Money Available for Maryland Grapegrowers
State to invest up to $4 million each year to get vineyards up and running
Maryland's new Vineyard Planting Loan Fund makes it possible for grapegrowers to borrow money for new vines (such as the ones pictured at Knob Hall Winery in Clear Spring, Md.), equipment and supplies and land preparation.
Annapolis, Md. -- Wall Street may be in trouble, and credit is extremely tight, but one bright spot in the economy is in Maryland, where a new loan program for vineyards was announced earlier this month. The wine and grape industry in Maryland is still very small, but a statewide organization, the Maryland Agricultural & Resource-Based Industry Development Corporation (MARBIDCO) wants to expand the state's commercial vineyard acreage.
The new Vineyard Planting Loan Fund is designed to help meet the financing needs of rural landowners who want to plant grapes and develop wineries. The program will make available low-interest loans of between $10,000 and $100,000 available to qualified persons, and the money may be used for the preparation of land for planting vineyards and for purchasing vines, vineyard equipment and supplies. The loans may not be used for purchasing tractors, pickup trucks or winemaking equipment, which are eligible under other MARBIDCO programs.
According to Steven McHenry, the executive director of MARBIDCO, the Vineyard Loan Fund "was developed in response to conversations with grape growers about their needs, and takes into account the fact that it takes 3 to 4 years to get a harvest from a newly planted vineyard. We were quite fortunate that the Maryland state legislature recognized what could be accomplished by stepping up and making an investment in this industry." The state of Maryland will place $3 million to $4 million in the Vineyard Loan Fund each year, with the goal of having the program be self-sustaining by 2020.
Joe Fiola, professor and specialist in viticulture and small fruit at the University of Maryland, stated that the importance of this fund is that it is an in-state program, run by a state organization with funding in place. "These loans," Fiola said, "should be easier to get than for potential grape growers to go through a commercial lender, and the loans have the advantage of being at low interest rates. It's a user-friendly program for Maryland growers. I'm excited about it, as it should get people who have been on the fence moving into growing grapes. The loan fund shows that government groups support and believe in the industry and its potential in the future."
A "Rural Business Working Capital Fund," MARBIDCO was authorized by the Maryland state legislature in 2004 to help Maryland's farm, forestry, seafood and recreation-based businesses become profitable and sustainable by providing targeted services that will help emerging industries such as the wine and grape industry. The aim is to provide specialized funding to these industries that will also support traditional rural businesses and keep land in agriculture.
The Maryland Wineries Association and the Maryland Grape Growers Association are supporting the vineyard loan program. Each loan application will be reviewed for financial viability by a loan review panel from MARBIDCO and for operational, viticultural and enological viability by members of the wine and grape industry's viticulture committee. Each loan application will include a business plan and each project will have a site visit to determine that there is the potential for a viable commercial vineyard. According to Fiola, these requirements will mean the loans will go to the most qualified applicants.
Maryland currently has 33 wineries and approximately 500 acres of planted vineyards.