Malt Barley, Simple Average T-Yields (SAT), or the North Dakota Personal T-Yields (PTY).

NOTE: For Master Yields, the only crop where MY are applicable for 2015 is Spring Canola; however, YE was not available for any State/County where Spring Canola is offered for 2015.

Malting Barley Price & Quality Endorsement

For the “MB" option, the System will apply YE Standard APH Procedures to the Malting Type APH databases.

For the “MA” option, the YE Standard APH Procedures will apply to Malting APH databases; YE is NOT applicable to Malt A actual history databases.

Master Yields (MY)

YE is applied to the Master Yield Summary Unit after it is created.

For a Master Yield Summary Unit

The Unit Number is “0000-0000” and the Yield Indicator is “MY”.

1. System or User will create Master Yield Summary Unit(s) by using standard Master Yield functionality to total Production and Acres and then calculate the Annual Yield for each year in the summary database(s)
2. System will apply a checkmark to the YE checkbox for each year eligible for Yield Exclusion in the APH Utilities grid on the summary database(s).
3. Standard YE functionality and display will apply to the MY Summary database(s).
4. To remove the YA from an Auto-generated MY summary database, the user will need to select the “Override Entire APH” checkbox and update the applicable fields as necessary.

For a Non-summary Unit

YE functionality on MY mirrors that of YA functionality.

• The “YE” Option Code will not be applied to the Non-Summary Unit(s).
• If the Yield Limitation code on the Summary Unit is “09” or “15”, the System will set the Yield Limitation code on the associated non-summary unit to “01”. The YE Option Code will not be applied to the Non-Summary detail line.

NOTE: For 2015 RY, the YE is only available on Plan 01, 02, or 03; most crops that allow Master Yields are Plan 90 and the YE is not available currently.

SF Database (CC/SF)

YE is applied to the APH databases prior to the SF rule.

The System will apply standard YE functionality and calculate the Approved Yield for both the CC and SF databases.

The System will then apply standard APH logic to determine if the SF rule is applicable.

Simple Average T-Yields (SA T-Yields)

When calculating the Simple Average T-Yields, if the YE option exists on one or more of the databases used to determine the SA T-Yield, the System will use the value of the Adjusted Yield in place of the Approved Yield.

To calculate the Simple Average T-Yield:

1. For all existing APH databases in the county that have the same crop/practice/type/TMA, the system will sum the Approved APH Yield (P15/37) from those APH databases where actual yields have not been excluded and at least one Actual Yield exists and the Adjusted APH Yield (P15/44) from those APH database where actual yields have been excluded (Crop Option = YE) and at least one actual yield exists.
2. The System will sum the number of existing APH databases for the same crop/practice/type/TMA.
3. Then, it will divide the sum of all the Approved and/or Adjusted APH Yields by the number of existing APH databases.

North Dakota Personal T-Yield (PTY) - YE is not applicable to a PTY Summary Unit

When creating the PTY Summary Unit, regardless of whether or not the YE checkbox is marked for an eligible year, the System will use the Production and Acres from all years for the applicable Practice/Type/Variety/TMA.

Excluded yields in an eligible year must still be used when determining insurability for those crops with minimum production (or minimum age/production) requirements. The System will not allow yields in eligible years to be excluded prior to the Year of Insurability if the APH Override of “Added Ins Acreage – Age Minimum or Added Ins. Acreage – Production Minimum” is selected.

If an Actual Yield is reduced when a practice or production method (e.g., removal, dehorning, grafting, transitioning, organic) was performed that reduced the crop's production for a specific crop year, then the Actual Yield for the crop year is not eligible for yield exclusion. This will need to be a user determination as there are no indicators to identify these years.

If one of the Actual Yields in the most recent three crop years in the APH database is in a crop year that is eligible for exclusion in the ADM, the Yield Variance Test is not applicable; yields will not be reduced for alternate bearing and downward trending. This includes any database for which the Yield Variance Test is required to determine if further testing or adjustments are necessary. If the YE is elected, the System will be updated to check for eligible years with actual yields in the most recent four years of the database. If at least one eligible year exists, the System will not apply a High Variability override; however, the Yield Variance link to the Testing page will still be visible.

The Opt Out selection of eligible years within a database under a two-year coverage module must be made on the First Year of the two-year coverage and cannot be changed in the Second Year. A validation will provide a warning to the user if a YE selection box is changed in the Second Module Year.

For Yield Exclusion, the System has been updated with the following Written Agreement functionality:

• Written Agreements cannot be used to request the YE coverage in a State/County where it is not available in the Standard ADM for the location State/County.
• YE is not applicable with the WA Type of "XC" and will suspend, at Mark Complete, any coverages that have YE on an "XC" WA Type.
• If YE is available in the standard ADM for the selected State/County/Crop and elected on a coverage, the System will use the WA ADM_ICE to determine if the YE is available and then apply it to the database and rate the detail line for which a WA is applied.