$19M grant open to spark growth of value-added agri-biz ventures

HILO, Hawaii—More than $19 million in grants is being made available nationwide to support the development of renewable energy projects and value-added agricultural business ventures, according to USDA Rural Development state director Lorraine P. Shin yesterday.

The Value Added Producer Grant program encouraged the development of renewable energy projects and is part of a comprehensive energy strategy announced by Agriculture Secretary Mike Johanns in early December to help farmers and ranchers mitigate the impact of high energy costs and develop long-term solutions.

Under this year’s program, the amount that can be awarded to a producer in the form of a working capital grant has been doubled to $300,000, and $1.5 million is also being allocated to provide grants of $25,000 or less to eligible producers.

Again this year, priority consideration will be given to those applicants who have at least 51 percent of project costs dedicated to activities for a bioenergy project.

To date, the program has funded $116 million in value-added grants for over 750 recipients nationwide, including $20.5 million to develop and market renewable energy projects in 29 states.

Renewable energy projects include biodiesel, ethanol or wind energy production, or the use of biomass to generate energy.

The grants may be used for planning activities, such as feasibility studies, marketing and business plans needed to establish a viable value-added marketing opportunity for an agricultural product, or to provide working capital for operating a value-added business venture, marketing value-added agricultural products and for farm-based renewable energy projects. Eligible applicants are independent producers, farmer and rancher cooperatives, agricultural groups, and majority-controlled producer-based business ventures.

Awards will be made on a competitive basis. Applications must be received no later than March 31, 2006. Detailed information and program requirements were included in the Dec. 21, 2005, publication of the Federal Register. For more information, contact Timothy W. O’Connell, Assistant to the State Director in Hilo at (808) 933-8313 or via e-mail at tim.oconnell@hi.usda.gov.

Johanns said that these Rural Development funds are a part of the strategy to bolster renewable energy and will help support value-added products.”

“President Bush’s commitment and the concerns about energy costs voiced at Farm Bill Forums across the nation inspired USDA to develop a comprehensive energy strategy and I am pleased to demonstrate we are following through on that strategy,” he said at the recent American Farm Bureau Federation annual meeting in Nashville.

Since 2001, USDA said it has invested nearly $290 million in renewable energy as part of Bush’s commitment to reduce dependence on foreign oil.

USDA Rural Development’s mission is to deliver programs in a way that will support increasing economic opportunity and improve the quality of life of rural residents.

As a venture capital entity, Rural Development has invested over $63 million since the beginning of the Bush administration to provide equity and technical assistance to finance and foster growth in homeownership, business development, and critical community and technology infrastructure. As a result, over 1.1 million jobs have been created or saved through these investments.

Further information on rural programs is available at a local USDA Rural Development office or by visiting USDA’s web site at http://www.rurdev.usda.gov.