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Notice

Notice of Funds Availability (NOFA) Inviting Applications for the Value-Added Agricultural Product Market Development Grant Program (VADG) (Independent Producers)

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Start Preamble Start Printed Page 42531

AGENCY:

Rural Business-Cooperative Service, USDA.

ACTION:

Notice.

SUMMARY:

The Rural Business-Cooperative Service (RBS) announces the availability of approximately $33 million in competitive grant funds for fiscal year 2002 to help independent agricultural producers enter into value-added activities. RBS hereby requests proposals from eligible independent producers, agricultural producer groups, farmer or rancher cooperatives, and majority-controlled producer-based business ventures interested in a competitively awarded grant to fund one of the following two activities: (1) Developing feasibility studies or business plans (including marketing plans or other planning activities) needed to establish a viable value-added marketing opportunity for an agricultural product; or (2) acquiring working capital to operate a value-added business venture or an alliance that will allow the producers to better compete in domestic and international markets. In order to provide program benefits to as many eligible applicants as possible, applications can only be for one or the other of these two activities, but not both.

Value-added products are defined as follows: (1) A change in the physical state or form of the product (such as milling wheat into flour or making strawberries into jam); (2) the production of a product in a manner that enhances its value, as demonstrated through a business plan (such as organically produced products); (3) 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 (such as an identity preserved marketing system). As a result of the change in physical state or the manner in which the agricultural commodity or product is produced or segregated, the customer base for the commodity or product is expanded and a greater portion of revenue derived from the marketing, processing, or physical segregation is made available to the producer of the commodity or product. Value-added also includes using any agricultural product or commodity to produce renewable energy on a farm or ranch.

The maximum award per grant is $500,000. In order to maximize the distribution of program benefits, smaller grant requests under $500,000 will receive priority points. Priority is also being given to projects producing energy from biomass or demonstrating profitable use of innovative technologies.

DATES:

Applications must be completed and submitted to the appropriate State USDA Rural Development office as soon as possible, but no later than 4:00 pm on August 8, 2002. Applications received after August 8, 2002 will not be considered. Late applications will not be accepted and will be returned to the applicant. Applicants must ensure that the service they use to deliver their applications can do so by the deadline. Due to recent security concerns, packages sent to the agency by mail have been delayed several days or even weeks.

ADDRESSES:

Submit proposals and other required materials to your State USDA Rural Development Office. RBS is strongly encouraging the electronic submission of proposals. 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 state office. A list of Rural Development State Offices, addresses, e-mail addresses, and telephone numbers follows.

Note:

Telephone numbers listed are not toll free.

U.S. Department of Agriculture Rural Development State Offices

Alabama

Chris Harmon, USDA Rural Development, Sterling Center, Suite 601, 4121 Carmichael Road, Montgomery, AL 36106-3683, (334) 279-3415, chris.harmon@al.usda.gov

Alaska

Dean Stewart, USDA Rural Development, 800 West Evergreen, Suite 201, Palmer, AK 99645, (907) 761-7722, dstewart@rdmail.rural.usda.gov

Arizona

Gary Mack, USDA Rural Development, 3003 North Central Avenue, Suite 900, Phoenix, AZ 85012, (602) 280-8717, gary.mack@az.usda.gov

Arkansas

Tim Smith, USDA Rural Development, 700 West Capitol Avenue, Room 3416, Little Rock, AR 72201-3225, (501) 301-3200, tim.smith@ar.usda.gov

California

Karen Spatz, USDA Rural Development, 430 G Street, Agency 4169, Davis, CA 95616, (530) 792-5829, karen.spatz@ca.usda.gov

Colorado

Leroy W. Cruz, USDA Rural Development, 655 Parfet Street, Lakewood, CO 80215, (720) 544-2926, leroy.cruz@co.usda.gov

Delaware-Maryland

Vincent F. Murphy, USDA Rural Development, 4607 South DuPont Highway, Camden, DE 19934, (302) 697-4323, vince.murphy@de.usda.gov

Florida/Virgin Islands

Joe Mueller, USDA Rural Development, 4440 NW. 25th Place, Gainesville, FL 32606, (352) 338-3482, joe.mueller@fl.usda.gov

Georgia

J. Craig Scroggs, USDA Rural Development, 333 Phillips Drive, McDonough, GA 30253, (678) 583-0866, craig.scroggs@ga.usda.gov

Hawaii

Timothy O'Connell, USDA Rural Development, Federal Building, Room 311, 154 Waianuenue Avenue, Hilo, HI 96720, (808) 933-8313, tim.oconnell@hi.usda.gov

Idaho

Dale Lish, USDA Rural Development, 9173 West Barnes Drive, Suite A1, Boise, ID 83709, (208) 785-5840, ext. 118, dale.lish@id.usda.gov

Illinois

Cathy McNeal, USDA Rural Development, 2118 West Park Court, Suite A, Champaign, IL 61821, (217) 403-6210, cathy.mcneal@il.usda.gov

Indiana

Jerry Hay, USDA Rural Development, 5975 Lakeside Boulevard, Indianapolis, IN 46278, (812) 346-3411, ext. 4, jerry.hay@in.usda.gov

Iowa

Jeff Jobe, USDA Rural Development, Federal Building, Room 873, 210 Walnut Street, Des Moines, IA 50309, (515) 284-5192, Jeff.jobe@ia.usda.gov

Kansas

Larry Carnahan, USDA Rural Development, 115 West Forth Street, Altamont, KS 67330, (620) 784-5431, lcarnaha@rdasun2.rurdev.usda.gov

Kentucky

Jeff Jones, USDA Rural Development, 771 Corporate Drive, Suite 200, Lexington, KY 40503, (859) 224-7300, jeff.jones@ky.usda.gov

Louisiana

Judy Meche, USDA Rural Development, 3727 Government Street, Alexandria, LA 71302, (318) 473-7960, judy.meche@la.usda.gov Start Printed Page 42532

Maine

Alan C. Daigle, USDA Rural Development, 967 Illinois Avenue, Suite 4, Bangor, ME 04402, (207) 990-9168, alan.daigle@me.usda.gov

Massachusetts/Rhode Island/Connecticut

Richard J. Burke, USDA Rural Development, 451 West Street, Suite 2, Amherst, MA 01002, (413) 253-4318, rburke@rurdev.usda.gov

Michigan

Lee Bambusch, USDA Rural Development, 3001 Coolidge Road, Suite 200, East Lansing, MI 48820, (517) 324-5216, lee.bambusch@mi.usda.gov

Minnesota

Robyn J. Holdorf, USDA Rural Development, 375 Jackson Street, Suite 410, St. Paul, MN 55101-1853, (651) 602-7812, robyn.holdorf@mn.usda.gov

Mississippi

Cecil Williams, USDA Rural Development, Federal Building, Suite 831, 100 West Capitol Street, Jackson, MS 39269, (601) 965-5457 cecil.williams@ms.usda.gov

Missouri

Nathan Chitwood, USDA Rural Development, 601 Business Loop 70 West, Parkade Center, Suite 235, Columbia, MO 65203, (573) 876-9320, nathan.chitwood@mo.usda.gov

Montana

William W. Barr, USDA Rural Development, 900 Technology Blvd., Suite B, Bozeman, MT 59717, (406) 585-2545, bill.barr@mt.usda.gov

Nebraska

Deb Yocum, USDA Rural Development, Federal Building, Room 152, 100 Centennial Mall North, Lincoln, NE 68508, (402) 223-3125, ext. 4, debra.yocum@ne.usda.gov

Nevada

Dan Johnson, USDA Rural Development, 2002 Idaho Street, Elko, NV 89801, (775) 738-8468, ext. 28, dan.johnson@nv.usda.gov

New Hampshire

Scott D. Johnson, USDA, Rural Development, City Center, 3rd Floor, 80 Main Street, Montpelier, VT 05602, (603) 223-6034, scott.johnson@nh.usda.gov

New Jersey

Michael P. Kelsey, USDA Rural Development, 5th Floor North Tower, Suite 500, 8000 Midlantic Drive, Mount Laurel, NJ 08054, (856) 787-7751, michael.kelsey@nj.usda.gov

New Mexico

Eric Vigil, USDA Rural Development, 6200 Jefferson Street, NE, Room 255, Albuquerque, NM 87109, (505) 761-4952, eric.vigil@nm.usda.gov

New York

Robert Pestridge, USDA Rural Development, The Galleries of Syracuse, 441 South Salina Street, Suite 357, Syracuse, NY 13202, (315) 477-6426, robert.pestridge@ny.usda.gov

North Carolina

Ms. Delane Johnson, USDA Rural Development State Office, 4405 Bland Road, Suite 260, Raleigh, NC 27609, (919) 873-2033, delane.johnson@nc.usda.gov

North Dakota

Dennis Rodin, USDA Rural Development, Federal Building, Room 211, 220 East Rosser Avenue, Bismarck, ND 58501, (701) 530-2065, Dennis.rodin@nd.usda.gov

Ohio

Deborah E. Rausch, USDA Rural Development, Federal Building, Room 507, 200 North High Street, Columbus, OH 43215, (614) 255-2425, deborah.rausch@oh.usda.gov

Oklahoma

Sally Vielma, USDA Rural Development, 100 USDA, Suite 108, Stillwater, OK 74074, (405) 742-1000, sally.vielma@ok.usda.gov

Oregon

Robert F. Haase, USDA Rural Development, 625 Salmon Avenue, Suite 5, Redmond, OR 97756, (541) 926-4358, ext. 124, bob.haase@or.usda.gov

Pennsylvania

Linda C. Hager, USDA Rural Development, One Credit Union Place, Suite 330, Harrisburg, PA 17110, (717) 237-2287, linda.hager@pa.usda.gov

Puerto Rico

Mr. Luis Garcia, USDA Rural Development State Office, Munoz Rivera, Number 654, IBM Plaza, Suite 601, San Juan, Puerto Rico 00918, (787) 766-5095, ext. 239, luis.garcia@pr.usda.gov

South Carolina

Ms. Debbie Turberville, USDA Rural Development State Office, Strom Thurmond Federal Building, 1835 Assembly Street, Suite 1007, Columbia, SC 29201, (843) 354-9613, debbie.turberville@sc.usda.gov

South Dakota

Gary L. Korzan, USDA Rural Development, Federal Building, Room 210, 200 4th Street, SW., Huron, SD 57350, (605) 352-1142, gary.korzan@sd.usda.gov

Tennessee

Dan Beasley, USDA Rural Development 3322 West End Avenue, Suite 300, Nashville, TN 37203, (615) 783-1341, dan.beasley@tn.usda.gov

Texas

Billy curb, USDA Rural Development, Federal Building, Suite 102, 101 South Main, Temple, TX 76501, (254) 742-9700, billy.curb@tx.usda.gov

Utah

Richard Carring, USDA Rural Development, Wallace F. Bennett Federal Building, 125 South State Street, Room 4311, Salt Lake City, UT 84147-0350, (801) 524-4328, richard.carring@ut.usda.gov

Vermont/New Hampshire

Michael R. Dolce, USDA Rural Development, City Center, 3rd Floor, 89 Main Street, Montpelier, VT 05602, (802) 775-7014 ext. 20, michael.dolce@vt.usda.gov

Virginia

Laurette Tucker, USDA Rural Development, Culpeper Building, Suite 238, 1606 Santa Rosa Road, Richmond, VA 23229, (804) 287-1594, laurette.tucker@va.usda.gov

Washington

John Brugger, USDA Rural Development, 1606 Perry Street, Suite E, Yakima, WA 98908, (509) 924-7350, ext. 114, john.brugger@wa.usda.gov

West Virginia

Mr. John M Comerci, USDA Rural Development, 481 Ragland Road, Beckley, WV 25801, (304) 252-8644, ext. 165, john.comerci@wv.usda.gov

Wisconsin

Barbara Brewster, USDA Rural Development, 4949 Kirschling Court, Stevens Point, WI 54481, (715) 345-7610, barbara.brewster@wi.usda.gov

Wyoming

Janice Stroud, USDA Rural Development, 100 East B Street, Room 1005, Casper, WY 82601, (307) 261-6318, janice.stroud@wy.usda.gov

Start Further Info

FOR FURTHER INFORMATION CONTACT:

For further information contact your USDA State Rural Development Office. You may also obtain information from the RBS website at: www.rurdev.usda.gov/​rbs/​coops/​vadg.htm.

End Further Info End Preamble Start Supplemental Information

SUPPLEMENTARY INFORMATION:

Background

This solicitation is issued pursuant to section 231 of the Agriculture Risk Protection Act of 2000 (Pub. L. 106-224) as amended by section 6401 of the Farm Security and Rural Investment Act of 2002 (Pub. L. 107-171) authorizing the establishment of the Value-Added Agricultural Product Market Development grants. The Secretary of Agriculture has delegated the program's administration to USDA's Rural Business-Cooperative Service.

The primary objective of this grant program is to help eligible independent producers of agricultural commodities, agricultural producer groups, farmer and rancher cooperatives, and majority-owned producer-based business ventures develop business plans for viable marketing opportunities and develop strategies to create marketing opportunities. Eligible agricultural producer groups, farmer and rancher cooperatives, and majority-controlled Start Printed Page 42533producer-based business ventures must limit their proposals to emerging markets. These grants will facilitate greater participation in emerging markets and new markets for value-added products. Grants will only be awarded if projects or ventures are determined to be economically viable and sustainable.

This grant program has a matching funds requirement. Applicants must provide matching funds at least equal to the grant. Other Federal grants cannot be used as matching funds. Grant funds and matching funds must be spent proportionately during the timeframe stated in the grant application. Grant funds will be disbursed pursuant to applicable provisions of 7 CFR parts 3015 and 3019. Matching funds must be used to support the overall purpose of the VADG program.

Definitions

Agency—The Rural Business-Cooperative Service (RBS) or its successor.

Agricultural Producer Group—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 into emerging markets.

Agricultural Product—Plant and animal products and their by-products to include fish and seafood products and forestry products.

Emerging Markets—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.

Farmer or Rancher Cooperative—A duly recognized farmer or rancher cooperative in good standing under State law. Farmer or rancher owned cooperatives must propose ventures that are entering into emerging markets.

Independent Producer—A producer of agricultural commodities or products including those products from aquaculture, fish harvesting, and wood lot enterprises. This can be an individual producer; or a producer owned corporation, LLC, or LLP solely owned by producers. An independent producer can also be a steering committee composed of independent agricultural producers in the process of organizing an association to operate a value-added venture. The venture must be owned and controlled by the independent producers who are supplying agricultural product to the market. An independent producer cannot produce under contract or joint ownership with any organization other than their own.

Majority-Controlled Producer-Based Business Ventures—A corporation, LLC, LLP, or other type of business structure where producers have more than 50 percent of the ownership and control of the entity. No more than 10 percent of the grant funds will be awarded to these ventures. Majority-controlled producer-based business ventures must propose ventures that are entering into emerging markets.

Matching Funds—Cash or confirmed funding commitments. Matching funds cannot be from another Federal grant. Matching funds must be at least equal to the grant amount. In-kind contributions as defined at 7 CFR part 3015, subpart G can be used as matching funds. Examples of in-kind contributions include volunteer services furnished by professional and technical personnel, donated supplies and equipment, and donated office space.

National Office—The Rural Business-Cooperative Service (RBS) office at USDA headquarters in Washington, DC.

Planning—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.

State Office—USDA Rural Development offices located in most states.

Value-Added—(1) Any agricultural commodity or product that has undergone a change in the physical state or form of the product (such as milling wheat into flour, slaughtering livestock or poultry, or making strawberries into jam.) (2) The production of an agricultural commodity or product in a manner that enhances its value, as demonstrated through a business plan (such as organically produced products.) (3) 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 (such as an identity preserved marketing system.) As a result of the change in physical state or the manner in which the agricultural commodity or product is produced or segregated, the customer base for the commodity or product is expanded and a greater portion of revenue derived from the marketing, processing, or physical segregation is made available to the producer of the commodity or product. Value-added also includes using any agricultural product or commodity to produce renewable energy on a farm or ranch.

Working Capital—Funds that are used to operate the venture and pay the normal expenses associated with the operation of that venture. Funds cannot be used to purchase or build facilities nor purchase or install processing equipment.

Recipient and Product Eligibility Requirements

Potential recipients of the grant must be an independent producer, agricultural producer group, farmer or rancher cooperative, or majority-controlled producer-based business venture as defined in the “Definitions” section of this NOFA. If the applicant is an agricultural producer group, it must be providing assistance directly to a specifically identified group of independent producers. Grant funds cannot be used to support the organization's general operations. If the applicant is an unincorporated group (steering committee), they must form a legal entity before grant funds can be disbursed.

The project proposed must involve a value-added product as defined in the “Definitions” section of this NOFA.

Applications without sufficient information to determine their eligibility will not be considered.

Proposal Preparation

A proposal must contain the following:

1. Form SF-424, “Application for Federal Assistance.”

2. Form SF-424A, “Budget Information—Non-Construction Programs.”

3. Form SF-424B, “Assurances—Non-Construction Programs.”

4. Table of Contents. For ease of locating information, each proposal must contain a detailed Table of Contents immediately following the required SF-424 forms. The Table of Contents should include page numbers for each component of the proposal. Pagination should begin immediately following the Table of Contents.

5. Proposal Summary. A summary of the Project Proposal, not to exceed one page, must include the following: title of the project, description of the project including goals and tasks to be accomplished, names of the individuals responsible for conducting and completing the tasks, and the expected timeframe for completing all tasks (which should normally not exceed one year.) The applicant must also clearly state whether the application is for a planning grant or a working capital grant. The application cannot be for both.

6. Eligibility. A detailed discussion, not to exceed two pages, describing how the applicant meets the definition of an Start Printed Page 42534independent producer, agricultural producer group, farmer or rancher cooperative, or majority-controlled producer-based business venture as outlined in the “Recipient Eligibility Requirements” section of this NOFA. If the applicant is an agricultural producer group, it must specifically identify the group of independent producers on whose behalf the work will be done. In addition, the applicant must describe all organizations other than the applicant that are involved in the project. Applicants must state the percentage of the venture that will be owned and controlled by independent producers. No more than 10 percent of program funds can go to ventures that are majority-controlled producer-based business ventures as defined in the “Definitions” section of this NOFA. The applicant must also discuss the value-added product to be produced including the category of value-added as defined in the “Definitions” section of this NOFA.

7. Proposal Narrative. The narrative portion of the project proposal, not to exceed 35 pages (Times New Roman, 12 pt.) must include the following:

i. Project Title. The title of the proposed project must be brief, not to exceed 75 characters, yet represent the major thrust of the project.

ii. Information sheet. A separate one page information sheet which lists each of the evaluation criteria listed in this NOFA under the “Evaluation Criteria” section followed by the page numbers of all relevant material and documentation contained in the proposal which addresses or supports that criteria.

iii. Goals of the Project. A clear statement of the ultimate goal of the project must be presented. It must describe the value-added venture to be developed.

iv. Evaluation Criteria. Each of the evaluation criteria listed in the “Evaluation Criteria” section of this NOFA must be addressed specifically and individually by category. These criteria should be in narrative form with any specific supporting documentation. Financial statements used to support any evaluation criteria will not count as part of the 35 page limit.

8. Verification of Matching Funds. You must furnish a copy of a bank statement if matching funds are in cash or a copy of the confirmed funding commitment from the funding source. If an in-kind match is included, so state and provide verification of all commitments and how those commitments are valued. Matching funds (in-kind and cash) must be included on the SF-424 and SF-424A application forms. 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 at the same rate as grant funds throughout the duration of the project. Other Federal grant funds cannot be used as matching funds.

Grant Amounts

The amount of funds available for VADG grants in FY 2002 is approximately $33 million. The actual number of grants funded will depend on the quality of proposals received and the amount of funding requested. The maximum amount of Federal funds awarded for any one proposal will be $500,000. However, priority points will be given to grant requests of less than the maximum.

Number of Awards

No one applicant can receive more than one grant for any one purpose. An applicant cannot receive a grant for planning activities and a grant for working capital.

Eligible Grant and Matching Funds Uses

Grant funds may be used to pay up to 50 percent of the costs for carrying out relevant projects. Grant funds and the applicant's matching funds must be spent at approximately the same rate. The applicant's matching contribution in cash or in-kind must be in accordance with applicable provisions of 7 CFR parts 3015 and 3019.

For planning projects, grant and the recipient's matching funds may be used for, but are not limited to, hiring personnel including lawyers, accountants and other qualified consultants associated with the following purposes:

1. Conducting a feasibility analysis of a proposed value-added venture to help determine the potential success of the venture;

2. Developing a business operations plan that provides comprehensive details on the management, planning, and other operational aspects of a proposed venture;

3. Developing a business marketing plan for the proposed value-added product or products including the identification of a market window, the identification of potential buyers, a description of the distribution system, and possible promotional campaigns; or

4. Obtaining legal advice and assistance related to the proposed venture.

For working capital projects, grant and recipient's matching funds may be used to establish a working capital account to fund operations. Funds from this account can be used for, but are not limited to:

1. Hiring an attorney to provide legal advice and to draft articles of incorporation, bylaws, and other legal documents related to the proposed venture;

2. Hiring a Certified Public Accountant or other qualified individuals to design an accounting system for the proposed venture; or

3. Paying salaries, utilities, and other operating costs; financing inventories; purchasing office equipment, computers, and supplies; and financing other related activities necessary to establish alliances or business ventures that allow producers to better compete in domestic or international markets for value-added products.

Ineligible Grant Uses

Grant and matching funds cannot be used to:

1. Plan, repair, rehabilitate, acquire, or construct a building or facility (including a processing facility);

2. Purchase, rent, or install fixed equipment including mobile and other processing equipment;

3. Pay for the preparation of the grant application;

4. Pay expenses not directly related to the funded venture;

5. Fund political or lobbying activities;

6. Pay costs incurred prior to receiving this grant;

7. Fund any activities prohibited by 7 CFR parts 3015 and 3019; and

8. Fund architectural or engineering design work for a specific physical facility.

9. Grant and Matching funds cannot be used to pay any expenses related to the production of any commodity or product to which value will be added.

Methods for Evaluating and Ranking Applications

State office personnel will initially review applications for eligibility, completeness, and responsiveness to this NOFA. Incomplete or non-responsive applications will be returned to the applicant and not evaluated further. If the submission deadline has not expired and time permits, ineligible applications will be returned to the applicants for possible revision. The State office will then conduct one review of all complete and eligible applications based on the selection criteria specified in the “Evaluation Criteria” section of this NOFA. The National office will then obtain two additional independent reviews. Points will be assigned based on the evaluation Start Printed Page 42535criteria. All scored applications will then be forwarded to the National Office, where the scoring will be reviewed and applications ranked. Applications will be listed in initial rank order and presented, along with funding level recommendations, to the Administrator of RBS, who will award the grants.

Evaluation Criteria

Evaluations of proposals will be based on the following criteria. Failure to address any one of the following criteria will disqualify the application. All proposals must be in compliance with this NOFA and applicable statutes.

Criteria for applications for Planning grants are:

1. Nature of the Proposed Venture (Maximum 5 points). Describe in detail the proposed venture. This must include the value-added activity being proposed, the technology to be used and its availability, and examples of similar ventures. Discuss how the number of end-users for the product will be increased and how more revenue derived from the venture will be available to the producer-owners of the venture. Points will be awarded based on the greatest expansion of markets and increased returns to producers.

2. Qualifications of Those Doing the Studies (Maximum 5 points). Describe the education and experience in performing the requested types of studies, and the success rate for those individuals. Points will be awarded based on demonstrated skills and a successful track record.

3. Project Leadership (Maximum 5 points). Describe the individuals who are the members of the steering committee or the individual who is leading this effort; provide information on education, business experience, financial experience, knowledge of the venture to be undertaken, and other relevant information. Points will be based on demonstrated relevant leadership skills.

4. Commitment (Maximum 5 points). Describe the level of producer commitment including the number of independent producers currently involved, the number of potential producers who could become involved, cash contributions and level of production from the producers. Describe the potential commitment of end-users of the value-added product to be produced including possible markets identified and potential buyers contacted. Describe the commitment from local and state development organizations, commodity associations, and local political institutions including technical assistance support and financial support. Higher producer commitment, higher end-user commitment, and higher local support will result in more points.

5. Work Plan/Budget (Maximum 5 points). Discuss the specific tasks to be completed using grant and matching funds. Each task must be clearly defined and described in detail. The work plan must present the order the tasks will be undertaken and the estimated time for completing each task. If a group of producers want a feasibility study conducted and a business plan drafted, the details of these two tasks must be presented and discussed. The budget must present a detailed breakdown of estimated costs associated with the project and allocate these costs to each of the tasks to be undertaken. Matching funds as well as grant funds must be accounted for in the budget. It is important that reviewers understand what is being proposed. Logical, realistic, and economically efficient plans and budgets will result in higher scores.

6. Amount Requested. One half (1/2) point will be awarded for grant requests between $450,000 and $350,001, one (1) point will be awarded for grant requests between $350,000 and $250,001, one and one half (11/2) points will be awarded to grant requests between $250,000 and $150,001, two (2) points will be awarded for grant requests of $150,000 or less.

7. Project cost per producer that are owners (Maximum 5 points). Calculated by dividing the Federal requested funds by the total number of producers that are owners of the venture. Points will be based on the largest number of producers that are owners benefited for the least cost.

8. For those applications proposing ventures that focus on the Presidential initiative of biomass production, five percent of the total score of the above seven criteria will be added to calculate the final score. For example, if an application is proposing to do a bio-energy project and scores a total of 30 points on criteria one through seven, 1.5 additional points (30 x .05) will be added making the final score 31.5.

Administrator priority points—Up to five (5) additional points may be awarded by the Administrator of RBS to recognize innovative technologies, insure geographic distribution of grants, or encourage value-added projects in under-served areas.

Criteria for applications for Working Capital are:

1. Business Viability (Maximum 5 points). Describe in detail the technical and economic feasibility of the venture. This includes the organizational structure and operational aspects of the venture. Discuss how the venture will operate efficiently and be sustainable. More points will be awarded to those proposals demonstrating the venture will be efficient and sustainable.

2. Customer Base/Increased Returns (Maximum 5 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 producer that are owners of the venture. Provide 3 years of pro forma financial statements, including an explanation of all assumptions such as input prices, finished product prices, and other economic factors used to generate the financial statements. The financial statements 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 the next two years. The balance sheet should be annual for all three years. The financial statements will not count as part of the 35 page limit for the narrative section of the proposal. More points will be awarded to those proposals that demonstrate the greatest expansion of the customer base and increased returns to producers.

3. Commitment (Maximum 5 points). Describe in detail producer commitment to the venture including the number of independent agricultural producers who will participate in the venture and their total level of production; financial resources invested in the venture; and any contracts used between the producer that are owners and the venture. Discuss the amount of funds raised from the independent producer that are owners and the use of those funds. Also describe who will purchase the output of the venture; the amount of output to be purchased; markets that have been identified and any completed marketing studies; and any letters of intent or contracts from the potential end-users. Describe the commitment from local and state development organizations, commodity associations, and local political institutions including technical assistance support and financial support. Do not submit specific contracts, letters of intent, or other supporting documents at this time. However, be sure to cite their existence when addressing this criteria. Points will be awarded based on the greatest level of documented commitment.

4. Management Team/Work Force (Maximum 5 points). Describe in detail Start Printed Page 42536the qualifications of the individuals who will manage and operate the venture. Discuss the education and experience of the management team, especially their experience in managing similar ventures. Describe in detail the availability and quality of the labor force needed to operate the value-added venture. Points will be awarded based on the greatest demonstrated level of relevant skills and experience.

5. Work Plan/Budget (Maximum 5 points). Discuss the specific tasks to be completed using grant and matching funds. Each task must be clearly defined and described in detail. The work plan must present the order the tasks will be undertaken and the estimated time for completing each task. The budget must present a detailed breakdown of estimated costs associated with the project and allocate these costs to each of the tasks to be undertaken. Matching funds as well as grant funds must be accounted for in the budget. It is important that reviewers understand what is being proposed. Logical, realistic, and economically efficient plans and budgets will result in higher scores.

6. Amount Requested. One half (1/2) point will be awarded for grant requests between $450,000 and $350,001, one (1) point will be awarded for grant requests between $350,000 and $250,001, one and one half (11/2) points will be awarded to grant requests between $250,000 and $150,001, two (2) points will be awarded for grant requests of $150,000 or less.

7. Project cost per producer that are owners (Maximum 5 points). Calculated by dividing the Federal requested funds by the total number of independent producers that are owners of the venture. Points will be based on the largest number of producers that are owners benefited for the least cost.

8. For those applications proposing ventures that focus on the Presidential initiative of biomass production, five percent of the total score of the above seven criteria will be added to calculate the final score. For example, if an application is proposing to do a bio-energy project and scores a total of 30 points on criteria one through seven, 1.5 additional points (30 × .05) will be added making the final score 31.5.

Administrator priority points—Up to five (5) points may be awarded by the Administrator of RBS to recognize innovative technologies, to insure geographic distribution of grants, or to encourage value-added projects in under-served areas.

Copies of the score sheets will be posted on the VADG program's web site.

What and Where To Submit

The Agency is strongly encouraging the electronic submission of proposals to the appropriate USDA Rural Development State Office. Electronic submissions must be in Microsoft Word, WordPerfect, or Rich Text Format (RTF). 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 state office. For strictly a paper submission, an original and two copies of the proposal, with all required forms, must be submitted in one package to the appropriate USDA Rural Development State Office. Do not submit any feasibility studies, marketing plans, or business plans at this time. Please refer to the list above for the address and e-mail of your State Office. Applications sent by facsimile will not be accepted.

When To Submit

The deadline for receipt of all applications is August 8, 2002. The Agency will not consider any application received after the deadline.

Grantee Requirements

Grantees will be required to do the following:

1. Sign a Value-Added Agricultural Product Market Development Grant Agreement similar to the one published at the end of this NOFA.

2. Sign required Federal grant-making forms including Form AD-1047, “Certification Regarding Debarment, Suspension, and Other Responsibility Matters-Primary Covered Transactions;” Form AD-1048, “Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-Lower Tier Covered Transactions;” Form AD-1949, “Certification Regarding a Drug-Free Workplace Requirements (Grants);” and Form RD 400-4, “Assurance Agreement (Civil Rights).”

3. If the grant and matching funds are to be used as working capital, submit a feasibility study and business plan demonstrating the new venture is feasible and likely to be economically sustainable. These documents are to be submitted to the appropriate USDA Rural Development State Office. The plans must include 3 years of pro forma financial statements, including an explanation of assumptions used to generate the financial statements. The financial statements 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 the next two years. The balance sheet should be annual for all three years. These studies are not to be submitted with the application. No funds will be released until these documents have been received and approved.

4. If requested by the USDA Rural Development State Office, submit copies of any contracts, letters of intent, or other documents cited in addressing any of the various “evaluation criteria”. If such a request is made, no funds will be released until those documents have been received and approved.

5. Use Standard Form 270, “Request for Advance or Reimbursement” to request advances and reimbursements. Requests are to be submitted on a monthly basis.

6. Submit a Standard Form 269, “Financial Status Report” and list expenditures according to agreed upon budget categories on a semi-annual basis. Reports are due by April 30 and October 30 after the grant is awarded.

7. Submit semi-annual performance reports which compare accomplishments to the objectives; if established objectives are not met, discuss problems, delays, or other problems that may affect completion of the project; establish objectives for the next reporting period; and discuss compliance with any special conditions on the use of awarded funds.

8. Upon completion of each task outlined in the proposal, grant recipients will deliver the results of the study or activity to the appropriate state office, accompanied by all applicable supporting data. These include, but are not limited to, feasibility studies, marketing plans, business plans, articles of incorporation and bylaws, and an accounting of how working capital funds were spent. All items delivered to the state offices will be held in confidence to the extent permitted by law.

9. Maintain a financial management system that is acceptable to the Agency.

10. Collect and maintain data on race, sex, and national origin of Grantee's membership/ownership.

11. Submit a final project performance report.

Other Federal Statutes and Regulations That Apply

Several other Federal statutes and regulations apply to proposals considered for review and to grants awarded. These include but are not limited to:

7 CFR part 15, subpart A—Nondiscrimination in Federally-Start Printed Page 42537Assisted Programs of the Department of Agriculture-Effectuation of Title VI of the Civil Rights Act of 1964;

7 CFR part 3015—Uniform Federal Assistance Regulations;

7 CFR part 3017—Governmentwide Debarment and Suspension (Nonprocurement) and Governmentwide Requirements for Drug-Free Workplace (Grants);

7 CFR part 3018—New Restrictions on Lobbying;

7 CFR part 3019—Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations; and

7 CFR part 3052—Audits of States, Local Governments, and Non-Profit Organizations.

Paperwork Reduction Act

The reporting requirements contained in this notice have been approved by the Office of Management and Budget (OMB) under Control Number 0570-0039.

Start Signature

Dated: June 19, 2002.

John Rosso,

Administrator, Rural Business-Cooperative Service.

End Signature

United States Department of Agriculture Rural Business-Cooperative Service

Value-Added Agricultural Product Market Development Grant Agreement (VADG)

This Grant Agreement (Agreement) dated _____, between _____ (Grantee), and the United States of America, acting through the Rural Business-Cooperative Service of the Department of Agriculture (Grantor), for $_____ in grant funds under the VADG program, delineates the agreement of the parties.

NOW, THEREFORE, in consideration of the grant;

The parties agree that:

1. All the terms and provisions of the VADG NOFA and application submitted by the Grantee for this VADG grant, including any attachments or amendments, are incorporated and included as part of this Agreement. Any changes to these documents or this agreement must be approved in writing by the Grantor.

2. As a condition of the Agreement, the Grantee certifies that it is in compliance with and will comply in the course of the Agreement with all applicable laws, regulations, Executive Orders, and other generally applicable requirements, including those contained in 7 CFR 3015.205(b), which are incorporated into this agreement by reference, and such other statutory provisions as are specifically contained herein. The Grantee will comply with title VI of the Civil Rights Act of 1964, section 504 of the Rehabilitation Act of 1973, and Executive Order 12250.

3. The provisions of 7 CFR part 3015, “Uniform Federal Assistance Regulations” and part 3019, “Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Nonprofit Organizations,” as applicable are incorporated herein and made a part hereof by reference.

FURTHER, the Grantee agrees that it will:

1. Not use grant funds or matching funds to plan, repair, rehabilitate, acquire, or construct a building or facility (including a processing facility); or to purchase, rent, or install fixed equipment.

2. Use Grant Funds and matching funds only for the purposes and activities specified in the proposal approved by the Agency including the approved budget. Any uses not provided for in the approved budget must be approved in writing by the Agency in advance of obligation by the Grantor.

3. Submit a feasibility study, business operations plans, and other studies and plans required by the Grantor if any part of the grant will be used to establish a working capital account.

4. Deliver the results of a study or activity to the Grantor upon completion of each task outlined in the proposal. These include, but are not limited to, feasibility studies, marketing plans, business operations plans, articles of incorporation and bylaws, and accounting of how working capital funds were spent. All items delivered to the Grantor will be held in confidence to the extent provided by law.

5. Request any cash advances in the minimum amount needed and timed to the actual, immediate cash requirements for carrying out the grant purpose. Standard Form 270, “Request for Advance or Reimbursement,” will be used for this purpose.

6. Submit a Standard Form 269, “Financial Status Report” and list expenditures according to agreed upon budget categories on a semi-annual basis. Reports are due by April 30 and October 30 after the grant is awarded.

7. Provide periodic reports as required by the Grantor. A financial status report and a project performance report will be required on a semi-annual basis (due April 30 and October 30). The financial status report must show how grant funds and matching funds have been used to date and project the funds needed and their purposes for the next quarter. A final report may serve as the last semi-annual report. Grantees shall constantly monitor performance to ensure that time schedules are being met and projected goals by time periods are being accomplished. The project performance reports shall include the following:

a. A comparison of actual accomplishments to the objectives for that period.

b. Reasons why established objectives were not met, if applicable.

c. Reasons for any problems, delays, or adverse conditions which will affect attainment of overall program objectives, prevent meeting time schedules or objectives, or preclude the attainment of particular objectives during established time periods. This disclosure shall be accomplished by a statement of the action taken or planned to resolve the situation.

d. Objectives and timetables established for the next reporting period.

e. The final report will also address the following:

(i) What have been the most challenging or unexpected aspects of this program?

(ii) What advice you would give to other organizations planning a similar program. These should include strengths and limitations of the program. If you had the opportunity, what would you have done differently?

(iii) If an innovative approach was used successfully, the grantee should describe their program in detail so that other organizations might consider replication in their areas.

8. Collect and maintain data on race, sex, and national origin of Grantee's membership/ownership.

9. Provide Financial Management Systems which will include:

a. Records that identify adequately the source and application of funds for grant-supported activities. Those records shall contain information pertaining to grant awards and authorizations, obligations, unobligated balances, assets, liabilities, outlays, and income.

b. Effective control over and accountability for all funds, property, and other assets. Grantees shall adequately safeguard all such assets and shall ensure that they are used solely for authorized purposes.

c. Accounting records supported by source documentation.

d. Grantee tracking of fund usage and records that show matching funds and grant funds are used in equal proportions. The grantee will provide verifiable documentation regarding matching fund usage, i.e., bank statements or copies of funding obligations from the matching source.

10. Retain financial records, supporting documents, statistical records, and all other records pertinent to the grant for a period of at least 3 years after grant closing, except that the records shall be retained beyond the 3-year period if audit findings have not been resolved. Microfilm or photocopies or similar methods may be substituted in lieu of original records. The Grantor and the Comptroller General of the United States, or any of their duly authorized representatives, shall have access to any books, documents, papers, and records of the Grantee's which are pertinent to the specific grant program for the purpose of making audits, examinations, excerpts, and transcripts.

11. Not encumber, transfer or dispose of the equipment or any part thereof, acquired wholly or in part with Grantor funds without the written consent of the Grantor.

12. Not duplicate other program purposes for which monies have been received, are committed, or are applied to from other sources (public or private).

Grantor agrees to make available to Grantee for the purpose of this Agreement funds in an amount not to exceed the Grant Funds. The funds will be reimbursed or advanced based on submission of Standard Form 270.

IN WITNESS WHEREOF, Grantee has this day authorized and caused this Agreement to be executed by—Start Printed Page 42538

Attest

By

(Grantee)

(Title)

UNITED STATES OF AMERICA

RURAL BUSINESS-COOPERATIVE SERVICE

By

(Grantor)  (Name)  (Title)

End Supplemental Information

[FR Doc. 02-15910 Filed 6-21-02; 8:45 am]

BILLING CODE 3410-XY-P