Assisting Family Farmers through Insurance Reform Measures Act

Bill: 115-s-1025
Sponsor: full_name: Sen. Flake, Jeff [R-AZ]
Introduced: 2017-05-03
Policy area: Agriculture and Food
Subjects: Agricultural insurance

Agricultural prices, subsidies, credit
Latest action: action_date: 2017-05-03
text: Read twice and referred to the Committee on Agriculture, Nutrition, and Forestry.

Summaries:
action_date: 2017-05-03
action_desc: Introduced in Senate
text: <p><b>Assisting Family Farmers through Insurance Reform Measures Act or the AFFIRM Act </b></p> <p>This bill amends the Federal Crop Insurance Act to require the Department of Agriculture (USDA) to reduce federal crop insurance payments and disclose details regarding subsidies. </p> <p>The bill prohibits premium subsidies: (1) for additional coverage for any person or legal entity that has an average adjusted gross income that is greater than $250,000, (2) that exceed $40,000 per year for any person or legal entity, or (3) for policies that are based on the actual market price of an agricultural commodity at the time of harvest.</p> <p>The bill establishes an annual cap on total reimbursements for administrative and operating costs of crop insurance providers that begins at $900 million for 2018 and is adjusted for inflation in each subsequent year. The average rate of return for insurance providers is limited to 8.9% of retained premiums. </p> <p>The bill eliminates a requirement that any renegotiated Standard Insurance Agreement (SRA) be budget-neutral. (The SRA is an agreement between USDA and the private companies that administer the federal crop insurance program that specifies details such as administrative and operating expense reimbursements and risk sharing. Eliminating the budget neutrality requirement permits USDA to use the renegotiation of the SRA to achieve savings.) </p> <p>USDA must annually disclose to the public specified details regarding the recipients and amounts of federal crop insurance subsidies. </p>

tv_txt: II 115th CONGRESS 1st Session S. 1025 IN THE SENATE OF THE UNITED STATES May 3, 2017 Mr. Flake (for himself and Mrs. Shaheen ) introduced the following bill; which was read twice and referred to the Committee on Agriculture, Nutrition, and Forestry A BILL To reform the Federal Crop Insurance Act and reduce Federal spending on crop insurance.

1. Short title; table of contents (a) Short title This Act may be cited as the Assisting Family Farmers through Insurance Reform Measures Act or the AFFIRM Act . (b) Table of contents The table of contents for this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Adjusted gross income and per person limitations on share of insurance premiums paid by Corporation. Sec. 3. Cap on reimbursements for administrative and operating expenses of crop insurance providers. Sec. 4. Renegotiation of Standard Reinsurance Agreement. Sec. 5. Cap on overall rate of return for crop insurance providers. Sec. 6. Prohibition on premium subsidy for harvest price policies. Sec. 7. Crop insurance premium subsidies disclosure in the public interest. 2. Adjusted gross income and per person limitations on share of insurance premiums paid by Corporation Section 508(e)(1) of the Federal Crop Insurance Act ( 7 U.S.C. 1508(e)(1) ) is amended— (1) by striking For the purpose and inserting the following: (A) Payment authority Subject to subparagraphs (B) and (C), for the purpose ; and (2) by adding at the end the following: (B) Adjusted gross income limitation The Corporation shall not pay a part of the premium for additional coverage for any person or legal entity that has an average adjusted gross income (as defined in section 1001D(a) of the Food Security Act of 1985 (7 U.S.C. 1308–3a(a))) that is greater than $250,000. (C) Per person limitation The Corporation shall not pay more than $40,000 for any reinsurance year to any person or legal entity for premiums under this section. . 3. Cap on reimbursements for administrative and operating expenses of crop insurance providers Section 508(k)(4) of the Federal Crop Insurance Act ( 7 U.S.C. 1508(k)(4) ) is amended by adding at the end the following: (G) Additional cap on reimbursements (i) In general Notwithstanding subparagraphs (A) through (F), the total amount of reimbursements for administrative and operating costs for the 2018 reinsurance year for all types of policies and plans of insurance shall not exceed $900,000,000. (ii) Adjustment For the 2019 reinsurance year and each subsequent reinsurance year, the dollar amount in effect pursuant to clause (i) shall be increased by the inflation factor established for the administrative and operating costs limitation in the 2011 Standard Reinsurance Agreement. . 4. Renegotiation of Standard Reinsurance Agreement Section 508(k)(8) of the Federal Crop Insurance Act ( 7 U.S.C. 1508(k)(8) ) is amended by striking subparagraph (F). 5. Cap on overall rate of return for crop insurance providers Section 508(k)(3) of the Federal Crop Insurance Act ( 7 U.S.C. 1508(k)(3) ) is amended— (1) by striking (3) Share of risk .—The and inserting the following: (3) Risk (A) Share of risk The ; and (2) by adding at the end the following: (B) Limitation on average rate of return The target average rate of return for reinsured companies for the 2018 reinsurance year and each subsequent reinsurance year shall be 8.9 percent of retained premiums. . 6. Prohibition on premium subsidy for harvest price policies Section 508(e) of the Federal Crop Insurance Act ( 7 U.S.C. 1508(e) ) is amended by adding at the end the following: (9) Prohibition on premium subsidy for harvest price policies Notwithstanding any other provision of law, beginning with the 2018 reinsurance year, the Corporation shall not pay any amount of premium subsidy in the case of a policy or plan of insurance that is based on the actual market price of an agricultural commodity on the date of harvest. . 7. Crop insurance premium subsidies disclosure in the public interest Section 502(c)(2) of the Federal Crop Insurance Act ( 7 U.S.C. 1502(c)(2) ) is amended— (1) by redesignating subparagraphs (A) and (B) as subparagraphs (C) and (D) respectively; and (2) by inserting before subparagraph (C) (as so redesignated) the following: (A) Disclosure in the public interest Notwithstanding paragraph (1) or any other provision of law, except as provided in subparagraph (B), the Secretary shall on an annual basis make available to the public— (i) (I) the name of each individual or entity that obtained a federally subsidized crop insurance, livestock, or forage policy or plan of insurance during the previous reinsurance year; (II) the amount of premium subsidy received by the individual or entity from the Corporation; and (III) the amount of any Federal portion of indemnities paid in the event of a loss for that reinsurance year for each policy associated with that individual or entity; and (ii) for each private insurance provider, a description by the name of the private insurance provider of— (I) the underwriting gains earned through participation in the federally subsidized crop insurance program; and (II) the amount paid under this subtitle for— (aa) administrative and operating expenses; (bb) any Federal portion of indemnities and reinsurance; and (cc) any other purpose. (B) Limitation The Secretary shall not disclose under subparagraph (A) information relating to individuals and entities covered by a catastrophic risk protection plan offered under section 508(b). .