Title 7
SECTION 1430.107
1430.107 Buy-up coverage.
§ 1430.107 Buy-up coverage.(a) For purposes of receiving buy-up MPP-Dairy coverage, a participating dairy operation may annually elect during an annual election period the following for the succeeding calendar year:
(1) A coverage level threshold for margins that, per cwt, is equal to one of the following: $4.50, $5, $5.50, $6, $6.50, $7, $7.50, or $8; and
(2) A percentage of coverage for the production history from 25 percent to 90 percent, in 5-percent increments.
(b) In the absence of any such election, the applicable coverage level provided, with no premium due, is catastrophic level coverage.
(c) A participating dairy operation that elects margin protection coverage above $4 is required to pay an annual premium based on coverage level and covered production history in addition to the administrative fee. Tier 1 applies to covered production history up to and including 4 million pounds; Tier 2 applies to covered production history above 4 million pounds.
(d) The premium per cwt of milk, based on the elected percentage of coverage of production history is specified in the following table.
Table to § 1430.107(d)
| Coverage level (margin) |
Tier 1 premium per cwt (for the covered production history that is 4 million pounds or less) |
Tier 2 premium per cwt (for the part of covered production history over 4 million pounds) |
|---|---|---|
| $4.50 | $0.010 | $0.020 |
| $5.00 | 0.025 | 0.040 |
| $5.50 | 0.040 | 0.100 |
| $6.00 | 0.055 | 0.155 |
| $6.50 | 0.090 | 0.290 |
| $7.00 | 0.217 | 0.830 |
| $7.50 | 0.300 | 1.060 |
| $8.00 | 0.475 | 1.360 |
(e) The annual premium due for a participating dairy operation is calculated by multiplying:
(1) The covered production history; and
(2) The premium per cwt of milk specified in paragraph (d) of this section for the coverage level elected by the dairy operation.
(f) In the case of a new dairy operation that first registers to participate in MPP-Dairy for a calendar year after the start of the calendar year, the participating dairy operation is required to pay a pro-rated premium for that calendar year based on the portion of the calendar year for which the participating dairy operation is eligible, and for which it purchases the coverage.
(g) A participating dairy operation is required to pay the annual premium calculated as specified in paragraphs (d) and (e) of this section for the applicable calendar year, according to either of the following options:
(1) In total at time of submission of coverage election to FSA; or
(2) In total no later than September 1 of the applicable calendar year of coverage, unless otherwise specified by the Deputy Administrator.
(h) If the total premium is not paid for an applicable calendar year of coverage as specified in paragraph (g) of this section, the participating dairy operation will only be covered at catastrophic level coverage beginning with the September-October consecutive 2-month period and for the remainder of the applicable coverage year.
(i) Annual premium balances due CCC from a participating dairy operation for a calendar year of coverage must be paid in full no later than September 1 of the applicable calendar year or within a grace period determined by the Deputy Administrator, if applicable.
(j) A participating dairy operation with an unpaid premium balance for a calendar year of coverage will lose eligibility for buy-up coverage for the subsequent coverage year if the premium is not paid in full by the close of the coverage election period, and will have its current buy-up level coverage reduced to the catastrophic level, as provided in § 1430.109.
(k) The Deputy Administrator may waive the obligation to pay the premium, or refund the premium paid, of a participating dairy operation for a calendar year, in cases that include, but are not limited to, as determined by the Deputy Administrator, death, retirement, permanent dissolution of a participating dairy operation, or other circumstances determined by the Deputy Administrator.
(l) MPP-Dairy administrative fees and premiums are required to be paid by a negotiable instrument satisfactory to FSA and made payable to CCC and either mailed to or provided in person to the administrative county office or other location designated by FSA.
(m) In the case of an intergenerational transfer, the additional premium, if any, is due September 1 if the notification of the transfer is made to FSA between January 1 and September 1 of the applicable calendar year, and immediately, if the notification is made between September 2 and December 31, unless otherwise specified by the Deputy Administrator.
[79 FR 51462, Aug. 29, 2014, as amended at 81 FR 21705, Apr. 13, 2016]