When most people talk about the farm bill, they look at some of the biggest portions of the legislation like the nutrition title, the commodities title or crop insurance. But within the $867 billion of funding in the farm bill “pie,” there is another much smaller slice of funding that has been making a big difference for farmers and the rural communities where they live.
Now, as House and Senate conferees try to hammer out a new farm bill, over 300 organizations are making an urgent request for the funding to continue for their slice. They would like to see $60 million a year in “permanent funding for the Local Agriculture Market Program. In their recent letter to conferees, the groups point out that despite the current plunge in farm-sector returns, “farmers and food producers that have participated in the local and regional food sector have experienced a strong return on investment.”
The mandatory LAMP funding provisions included in the 1,006-page Senate farm bill proposal—but not in the 641-page House version—are designed to build on this accelerating, profit-generating shift toward local and regional food supply chains. LAMP advocates say this shift has been driven by past farm bill programs: USDA’s Value-added Producer Grants Program and the Farmers Market and Local Food Promotion Program, which includes the Farmers Market Promotion Program and the Local Food Promotion Program. These programs expire Sept. 30 unless they are either reauthorized in the new farm bill or a short-term extension of the 2014 legislation.
The LAMP letter concludes the Senate’s proposed permanent funding for local food programs to include VAPG and the expanded FMLFPP will “grow farm and food-based value-added businesses, local and regional markets, and strengthen local supply chains that support farm profitability.”
More support for the endangered VAPG program comes from a recent USDA report: USDA’s Value-Added Producer Grant Program and Its Effect on Business Survival and Growth. The 38-page report released in May concludes that “VAPG recipients were 89 percent less likely to fail two years after receiving the grant than the group of similar nonrecipients.”
To boost business survival rates, the VAPG program has offered up to $75,000 in planning grants and up to $250,000 in working capital grants. Producers can apply through their state or regional Rural Development offices and must match each award with equal cash or in-kind funding.
A USDA Rural Development spokesperson said VAPG demand “has typically exceeded the availability of funds.” Since the program began in 2001, RD has processed some 7,700 applications resulting in over 2,900 grants. In 2018 alone, the agency “received 536 applications requesting $77.1 million and approved 249 awards utilizing total available funding of $36.2 million.” For the 2001 to 2015 period, the program made 2,345 grants to farmers and ranchers, totaling $318 million for an average $136,000 per grant.
Here are some recent examples of how farmers and rural residents are using the funds:
Whiskey Run Creek Vineyard and Winery is located on a fifth-generation farm located in Brownsville, Nebraska. The company was awarded a $213,350 VAPG for working capital in fiscal year 2016. The nine-acre portion of the farm set aside for the vineyard currently includes 4,000 vines and 13 variety of grapes that are used to produce quality Nebraska wines. Whiskey Run Creek has successfully processed and marketed 27 different wines over the years. With the help of the VAPG program and their market expansion project they expect to increase their customer base by 30 percent and revenues by $220,000 over the three-year grant period. They currently have three employees and if they continue to see success from the grant they anticipate hiring two additional employees, according to USDA.
Farmers’ All Natural Creamery in Wellman, Iowa, launched with a VAPG grant back in 2003 and was awarded a $250,000 grant this year. Mindy Seiffert, a director at the creamery’s parent, the Open Gates Group, tells Agri-Pulse that the 2018 grant has been essential in launching “our 100 percent American Grassfed Association certified organic kefir, which in turn supports the grass-fed dairy producers we get the milk from.” Seiffert says the creamery started shipping its new kefir (a fermented milk drink) to Midwestern customers in April and expects to “expand our distribution to the Rocky Mountain and Southwest regions in 2019” thanks to the grant.
Blair Andrews, responsible for sales at Natural Dakota Soy in Aberdeen, South Dakota, told Agri-Pulse that her extruded soybean plant’s VAPG grant is earmarked for buying non-GMO soybeans because “consumers are all saying that they want non-GMO products, so we’re hoping to move toward buying all non-GMO soybeans in the future.” Thanks to this USDA support, she says, “We’re going to be able to reach out to a lot of new customers.”
The Turner family purchased the 700-acre Claybrook Farms near Covington, Tennessee, in 1975, growing it to over 1,000 acres and adding the production of corn, soybeans, wheat, and oats to support their cattle operation. When patriarch Carl Turner passed the reins to his son, Dave, in 2012, the family started to focus on marketing their locally raised beef in Memphis and the surrounding area. Claybrook Farms used a $300,000 USDA Rural Development Value Added Producer Grant to expand their operations. During startup, the newly formed meat company sold beef out of the back of pickup truck cooler, but today they are averaging five cattle per week pushing the local packing company to capacity. USDA reports that, as a result of this project, a total of eight to 10 jobs have either been directly or indirectly created or saved.
Editor’s note: Agri-Pulse Editor Sara Wyant can be reached at www.agri-pulse.com. Jon Harsch contributed to this report.
