[Federal Register Volume 66, Number 44 (Tuesday, March 6, 2001)]
[Notices]
[Pages 13490-13495]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-5373]


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DEPARTMENT OF AGRICULTURE

Rural Business-Cooperative Service


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

AGENCY: Rural Business-Cooperative Service, USDA.

ACTION: Notice.

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SUMMARY: The Rural Business-Cooperative Service (RBS) announces the 
availability of approximately $20,000,000 in competitive grant funds to 
help independent producers enter into value-added activities under 
231(a) of the Agriculture Risk Protection Act of 2000. RBS hereby 
requests proposals from eligible independent producers of agricultural 
commodities interested in a competitively awarded grant to develop 
business plans to establish a viable marketing opportunity for their 
value-added product; or to acquire capital to establish a value-added 
business venture or alliance that will allow the producers to better 
compete in domestic and international markets. Up to $10,000,000 will 
be allocated for the first competition, with unused funds being made 
available in a second competition. The maximum award per grant is 
$500,000.

DATES: The deadline for receipt of an application for the first 
competition is 5 p.m. eastern time on April 23, 2001.

[[Page 13491]]

Applications for the second competition are due 4 p.m. eastern time on 
June 27, 2001. The application deadlines are firm as to date and hour. 
The agency will not consider any application received after the 
deadline. Comments regarding the information collection requirements 
under the Paperwork Reduction Act of 1995 must be received on or before 
May 7, 2001 to be assured of consideration.

ADDRESSES: Send proposals and other required materials to Dr. Thomas H. 
Stafford, Director, Cooperative Marketing Division, Rural Business-
Cooperative Service, USDA, Stop 3252, Room 4204, 1400 Independence 
Avenue SW., Washington, DC 20250-3252. Telephone: (202) 690-0368, E-
Mail: [email protected].

FOR FURTHER INFORMATION CONTACT: Dr. Thomas H. Stafford, Director, 
Cooperative Marketing Division, Rural Business-Cooperative Service, 
USDA, STOP 3252, 1400 Independence Ave. SW., Washington, DC 20250-3252. 
Telephone (202) 690-0368, Facsimile (202) 690-2723, E-mail: 
[email protected]. You may also obtain information from the RBS 
website at: http://www.rurdev.usda.gov/rbs/coops/vadg.htm.

SUPPLEMENTARY INFORMATION:

Background

    This solicitation is issued pursuant to section 231 of the 
Agriculture Risk Protection Act of 2000 (Pub. L. 106-224) 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 
for the fiscal year ending September 30, 2001.
    The primary objective of this grant program is to encourage 
producers of agricultural commodities and products of agricultural 
commodities to further refine these products increasing their value to 
end users. These grants will facilitate greater participation in 
markets for value-added agricultural commodities and facilitate the 
opening of new markets for value-added products. These grants will be 
used to fund ventures for a variety of agricultural commodities. Grants 
will only be awarded if projects or ventures are determined to be 
economically viable and sustainable.
    Since there are numerous eligible uses for a VADG grant, applicants 
must carefully list each activity they will undertake and the order 
each activity will be completed. This is critical since payments for 
subsequent activities will be made based on the successful completion 
of prerequisite activities. The Agency reserves the right to terminate 
the grant award if a prerequisite activity was not successful or if it 
showed the venture has a low probability of success. For example, 
business operations plan development will not be funded until a 
feasibility study has been completed and the results of the study show 
the venture has a strong chance of success.
    Applicants must provide matching non-Federal funds at least equal 
to the grant. Grant funds will be disbursed pursuant to 7 CFR parts 
3015 and 3019. Matching funds must be used to support the overall 
purpose of the VADG program.
    All forms required to apply are available from the Cooperative 
Services Program web-site at http://www.rurdev.usda.gov/rbs/coops/vadg.htm, by calling (202) 690-0368, or facsimile (202) 690-2723. Forms 
may be requested via the internet by sending a message with your name, 
mailing address (not e-mail), and phone number to 
[email protected]. When calling or e-mailing, please indicate 
you are requesting forms for fiscal year (FY) 2001 Value-Added Product 
Market Development Grant Program. Forms will be mailed to you (not 
e-mailed or faxed) as quickly as possible. Forms are also available 
from most local USDA Rural Development offices.

Definitions

    Agency--The Rural Business-Cooperative Service (RBS) or its 
successor.
    Agricultural Product--Plant and animal products and their by-
products to include aquaculturally produced fish and seafood products 
and forestry products.
    Business Plan--A defined program of economic activities to 
determine the viability of a potential value-added venture including 
feasibility studies, marketing plans, business operations plans, and 
legal evaluations.
    Independent Producers--Agricultural producers, including 
associations of producers and producer-owned corporations, who do not 
produce the agricultural product under contract or joint ownership with 
any other organization.
    Matching Funds--Cash or confirmed funding commitments from non-
Federal sources. Matching funds must be at least equal to the grant 
amount. In-kind contributions as defined at 7 CFR 3019.23 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.
    Value-Added--Changes in the raw or partly processed agriculturally 
produced commodity that results in a product having a higher value to 
potential buyers. Examples include processing wheat into flour, 
slaughtering livestock or poultry, and collecting and converting 
methane from animal waste to generate energy.

Recipient Eligibility Requirements

    Potential recipients of the grant must be Independent Producers as 
defined above.
    The project proposed must add value as defined above to an 
agricultural product or a product of an agricultural product.

Proposal Preparation

    A proposal should 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 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, should 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.
    (6) Proposal Narrative. The narrative portion of the project 
proposal must include at least the following:
    (i) Project Title. The title of the proposed project must be brief, 
yet represent the major thrust of the project.
    (ii) Information sheet. A separate one-page information sheet which 
lists each of the seven evaluation criteria listed in this NOFA under 
the ``Evaluation Criteria and Weights'' 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 and all the organizational

[[Page 13492]]

tasks and their sequence that need to be completed before operations 
can begin. Examples of similar types of operations should be presented 
and discussed in detail.
    (iv) Specific Tasks to Be Completed. The narrative must list the 
specific tasks that will be funded by the grant. For example, a group 
of producers may want to have a feasibility study conducted and a 
business operations plan drafted. The details of these two tasks must 
be presented and discussed. This includes the order in which they will 
be completed and an estimate of the time necessary to complete the 
tasks. The Agency reserves the right to terminate the grant if a 
prerequisite activity was not successful or it showed the venture had a 
low probability of success.
    (v) Evaluation Criteria. Each of the seven evaluation criteria 
listed in the Evaluation Criteria and Weights section of this NOFA must 
be addressed specifically and individually by category. These criteria 
should be in narrative form with any specific supporting documentation.
    (7) Verification of Matching Funds. Present 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 in-kind match is 
included, so state and provide verification of all commitments and how 
those commitments are priced.
    (8) Budget. A detailed breakdown of estimated costs and a project 
budget.

Grant Amounts

    The amount of funds available for VADG grants in FY 2001 is 
$20,000,000. The actual number of grants funded will depend on the 
quality of proposals received and the amount of funding requested. 
Maximum amount of Federal funds awarded for any one proposal will be 
$500,000. Up to $10,000,000 will be awarded in the first round of 
competition with any residual amount awarded in the second round. 
Eligible applicants not awarded in the first round will automatically 
be included in the second competition, unless an applicant wishes to 
submit a modified proposal.
    In the event that the applicant is awarded a grant that is less 
than the amount requested, they will be required to modify their 
application to conform to the reduced amount before execution of the 
grant agreement. The Agency reserves the right to reduce or de-obligate 
the award, if acceptable modifications are not submitted by the awardee 
within 15 working days from the date the application is returned to the 
applicant. Any modifications must be within the scope of the original 
application.

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. Applicant's contribution in cash or in-
kind must be in accordance with 7 CFR parts 3015 and 3019. Grant and 
the recipient's matching funds may be used for, but are not limited to, 
the following purposes:
    1. Conduct a feasibility analysis of the proposed value-added 
venture to help determine the potential success of the venture. Funds 
can be used to hire a qualified consultant.
    2. Develop a business operations plan that provides comprehensive 
details on the management, planning, and other operational aspects of 
the proposed venture. Funds can be used to hire a qualified consultant.
    3. Develop 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. Funds can be 
used to hire a qualified consultant.
    4. Establish a working capital account to fund operations prior to 
obtaining sufficient cash flow from operations. Funds from this account 
can be used for, but are not limited to:
    (a) hiring an attorney to provide legal advice and to draft 
articles of incorporation, bylaws, and other legal documents related to 
the proposed venture;
    (b) hiring a Certified Public Accountant or other qualified 
individual to design an accounting system for the proposed venture; and
    (c) pay salaries, utilities, and other operating costs to finance 
inventories, purchase office equipment, computers, and supplies, and 
finance 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;
    3. Repair or maintain privately owned vehicles;
    4. Pay for the preparation of the grant application;
    5. Fund political 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 the physical 
facility that are often part of the project feasibility study.

Methods for Evaluating and Ranking Applications

    Applications will be evaluated by a panel of agricultural 
economists and other technical experts appointed by RBS. Applications 
will be evaluated competitively and points awarded as specified in the 
``Evaluation Criteria and Weights'' section of this NOFA. After 
assigning points upon those criteria, 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. The Administrator reserves the right to add 10 points to any 
proposal to ensure geographic distribution. The Administrator further 
reserves the right to add 10 points to any proposal to ensure commodity 
type distribution. Applications will then be funded in final rank order 
until all available funds have been expended. Applicants must score 65 
points or more during the first round to be considered for funding. 
Unused remaining funds from the first competition will be allocated to 
the second competition. Unless the proposal is withdrawn, eligible, but 
unfunded, proposals from the first competition will be considered in 
the second competition, with or without a revision by the applicant.

Evaluation Criteria and Weights

    RBS will initially determine whether the submitting organization is 
eligible and whether the application contains the information required 
by this NOFA. Prior to technical examination, each proposal will be 
reviewed for responsiveness to the funding solicitation. Submissions 
that do not fall within the guidelines as stated in this NOFA will be 
eliminated from the competition and will be returned to the applicant. 
After this initial screening, RBS will use the following criteria to 
rate and rank proposals received in response to this NOFA. Failure to 
address any of the following criteria will disqualify the proposal.
    1. Technical feasibility of the value-added activity (Maximum 20 
points). Describe in detail the operations of 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. Projects will be evaluated

[[Page 13493]]

under this criteria for their overall ability to (1) operate 
efficiently, (2) maximize returns to producers, (3) be sustainable, and 
(4) improve the local rural economy.
    2. Level of producer commitment (Maximum 20 points). Describe in 
detail the number of independent producers who will participate in the 
venture and their total level of production, the number and type of 
written commitments received, and the amount of funds raised from the 
independent producers.
    3. Level of commitment from end-users of the product to be produced 
(Maximum 15 points). Describe in detail who will purchase the output of 
the venture; estimate the amount to be purchased; provide any completed 
marketing studies; and provide any letters of intent or similar 
commitment from the potential end-users.
    4. Qualifications of personnel performing the proposed tasks and a 
demonstrated track-record of performing activities similar to those 
being proposed (Maximum 15 points). Describe in detail qualifications 
of the individuals who will actually do the proposed tasks and provide 
resumes and information about their organizations. If a consultant or 
others are to be hired, include a statement as to their commitment, as 
well as their qualifications.
    5. Plan of work incorporating the appropriate tasks to accomplish 
the stated objectives (Maximum 15 points). The work plan must include 
the specific tasks that will be completed using the grant and matching 
fund money. Describe in detail the various tasks to be performed. For 
example, if the task is a feasibility study, the work plan must include 
the various aspects of the venture that will be analyzed. The work plan 
must present the order the tasks will be undertaken and the estimated 
time for completing each task. If the grant and match will be used for 
working capital, a detailed description of how the capital will be used 
must be included. Sufficient detail must be provided to determine 
whether or not funds are being used for qualified purposes.
    6. Project cost per producer (Maximum 10 points). Calculated by 
dividing the estimated total number of producers benefiting from the 
venture by the project funding (grant amount plus the applicant's 
match). Scores will be assigned based on all applications in the 
competition.
    7. Level of support from different development groups and agencies 
(Maximum 5 points). Describe in detail the involvement of other groups, 
state agencies, and local agencies in the venture and the kind of 
support they are providing. This can be financial and in-kind support.

What and Where To Submit

    An original and two copies of the proposal, with all required forms 
and documentation, must be submitted in one package to: Dr. Thomas H. 
Stafford, Director, Cooperative Marketing Division, Rural Business-
Cooperative Service, USDA, Stop 3252, Room 4204, 1400 Independence 
Avenue SW., Washington, DC 20250-3252. Applications sent electronically 
or by facsimile will not be accepted.

When To Submit

    The deadline for receipt of first round applications is 4 p.m. 
eastern time on April 23, 2001. The deadline for receipt of second 
round applications is 4 p.m. eastern time on June 27, 2001. The 
application deadline is firm as to date and hour and applies to 
submission of the original application and two copies to the National 
Office in Washington, DC. 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.
    3. Submit a feasibility study showing the viability of the venture, 
if any Federal grant and matching funds are to be used as working 
capital.
    4. Use Standard Form 270, ``Request for Advance or Reimbursement'' 
to request advances and reimbursements. Requests to be submitted on a 
quarterly or less frequent basis.
    5. 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.
    6. 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.
    7. Upon completion of each task outlined in the proposal, grant 
recipients will deliver the results of the study or activity to RBS, 
accompanied by all applicable supporting data. These include, but are 
not limited to, feasibility studies, marketing plans, business 
operation plans, articles of incorporation and bylaws, or an accounting 
of how working capital funds were spent. All items delivered to RBS 
will be held in confidence to the extent permitted by law.
    8. Maintain a financial management system that is acceptable to the 
Agency.
    9. Collect and maintain data on race, sex, and national origin 
provided by the membership of the Independent Producers as defined 
above.
    10. 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-Assisted 
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 received 
temporary emergency clearance by the Office of Management and Budget 
(OMB) under Control Number 0570-0039. However, in accordance with the 
Paperwork Reduction Act of 1995, RBS will seek standard OMB approval of 
the reporting requirements contained in this Notice and hereby opens a 
60-day public comment period.
    Abstract: RBS, an Agency within the USDA Rural Development mission 
area, will administer the VADG grant program. The intent of the VADG 
grant program is to develop a business plan for viable marketing 
opportunities for a value-added agricultural commodity or product of an 
agricultural product; or to acquire capital to establish a value-

[[Page 13494]]

added business venture or alliance that will allow the producers to 
better compete in domestic and international markets.

Public Burden in This Notice

    At this time, the Agency is requesting OMB clearance of the 
following burden:
    Form SF-424 ``Application for Federal Assistance.'' This form is 
used by applicants as a required face sheet for applications for 
Federal assistance.
    Form SF-424A ``Budget Information-Non construction Programs.'' This 
form must be completed by applicants to show the project's budget 
breakdown, both as to expense categories and the division between 
Federal and non-Federal sources.
    Form SF-424B ``Assurances-Non Construction Programs.'' This form 
must be completed by the applicant to give the Federal government 
certain assurances that the applicant has the legal authority to apply 
for Federal assistance and the financial capacity to pay the non-
Federal share of project costs. The applicant also gives assurance it 
will comply with various legal and regulatory requirements as described 
in the form.
    Grantees will be required to do the following:
    1. Grant Agreement. Sign a Value-Added Agricultural Product Market 
Development Grant Agreement similar to the one published at the end of 
this NOFA.
    2. Feasibility Study. Submit a feasibility study showing the 
viability of the venture if any Federal grant and matching funds are to 
be used as working capital.
    3. Payment requests. Use Standard Form 270, ``Request for Advance 
or Reimbursement'' to request advances and reimbursements. Requests to 
be submitted on a quarterly or less frequent basis.
    4. Report Financial Status. 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.
    5. Performance Reports. Submit semi-annual performance reports 
which compares 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.
    6. Study Results. Upon completion of each task outlined in the 
proposal, grant recipients will deliver the results of the study or 
activity to RBS, accompanied by all applicable supporting data. These 
include, but are not limited to, feasibility studies, marketing plans, 
business operation plans, articles of incorporation and bylaws, or an 
accounting of how working capital funds were spent. All items delivered 
to RBS will be held in confidence to the extent provided for by law.
    7. Financial Management System. Maintain a financial management 
system that is acceptable to the Agency.
    8. Civil Rights Data. Collect and maintain data on sex, race, and 
national origin of the Independent Producers membership.
    9. Final Performance Report. Submit a final project performance 
report.

Project Proposal

    The applicant must submit a project proposal containing the 
elements described in this notice and in the format prescribed. The 
elements of the proposal are: (1) Table of contents providing page 
numbers for each component of the proposal; (2) a project summary, not 
to exceed one page, that includes the title of the project, a 
description of the project, and the names of individuals working on the 
project; and (3) a project narrative that discusses the goals of the 
project, the specific tasks to be completed, and the seven criteria 
which is the basis for selection for funding.

Project Reporting Requirements

    Awardees will be required to submit written project performance 
reports on a semi-annual basis. The project performance report shall 
include, but need not be limited to: (1) A comparison of actual 
accomplishments to the objectives; (2) problems in meeting established 
objectives; (3) problems, delays, or adverse conditions which will 
materially affect completion of the project; (4) objectives established 
for the next reporting period; (5) status of compliance with any 
special conditions on the use of awarded funds.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 8.2 hours per response.
    Respondents: Associations of independent producers and entities 
representing steering committees of independent producers.
    Estimated Number of Respondents: 120.
    Estimated Number of Responses per Respondent: 2.5.
    Estimated Number of Responses: 300.
    Estimated Total Annual Burden on Respondents: 2,460 hours.
    Copies of this information collection can be obtained from Cheryl 
Thompson, Regulations and Paperwork Management Branch, (202) 692-0043.

Comments

    Comments are invited on: (a) Whether the proposed collection of 
information is necessary for the proper performance of the functions of 
the Agency, including whether the information will have practical 
utility; (b) the accuracy of the Agency estimate of the burden of the 
proposed collection of information including the validity of the 
methodology and assumptions used; (c) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (d) ways 
to minimize the burden of the collection of information on those who 
are to respond, including the use of appropriate automated, electronic, 
mechanical, or other technological collection techniques or other forms 
of information technology.
    All responses to this notice will be summarized and included in the 
request for OMB approval. All comments will also become a matter of 
public record. Comments on the paperwork burden may be sent to Cheryl 
Thompson, Regulations and Paperwork Management Branch, Rural 
Development, U.S. Department of Agriculture, Stop 0742, 1400 
Independence Avenue SW, Washington, DC 20250-0742.

    Dated: February 26, 2001.
William F. Hagy III,
Acting Administrator, Rural Business-Cooperative Service, 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 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.

[[Page 13495]]

    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,'' part 3016, ``Uniform Administrative Requirements for 
Grants and Cooperative Agreements to State and Local Governments,'' or 
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 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 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 quarterly 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 producer-members by race, sex, and 
national origin. The grantee must ensure that their recipients also 
collect and maintain data on beneficiaries by race, sex, and national 
origin as required by title VI of the Civil Rights Act of 1964 and must 
be provided to the Agency for compliance review purposes.
    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; and
    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

Attest
By--------------------------------------------------------------------
(Grantee)
(Title)---------------------------------------------------------------
United States of America
Rural Business-Cooperative Service
By--------------------------------------------------------------------
(Grantor)     (Name)     (Title)

[FR Doc. 01-5373 Filed 3-5-01; 8:45 am]
BILLING CODE 3410-XY-U