Value-Added Agricultural Products & Processes Financial Assistance Program
(VAAPFAP)
Iowa is a long-standing national leader in the production of corn,
pork, soybeans, eggs and beef. However, assuring that Iowa’s farm prosperity
continues means thinking and moving beyond simply producing abundant commodity
crops and livestock. Farm income, and the economic well-being of most of Iowa’s
rural communities, depends increasingly on our ability to process those crops
into new and innovative, refined, consumer-ready food, fiber, and fuel products.
VAAPFAP was created in 1994 by the Iowa General Assembly to provide support
and business incentives to Iowa farmers and agribusiness entrepreneurs. The
program is designed to speed the rate of every ag-based innovation in food and
fiber products, and to encourage organization of new ventures to produce those
innovations.
VAAPFAP may assist projects in these primary categories:
Innovative Agricultural Products and Processes – provides financial
assistance for projects that use Iowa agricultural commodities to
produce higher-value products that are not commonly produced in Iowa.
Renewable Fuels and Co-Products – provides financial assistance for
development of renewable fuel production facilities such as biodiesel or
ethanol facilities that yield co-products used for livestock feed.
Agricultural Biotechnology Industry, Biomass and Alternative Energy –
provides financial assistance to agricultural businesses that utilize
scientifically enhanced plants or animals that can be raised by
producers. Assistance is also available for agricultural biomass
businesses that utilize commodity crops, agricultural by-products, or
animal feedstock in the production of chemicals, protein products, or
other similar products. Businesses involved in the production of
alternate energy which could include ethanol, biodiesel, biomass,
hydrogen, or the production of wind energy can also benefit from this
program.
Organic Processing and Emerging Markets – provides assistance to
businesses that add value through further processing of organic products
and through emerging markets.
Project Creation Assistance – available for projects that may be
ineligible under the regular program because of their "precommercial"
status.
Financial Assistance Guidelines. No single project may receive more than
25 percent of the program’s annual fund appropriation. Financial assistance
is provided to qualifying projects in the form of loans and forgivable
loans.
Evaluation Criteria. Applications are evaluated according to criteria
specified in the Code of Iowa, and include the following:
The feasibility of the existing or proposed facility to remain a
viable enterprise
The degree to which the facility will increase the utilization of
agricultural commodities produced in Iowa
The extent to which the existing or proposed facility is located
in a rural region of the state
The proportion of private funds to be contributed to the project
The level of economic development need in the region where the
value-adding facility is to be located
The degree to which the facility produces a co-product that is
marketed in the same locality as the facility
Program Eligibility Requirements:
The proposed project must be located in Iowa
The applicant must have a business plan demonstrating a viable
market and managerial and technical capabilities to execute the plan
The business should also have a third-party feasibility study
confirming the viability of the proposed business
The grantee must not use funds for any activity directly related
to farming
Must meet wage thresholds requirements.
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