Value Added Producer Grant Program

Official Website: http://www.rurdev.usda.gov/rbs/coops/vadg.htm

Purpose: Grants may be used for planning activities and for working capital for marketing value-added agricultural products and for farm-based renewable energy.

Eligible applicants: independent producers, farmer and rancher cooperatives, agricultural producer groups, and majority-controlled producer-based business ventures.

Eligible uses of funding (Planning Grant): To obtain legal advice and assistance, To conduct a feasibility analysis, To develop a business plan, To develop a marketing plan

Eligible uses of funding (Working Capital): To provide funds to operate ventures and pay the normal expenses of the venture.  (There are limitations on the use of funds).

Ineligible uses of funding: Starting or expanding a farm or farming operation, normal costs of production, buying fixed equipment, permanent improvements to a farm or ranch (buildings, machinery, land)

Funding level: The maximum grant for a Planning Grant is $100,000.  The maximum grant for Working Capital Grant is $300,000.  $1.5 million has been reserved for grants that are $25,000 or less.

Match requirement: Yes. Must match each VAPG dollar with equal amount.  Program allows in-kind match. Requires match be an eligible purpose under the grant.  For example, you cannot use the cost of machinery as match as you cannot use VAPG funds to purchase machinery.

Timing of grants: Proposals are usually due sometime in the spring/early summer.  The annual Notice of Solicitation of Applications (NOSA) for the 2006 funding cycle was published on December 21, 2005.  Applications are being accepted until March 31, 2006.

Tips to writing a successful VAPG:

• Start early.
• Respond specifically to the criteria that are the basis for scoring.   Maximum score is 100 points.
• Use the University of Nebraska Template.  University of Nebraska Food Science Center’s VAPG Template http://fpc.unl.edu/Newsworthy/grant.htm If you decide to apply.  It will make your work much easier!
• Work with your local SBDC or Extension Office to get your financial information organized.

Examples of funded projects: 

“To develop an alliance between rural farmers and rural grocers to increase demand for naturally grown pork through marketing of processed meats such as hams, bacon and sausage products”

“To conduct a feasibility analysis and develop a business plan for producing a variety of NJ value-added dairy products benefiting producers in Sussex and Warren Counties”

“For working capital to enter new markets for small specialty potatoes”