Announcement of Value-Added Producer Grant Application Deadlines, 20900-20911 [E9-10424]

Agencies

• DEPARTMENT OF AGRICULTURE
• Rural Business-Cooperative Service

[Federal Register Volume 74, Number 86 (Wednesday, May 6, 2009)]
[Notices]
[Pages 20900-20911]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-10424]


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DEPARTMENT OF AGRICULTURE

Rural Business-Cooperative Service


Announcement of Value-Added Producer Grant Application Deadlines

AGENCY: Rural Business-Cooperative Service, USDA.

ACTION: Notice of solicitation of applications.

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SUMMARY: The Rural Business-Cooperative Service (RBS) announces the 
availability of approximately $18 million in competitive grant funds 
for fiscal year (FY) 2009 to help independent agricultural producers 
enter into value-added activities.
    Awards may be made for planning activities or for working capital 
expenses, but not for both. The maximum grant amount for a planning 
grant is $100,000 and the maximum grant amount for a working capital 
grant is $300,000.
    Ten percent of available funds are reserved to fund applications 
submitted by Beginning Farmers or Ranchers and Socially Disadvantaged 
Farmers or Ranchers as defined at 7 U.S.C. 1991(a) and 2003(e). An 
additional ten percent of available funds are reserved to fund Mid-Tier 
Value Chain projects, as defined in section I of this notice (both 
collectively referred to as ``reserved funds'').

DATES: Applications for grants must be submitted on paper or 
electronically according to the following deadlines:
    Paper applications for unreserved funds must be postmarked and 
mailed, shipped, or sent overnight no later than July 6, 2009, to be 
eligible for FY 2009 grant funding. Paper applications for reserved 
funds must be postmarked and mailed, shipped, or sent overnight no 
later than June 22, 2009 to be eligible for FY 2009 grant funding. Late 
applications are not eligible for FY 2009 grant funding.
    Electronic applications for unreserved funds must be received by 
July 6, 2009, to be eligible for FY 2009 grant funding. Electronic 
applications for reserved funds must be received no later than June 22, 
2009, to be eligible for FY 2009 grant funding. Late applications are 
not eligible for FY 2009 grant funding.

ADDRESSES: An application guide and other materials may be obtained at 
https://www.rurdev.usda.gov/rbs/coops/vadg.htm or by contacting the 
applicant's USDA Rural Development State Office. The State Office can 
be reached by calling 800-670-6553 and pressing ``1.''
    Paper applications must be submitted to the Rural Development State 
Office for the State in which the Project will primarily take place. 
Addresses may be found at: https://www.rurdev.usda.gov/recd_map.html.
    Electronic applications must be submitted through the Grants.gov 
Web site at: https://www.grants.gov, following the instructions found on 
this Web site.

FOR FURTHER INFORMATION CONTACT: Applicants should visit the program 
Web site at https://www.rurdev.usda.gov/rbs/coops/vadg.htm, which 
contains application guidance, Frequently Asked Questions and an 
Application Guide with templates. Or applicants may contact their USDA 
Rural Development State Office. The State Office can be reached by 
calling 800-670-6553 and pressing ``1,'' or by selecting the Contact 
Information link at the above Web site.
    Applicants are encouraged to contact their State Offices well in 
advance of the deadline to discuss their projects and ask any questions 
about the application process. Also, applicants may submit drafts of 
their applications to their State Offices for a preliminary review 
anytime prior to June 5, 2009. The preliminary review will only assess 
the eligibility of the application and its completeness. The results of 
the preliminary review are not binding on the Agency.

SUPPLEMENTARY INFORMATION:

Overview

    Federal Agency: USDA Rural Development.
    Funding Opportunity Title: Value-Added Producer Grants.
    Announcement Type: Initial announcement.
    Catalog of Federal Domestic Assistance Number: 10.352.
    Dates: Application Deadline: Applications for grants must be 
submitted on paper or electronically according to the following 
deadlines:
    Paper applications for unreserved funds must be postmarked and 
mailed, shipped, or sent overnight no later than July 6, 2009 to be 
eligible for FY 2009 grant funding. Paper applications for reserved 
funds must be postmarked and mailed, shipped, or sent overnight no 
later than June 22, 2009 to be eligible for FY 2009 grant funding. Late 
applications are not eligible for FY 2009 grant funding.
    Electronic applications for unreserved funds must be received by 
July 6, 2009 to be eligible for FY 2009 grant funding. Electronic 
applications for reserved funds must be received by June 22, 2009. Late 
applications are not eligible for FY 2009 grant funding.

I. Funding Opportunity Description

    This solicitation is issued pursuant to section 231 of the 
Agriculture Risk Protection Act of 2000 (Pub. L. 106-224) as amended by 
section 6202 of the Food, Conservation, and Energy Act of 2008 (Pub. L. 
110-246) (see 7 U.S.C. 1621 note)) authorizing the establishment of the 
Value-Added Agricultural Product Market Development grants, also known 
as Value-Added Producer Grants. The Secretary of Agriculture has 
delegated the program's administration to USDA Rural Development 
Cooperative Programs.
    The primary objective of this grant program is to help Independent 
Producers of Agricultural Commodities, Agriculture Producer Groups, 
Farmer and Rancher Cooperatives, and Majority-Controlled Producer-Based 
Business Ventures develop strategies to create marketing opportunities 
and to help develop Business Plans for viable marketing opportunities 
regarding production of bio-based products from agricultural 
commodities. Cooperative Programs will competitively award funds for 
Planning Grants and Working Capital Grants. In order to provide program 
benefits to as many eligible applicants as possible, applicants must 
apply only for a Planning Grant or for a Working Capital Grant, but not 
both. Grants will only be awarded if Projects are determined to be 
economically viable and sustainable.
    USDA Rural Development is encouraging projects that highlight 
innovative uses of agricultural products. This may include using 
existing agricultural products in non-traditional ways and/or merging 
agricultural products with technology in creative ways. As with all 
value-added efforts, generating new products, creating expanded 
marketing opportunities and increasing producer income are the end 
goal. Applications proposing to develop innovative, sustainable 
products, businesses, or marketing opportunities that accelerate 
creation of new economic opportunities and commercialization in the 
agri-food, agri-science, or agriculture products

[[Page 20901]]

integrated or merged with other sciences or technologies are invited. 
This may include alternative uses of agricultural products as well as, 
value-added processing of agricultural commodities to produce bio-
materials (e.g. plastics, fiberboard), green chemicals, functional 
foods (e.g. lutin enhanced ``power bar'' snacks, soy enhanced 
products), nutraceuticals, on-farm renewable energy, and biofuels (e.g. 
ethanol, bio-diesel).
    Please note that businesses of all sizes may apply, but priority 
will be given to Small and Medium-Sized Farms or Ranches that are 
structured as Family Farms and there is no restriction on the minimum 
grant size that will be awarded. In FY 2008, 31 percent of awards were 
$50,000 or less.

Definitions

    The definitions at 7 CFR 4284.3 and 4284.904 are incorporated by 
reference, with the exception of the definition of Value-Added, which 
is superseded by the definition of Value-Added Agricultural Product as 
published in the 2008 Farm Bill and is included below. In addition, the 
Agency uses the following terms in this NOSA: Agricultural Commodity, 
Beginning Farmer or Rancher, Business Plan, Conflict of Interest, 
Family Farm, Feasibility Study, Local and Regional Supply Network, 
Locally-Produced Agricultural Food Product, Marketing Plan, Medium-
Sized Farm, Mid-Tier Value Chain, Pro Forma Financial Statements, 
Project, Small Farm, Socially Disadvantaged Farmer or Rancher, and 
Venture. It is the Agency's position that those terms are defined as 
follows.
    Agricultural Commodity--An unprocessed product of farms, ranches, 
nurseries, and forests. Agricultural Commodities include: Livestock, 
poultry, and fish; fruits and vegetables; grains, such as wheat, 
barley, oats, rye, triticale, rice, corn, and sorghum; legumes, such as 
field beans and peas; animal feed and forage crops; seed crops; fiber 
crops, such as cotton; oil crops, such as safflower, sunflower, corn, 
and cottonseed; trees grown for lumber and wood products; nursery stock 
grown commercially; Christmas trees; ornamentals and cut flowers; and 
turf grown commercially for sod. Agricultural Commodities do not 
include horses or animals raised as pets, such as cats, dogs, and 
ferrets.
    Beginning Farmer or Rancher--See 7 U.S.C. 1991(a):
    Business Plan--A formal statement of a set of business goals, the 
reasons why they are believed attainable, and the plan for reaching 
those goals, including three years of pro forma financial statements. 
It may also contain background information about the organization or 
team attempting to reach those goals.
    Conflict of Interest--A situation in which a person or entity has 
competing professional or personal interests that make it difficult for 
the person or business to act impartially. An example of a Conflict of 
Interest is a grant recipient or an employee of a recipient that 
conducts or significantly participates in conducting a Feasibility 
Study for the recipient.
    Family Farm--See 7 CFR 761.2.
    Feasibility Study--An independent, third party analysis that shows 
how the Venture would operate under a set of assumptions--the 
technology used (the facilities, equipment, production process, etc.), 
the qualifications of the management team, and the financial aspects 
(capital needs, volume, cost of goods, wages, etc.). The analysis 
should answer the following questions about the Venture.
    (1) Where is it now?
    (2) Where do the owners of the Venture want to go?
    (3) Why do the owners of the Venture want to go forward with the 
Venture?
    (4) How will the owners of the Venture accomplish the Venture?
    (5) What resources are needed?
    (6) Who will provide assistance?
    (7) When will the Venture be completed?
    (8) How much will the Venture cost?
    (9) What are the risks?
    Local and Regional Supply Network--An interconnected group of food-
related business enterprises through which food products move from 
production through consumption in a local or regional area of the U.S. 
Examples of food-related business enterprises are Agricultural 
Producers, processors, distributors, wholesalers, retailers, and 
consumers. Entities that are engaged in agricultural production, food 
processing, distribution, marketing, or consumption on a national or 
global scale are not considered to be part of a local and regional 
supply network.
    Locally-Produced Agricultural Food Product--Any agricultural food 
product that is raised, produced, and distributed in--
    (1) the locality or region in which the final product is marketed, 
so that the total distance that the product is transported is less than 
400 miles from the origin of the product; or
    (2) the State in which the product is produced.
    Marketing Plan--A plan for the Venture conducted by a qualified 
consultant that identifies a market window, potential buyers, a 
description of the distribution system and possible promotional 
campaigns.
    Medium-Sized Farm--A farm or ranch that has averaged $500,000 or 
less in annual gross sales of agricultural products in the last three 
years.
    Mid-Tier Value Chain--Local and regional supply networks that link 
independent producers with businesses and cooperatives that market 
Value-Added Agricultural Products in a manner that--
    (1) targets and strengthens the profitability and competitiveness 
of small and medium-sized farms and ranches that are structured as a 
family farm; and
    (2) obtains agreement from an eligible Agricultural Producer Group, 
Farmer or Rancher Cooperative, or Majority-Controlled Producer-Based 
Business Venture that is engaged in the value chain on a marketing 
strategy.
    Pro Forma Financial Statements--Financial statements that identify 
the future financial position of a company. They are part of the 
Business Plan and include an explanation of all assumptions, such as 
input prices, finished product prices, and other economic factors used 
to generate the financial statements. They must include cash flow 
statements, income statements, and balance sheets. Income statements 
and cash flow statements must be monthly for the first year, then 
annual for future years. The balance sheet should be annual for all 
years.
    Project--Includes all proposed activities to be funded by the VAPG 
and Matching Funds:
    Small Farm--A farm or ranch that has averaged $250,000 or less in 
annual gross sales of agricultural products in the last three years.
    Socially Disadvantaged Farmer or Rancher--See 7 U.S.C. 2003(e):
    Value-Added Agricultural Product--Any agricultural commodity or 
product that
    (1)(i) has undergone a change in physical state;
    (ii) was produced in a manner that enhances the value of the 
agricultural commodity or product, as demonstrated through a Business 
Plan that shows the enhanced value, as determined by the Secretary;
    (iii) is physically segregated in a manner that results in the 
enhancement of the value of the Agricultural Commodity or product;
    (iv) is a source of farm- or ranch-based renewable energy, 
including E-85 fuel; or
    (v) is aggregated and marketed as a locally-produced agricultural 
food product; and

[[Page 20902]]

    (2) as a result of the change in physical state or the manner in 
which the Agricultural Commodity or product was produced, marketed, or 
segregated--
    (i) the customer base for the agricultural commodity or product is 
expanded; and
    (ii) a greater portion of the revenue derived from the marketing, 
processing, or physical segregation of the agricultural commodity or 
product is available to the producer of the commodity or product.
    Venture--Includes the Project and any other activities related to 
the production, processing, and marketing of the Value-Added product 
that is the subject of the VAPG grant request. Please note that not all 
Venture-related expenses will be eligible for this program.

II. Award Information

    Type of Award: Grant.
    Fiscal Year Funds: FY 2009.
    Approximate Total Funding: $18 million.
    Approximate Number of Awards: 80.
    Approximate Average Award: $140,000.
    Floor of Award Range: None.
    Ceiling of Award Range: $100,000 for Planning Grants and $300,000 
for Working Capital Grants.
    Anticipated Award Date: September 1, 2009.
    Budget Period Length: Not to exceed 3 years.
    Project Period Length: Not to exceed 3 years.

III. Eligibility Information

A. Eligible Applicants

    Applicants must be an Independent Producer, Agriculture Producer 
Group, Farmer or Rancher Cooperative, or Majority-Controlled Producer-
Based Business Venture as defined in 7 CFR part 4284, subpart A. Local 
and Regional Supply Networks, as defined in Section I of this notice 
are eligible only to apply for funds reserved for Mid-Tier Value Chain 
Projects.
    An applicant applying as an Independent Producer must be 100 
percent owned by Independent Producers. The owner(s) must currently own 
and produce more than 50 percent of the Agricultural Commodity that 
will be used for the Value-Added Agricultural Product, and that product 
must be owned by the Independent Producer owners from its raw commodity 
state through the marketing of the final product. Examples of 
Independent Producers are steering committees, sole proprietorships, 
LLCs, LLPs, and other for-profit corporations.
    An applicant applying as an Agriculture Producer Group must have a 
mission that includes working on behalf of Independent Producers. The 
majority of its membership and board of directors must meet the 
definition of an Independent Producer. The applicant must identify the 
Independent Producers on whose behalf the proposed Project will be 
completed. Note that this type of applicant may not apply on behalf of 
its entire membership. The Independent Producers on whose behalf the 
proposed Project will be completed must currently own and produce more 
than 50 percent of the Agricultural Commodity that will be used for the 
Value-Added Agricultural Product, and that product must be owned by the 
Independent Producer owners from its raw commodity state through the 
marketing of the final product. Examples of Agricultural Producer 
Groups are trade associations.
    An applicant applying as a Farmer or Rancher Cooperative must be in 
good standing and incorporated as a cooperative in its state of 
incorporation. The cooperative must be 100 percent owned by farmers and 
ranchers. These owners must currently own and produce more than 50 
percent of the Agricultural Commodity that will be used for the Value-
Added Agricultural Product, and that product must be owned by the 
Independent Producer owners from its raw state through the marketing of 
the final product.
    An applicant applying as a Majority-Controlled Producer-Based 
Business Venture must have more than 50 percent of its ownership and 
control held by Independent Producers or partnerships, LLCs, LLPs, 
corporations, or cooperatives that are themselves 100 percent owned and 
controlled by Independent Producers. The Independent Producer owners 
must currently own and produce more than 50 percent of the Agricultural 
Commodity that will be used for the Value-Added Agricultural Product, 
and that product must be owned by the Independent Producer owners from 
its raw commodity state through the marketing of the final product. 
Examples of Majority-Controlled Producer-Based Business Ventures are 
LLCs, LLPs, and other for-profit corporations. No more than 10 percent 
of program funds can go to applicants that are Majority-Controlled 
Producer-Based Business Ventures.
    For the Mid-Tier Value Chain reserved funds only, an applicant 
applying as a Local and Regional Supply Network must be either one of 
the organizations that is a member of the network who agrees to be the 
legal representative for the network and assume responsibility for the 
management of grant funds, if selected for funding, or the applicant 
must be a legal entity that is comprised of the business enterprises 
that are members of the network. The network must operate on a local 
and/or regional basis in the United States. And, it must link 
independent producers with businesses and cooperatives that market 
Value-Added Agricultural Products in a manner that targets and 
strengthens the profitability and competitiveness of Small and Medium-
Sized Farms and Ranches that are structured as a Family Farm. Finally, 
the network must obtain an agreement from an eligible Agricultural 
Producer Group, Farmer or Rancher Cooperative, or Majority-Controlled 
Producer-Based Business Venture that is engaged in the value chain on a 
marketing strategy. For Planning Grants, examples of agreements 
include, but are not limited to, letters of intent to partner on 
marketing, distribution, or processing. For Working Capital Grants, 
examples of agreements include, but are not limited to, marketing 
agreements, distribution agreements, and processing agreements.
    Applicants other than Independent Producers must limit their 
Projects to Emerging Markets.
    If the applicant is an unincorporated group (steering committee), 
it must form a legal entity before the Grant Agreement can be approved 
by the Agency. A steering committee may only apply as an Independent 
Producer. Therefore, the steering committee must be 100 percent 
composed of Independent Producers and the business to be formed must 
meet the definition of Independent Producer, as defined in 7 CFR 4284, 
subpart A.
    Entities that contract out the production of an Agricultural 
Commodity are not considered Independent Producers.
    Farmer or Rancher Cooperatives that are 100 percent owned by 
farmers and ranchers must apply as Farmer or Rancher Cooperatives. It 
is the Agency's position that if a cooperative is 100 percent owned and 
controlled by agricultural harvesters (e.g. fishermen, loggers), it is 
eligible only as an Independent Producer and not as a Farmer or Rancher 
Cooperative. If a cooperative is not 100 percent owned and controlled 
by farmers and ranchers or 100 percent owned and controlled by 
agricultural harvesters, it may still be eligible to apply as a 
Majority-Controlled Producer-Based Business Venture, provided it meets 
the definition in 7 CFR part 4284, subpart A.

[[Page 20903]]

    Any businesses that are selected for awards must provide 
documentation that they are in good standing with the state of 
incorporation.
    In addition to the above requirements, applicants may be considered 
for reserved funds if they meet the definition of a Beginning Farmer or 
Rancher or a Socially Disadvantaged Farmer or Rancher as defined in 
Section I of this notice.

B. Cost Sharing or Matching

    Matching Funds are required, must be at least equal to the amount 
of grant funds requested, and are subject to the same use restrictions 
as grant funds. Applicants must verify in their applications that 
eligible Matching Funds are available for the time period of the grant. 
Unless provided by other authorizing legislation, other Federal grant 
funds cannot be used as Matching Funds. Matching Funds must be spent at 
a rate equal to or greater than the rate at which grant funds are 
expended. If Matching Funds are provided in an amount exceeding the 
minimum requirement the applicant must spend their Matching Funds 
contribution at a proportional rate. For example, if an applicant 
proposes to provide 75 percent of the total Project cost in Matching 
Funds and a grant is awarded, the Agency expects that the grantee will 
expend at least $0.75 of Matching Funds for every $0.25 of grant funds 
expended.
    Matching Funds must be provided by either the applicant or by a 
third party in the form of cash or eligible in-kind contributions. 
Applicants that are awarded grants may not change the source, type, or 
amount of Matching Funds proposed in their applications without prior 
written approval from the Agency. Matching Funds must be spent on 
eligible expenses and must be from eligible sources.

C. Other Eligibility Requirements

    Product Eligibility: The project proposed must involve a Value-
Added product as defined in Section I of this notice. There are five 
methods through which value-added can be demonstrated. Regardless of 
which method is used an expansion of customer base AND an increase in 
revenue to the agricultural producers must also be demonstrated.
    1. A change in physical state occurs when an Agricultural Commodity 
cannot be returned to its original state. Examples of value-added 
products in this category are fish fillets, diced tomatoes, ethanol, 
bio-diesel, and wool rugs. Common production or harvesting methods are 
not considered a change in physical state. For example, dehydrated 
corn, bottled milk, raw fiber, Christmas trees, and cut flowers are not 
eligible in this category.
    2. Production in a manner that enhances the value of the 
Agricultural Commodity occurs when a nonstandard production method adds 
value per unit of production over a standard production method. It is 
the Agency's position that only Working Capital applications are 
eligible for this category because the enhanced value must be 
demonstrated using information from a Feasibility Study and Business 
Plan developed for the Venture. Examples are organic carrots, eggs 
produced from free-range chickens, and beef produced from cattle fed a 
``natural'' diet. Branded products or products packaged in a non-
standard way are not eligible under this category.
    3. Physical segregation that enhances the value of the Agricultural 
Commodity occurs when a physical barrier (i.e. distance or a structure) 
separates a commodity from other varieties of the same commodity on the 
same farm during production and that the separation continues through 
the harvesting, processing, and marketing of the product or commodity. 
An example is genetically-modified corn and non-genetically modified 
corn produced on the same farm, but physically separated so that no 
cross-pollination occurs.
    4. A source of farm- or ranch-based renewable energy is an 
Agricultural Commodity or Product used to generate energy on a farm or 
ranch. An example is an anaerobic digester. Fuels such as ethanol, bio-
diesel, or switchgrass pellets, that are not generated on a farm or 
ranch owned or leased by the owners of the Venture are not eligible 
under this category. However, these types of fuel may be considered 
under the first category.
    5. Aggregation and marketing of locally-produced agricultural food 
products occurs when any food product made from an Agricultural 
Commodity is raised, produced, and marketed within 400 miles of the 
farm that produced the commodity or within the same State as that farm. 
Examples are strawberry ice cream sold at a farmers market that is 
within 400 miles of the dairy farm that produced the milk from which 
the ice cream was made, or organic lettuce sold to local restaurants. 
Please note that organic produce or other types of products that are 
produced in a manner that enhances their value can apply for planning 
grants under this category as long as 100 percent of the marketing of 
the product will occur within 400 miles of the farm that produced the 
Agricultural Commodity.
    In addition to the above requirements, applications may be 
considered for reserved funds if the proposed project meets the 
definition of a Mid-Tier Value Chain as defined in Section I of this 
notice. Mid-Tier Value Chains must involve local and regional supply 
networks that contain at least two alliances, linkages, or partnerships 
within the value chain. They must also directly impact the 
profitability and competitiveness of Small and Medium-Sized Farms and 
Ranches that are structured as Family Farms. Finally, the project must 
include an agreement from an Agricultural Producer Group, Farmer or 
Rancher Cooperative, or Majority-Controlled Producer-Based Business 
Venture that is engaged in the value chain on a marketing strategy.
    Purpose Eligibility: The application must specify whether grant 
funds are requested for planning activities or for working capital. 
Applicants may not request funds for both types of activities in one 
application. Working capital expenses are not considered eligible for 
Planning Grants and planning expenses are not considered eligible for 
Working Capital Grants. Applications requesting more than the maximum 
grant amount will be considered ineligible.
    It is the Agency's position that applicants other than Independent 
Producers applying for a Working Capital Grant must demonstrate that 
the Venture has not been in operation more than two years at the time 
of application in order to show that the applicant is entering an 
Emerging Market.
    Additionally, it is the Agency's position that all Working Capital 
Grant applicants must be marketing the Value-Added Agricultural 
Product(s) that is(are) the subject of the grant application at the 
time of application.
    Grant Period Eligibility: Applicants may propose a timeframe for 
the grant project up to 36 months in length. Projects cannot begin 
earlier than October 1, 2009 and cannot end later than September 30, 
2012. Applications that request funds for a time period beginning prior 
to October 1, 2009 and/or ending after September 30, 2012, will be 
considered ineligible. Applicants may propose a start date falling any 
time during FY 2009 (October 1, 2009 to September 30, 2010). If the 
project period will be longer than one year, the applicant must 
identify a separate, unique task(s) for the first year and for any 
subsequent year of the proposed project. Any applications proposing a 
project of longer than one year with duplicative or similar activities 
in each year is ineligible for funding. The Agency will consider 
requests for an extension on a case-by-case basis if

[[Page 20904]]

extenuating circumstances prevent a grantee from completing an award 
within the approved grant period, but no extensions can be approved to 
extend the grant period beyond a total of three years.
    Multiple Grant Eligibility: An applicant can submit only one 
application in response to this notice. The application must designate 
whether the application submitted should be considered for the general 
fund or for one of the reserved programs.
    Applicants who have already received a Planning Grant for the 
proposed Project cannot receive another Planning Grant for the same 
Project. Applicants who have already received a Working Capital Grant 
for a Project cannot receive any additional grants for that Project.
    Current Grant Eligibility: If an applicant currently has a VAPG, it 
must be completed prior to the beginning of the FY 2009 grant period.
    Judgment Eligibility: In accordance with 7 CFR 4284.6.

IV. Application and Submission Information

A. Address To Request Application Package

    The application package for applying on paper for this funding 
opportunity can be obtained at https://www.rurdev.usda.gov/rbs/coops/vadg.htm. Alternatively, applicants may contact their USDA Rural 
Development State Office. The State Office can be reached by calling 
800-670-6553 and pressing ``1.'' For electronic applications, 
applicants must visit https://www.grants.gov and follow the 
instructions.

B. Content and Form of Submission

    Applications must be submitted on paper or electronically. An 
Application Guide may be viewed at https://www.rurdev.usda.gov/rbs/coops/vadg.htm. It is strongly recommended that applicants use the 
template provided on the Web site. The template can be filled out 
electronically and printed out for submission with the required forms 
for a paper submission or it can be filled out electronically and 
submitted as an attachment through Grants.gov.
    If an application is submitted on paper, one signed original and 
one copy of the complete application must be submitted.
    If the application is submitted electronically, the applicant must 
follow the instructions given at https://www.grants.gov. Applicants are 
strongly advised to visit the site well in advance of the application 
deadline to ensure that they have obtained the proper authentication 
and have sufficient computer resources to complete the application.
    The Agency will conduct an initial screening of all applications 
for eligibility and to determine whether the application is complete 
and sufficiently responsive to the requirements set forth in this 
notice to allow for an informed review. Information submitted as part 
of the application will be protected from disclosure to the extent 
permitted by law.
    Applicants must complete and submit the elements listed below, 
except as noted in the next paragraph. Please note that the 
requirements in the following locations within 7 CFR part 4284 have 
been combined with other requirements to simplify the application and 
reduce duplication: 7 CFR 4284.910(c)(5)(i), 4284.910(c)(5)(ii), and 
4284.910(c)(5)(iv).
    Applicants requesting less than $50,000 are not required to submit 
the following items at the time of application. However, if selected 
for an award, the applicants will be required to submit these items as 
part of the conditions of the award: Form SF-424A (section IV, B.2), 
Form SF-424B (section IV, B.3), Title Page (section IV, B.4), Goals of 
the Project (section IV, B.8.i), and Performance Evaluation Criteria 
(section IV, B.8.ii).
    1. Form SF-424, ``Application for Federal Assistance.'' The form 
must be completed, signed and submitted as part of the application 
package. All applicants are also required to have an Employer 
Identification Number (or a Social Security Number if the applicant is 
an individual or steering committee) and a DUNS number (including 
individuals and sole proprietorships). The DUNS number is a nine-digit 
identification number which uniquely identifies business entities. To 
obtain a DUNS number, access https://www.dnb.com/us, or call (866) 705-
5711.
    2. Form SF-424A, ``Budget Information--Non-Construction Programs.'' 
This form must be completed and submitted as part of the application 
package.
    3. Form SF-424B, ``Assurances--Non-Construction Programs.'' This 
form must be completed, signed, and submitted as part of the 
application package.
    4. Title Page (limited to one page). The title page must include 
the title of the project and may include other relevant identifying 
information.
    5. Table of Contents. A detailed Table of Contents (TOC) 
immediately following the title page is required.
    6. Executive Summary (limited to one page). The Executive Summary 
should briefly describe the Project, including goals, tasks to be 
completed and other relevant information that provides a general 
overview of the Project. The applicant must clearly state whether the 
application is for a Planning Grant or a Working Capital Grant and the 
grant amount requested.
    7. Eligibility Discussion (limited to six pages). The applicant 
must provide the following information so that the Agency can assess 
the eligibility of the applicant and the proposed Project. Answers of 
zero or none may not disqualify an applicant, depending on what type of 
applicant organization is applying.
    i. Applicant Eligibility. Applicants must provide the following 
information so that the Agency can determine the eligibility of the 
applicant organization for assistance.
     Describe the applicant in a brief statement (for example, 
individual farm or membership organization, etc.) and identify its 
legal structure (for example sole proprietorship, LLC, LLP, 
cooperative, non-profit organization, or others described in detail).
     Identify the owners or members who will be contributing 
the Agricultural Commodity to which value will be added to the Project. 
Applicants must provide the names of the individuals who are owners or 
members, as well as the percentage of their ownership in the 
organization. If the applicant organization is owned by entities other 
than individuals, it must identify those entities and provide a list of 
the individuals who own each entity. If the list is longer than a few 
lines, it should be attached as an appendix to the application and will 
not be counted toward the page limit of this section.
     A statement that certifies that these owners or members 
are actively and currently engaged in the production of the 
Agricultural Commodity.
     Describe how the applicant organization is governed or 
managed, including a description of who and how many owners/members 
have voting rights, if applicable.
     The number of individuals on the governing board (e.g. 
board of directors).
     The number of individuals on the governing board who have 
voting rights and are currently engaged in the production of the 
Agricultural Commodity to which value will be added and will be 
providing that commodity to the Project.
     If the applicant organization is a membership 
organization, include the organization's mission statement, which must 
be copied from the organization's

[[Page 20905]]

articles of incorporation, bylaws, or other governing documents.
     The amount of the Agricultural Commodity needed for the 
Project. Planning applications must provide an estimate.
     The amount of the Agricultural Commodity that will be 
provided by the owners or members of the applicant organization. 
Planning applications must provide an estimate.
     The amount of the Agricultural Commodity that will be 
purchased or donated from third-party sources.
     How the owners or members providing the Agricultural 
Commodity to the Project will maintain ownership of the commodity from 
its raw state to marketing the Value-Added Agricultural Product.
     In addition to the above information, if applying for 
Beginning Farmer or Rancher or Socially Disadvantaged Farmer or Rancher 
reserved funds, provide documentation demonstrating that the applicant 
organization meets the definition of a Beginning Farmer or Rancher or a 
Socially Disadvantaged Farmer or Rancher.
     In addition to the above information, if applying for Mid-
Tier Value Chain reserved funds, provide a discussion that demonstrates 
that the applicant meets the definition of a Local or Regional Supply 
Network. The discussion must include the following: (1) A description 
of whether the applicant organization is the network itself or the 
legal representative that is a member organization and business 
enterprise of the network, (2) a description of the network, its member 
organizations, and its purpose, and (3) a description of the alliances, 
linkages, or partnerships within the value chain of which the network 
is comprised.
    ii. Product Eligibility. Applicants must provide the following 
information so that the Agency can determine the eligibility of the 
Value-Added Agricultural Product to be marketed.
     The Agricultural Commodity to which value will be added.
     Describe the method or process through which value will be 
added. This must include at least one of the following: a change in 
physical state, a non-standard production method that enhances the 
commodity's value, physical segregation, on-farm or on-ranch generation 
of renewable energy, and/or a locally-produced agricultural food 
product.
     The dollar amount of value added per production unit to 
the Agricultural Commodity that is attributed to the value-added 
process. Applicants for planning grants must estimate this amount while 
applicants for working capital grants must use the amount from their 
Feasibility Study and Business Plan results.
     The Value-Added Agricultural Product that will be 
produced.
     Describe the expansion of customer base for the Value-
Added Agricultural Product. Those applying for a planning grant must 
provide an estimate for the expansion of customer base. Those applying 
for a working capital grant must supply the relevant information from 
the Feasibility Study and Business Plan that was completed for the 
Venture. If no expansion of customer base exists or is likely to exist, 
the application is not eligible for funding.
     The amount of the increased portion of revenue derived 
from marketing the Value-Added Agricultural Product that will be 
available to the producers of the Agricultural Commodity to which value 
is added. Applicants for a planning grant must provide an estimate for 
the increase in revenue. Those applying for a working capital grant 
must supply the relevant information from the Feasibility Study and 
Business Plan that was completed for the Venture. If no increase in 
revenue exists or is likely to exist, the application is not eligible 
for funding.
     In addition to the above requirements, if applying for 
Mid-Tier Value Chain reserved funds, provide a discussion that 
demonstrates the Project incorporates an increase in the profitability 
and competitiveness of Small and Medium-Sized Farms and Ranches that 
are structured as Family Farms due to the manner in which the Value-
Added Agricultural Product is marketed and a copy of an agreement with 
an Agricultural Producer Group, Farmer or Rancher Cooperative, or 
Majority-Controlled Producer-Based Business Venture that is engaged in 
the value chain on a marketing strategy and that includes the names of 
the parties and a description of the nature of their collaboration.
    iii. Purpose Eligibility. Applicants must provide the following 
information so that the Agency can determine the eligibility of the 
proposed use of funds. In addition to reviewing the responses to these 
questions, the Agency will also evaluate the budget and work plan 
submitted in response to the Proposal Evaluation Criteria to determine 
the eligibility of the use of funds.
     A statement that an independent, third-party Feasibility 
Study has been conducted for the proposed Venture. The applicant must 
provide the name of the party who conducted the Feasibility Study and 
the date it was completed. The Feasibility Study should not be 
submitted with the application, but the Agency may request it at any 
time in order to facilitate its eligibility review.
     A statement that a Business Plan has been developed for 
the proposed Venture. The applicant must provide the name of the party 
who developed the Business Plan and the date it was completed. The 
Business Plan should not be submitted with the application, but the 
Agency may request it at any time in order to facilitate its 
eligibility review.
     Describe how long the applicant organization has been 
engaged in the Venture that is the subject of the application.
    8. Proposal Narrative (limited to 15 pages).
    i. Goals of the Project. The application must include a clear 
statement of the ultimate goals of the Project, including an 
explanation of how a market will be expanded and the degree to which 
incremental revenue will accrue to the benefit of the Agricultural 
Producer(s).
    ii. Performance Evaluation Criteria. Applicants applying for 
Planning Grants must suggest at least one criterion by which their 
performance under a grant could be evaluated. Applicants applying for 
Working Capital Grants must identify the projected increase in customer 
base, revenue accruing to Independent Producers, and number of jobs 
attributed to the Project. Working capital projects with significant 
energy components must also identify the projected increase in capacity 
(e.g. gallons of ethanol produced annually, megawatt hours produced 
annually) attributed to the Project. Please note that these criteria 
are different from the Proposal Evaluation Criteria and are a separate 
requirement.
    iii. Proposal Evaluation Criteria. Each of the proposal evaluation 
criteria referenced in Section V.A. of this funding announcement must 
be addressed, specifically and individually, in narrative form. 
Applications that do not address the appropriate criteria (Planning 
Grant applications must address Planning Grant evaluation criteria and 
Working Capital Grant applications must address Working Capital Grant 
evaluation criteria) will be considered ineligible.
    9. Certification of Matching Funds. Applicants must certify that 
Matching Funds will be available at the same time grant funds are 
anticipated to be spent and that Matching Funds will be spent in 
advance of grant funding, such that for every dollar of grant funds 
advanced, not less than an equal amount of Matching Funds will have 
been expended prior to submitting the request for reimbursement. This

[[Page 20906]]

certification is a separate requirement from the verification of 
Matching Funds requirement. To fulfill this requirement, applicants 
must include a statement for this section that reads as follows: 
``[INSERT NAME OF APPLICANT] certifies that matching funds will be 
available at the same time grant funds are anticipated to be spent and 
that matching funds will be spent in advance of grant funding, such 
that for every dollar of grant funds advanced, not less than an equal 
amount of matching funds will have been expended prior to submitting 
the request for reimbursement.'' A separate signature is not required.
    10. Verification of Matching Funds. Applicants must provide 
documentation of all proposed Matching Funds, both cash and in-kind. 
The documentation below must be included in the Appendix. Template 
letters for each type of matching funds are available at https://www.rurdev.usda.gov/rbs/coops/applicants.htm.
    i. Matching funds provided by the applicant in cash. A copy of a 
bank statement with an ending date within one month of the application 
submission and showing an ending balance equal to or greater than the 
amount of cash Matching Funds proposed is required.
    ii. Matching funds provided through a loan or line of credit. The 
applicant must include a signed letter from the lending institution 
verifying the amount available, the purposes for which funds may be 
used, and the time period of availability of the funds. Specific dates 
(month/day/year) corresponding to the proposed grant period or to dates 
within the grant period when matching funds will be made available, 
must be included.
    iii. Matching funds provided by the applicant through an in-kind 
contribution. The application must include a signed letter from the 
applicant verifying the goods or services to be donated, the value of 
the goods or services, and when the goods and services will be donated. 
Specific dates (month/day/year) corresponding to the proposed grant 
period or to dates within the grant period when matching contributions 
will be made available, must be included. Note that applicant in-kind 
match for planning grants should not include values for applicant time 
spent on feasibility or business planning activities due to a possible 
conflict of interest. Although applicants may participate with their 
consultant in the feasibility and business planning activities, they 
may not include their time as an in-kind match contribution to the 
project. This represents a possible conflict of interest and should be 
avoided in the application. Also note that if the applicant 
organization is purchasing goods or services for the grant (e.g. 
salaries, inventory), the contribution is considered a cash 
contribution and must be verified as described in paragraph i. above. 
Also, if an owner or employee of the applicant organization is donating 
goods or services, the contribution is considered a third-party in-kind 
contribution and must be verified as described in paragraph v. below.
    iv. Matching funds provided by a third party in cash. The 
application must include a signed letter from that third party 
verifying how much cash will be donated and when it will be donated. 
Specific dates (month/day/year) corresponding to the proposed grant 
period or to dates within the grant period when matching funds will be 
made available, must be included.
    v. Matching Funds provided by a third party in-kind donation. The 
application must include a signed letter from the third party verifying 
the goods or services to be donated, the value of the goods or 
services, and when the goods and services will be donated. Specific 
dates (month/day/year) corresponding to the proposed grant period or to 
dates within the grant period when matching contributions will be made 
available, must be included.
    Verification for cash or in-kind contributions donated outside the 
proposed time period of the grant will not be accepted. Verification 
for in-kind contributions that are over-valued will not be accepted. 
The valuation process for the in-kind funds does not need to be 
included in the application, especially if it is lengthy, but the 
applicant must be able to demonstrate how the valuation was achieved at 
the time of notification of tentative selection for the grant award. If 
the applicant cannot satisfactorily demonstrate how the valuation was 
determined, the grant award may be withdrawn or the amount of the grant 
may be reduced.
    Matching Funds are subject to the same use restrictions as grant 
funds. Matching Funds must be spent or donated during the grant period 
and the funds must be expended at a rate equal to or greater than the 
rate grant funds are expended. Some examples of acceptable uses for 
matching funds are: skilled labor performing work required for the 
proposed Project, office supplies, and purchasing inventory. Some 
examples of unacceptable uses of matching funds are: real property, 
fixed equipment, buildings, and vehicles.
    Expected program income may not be used to fulfill the Matching 
Funds requirement at the time of application. If program income is 
earned during the time period of the grant, it is subject to the 
requirements of 7 CFR part 3015, subpart F and 7 CFR 3019.24 and any 
provisions in the Grant Agreement.

C. Submission Dates and Times

    Application Deadline Date: July 6, 2009 for unreserved funds. June 
22, 2009 for reserved funds.
    Explanation of Deadlines: Paper applications must be postmarked, 
mailed, shipped, or sent overnight by the deadline date (see Section 
IV.F. for the address). Final electronic applications must be received 
by Grants.gov by the deadline date. If an application does not meet the 
deadline above, it will not be considered for funding. Applicants will 
be notified that their applications did not meet the submission 
deadline.

D. Intergovernmental Review of Applications

    Executive Order (EO) 12372, Intergovernmental Review of Federal 
Programs, applies to this program. This EO requires that Federal 
agencies provide opportunities for consultation on proposed assistance 
with State and local governments. Many states have established a Single 
Point of Contact (SPOC) to facilitate this consultation. A list of 
states that maintain an SPOC may be obtained at https://www.whitehouse.gov/omb/grants/spoc.html. If an applicant's state has an 
SPOC, the applicant may submit the application directly for review. Any 
comments obtained through the SPOC must be provided to Rural 
Development for consideration as part of the application. If the 
applicant's state has not established an SPOC, or the applicant does 
not want to submit the application, Rural Development will submit the 
application to the SPOC or other appropriate agency or agencies.
    Applicants are also encouraged to contact their Rural Development 
State Office for assistance and questions on this process. The Rural 
Development State Office can be reached by calling 800-670-6553 and 
selecting option ``1'' or by viewing the following Web site: https://www.rurdev.usda.gov/.

E. Funding Restrictions

    Funding restrictions apply to both grant funds and matching funds. 
Funds may only be used for planning activities or working capital for 
Projects focusing on processing and marketing a value-added product.
    1. Examples of acceptable planning activities include:

[[Page 20907]]

    i. Obtaining legal advice and assistance related to the proposed 
Venture;
    ii. Conducting a Feasibility Study of a proposed Value-Added 
Venture to help determine the potential marketing success of the 
Venture;
    iii. Developing a Business Plan that provides comprehensive details 
on the management, planning, and other operational aspects of a 
proposed Venture; and
    iv. Developing a marketing plan for the proposed Value-Added 
product, including the identification of a market window, the 
identification of potential buyers, a description of the distribution 
system, and possible promotional campaigns.
    2. Examples of acceptable working capital uses include:
    i. Designing or purchasing an accounting system for the proposed 
Venture;
    ii. Paying for salaries, utilities, and rental of office space;
    iii. Purchasing inventory, office equipment (e.g. computers, 
printers, copiers, scanners), and office supplies (e.g. paper, pens, 
file folders); and
    iv. Conducting a marketing campaign for the proposed Value-Added 
product.
    3. No funds made available under this solicitation shall be used 
to:
    i. Plan, repair, rehabilitate, acquire, or construct a building or 
facility, including a processing facility;
    ii. Purchase, rent, or install fixed equipment, including 
processing equipment;
    iii. Purchase vehicles, including boats;
    iv. Pay for the preparation of the grant application;
    v. Pay expenses not directly related to the funded Venture;
    vi. Fund political or lobbying activities;
    vii. Fund any activities prohibited by 7 CFR parts 3015 and 3019;
    viii. Fund architectural or engineering design work for a specific 
physical facility;
    ix. Fund any expenses related to the production of any commodity or 
product to which value will be added, including seed, rootstock, labor 
for harvesting the crop, and delivery of the commodity to a processing 
facility. The Agency considers these expenses to be ineligible because 
the intent of the program is to assist producers with marketing value-
added products rather than producing Agricultural Commodities;
    x. Fund research and development;
    xi. Purchase land;
    xii. Duplicate current services or replace or substitute support 
previously provided;
    xiii. Pay costs of the Project incurred prior to the date of grant 
approval;
    xiv. Pay for assistance to any private business enterprise which 
does not have at least 51 percent ownership by those who are either 
citizens of the United States or reside in the United States after 
being legally admitted for permanent residence; or
    xv. Pay any judgment or debt owed to the United States; or
    xvi. Conduct activities on behalf of anyone other than a specific 
Independent Producer or group of Independent Producers. The Agency 
considers conducting industry-level Feasibility Studies and Business 
Plans that are also known as feasibility study templates or guides or 
business plan templates or guides to be ineligible because the 
assistance is not provided to a specific group of Independent 
Producers.
    xvii. Pay for any goods or services provided by a person or entity 
who has a Conflict of Interest. Also, note that in-kind Matching Funds 
may not be provided by a person or entity that has a Conflict of 
Interest. See Section IV.B.10.iii of this notice for additional 
information.

F. Other Submission Requirements

    Paper applications must be submitted to the Rural Development State 
Office for the State in which the Project will primarily take place. 
Addresses can be found online at: https://www.rurdev.usda.gov/recd_map.html or in the ADDRESSES section at the beginning of this Notice.
    Applications can also be submitted electronically at https://www.grants.gov. Applications submitted by electronic mail or facsimile 
will not be accepted. Each application submission must contain all 
required documents in one envelope, if by mail or courier delivery 
service.

V. Application Review Information

A. Criteria

    All eligible and complete applications will be evaluated based on 
the following criteria. Applications for Planning Grants have different 
criteria to address than applications for Working Capital Grants.
    1. Criteria for Planning Grant applications:
    i. Nature of the proposed venture (0-8 points). Projects will be 
evaluated for technological feasibility, operational efficiency, 
profitability, sustainability and the likely improvement to the local 
rural economy. Evaluators may rely on their own knowledge and examples 
of similar ventures described in the proposal to form conclusions 
regarding this criterion. Points will be awarded based on the greatest 
expansion of markets and increased returns to producers.
    ii. Qualifications of those doing work (0-8 points). Proposals will 
be reviewed for whether the personnel who are responsible for doing 
proposed tasks, including those hired to do the studies, have the 
necessary qualifications. If a consultant or others are to be hired, 
more points may be awarded if the proposal includes evidence of their 
availability and commitment as well. If staff or consultants have not 
been selected at the time of application, the application should 
include specific descriptions of the qualifications required for the 
positions to be filled. Qualifications of the personnel and consultants 
should be discussed directly within the response to this criterion. If 
resumes are included, those pages will count toward the page limit for 
the narrative.
    iii. Commitments and support (0-5 points). Producer commitments 
will be evaluated on the basis of the number of Independent Producers 
currently involved as well as how many may potentially be involved, and 
the nature, level and quality of their contributions. End-user 
commitments will be evaluated on the basis of potential markets and the 
potential amount of output to be purchased. Proposals will be reviewed 
for evidence that the project enjoys third party support and 
endorsement, with emphasis placed on financial and in-kind support as 
well as technical assistance. Support should be discussed directly 
within the response to this criterion. If support letters are included, 
those pages will count toward the page limit for the narrative. Points 
will be awarded based on the greatest level of documented and 
referenced commitment.
    iv. Project leadership (0-8 points). The leadership abilities of 
individuals (i.e. owners, not consultants) who are proposing the 
Venture will be evaluated as to whether they are sufficient to support 
a conclusion of likely project success. Credit may be given for 
leadership evidenced in community or volunteer efforts. Leadership 
abilities should be discussed directly within the response to this 
criterion. If resumes are attached at the end of the application, those 
pages will count toward the page limit for the narrative.
    v. Work plan/budget (0-8 points). Applicants must submit a work 
plan and budget. The work plan will be reviewed to determine whether it 
provides specific and detailed descriptions of tasks that will

[[Page 20908]]

accomplish the project's goals. The budget must present a detailed 
breakdown of all estimated costs associated with the planning 
activities and allocate these costs among the listed tasks. The source 
and use of grant and matching funds must be specified. Points may not 
be awarded unless sufficient detail is provided to determine if funds 
are being used for qualified purposes. Matching funds as well as grant 
funds must be accounted for in the budget to receive points. If the 
project period will be longer than one year, the work plan and budget 
must identify a separate, unique task(s) for the first year and for any 
subsequent year of the proposed project. Any applications proposing a 
project of longer than one year with duplicative or similar activities 
in each year is ineligible for funding.
    vi. Amount requested (0 or 2 points). Two points will be awarded 
for grant requests of $50,000 or less. To determine the number of 
points to award, the Agency will use the amount indicated in the work 
plan and budget.
    vii. Project cost per owner-producer (0-3 points). The applicant 
must state the number of Independent Producers that are owners of the 
Venture. Points will be calculated by dividing the amount of Federal 
funds requested by the total number of Independent Producers that are 
owners of the Venture. The allocation of points for this criterion 
shall be as follows:
     0 points will be awarded to applications without enough 
information to determine the number of owner-producers.
     1 point will be awarded to applications with a project 
cost per owner-producer of $70,001-$100,000.
     2 points will be awarded to applications with a project 
cost per owner-producer of $35,001-$70,000.
     3 points will be awarded to applications with a project 
cost per owner-producer of $1-$35,000.
    An owner cannot be considered an Independent Producer unless he/she 
is a producer of the Agricultural Commodity to which value will be 
added as part of this Project. For Agriculture Producer Groups, the 
number used must be the number of Independent Producers represented who 
produce the commodity to which value will be added. In cases where 
family members (including husband and wife) are owners and producers in 
a Venture, each family member shall count as one owner-producer.
    Applicants must be prepared to prove that the numbers and 
individuals identified meet the requirements specified upon 
notification of a grant award. Failure to do so shall result in 
withdrawal of the grant award.
    viii. Business management capabilities (0-10 points). Applicants 
must discuss their financial management system, procurement procedures, 
personnel policies, property management system, and travel procedures. 
Up to two points can be awarded for each component of this criterion, 
based on the appropriateness of the system, procedures or policies to 
the size and structure of the business applying. Larger, more complex 
businesses will be expected to have more complex systems, procedures, 
and policies than smaller, less complex businesses.
    ix. Sustainability and economic impact (0-15 points). Projects will 
be evaluated based on the expected sustainability of the Venture and 
the expected economic impact on the local economy.
    x. Innovation (including renewable energy) (0 or 10 points). The 
applicant must describe the innovation that supports the Value-Added 
Agricultural Product; demonstrate how the project will accelerate 
adoption of innovation and commercialization; and document how the 
innovation will enhance the income and opportunity for farming and 
ranching operations. The applicant must also demonstrate how the 
proposed Value-Added Agricultural Product or process by which the 
product is made is forward-thinking, incorporates advanced ideas, or 
improves efficiency, effectiveness or competitive advantage. Projects 
that meet category (iv) of the definition of a Value-Added Agricultural 
Product, as defined in this notice, will receive 10 points.
    xi. Type of applicant (0 or 8 points). If an application is from an 
applicant that is a Beginning Farmer or Rancher, a Socially 
Disadvantaged Farmer or Rancher, or an operator of a Small or Medium-
Sized Farm or Ranch that is structured as a Family Farm, 8 points will 
be awarded. Applicants must provide documentation that they meet one of 
these definitions to receive points.
    xii. Administrator points (up to 5 points, but not to exceed 10 
percent of the total points awarded for the other 10 criteria). The 
Administrator of USDA Rural Development Business and Cooperative 
Programs may award additional points to recognize innovative 
technologies, insure geographic distribution of grants, or encourage 
Value-Added Projects in under-served areas. Applicants may submit an 
explanation of how the technology proposed is innovative and/or 
specific information verifying that the project is in an under-served 
area.
    2. Criteria for Working Capital applications:
    i. Business viability (0-8 points). Proposals will be evaluated on 
the basis of the technical and economic feasibility and sustainability 
of the Venture and the efficiency of operations. When responding to 
this criterion, applicants should reference critical data and 
information identified in the venture-specific feasibility study and 
business plan.
    ii. Customer base/increased returns (0-8 points). Describe in 
detail how the customer base for the product being produced will expand 
because of the Value-Added Venture. Provide documented estimates of 
this expansion. Describe in detail how a greater portion of the revenue 
derived from the venture will be returned to the producers that are 
owners of the Venture. Applicants should also reference the pro forma 
financial statements developed for the Venture. Applications that 
demonstrate strong growth in a market or customer base and greater 
Value-Added revenue accruing to producer-owners will receive more 
points than those that demonstrate less growth in markets and realized 
Value-Add