Value-added producers benefit from grants, according to report

Many farmers and ranchers can make a higher profit by processing raw agricultural commodities into “value-added” goods. For example, fruit made into jam or milk made into cheese each fetch a higher price than the base ingredients.

Profits from value-added processing can lend income stability to a farm or ranch operation, and the additional labor required for processing can create employment opportunities in rural communities. However, there is a cost to producers to get the ball rolling on value-added production. For instance, if a dairy wants to start making cheese from their milk, building a new cheese-making facility is costly.

The Value-Added Producer Grants (VAPG) program, administered by the U.S. Department of Agriculture (USDA) Rural Business and Cooperative Service, is designed to address this barrier. VAPG supports farmers and ranchers who want to access value-added markets by offering support for development of business and marketing plans; feasibility studies; and working capital for processing costs, advertising, and some inventory and salary expenses. Organic agriculture is even considered a “value-added” activity because organic agricultural products bring a price premium.

A recent USDA Economic Research Service (ERS) report examined the impact of the VAPG program on 1,020 businesses. The study used data from the USDA Office of Rural Development and the National Establishment Time-Series (NETS). VAPG-recipient business outcomes were compared to similar nonrecipient business results. The findings from this report provide new and valuable information regarding the effect of the VAPG program.

According to USDA ERS, businesses that received VAPG funding were less likely to fail, compared to nonrecipients. These businesses were 89 percent less likely to fail within two years of receiving the grant, opposed to nonrecipient businesses of the same age and characteristics.

Additionally, the research found VAPG-funded businesses are more likely to hire employees. Between one and five years post-award, grant recipients employed five to six additional employees, on average. Prior to receiving funds, no significant difference in employment levels was found.

Lastly, the study found the success of a business correlated to the amount of funding received. After two years, businesses awarded with more dollars were less likely to fail. The increase also corresponded with job creation, as those with higher funding allotments were more likely to employ more workers.

These results show a clear impact of VAPG. Businesses that receive VAPG funding invest in their communities, support rural economies, and create jobs. This is evident in our home states of Nebraska and Iowa, 23 grants were awarded in 2016 to entrepreneurial farmers and ranchers who process various value-added goods such as wine, ice cream, organic maple syrup, honey, and ethanol.

Unfortunately, this program is being threatened. The House version of the 2018 farm bill (H.R. 2) proposed to eliminate the majority of VAPG funding. Thankfully a vote on the draft failed on Friday. We urge our representatives to recognize the value of this program and protect it in the final farm bill.

Feature photo: Fruit made into jam and sold as a value-added product may fetch a higher price than its base ingredient. A recent USDA report examined Value-Added Producer Grants program recipients and found clear benefits compared to producers who have not received a grant. | Photo by Kylie Kai Read more about Value-added producers benefit from grants, according to report

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Farm bill fails to pass House; rural America wins, for now

Today, the House of Representatives failed to pass H.R. 2, its draft of the Agriculture and Nutrition Act of 2018, commonly known as the farm bill. Representatives voted 198 in favor and 213 against.

This is a win for rural America, as the bill’s proposals were a giant step in the wrong direction.

The draft included eliminating the Conservation Stewardship Program and cut funds for working lands conservation by nearly $5 billion over 10 years.

The bill also proposed a troubling set of rollbacks to common-sense limitations on subsidy payments, and created loopholes for the largest operations to access unlimited subsidy payments.

Finally, the bill aimed to slash funding for programs that spark rural economic development including the Value-Added Producer Grant Program, the National Organic Certification Cost-Share Program, and the Rural Microentrepreneur Program. These programs facilitate the development of rural businesses, and their loss would have been sorely felt in rural America.

The House Agriculture Committee passed its draft of the bill on April 18. This week, lawmakers considered 106 amendments and discussed the bill on the House floor.

Thankfully, these proposals will not be moving forward. America needs a bipartisan farm bill that supports rural communities.

The current farm bill expires Sept. 30, 2018. Read more about Farm bill fails to pass House; rural America wins, for now

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Dear Sen. Roberts: we write to you with concerns about the future of conservation programs in the farm bill

The Center for Rural Affairs recently led an effort to gather farmers in support of conservation programs in the farm bill. On May 7, this letter was sent to Sen. Pat Roberts (KS) who chairs the U.S. Senate Committee on Agriculture, Nutrition, and Forestry.


The Honorable Pat Roberts 
109 Hart Senate Office Building 
Washington, DC 20510-1605 

Dear Chairman Roberts, 

As farmers and ranchers in Kansas, we write to you with concerns about the future of conservation programs authorized in Title II of the Farm Bill. The recent version of this omnibus legislation that came out of the House Agriculture Committee strikes a serious blow to working lands conservation programs. First, it essentially would eliminate the Conservation Stewardship Program. The bill also proposed to significantly lower the funding available for working lands programs, which additionally includes the Environmental Quality Incentives Program (EQIP), by nearly $5 billion over 10 years. We are asking that the Senate Agriculture Committee maintain and improve the structure and funding of the working lands conservation programs as authorized in 2014. 

We know from experience that conservation practices reduce on-farm risk and enhance profitability. Measures such as planting cover crops, engaging in no-till, and rotational grazing can help to build soil health, lessen disease pressure, and improve the resiliency of rangeland. In turn, conservation practices pass on benefits to the wider community. For example, protecting water quality, reducing nutrient loss, and addressing the risks of wildfires help to ensure a safe, secure, and cost-effective food system. 

One of the major barriers that farmers and ranchers face in adopting additional conservation practices and technologies is that it includes risk: the financial risk of investment, and also the risk of taking on a new practice with a learning curve. Therefore, incentives for innovation and investment are vital to build and maintain a resilient agriculture – particularly in the face of volatile weather, adapting pests, and increased demand for food. 

Voluntary working lands programs offer the potential to create long-term benefits for society and farmers and ranchers without increasing burdensome and administratively expensive regulations. In the long run, these public working land investments are needed to save taxpayers money by potentially lowering disaster and insurance payments. 

Strong support for conservation, especially working lands programs, not only improves agriculture, benefits taxpayers, and protects resources, but also it is vital for our long-term national security. Around the world, in areas where land is degraded and food is scarce, conflicts and crises arise. Furthermore, protecting the future productivity and health of our soil, water, and air strengthens the future of a healthy and well-fed America. 

Thank you so much for your service and leadership in the Senate Agriculture Committee. We are confident you and your committee members will protect the funding and programs in the Conservation Title of the Farm Bill especially the working lands programs like CSP and EQIP. 

Respectfully,

Allen Roth
Ellis County

Alan Williams
Scott County

Bill Simshauser
Kearny County

Brigham Stewart
Washington County

Brit Hayes
Hodgeman County

C. Brian Hastings
Hodgeman County

Cameron Peirce
Reno County 

Chad Basinger 
Reno County 

C.J. Blew
Reno County 

Colby Harner 
Sugar Creek Ranch 
Reno County 

Dale and Nancy Kirkham 
Greenwood County 

Darrin Unruh 
Reno County 

Derek Zongker 
Reno County 

Don Hineman 
Lane County

Donn Teske
Pottawatomie County

Ed Reznicek and Mary Fund
Nemaha County

Erika Jaeger
4F Farms, Inc.
Kearny County

Felix Revello
Pawnee County

Forrest and Marlene Peters
Phillips County

Fred and Connie Neufeld
McPherson County

Gene Albers
Kingman County 

James Funke and Christine Terrill
Reno County 

Jerry Clasen 
Reno County 

Jim and Lisa French 
Reno County 

Kendall Hodgson 
Rice County 

Larry Hickman 
Russell County 

Laura and Doug Fortmeyer
Jubilee Farm
Brown County

Luke Jaeger
Trifecta Farms, Inc.
Sherman County

Marion Krehbiel
Reno County

Matthew Jaeger
Trifecta Farms
Sherman County

Michael and Melinda Moeder
Logan and Thomas Counties

Myron Schmidt
Gray County

Ron Brown
Cheyenne County 

Sam Sanders 
Reno County 

Ted Worl 
Rice County 

Titus Jaeger 
Jaeger Family Farms, Inc. 
Kearny County 

Todd Miller 
Harper County

Tom Holmquist 
Saline County 

Travis Groff
Ellis County 

Troy Schroeder
Barton County Read more about Dear Sen. Roberts: we write to you with concerns about the future of conservation programs in the farm bill

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Voters should challenge candidates on Iowa’s energy future

Published in the Des Moines Register, May 11, 2018

Iowa’s future as a leader in renewable energy is on the ballot in 2018. As legislators head home and campaigns gear up for important primary elections, voters should call attention to key policy changes our state will face for our energy future.

Higher blends of ethanol sold year-round can provide opportunities for Iowa’s farmers and for cellulosic ethanol as it grows in volume. Iowa transmission lines are currently expanding to other states, creating more potential for a regional clean energy supply from wind and solar.

And, perhaps most promising, the expansion of solar in Minnesota, Illinois, and other states has been so rapid, federal regulators are moving quickly to update rules around distributed energy resources. As homeowners and businesses add on-site electricity generation and storage, a new set of questions and policies must be addressed.

In the next four years, a number of state and federal incentives that have shaped the energy landscape in Iowa are set to expire. The Renewable Fuel Standard, set in 2005 and expanded in 2007, allowed for mandated increases in biofuels. Biofuel increases were intended to bring commercial cellulosic fuels to scale and on par with starch-based ethanol. While cellulosic fuels are commercially viable, they are still not yet ready to be produced at high volumes. With the phased biofuel increases ending in 2022, what is the future for advanced biofuels derived from biomass?

Also in 2022, state funding sunsets for the Iowa Energy Center, current home of the carefully crafted Iowa Energy Plan. The Iowa Energy Center has helped communities become more energy independent and has championed economic development around clean energy.

We have heard very little discussion on the campaign trail regarding the merits and weaknesses of the Iowa Energy Plan, and the future of the center. Compare that to the gubernatorial campaign in 2006, where funding for the Iowa Power Fund inspired people to vote for then-candidate Chet Culver. People long to be inspired. Actions taken by the state Legislature to dismantle energy efficiency programs leave little for inspiration.

Federal tax credits that have spurred rapid growth of wind energy across the state are on track to phase out by 2019. State policy and existing infrastructure will largely dictate where future growth opportunities lie.

Iowa blazed a trail by developing a Renewable Portfolio Standard in 1983 — the first state to do so. Changes coming in the next four years present a great opportunity to revisit and retool. What should Iowa’s energy future be?

Today marks an opportune time to re-imagine a new vision for renewable energy in Iowa. The state can grow in a number of directions — we could expand our successful solar production tax credit, promote community solar projects, set criteria for energy storage, and create new pathways for financing clean energy upgrades.

A clear vision, combined with strong leadership and smart policy, can make Iowa’s long-standing leadership in renewable energy last for another generation. Voters need to demand fresh ideas and plans from candidates in this election. Read more about Voters should challenge candidates on Iowa’s energy future

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Rural Advocates: Restore Renewable Energy Money to Farm Bill

By Roz Brown, Public News Service (IA)

Farmers and small business owners who want to embrace renewable energy will not get any help from the federal government under the proposed farm bill headed to the U.S. House of Representatives this week. 

Funding for the Rural Energy Assistance Program has been eliminated in the current draft. 

The program has provided guaranteed grants or loans to purchase, install and construct renewable energy systems and make energy efficiency improvements to non-residential buildings and facilities. 

Katie Rock, a policy associate at the Center for Rural Affairs, says the program also has funded renewable technologies that reduce energy consumption.

"So, the cost savings that are offered through these programs, once they can make these upgrades, can be substantial for farms and businesses enough that they can expand or hire more people to run their business," she stresses.

The farm bill is renewed every five years. The 2014 bill included $50 million a year in Rural Energy Assistance Program funding.

Rock notes that many farmers want to be more energy independent, but with farm income at its lowest point in 12 years, they can't tackle such projects without the loans or grants offered through Rural Energy Assistance Program.

"Especially right now in our farm economy, any creative way to finance these kinds of changes are a great asset to small businesses," she states.

Since 2008, more than 13,000 projects in all 50 states have received Rural Energy Assistance Program awards.

Rock says one of those was an Iowa farmer who used the funds to upgrade a turkey barn with LED lighting and benefited on two fronts.

"And not only was it a huge cost savings for them, but they noticed a difference in the health of the turkeys which they really didn't expect and can't really explain," she relates.

The current draft of the farm bill calls for possibly appropriating money for Rural Energy Assistance Program on an annual basis, meaning at best the funds for next year would be cut from $50 million to $20 million, and at worst, the program would be eliminated.

Farm bill alert

May 15: The House is set to vote early this week on their version of the farm bill. Call your representatives today and ask them to VOTE NO. More info can be found here. Read more about Rural Advocates: Restore Renewable Energy Money to Farm Bill

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Your voice is needed to stop harmful farm bill

The U.S. House of Representatives is set to vote very soon on a troubling draft of the farm bill. Their proposal would slash working lands conservation funding, open up loopholes for unlimited agricultural subsidies, and defund several programs that support rural communities. You can read more here, but in short, this bill would set our progress back by decades.

This bill needs to be voted down – which means your House representative needs to hear from you!

Will you take a few minutes to make a quick call today and ask your representative to vote against H.R. 2, the House version of the farm bill? Find your representative here.

You can share this message with the person who answers the phone:

  • Share your name and where you live (so they know you vote in their district).
  • Request that your representative vote against H.R. 2, the House version of the 2018 farm bill.
  • Provide reasons to oppose the bill: it would slash working lands conservation funding, it would open up new subsidy loopholes, and it would eliminate funding for programs that support rural communities.

Five minutes of your time will make a big difference. Read more about Your voice is needed to stop harmful farm bill

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When the dust settles, farmers focus on land stewardship

In recent past, the Great Plains has experienced extreme weather conditions. Most recently, we witnessed very high winds combined with dry conditions, resulting in dust clouds reminiscent of the 1930s.

With a challenging agricultural economy, partnered with changes in land values, larger equipment, and farming practices, many farmers and ranchers are removing windbreaks. Budgets are tight and producers are trying to maximize use of the land, but risk the loss of valuable topsoil. Windbreaks can be used to control soil erosion by wind and water, enhance crop production, and protect livestock.

While weather events can’t be controlled, farmers and ranchers can be proactive in protecting our resources. Instead of tearing out aging windbreaks, they can replace trees and implement additional soil-conserving practices, such as reduced tillage or planting cover crops. Federal working lands conservation programs, such as the Conservation Stewardship Program (CSP) and Environmental Quality Incentives Program (EQIP), help producers adopt and implement these practices.

Recently, the House released their version of the farm bill – and it disincentivizes land stewardship. The bill eliminates funding for CSP, and cuts dollars for all working lands conservation programs by nearly $5 billion over 10 years. Farmers and ranchers are stewards of the land who need funding, tools, and resources to protect our soil and water. With a farm bill that doesn’t value conservation, should we be wary of another dust bowl? Read more about When the dust settles, farmers focus on land stewardship

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Local View: House farm bill fails rural Nebraska

Published first in the Lincoln Journal-Star, May 9, 2018

The House Agriculture Committee has proposed and voted for a new version of the farm bill. Unfortunately, their proposed bill fails rural Nebraskans.

Working together with members of our congressional delegation, rural Nebraskans have made major improvements to farm policy in the last two farm bills. Farm policy today is more fair, better protects our land and water and does more to create opportunity for a new generation than it did 10 years ago. The House farm bill threatens to turn the clock back a decade.

The bill makes three major changes that roll back wins Nebraskans have worked together to achieve.

The Conservation Stewardship Program, won in 2009, protects more than 70 million acres nationwide. It is a sensible program that is working for Nebraskans. In 2017, Nebraska ranked second in the country for new acres enrolled, and first in the country for acres re-enrolled.

The program offers farmers and ranchers the opportunity to earn payments for actively managing and maintaining conservation on their farm. The program supports practices such as grass waterways, pollinator strips, rotational grazing, and cover crops. The House farm bill eliminates the Conservation Stewardship Program.

The 2014 farm bill made historic changes to tighten loopholes that previously allowed the largest farmers to collect unlimited farm program commodity subsidies. Our own Rep. Jeff Fortenberry championed a 2013 bill in the House to close such loopholes. The House farm bill rolls back these reforms, reopening and creating new loopholes that will allow the largest farms to collect government payments without limit.

Unlimited farm payments for corporate-owned farms are the opposite of what rural Nebraska needs. Not only are such payments fiscally irresponsible, they are unfair to Nebraska’s hard-working, family-scale farmers. As Congress moves forward with the farm bill, we call on Rep. Fortenberry to again stand as a champion against this harmful proposal.

Finally, innovative programs such as the Value-Added Producer Grant Program, the Rural Microentrepreneur Assistance Program and the Farmers Market and Local Food Promotion Program won in the last two years have added support for rural small businesses and local and regional market development.

Supported by members of our delegations in Washington, these programs are creating opportunity for a new generation in rural Nebraska. The House farm bill effectively eliminates these critical programs by defunding them.

We are proud to have worked with rural Nebraskans and our delegation in D.C. to win, protect, and build on many of these gains in the 2014 and 2008 farm bills. Farm policy today is more fair, creates more opportunity, and is better at supporting stewardship of our land and water for future generations because of our collective work.

The changes we have won are especially critical to Nebraska's farm and rural economies with today’s low commodity prices.

Conservation programs support land stewardship, which fortifies revenue for current and future generations. Limiting farm payments makes government subsidies more fair, curbing pressure on beginning and family size operators. Finally, programs that spark new market development bring renewed opportunity to small towns.

Rolling back these wins in the face of the current farm economy will only worsen the economic picture for farm communities. We must not allow the House to turn the clock back 10 years. We call on our delegation in Washington to reject the current version of the bill.

We can do better. We must do better. Rural Nebraskans, our land, our water, and future generations are counting on it.

Brian Depew is executive director of the Lyons-based Center for Rural Affairs. Read more about Local View: House farm bill fails rural Nebraska

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Staff spotlight: Preston appointed as interim Women's Business Center director

For nearly 20 years, Kim Preston has been part of the Center for Rural Affairs team. During that time, she has taken on different roles, and made each one her own.

In 1999, Preston started her career with the Center in the policy and research program. Fourteen years later, she was asked to become the administrative assistant for the small business program, Rural Enterprise Assistance Project (REAP). In five years, she has gained a broad knowledge of the loan making process, and has worked directly with technical assistance specialists providing services to clients.

“I have a broad view of business development with my ‘behind the scenes’ perspective,” said Preston. “This has allowed me an intimate look at both the ups and downs of small businesses, and hopefully the knowledge to help businesses replicate the ups and avoid the downs.”

Her experience has guided Preston toward her current role as interim director of the REAP Women’s Business Center. She steps in for Monica Braun, of Seward, who recently retired after 12 years as Women’s Business Center Director and 16 years with the Center for Rural Affairs.

“Kim has the skills and the passion to lead our work assisting women entrepreneurs in rural Nebraska,” said Brian Depew, Center for Rural Affairs executive director.

As interim Women Business Center director, she will coordinate with partner organizations to provide training and technical assistance opportunities to borrowers and prospective borrowers; assist business specialists in developing individualized technical assistance plans and provide guidance on implementation of the plan as needed for loan applicants and borrowers; and develop a strong relationship with REAP program borrowers and potential borrowers to arm small business owners with the knowledge and tools necessary for success.

“I’m really looking forward to meeting and working more directly with business owners and potential business owners,” said Preston. “I’m excited to apply a lot of what I’ve learned in the last five years in a practical environment.”

Not only does she have years of practical experience in rural financing, Preston has also personally lived and loved rural her entire life.

“I learned the importance of the small-knit community and local support as a young child,” she said. “My dad took over his dad's small engine repair shop and later went to work for another small business owner when the opportunity to sell the shop came up. I grew up with all of my grandparents within five blocks. Nothing can replace the love and support I felt growing up in that environment.”

Preston says raising a family in a rural setting remains important to her and her husband. They have two nearly grown children and 50 cow/calf pairs on their farm outside of Lyons, Nebraska. She also volunteers for her church and local food pantry.

“Providing the opportunity for our children to grow up in a community that knows you and loves you is something we wanted, and our children have appreciated their large, extended family of neighbors, teachers, and church community,” Preston said. “Our children have learned that someone always has their back, and they, in turn, are looking out for their friends and neighbors as well.”

In their free time, Preston and her husband enjoy golfing and league bowling, and also taking the occasional motorcycle ride in the country.

“I’m fortunate to experience so many elements of small town life in my personal life and to work for an organization dedicated to supporting it,” she said.

The Women’s Business Center’s services reach statewide in Nebraska. Preston can be reached at the Center’s main office in Lyons, at 402.687.2100 ext. 1008 or kimp@cfra.org. Read more about Staff spotlight: Preston appointed as interim Women's Business Center director

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