Missouri Value-Added Program

Missouri Value-Added Grant Program
The Missouri Value-Added Grant Program provides grants for projects that boost local economics by adding value to agricultural products. The maximum individual grant is $150,000. However, one-third of the available funds will be awarded to project requests of $25,000 or less. The grants are intended to finance activities prior to starting or expanding a business, such as feasibility studies, prospectus development for cooperatives and business and marketing plans. They cannot be used for operational or capital expenditures. In short, the grants will help identify opportunities and niche markets to better ensure successful enterprises and help get projects to a bankable stage. Agricultural products are defined as an agricultural, horticultural, viticultural, or vegetable product, growing of grapes that will be processed into wine, bees, honey, fish or other aquacultural product, planting, seed, livestock, a livestock product, a forestry product, poultry or poultry product, either in its natural or processed state, that has been produced, processed, or otherwise had value added to it in Missouri.

Evaluation and Funding Criteria
Proposals will be selected on a competitive basis. Each proposal will be evaluated and rated using the following criteria:

1. agriculture economic development potential;
2. credibility and merit;
3. probability of near-term commercialization and practical application of project results;
4. presence, source and level of matching funds; and
5. where the project will have an economic impact.
   

Eligibility Requirements
Applicants must be at least 18 years old and Missouri residents, groups of individuals, businesses, and organizations related to agriculture whose proposed project is based in Missouri. Eligible applicants must use grant funds directly or subcontract with a public or private organization or other resource to achieve the grant proposal objectives. A proposed project must be located in Missouri, must add value to an agricultural product and must benefit the economy of a rural community. Proposals and anticipated project results must have potential for direct commercial application.

Restrictions
The program does not fund:

1. business start-up;
2. business expansion, unless qualified on the basis of program criteria;
3. paying off existing debt;
4. substituting existing efforts or research already underway;
5. covering institutional overhead costs; or
6. buying land, buildings or equipment.

Application Requirements
The application should provide evaluators with a written statement describing an activity that has a sound approach and merits financial support. Applications will be judged principally on how they conform to the grant objectives and criteria, as well as on cost effectiveness. Applications should be no more than 20 pages long (including all supplements) and should conform to the format described on the application form.

Missouri Value-Added Loan Guarantee Program
The Missouri Value-Added Loan Guarantee Program provides partial loan guarantees to banks, savings and loans, and Farm Credit system lenders. Under the program, lenders can receive a 25 percent first-loss guarantee on loans up to $250,000 that finance projects involved in processing, manufacturing, marketing, exporting, or adding value to agricultural products. Loans can be used to finance agricultural property, which includes land, building, structures, improvements, and equipment. Loans may also be guaranteed to buy stock in a start-up cooperative that processes an agricultural product. Loan proceeds may not be used for a line of credit, working capital, or producing livestock or agricultural crops, except for plant stock used for growing grapes that will be processed into wine.

Eligibility Requirements
A borrower may be an individual, partnership, corporation, firm, cooperative, association, trust, political subdivision, state agency or other legal entity executing a note or other evidence of an agricultural business development loan. If an individual , the borrower must be at least 18 years old and a Missouri resident. Any agricultural property financed must be located in Missouri and used by state residents or by Missouri-based businesses. The program is intended to create new economic activity by creating or retaining jobs. Financed projects must demonstrate a good likelihood to succeed in developing, expanding, and operating business enterprises involved in adding value to, marketing, exporting, processing, or manufacturing agricultural products. No more than 90 percent of a project may be financed. Eligible borrowers may also qualify for reduced interest rates through the MISSOURI FIRST Linked Deposit Program administered by the state treasurer's office. For more information about the MISSOURI FIRST Linked Deposit Program, call (800) 662-8257.

Making Loans
Borrowers wishing to secure a loan through the loan guarantee program must apply for a loan through a bank, savings and loan association, the Farm Credit System or other eligible lender. A participating lender must decide whether a prospective borrower meets its requirements for a loan if a 25 percent first-loss guarantee is provided through the Missouri Value-Added Loan Guarantee Program.

For more information, contact: Missouri Agricultural and Small Business Development Authority, PO Box 630, Jefferson City, MO 65102-0630, (573) 751-2129, masbda@mail.state.mo.us. Visit us at our website at www.mda.state.mo.us

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