On March 5, 2021, USDA Rural Development announced the availability of at least $76 million in total funding for VAPG projects. The application window to apply is open now and online applications are accepted until April 29, 2020 through grants.gov, and paper applications must be postmarked by May 4, 2021. We encourage all readers to help get the word out to qualified individuals and groups.
“Value-added” foods and goods are made from raw agricultural products (e.g., vegetables, grains, or dairy) that are minimally processed and then transformed into products like cheese, sauces, and breads. Specially labeled or marketed goods (e.g. “organic” or “locally grown”) can also be considered value-added as the label claim makes their products more appealing (valuable) to consumers. Value-added products bring in higher prices than raw products alone, which helps farmers and ranchers improve their bottom lines and grow their businesses – which in turn increases hiring and spending in their local communities! Making the jump to value-added production can be time and money intensive, which is why many producers have found success with using the U.S. Department of Agriculture’s (USDA) Value-Added Producer Grant (VAPG) program to kickstart new or expand existing value-added operations.
In an effort to help farmers regain business lost during the pandemic, Congress provided $35 million in additional VAPG funding – with a reduced cost share match! – to supplement the $41 million already available for USDA Rural Development through mandatory farm bill funding and annual FY 2021 appropriations. Unfortunately the changes to the cost share requirements have caused confusion. To start, the VAPG grant cycle will be open to all applicants with a 10% cost share requirement. Once that initial $35 million provided as part of coronavirus relief is awarded, any unfunded VAPG application with a score of 50 or higher will be given the opportunity to amend their budget to compete for the remaining $41 million in funding that will have the normal, farm bill set, 50% cost share requirement. You can learn more about the changes made to the program in USDA’s Amended Notice.
Value-Added Producer Grant (VAPG)
Administered by the Rural Business-Cooperative Service of the USDA, VAPG provides grant funding to independent producers, including farmer and rancher groups and collectives, to develop or expand value-added producer-owned businesses. There are two types of grants awarded through VAPG:
- Planning projects provide grant funds of up to $75,000 in economic planning activities such as the development of business and marketing plans and feasibility studies needed to establish viable marketing opportunities for value-added products
- Working capital projects are directly related to the processing and/or marketing of value-added products with a maximum award amount of $250,000. In general, applications with requests of $50,000 or more must be supported by an independent feasibility study and business plan.
Who is eligible?
Viable entities that are eligible to apply include:
- Independent, individual agricultural producers
- Groups of agricultural producers
- Majority-controlled producer-based business ventures
- Farmer or rancher cooperatives
Read more about eligibility criteria in the VAPG section of our Grassroots Guide
How do I apply?
More information can be found on USDA’s VAPG grant page, where you will find toolkit guides for both grant projects, required documentation, and steps on preliminary actions your operation should take prior to submitting an application. Get in touch with your state office’s Business Program Specialist to walk through your project and see if it is eligible for grant funding.
When is the deadline?
The FY2021 application window is currently open now through April 24, 2021 for online applications and May 4, 2021 for paper applications.
- Paper applications: All materials for paper applications must be submitted and/or postmarked by May 4, 2021 to be considered for funding this cycle.
- Electronic applications: All materials must be submitted via http://www.grants.gov and be received before Midnight EST on April 29, 2021
- You may also opt to submit your application via email or in-person over to your local field office– in-person submissions must be done before COB at 4:30pm local time on May 4, 2021.
- Contact your State Rural Development Coordinator with any questions.
VAPG is a subprogram of the Local Agriculture Market Program (LAMP) that provides competitive grants to individual independent agricultural producers, groups of independent producers, producer-controlled entities, organizations representing agricultural producers, and farmer or rancher cooperatives to create or expand value-added producer-owned businesses. Priority is given to projects that increase opportunities for small and mid-sized family farms, and/or for beginning, veteran, and socially disadvantaged farmers and ranchers.
For more information on VAPG and program eligibility, click here or visit our Farmers’ Guide to Applying for the Value Added Producer Grant Program. USDA has also created a “toolkit” for applicants, which includes an application checklist, templates, required grant forms, and instructions (this can be found under the “To Apply” tab).
NSAC’s Legacy of Advocacy
The National Sustainable Agriculture Coalition (NSAC) helped to create VAPG as part of the 2000 Agricultural Risk Protection Act. For the last twenty plus years, NSAC has been one of the leading advocates for VAPG and other programs that support local food systems and rural development. In the 2002 Farm Bill, NSAC successfully advocated to strengthen VAPG and expand the program to include support for organic products and sustainable livestock niche markets.
In the 2008 Farm Bill negotiations, NSAC won the addition of local food enterprises and food supply networks linking farm to table as eligible activities for VAPG support. We also worked with Congress to secure program priorities for assisting small and mid-size family farms and for beginning and socially disadvantaged farmers and ranchers. In the 2014 Farm Bill, NSAC worked with Congress to ensure that program priorities were being met when USDA selects successful proposals. We also won the addition of returning veteran farmers as a new priority category.
The 2018 Farm Bill reauthorized VAPG through LAMP, which guarantees VAPG permanent mandatory funding at $17.5 million per year for the next five years – a major victory for NSAC and our allies in the local/regional food community.
In addition to our farm bill work, NSAC has also led appropriations advocacy to secure additional, discretionary funds for VAPG. The FY 2019 omnibus appropriations bill included $15 million for VAPG, the FY 2020 minibus appropriations bill included $12 million in additional funding for the program, and the FY 2021 appropriations bill again provided $12 million in discretionary funding.