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Value-Added Producer Grants

The VAPG program was funded in 2001 for the first time and was made available to individual producers and groups of producers who add value to their agricultural product through further processing.

The Value-Added Agricultural Producer Grants program is designed to encourage independent producers of agricultural commodities to process their raw products into marketable goods, thereby increasing farm income.

  $18 million is available for the VAPG program this year.

Who May Apply?

There are four eligible entities that can apply for the funds. Those are:

    Independent Producer. 

An individual producer of agricultural commodities or products including those products from aquaculture, fish harvesting, and wood lot enterprises can be an individual producer;

An association of producers such as a producer owned corporation, LLC, or LLP solely owned by producers. 

A steering committee composed of agricultural producers in the process of organizing an association to operate a value-added venture.

An independent producer can not produce under contract or joint ownership with any organization other than their own.

    Farmer or Rancher Cooperative 

A business incorporated under state cooperative or corporation statutes that is farmer or ranched owned, farmer or rancher controlled, and benefits are returned to the farmer or rancher owner on the basis of patronage of the cooperative.

Farmer or rancher owned cooperatives must propose ventures that are entering into emerging markets.

    Agricultural Producer Groups

Any organization that represents independent producers such as a producer trade association or a state or national commodity group. Agricultural Producer Groups must propose ventures that are entering emerging markets.

    Majority-Controlled Producer Based Business Ventures

A corporation, LLC, LLP, or other type of business structures where producers have more than 50 percent ownership and control of the entity.   Majority-Controlled Producer Based Business Ventures must propose project activities that are entering emerging markets.

What is an Emerging Market?

An emerging market is a new or developing market for the applicant. That is, a market the applicant has not traditionally supplied. The venture must be focused on this new or developing market.

Product Eligibility

A Value-Added Product Must:

Expand the customer base for the product or commodity, and result in a greater portion of the revenues derived from the value-added activity that is available to the producer.

The product must then meet one of the following criteria to be eligible:

The changing of the physical state or form of the product. Examples include: processing wheat into flour, corn into ethanol, slaughtering livestock or poultry, or slicing tomatoes. 

A product produced in a manner that enhances its value, as demonstrated through a business plan. An example is organically produced products. 

The physical segregation of an agricultural commodity or product in a manner  that results in the enhancement of the value of that commodity or product. Examples: include an identity preservation system for a variety or quality of grain desired by an identified end-user or the traceability of hormone-free livestock to the retailer.

The term “value-added agricultural product” includes any agricultural  commodity or product that is used to produce renewable energy on a farm or ranch. Examples: collecting and converting methane from animal waste to generate energy.

Locally produced and marketed farm products are those that are grown on your own farm and are sold within a 400 mile radius of your farm or within the state in which it is produced.

What Can Grant Funds Be Used For?

Funds are divided into two areas, planning and working capital.

Planning is a defined program of economic activities to determine the viability of  a potential value-added venture including feasibility studies, marketing plans, business plans and legal evaluations.  A maximum of $100,000 is available for a planning grant.

Working capital funds are used to operate the venture and pay the normal expenses associated with the operation of the venture.  A maximum of $300,000 is available for a working capital grant.

What are Ineligible Uses for the Fund?

Plan, repair, rehabilitate, acquire, or construct a facility
Purchase, rent, or install processing equipment
Pay for the preparation of the grant activity
Pay expenses not directly related to the funded venture
Pay costs incurred prior to receiving the grant
Fund political and lobbying activities
Fund activities prohibited by 7 CFR parts 3015 and 3019
Pay any expenses related to agricultural production

Scoring Criteria - Planning (for 2009)

Scoring Criteria - Working Capital (for 2009)

How Do You Apply?

Review and Selection Process

Reserved Funds

Applicants who submit their application for reserve funds must meet one of the three criteria below in order to compete in this category:

Beginning Farmers
Socially Disadvantaged Farmer
Mid-Tier Value Chain producer

An original and one copy of the proposal, with all required forms and  documentation, must be submitted in one package to the appropriate USDA Office. The application must be postmarked and mailed, shipped or sent overnight no later than June 22, 2009.  Applications in Georgia should be submitted to:

USDA Rural Development
111 E. Spring St.
Monroe, GA  30655

Non-Reserved Funds

An original and one copy of the proposal, with all required forms and  documentation, must be submitted in one package to the appropriate USDA Office. The application must be postmarked and mailed, shipped or sent overnight no later than March 31, 2008.  Applications in Georgia should be submitted to:

USDA Rural Development
111 E. Spring St.
Monroe, GA  30655

File an electronic application at the website: http://www.grants.gov. Note that you will need to
follow the instructions on the website to submit an application. Your submission will include the
required forms (outlined below) and an attachment which should include all remaining elements
of your application. 

Warning:  Do not wait until the last day and expect to file your application electronically.  You should start TODAY with the registration process.

The CCR registers your organization, housing your organizational information and allowing
http://www.Grants.gov to use it to verify your identity. You may register for the CCR by calling the CCR
Assistance Center at (888) 227-2423 or you may register online at: http://www.ccr.gov.

The Credential Provider gives you or your representative a username and password, as part of the
Federal Government’s e-Authentication to ensure a secure transaction. You will need the
username and password when you register with http://www.Grants.gov or use http://www.Grants.gov to submit your
application. You must register with the Credential Provider through http://www.Grants.gov at the following
website: https://apply.grants.gov/OrcRegister.

Electronic submissions via e-mail or fax will not be accepted.

For strictly a paper submission, an original (signed) of the proposal, with all required forms, must be submitted in one package to the above address. Do not submit any feasibility studies, marketing plans, or business plans at this time.  

What Does Your Application Consist Of?

The following forms and documents may assist you in completing your application.  Please follow the directions as published in the Request for Proposals for filing a complete application.  You can download the Notice of Funding by going here.

The following guide can also help you in preparing you grant request.  The template can help you prepare the application so that no required information is omitted.

There are additional guides that are available at http://www.rurdev.usda.gov/rbs/coops/vadg.htm

To view a PowerPoint presentation on this program, please download it here (pdf).

You must also obtain a DUNS number from Dun and Bradstreet.  This requirement applies to all applicants.  To find out information on how to request this number, please go here.

There is a 15 page limit per application.

You should also visit the Agricultural Marketing Resource Center at www.agmrc.org for much more information regarding value-added products.  

To print out a one-page brochure on this program, please choose here.

Applications for the 2009 funding cycle are announced in the Federal Register on March 16, 2007.  Applications were due by April 16, 2007.

Much more information can be found by going to our National web site at http://www.rurdev.usda.gov/rbs/coops/vadg.htm

The VAPG program was funded in 2001 for the first time and was made available to individual producers and groups of producers who add value to their agricultural product through further processing.

The 2002 Farm Bill contained legislation to fund the program for six years with an annual allocation of $40 million. Funding for FY '02 was $33 million, FY '03 was $28 million and FY '04 was $13 million.  Funding for FY '07 was $19,475,000.  The new Value-Added Agricultural Producer Grants program is designed to encourage independent producers of agricultural commodities to process their raw products into marketable goods, thereby increasing farm income. 

Who May Apply?

There are four eligible entities that can apply for the funds. Those are:

    Independent Producer. 

An individual producer of agricultural commodities or products including those products from aquaculture, fish harvesting, and wood lot enterprises can be an individual producer;

An association of producers such as a producer owned corporation, LLC, or LLP solely owned by producers. 

A steering committee composed of agricultural producers in the process of organizing an association to operate a value-added venture.

An independent producer can not produce under contract or joint ownership with any organization other than their own.

    Farmer or Rancher Cooperative 

A business incorporated under state cooperative or corporation statutes that is farmer or ranched owned, farmer or rancher controlled, and benefits are returned to the farmer or rancher owner on the basis of patronage of the cooperative.

Farmer or rancher owned cooperatives must propose ventures that are entering into emerging markets.

    Agricultural Producer Groups

Any organization that represents independent producers such as a producer trade association or a state or national commodity group. Agricultural Producer Groups must propose ventures that are entering emerging markets.

    Majority-Controlled Producer Based Business Ventures

A corporation, LLC, LLP, or other type of business structures where producers have more than 50 percent ownership and control of the entity.   Majority-Controlled Producer Based Business Ventures must propose project activities that are entering emerging markets.

What is an Emerging Market?

An emerging market is a new or developing market for the applicant. That is, a market the applicant has not traditionally supplied. The venture must be focused on this new or developing market.

Product Eligibility

A Value-Added Product Must:

Expand the customer base for the product or commodity, and result in a greater portion of the revenues derived from the value-added activity that is available to the producer.

The product must then meet one of the following criteria to be eligible:

The changing of the physical state or form of the product. Examples include: processing wheat into flour, corn into ethanol, slaughtering livestock or poultry, or slicing tomatoes. 

A product produced in a manner that enhances its value, as demonstrated through a business plan. An example is organically produced products. 

The physical segregation of an agricultural commodity or product in a manner  that results in the enhancement of the value of that commodity or product. Examples: include an identity preservation system for a variety or quality of grain desired by an identified end-user or the traceability of hormone-free livestock to the retailer.

The term “value-added agricultural product” includes any agricultural  commodity or product that is used to produce renewable energy on a farm or ranch. Examples: collecting and converting methane from animal waste to generate energy

What Can Grant Funds Be Used For?

Funds are divided into two areas, planning and working capital.

Planning is a defined program of economic activities to determine the viability of  a potential value-added venture including feasibility studies, marketing plans, business plans and legal evaluations.  A maximum of $100,000 is available for a planning grant.

Working capital funds are used to operate the venture and pay the normal expenses associated with the operation of the venture.  A maximum of $300,000 is available for a working capital grant.

What are Ineligible Uses for the Fund?

Plan, repair, rehabilitate, acquire, or construct a facility
Purchase, rent, or install processing equipment
Pay for the preparation of the grant activity
Pay expenses not directly related to the funded venture
Pay costs incurred prior to receiving the grant
Fund political and lobbying activities
Fund activities prohibited by 7 CFR parts 3015 and 3019
Pay any expenses related to agricultural production

How Do You Apply?

Review and Selection Process

An original and one copy of the proposal, with all required forms and  documentation, must be submitted in one package to the appropriate USDA State Office. The application deadline is 4:00 p.m. (Eastern) on April 16, 2007.  Applications in Georgia should be submitted to:

Cooperative Services
Attn: VAPG Program
MS 3250, Rm. 4016
1400 Independence Ave. SW
Washington, DC 20250-3250
(202) 720-7558

File an electronic application at the website: http://www.grants.gov. Note that you will need to follow the instructions on the website to submit an application. Your submission will include the
required forms (outlined below) and an attachment which should include all remaining elements of your application.

The CCR registers your organization, housing your organizational information and allowing http://www.Grants.gov to use it to verify your identity. You may register for the CCR by calling the CCR
Assistance Center at (888) 227-2423 or you may register online at: http://www.ccr.gov.

The Credential Provider gives you or your representative a username and password, as part of the Federal Government’s e-Authentication to ensure a secure transaction. You will need the
username and password when you register with http://www.Grants.gov or use http://www.Grants.gov to submit your application. You must register with the Credential Provider through http://www.Grants.gov at the following website: https://apply.grants.gov/OrcRegister.

Electronic submissions are strongly encouraged.  Electronic submissions should be e-mailed to 

Electronic submissions must be in Microsoft Word, WordPerfect, Rich Text Format (RTF), or Portable Document Format (PDF). If proposals are electronically submitted, signed paper copies of the three required forms, SF–424 ‘‘Application for Federal Assistance,’’ SF–424A ‘‘Budget Information—Non-Construction Programs,’’ and SF–424B ‘‘Assurances—Non-Construction Programs,’’ need to be mailed to the above address. For strictly a paper submission, an original (signed) and one copy of the proposal, with all required forms, must be submitted in one package to the above address. Do not submit any feasibility studies, marketing plans, or business plans at this time. Applications sent by facsimile will not be accepted.  

What Does Your Application Consist Of?

The following forms and documents may assist you in completing your application.  Please follow the directions as published in the Request for Proposals for filing a complete application.  You can download the Notice of Funding by going here.

The following guide can also help you in preparing you grant request.  The template can help you prepare the application so that no required information is omitted.

There are additional guides that are available at http://www.rurdev.usda.gov/rbs/coops/vadg.htm

To view a PowerPoint presentation on this program, please download it here (pdf).

There is a 35 page limit per application.

To print out a one-page brochure on this program, please choose here.

Please send any comments or suggestions to:   craig.scroggs@ga.usda.gov

Last Updated : May 06, 2009