USDA Value-Added Producer Grants are Available
Many hydroponic producers and would-be producers are interested in grant opportunities to fund the development and continued development of their businesses. The USDA announced in May 2009 the availability of $18 million in competitive grant funds for the Value-Added Producer Grants. Following are a few highlights of the program, and additional information can be accessed at http://www.rurdev.usda.gov/rbs/coops/vadg.htm.
Grant Objective: Help Independent Producers of Agricultural Commodities (unprocessed product of farms, ranches, nurseries, and forests) and Agriculture Producer Groups develop strategies to create marketing opportunities and to help develop Business Plans for viable marketing opportunities regarding production of bio-based products from agricultural commodities. Producer Groups must have a mission that includes working on behalf of independent producers and the majority of the membership and board of directors must be independent producers.
End goals are to generate new products, create expanded marketing opportunities and increase producer income
$18 million available in competitive funds for FY 2009
o 10% funds reserved for Beginning Farmers or Ranchers and Socially Disadvantaged Farmers or Ranchers (deadline June 22, 2009)
o 10% of funds reserved for funding Mid-Tier Value Chain projects (postmark deadline June 22, 2009)
o All unreserved funding applications due by July 6, 2009
o Applications can be electronically submitted or postmarked by above deadlines
o Anticipated Award date is September 1, 2009
o Projects may not exceed 3 years
USDA welcomes applications that develop innovative, sustainable products, businesses, or marketing opportunities that accelerate creation of new economic opportunities and commercialization in the agri-food, agri-science or agriculture products integrated with other sciences or technologies.
Projects must be economically viable and sustainable and are encouraged to:
- Highlight innovative uses of agricultural products
- Use agricultural products in non-traditional ways
- Merge agricultural products with technology in creative ways
Value-Added Agricultural Product: any agricultural product or commodity that has:
- Undergone a change in physical state (does not include common production or harvesting methods, for example: cut flowers)
- Was produced in a manner that enhances the value of the commodity or product, as demonstrated through a business plan that shows the enhanced value (branded products or products packaged in a non-standard way are not eligible here)
- Is physically segregated in a manner that results in the enhancement of the value of the product (for example, genetically modified corn produced on same farm as standard corn)
- Is a source of farm or ranch-based renewable energy
- Is aggregated and marketing as a locally-produced agricultural food product
And as a result of the change in physical state or the manner in which it was produced, marketed or segregated:
- The customer base for the commodity/product is expanded
- A greater portion of the revenue derived from the marketing, processing or physical segregation of the commodity/product is available to the producer
Award Specifics
· Two types of awards (may apply for one, but not both):
o Planning activities up to $100,000 include:
§ Obtaining legal advice and assistance related to proposed Venture
§ Conducting a feasibility study of a proposed value-added venture to help determine the potential marketing success of the Venture
§ Developing a business plan that provides comprehensive details on the management, planning, and other operational aspects of a proposed venture
§ Developing a marketing plan for the proposed Value-added product, including the identification of a market window, the identification of potential buyers, a description of the distribution system and possible promotional campaigns
o Working capital expenses up to $300,000 include:
§ Designing or purchasing an accounting system for the proposed Venture
§ Paying for salaries, utilities, and rental of office space
§ Purchasing inventory, office equipment, and office supplies
§ Conducting a marketing campaign for the proposed Value-added product
· Matching funds are required and must equal the amount of grant funds requested
o Federal grant funds cannot be used as matching funds
o Must be spent at a rate equal to or greater than grant funds expended
o Must be cash or eligible in-kind contributions
· Priority is given to Small ($250,000 or less in annual gross sales) and Medium-Sized ($500,000 or less in annual gross sales) Farms or Ranches structured as Family Farms
· Applicants are encouraged to contact their USDA Rural Development office to discuss the project and for preliminary application review. Our contact:
Deborah E. Rausch, USDA Rural Development
Federal Building, Rm. 507
200 North High St.
Columbus, OH 43215
Phone: (614) 255-2425
deborah.rausch@oh.usda.gov
Funds cannot be used to:
- Plan, repair, acquire or construct a building or facility
- Purchase, rent, or install fixed equipment
- Purchase vehicles or boats
- Pay for preparation of the grant application
- Pay expenses not directly related to the funded grant
- Fund political or lobbying activities
- Fund architectural or engineering design work
- Fund expenses related to production of commodity or product to which value will be added
- Fund research and development
- Purchase land
- Duplicate current services
Beth Fausey, Ph.D.
Floriculture and Hydroponic Vegetable Extension Educator
Director, Agricultural Business Enhancement Center
Ohio State University Extension
639 S. Dunbridge Rd., Suite 4
Bowling Green, OH 43402
Phone: 419-354-6916 ext.11
Toll Free: 800-358-4678
Fax: 419-354-6416
www.abe.osu.edu
www.oardc.ohio-state.edu/hydroponics
