Intertribal Agriculture CouncilNational Webinar Series:USDA Value Added Producer Grant (VAPG)June 4th, 2015

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2015 Value-Added Producer Grant Program

For Tribal Applicants

VAPG Purpose

Provides funds for economic planning activities or eligible working capital expenses

to enable viable Agricultural Producers to develop businesses that produce and market

Value-Added Agricultural Products and to create marketing opportunities for such

businesses.

VAPG

Value-Added Producer Grant

Authorization Section 231 of the Agriculture Risk Protection Act of 2000 (P. L. 106-224), as amended by section 6203 of

the Agricultural Act of 2014 (P. L. 113-79)

(see 7 U.S.C. 1632a)

Program RegulationFinal Rule 7 CFR part 4284 subpart J

published May 8, 2015

National Competition

FY2015 Available Funding: $30 million

Application Deadlines: July 2, 2015 for Grants.gov

July 7, 2015 for paper

Maximum Award Amounts: $75,000 Planning

$250,000 Working Capital

Matching Requirement: 1-to-1 match (50 percent of total project costs) cash or eligible in-kind contributions to be used only for eligible project purposes.

Grant Period: Up to 36 months, depending on project complexity.

Value-Added Producer Grant

Recent Tribal Project Examples

Oneida Tribe of Indians of Wisconsin- Joanie Buckley

Ute Mountain Ute Tribe Farm & Ranch- Paul Evans / Marcie Reichenau

Intertribal Maple Syrup Cooperative- Dan Cornelius

VAPG

Oneida White Corn

Changes in 2015

Program Regulation Final Rule 7 CFR 4284-J

• Changes resulting from the 2014 Farm Bill.

• Agency responses to public comments on Farm Bill and previous version of program regulation

• Clarifications, revision to conform to other USDA definitions, and information previously included only in the annual notice.

VAPG

Changes affecting Tribal Applicants

VAPG

Revised definition of ‘Agricultural producer:’

(1) An individual or entity that produces an Agricultural Commodity through participation in the day-to-day labor, management, and field operations; or that has the legal right to harvest an Agricultural Commodity that is the subject of the VAPG project.

Individuals and entities that may have ownership and/or financial control without being engaged in the day-to-day labor , management, and field operations will no longer be eligible for a value-added producer grant.

What does this change mean for Tribal applicants?

VAPG

Agricultural producer

2) The Agency shall determine the Agricultural producer status of Tribes and Tribal entities without regard to day-to-day labor, management, and field operation and right to harvest status.

How will the Agency determine eligibility “without regard to day-to-day labor, management, and field

operation and right to harvest status?”

VAPG

Tribes and tribal entities should address the questions in application template Appendix A regarding composition, structure and relationship of the entity to the tribe, the beneficiaries of returns generated by the project, etc.; AND MUST meet all other eligibility requirements.

Basic Program Requirements

VAPG

• Applicant eligibility• Project eligibility• Purpose eligibility• Evaluation criteria

Four Eligible Applicant Types

• Independent Producers• Agricultural Producer Groups• Farmer or Rancher Cooperatives• Majority-Controlled Producer-Based

Businesses

VAPG

All Four Applicant Types Must :

• Currently produce and own more than 50 percent of the raw commodity that will be used for the Value-Added product.

• Own the product from its raw commodity state through the production of the Value-Added product during the Project (except for MTVC).

VAPG

Emerging Market

• Agricultural Producer Groups, Farmer or Rancher Cooperatives, and Majority-Controlled Producer-Based Businesses, must show that they are entering an emerging market as a result of the proposed project.

• Applicants cannot have supplied the proposed product, geographic or demographic market for more than two years at time of application submission.

VAPG

Key Questions for Tribes

VAPG

• Is the tribe or tribal entity the applicant?

• Does the tribe or tribal entity produce and own more than 50 percent of the raw commodity needed for the project?

• Does the tribe or tribal entity own the product from raw commodity through the Value-Added process.

• Will participant tribal members and/or the tribe as a whole benefit from increased returns resulting from the project?

Project Eligibility

• Value-added product methodology• Expansion of customer base• Greater portion of revenue from the

process returned to the producer

VAPG

Five Value-Added Methodologies

• Change in physical state• Produced in a manner that enhances

the value of the agricultural commodity• Physical segregation• Farm- or ranch-based renewable

energy• Locally-produced agricultural food

product

Project Eligibility

• Increase in customer base• Greater portion of revenue derived from

the value-added process returned to the producer.

All applicants must demonstrate:

Project Eligibility

Purpose Eligibility

• 2 types of grants• Use of funds• Budget & work plan

VAPG

2 Types of VAPG Grants

1) Planning Grant

To pay a qualified (third-party) consultant for development of feasibility, marketing, business plan related to the processing and/or marketing of a value-added product.

2) Working Capital Grant

To pay eligible project expenses related to the processing and/or marketing of a value-added product.

Purpose Eligibility

Working Capital Grants

1) Requests of $50,000 or more (emerging market)-feasibility study required

2) Requests of $50,000 or more (market expansion)-business plan only required

3) Requests of less than $50,000-no feasibility study or business plan requirement.

Purpose Eligibility

Use of Funds

Examples of Eligible Costs:

• Processing costs including labor, utilities, packaging and labeling, ingredients;

• Additional raw commodity inventory from third parties (up 49% of the total amount required for the project)

• Advertising and promotion

• Financial/accounting systems

Purpose Eligibility

Use of Funds

Examples of Ineligible Costs:

• Purchase of land, buildings or equipment• Preparation of the grant application,• Research and development, architectural or

engineering design work• Expenses for the production, harvesting or delivery

to a processing facility of any agricultural commodity or product

Purpose Eligibility

Matching Funds

• Applicant cash, loan, or line of credit; and/or

• Applicant or family member in-kind contributions of fairly valued time spent on the project (applicant provided services limited to 25 percent of total project costs); and/or

• Third-party cash or

• Third-party in-kind contributions

Purpose Eligibility

Matching Funds must be…

• Equal to at least the grant amount (at least 50 percent of total project costs).

• Spent only on eligible expenses;

• Spent in advance of grant;

• From eligible sources without a real or apparent conflict of interest

• Verified at application and confirmed at award

Purpose Eligibility

Other Eligibility Requirements

VAPG

• Multiple Grant• Active Grant• Grant Period• Completeness

Evaluation Criteria

• Performance evaluation criteria• Proposal evaluation criteria

VAPG

• Applicant suggests one or more relevant criterion to be used to evaluate whether or not the primary goals and objectives of the project are being met.

• All applicants estimate how many jobs are expected to be created or saved as a result of the project?

• Working capital applicants record data on expansion of customer base and increase in revenue from the Applicant eligibility section.

Performance Evaluation Criteria

Proposal Evaluation Criteria

The Agency selects and ranks applications based on responses to 5 criteria:

1. Nature of the proposed project (0-30)

2. Qualifications of project personnel (0-20)

3. Commitments and support (0-10)

4. Work plan and budget (0-20)

5. Priority points (5 and/or additional 5)

VAPG

Scoring Priority

Five points will be awarded to eligible:• Beginning Farmers or Ranchers• Veteran Farmers or Ranchers*• Socially-Disadvantaged Farmers or

Ranchers• Small- or Medium-Sized Family Farms• Farmer or Rancher Cooperatives• Applications proposing Mid-Tier Value Chain

projects

VAPG

Scoring Priority

Up to 5 additional points will be awarded to Agricultural Producer Groups, Farmer or Rancher Cooperatives, and Majority Controlled Producer-Based Businesses that propose projects that best contribute to new or expanded marketing opportunities for:

• Beginning Farmers or Ranchers• Veteran Farmers or Ranchers*• Socially-Disadvantaged Farmers or Ranchers• Small- or Medium-Sized Family Farms

VAPG

Tools for Applicants

VAPG

Program Information & Materialshttp://

www.rd.usda.gov/programs-services/value-added-producer-grants

Outreach Fact sheets• General program Info• Locally-produced food• Harvesters• Mid-tier value chains• …and more!

TOOLS

TOOLS

Comprehensive Toolkits for

Planning and Working Capital

Checklists to ensure complete applications

TOOLS

Links to required forms and necessary resources, including:• SF 424s• AD 3030• Program

regulation• NOFA• And more!

Links to DUNS and SAM

Individual OPTIONAL templates for Planning and Working Capital applications.

TOOLS

Guidance for:• Tribal applicants

• Required documentation• Matching fund verification templates

• Reserve fund and priority point eligibility

TOOLS

Where to go for assistance:

USDA Rural Development State Office Contacts

http://www.rd.usda.gov/contact-us/state-offices

USDA Rural Development National Office

Amy CavanaughDirector, Grants Division

amy.cavanaugh@wdc.usda.gov

Tracey Kennedytracey.kennedy@wdc.usda.gov

Shantelle Gordonshantelle.gordon@wdc.usda.gov

QUESTIONS?

Webinar recording available at:

“IndianAg” Channel on YouTubeor check

http://IndianAgLink.com