Deadline Set for Producer Grants

U.S. wine industry stands to benefit from $18 million value-added ag program
 
 
Washington, D.C. -- The USDA rural development branch recently announced the availability of $18 million to be used for competitive grants through its value-added producer grant program. Bill Nelson of WineAmerica said that in past years the wine industry has been successful in securing these grants, first made available in 2001 and then written into the U.S. Farm Bill in 2003.

In 2008 the program awarded wine and grape farmers and associations nearly $1 million in planning and working capital grants, with three Maryland wineries among the winners. Two years earlier, 23 of the 185 agricultural grant recipients were wine industry associations, vineyard or winery owners.

Who is eligible?
The availability notice indicates that the objective of this program is to help independent producers, agriculture producer groups, farmer/rancher cooperatives and minority-controlled producer-based ventures. Nelson said that trade associations are considered agricultural producer groups and are eligible to apply for funding on behalf of their members.

Karen Firestein, the USDA rural development employee who runs the value-added producer grant program in California, told Wines &  Vines that trade associations such as Wine Institute, the Monterey County Vintners & Growers Association and the Lodi-Woodbridge Winegrape Commission all have won grants in the past. She added that applicants are encouraged to get in touch with their state's USDA Rural Development office as soon as possible to find out if they are eligible to apply and begin the application process.

Applicants may apply for a planning grant or a working capital grant, but not both. Many industry associations use the funding for marketing regional wines. There is no minimum grant amount, but the maximum planning grant is $100,000 and the maximum working capital grant is $300,000. According to Firestein, the split between planning and working capital grants is about 50-50.

Feasibility study
The deadline for this round of grant applications is Nov. 30, 2009. And since a feasibility study from an independent, third-party consultant is required with the application, quick action is needed. Firestein said that individual states' USDA Rural Development offices may have advice about how to find an appropriate consultant, though some applicants use other channels to find them, such as local small business development centers, accountants and agricultural extension advisers.

Feasibility studies are required to show how the proposed venture would operate, answering such questions as, "What resources are needed?" and "When will the venture be completed?" (For further information about the feasibility study and other requirements, see rurdev.usda.gov/rbs/coops/vadg.htm.)

The website includes other details regarding eligibility, as well as a template to help write the grant application. Applicants may submit drafts to their state office for review prior to Oct. 1, 2009. Once applications are completed, an appointed USDA staff member reviews all of the applications at the state level, while three outside agents review a portion of each application, scoring each one as they go. Applications and their recommended scores ultimately are sent to the federal office of the USDA Rural Development department.

Special consideration
According to the notice of grant funding availability, the USDA department plans to offer 80 grants with an average amount of $140,000. In 2008, 31% of awards were $50,000 or less. The document adds that 10% of available funds are being set aside for applications submitted by "beginning farmers or ranchers" (those who have operated a farm for 10 years or fewer) and "socially disadvantaged farmers or ranchers." Socially disadvantaged is defined as "a group whose members have been subjected to racial, ethnic or gender prejudice because of their identity as members of a group, without regard to their individual qualities."

Operators of small and medium sized farms and ranches that are structured as family farms are encouraged to apply. Under current guidelines, gross sales of agricultural product can be no more than $250,000 for a small farm and between $250,001 and $700,000 for a medium farm.

To be directed to your USDA Rural Development state office, call (800) 670-6553 and press 1. For this or other information about the value-added producer grant program, visit rurdev.usda.gov/rbs/coops/vadg.htm.