Final Agency Determination: FAD-007

Subject: Arbitration Process. Section 20(a) of the Basic Provisions, 7 C.F.R. § 457.8

Background

On March 15, 2001, the Risk Management Agency (RMA) was asked for a final agency determination concerning the arbitration process as it appears in the Basic Provisions cited above. Specifically, section 20 (a) of the provisions states: (a) "If you and we fail to agree on any factual determination, the disagreement will be resolved in accordance with the rules of the American Arbitration Association . . . "

Interpretation Submitted

Section 20(a) of the Basic Provisions, 7 C.F.R. § 457.8 permits arbitration before any Alternative Dispute Resolution organization, provided the organization applies the rules of the American Arbitration Association (AAA) to the proceedings.

Final Agency Determination

RMA agrees with the interpretation submitted. Therefore, it is the agency's final determination that the provisions contained in section 20 allow arbitration before any Alternative Dispute Resolution organization, provided the organization applies the rules of the AAA to the proceedings.

In accordance with 7 C.F.R. section 400.765(c), this constitutes the final agency determination and is binding on all participants in the Federal crop insurance program.

Date of Issue: May 18, 2001