[Federal Register Volume 70, Number 244 (Wednesday, December 21, 2005)]
[Notices]
[Pages 75780-75790]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-7596]


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DEPARTMENT OF AGRICULTURE

Rural Business-Cooperative Service


Announcement of Value-Added Producer Grant Application Deadlines

AGENCY: Rural Business-Cooperative Service, USDA.

ACTION: Notice of solicitation of applications.

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SUMMARY: The Rural Business-Cooperative Service (RBS) announces the 
availability of approximately $19.475 million in competitive grant 
funds for fiscal year (FY) 2006 to help independent agricultural 
producers enter into value-added activities. Of this amount, $1.5 
million is set aside for applicants requesting $25,000 or less. Awards 
may be made for planning activities or for working capital expenses, 
but not for both. The maximum grant amount for a planning grant is 
$100,000 and the maximum grant amount for a working capital grant is 
$300,000.

DATES: You may submit completed applications for grants on paper or 
electronically according to the following deadlines:
    Paper copies must be postmarked and mailed, shipped, or sent 
overnight no later than March 31, 2006, to be eligible for FY 2006 
grant funding. Late applications are not eligible for FY 2006 grant 
funding.
    Electronic copies must be received by March 31, 2006 to be eligible 
for FY 2006 grant funding. Late applications are not eligible for FY 
2006 grant funding.

ADDRESSES: You may obtain application guides and materials for a VAPG 
at http://www.rurdev.usda.gov/rbs/coops/vadg.htm or by contacting your 
USDA Rural Development State Office. You can reach your State Office by 
calling (202) 720-4323 and pressing ``1''.
    Submit completed paper applications for a grant to Cooperative 
Programs, Attn: VAPG Program, Mail Stop 3250,

[[Page 75781]]

Room 4016-South, 1400 Independence Ave., SW., Washington, DC 20250-
3250. The phone number that should be used for FedEx packages is (202) 
720-7558.
    Submit electronic grant applications at http://www.grants.gov, 
following the instructions found on this Web site.

FOR FURTHER INFORMATION CONTACT: Visit the program Web site at http://www.rurdev.usda.gov/rbs/coops/vadg.htm, which contains application 
guidance, including Frequently Asked Questions and an Application 
Guide. Or you may contact your USDA Rural Development State Office. You 
can reach your State Office by calling (202) 720-4323 and pressing 
``1'', or by selecting the State Contacts link at the above Web site. 
Applicants are encouraged to contact their State Offices well in 
advance of the deadline to discuss their projects and ask any questions 
about the application process.

SUPPLEMENTARY INFORMATION:

Overview

    Federal Agency: Rural Business-Cooperative Service.
    Funding Opportunity Title: Value-Added Producer Grants.
    Announcement Type: Initial announcement.
    Catalog of Federal Domestic Assistance Number: 10.352.
    Dates: Application Deadline: You may submit completed applications 
for grants on paper or electronically according to the following 
deadlines:
    Paper copies must be postmarked and mailed, shipped, or sent 
overnight no later than March 31, 2006, to be eligible for FY 2006 
grant funding. Late applications are not eligible for FY 2006 grant 
funding.
    Electronic copies must be received by March 31, 2006 to be eligible 
for FY 2006 grant funding. Late applications are not eligible for FY 
2006 grant funding.

I. Funding Opportunity Description

    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 (see 7 U.S.C. 1621 note)) authorizing the 
establishment of the Value-Added Agricultural Product Market 
Development grants, also known as Value-Added Producer 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, agriculture producer 
groups, farmer and rancher cooperatives, and majority-controlled 
producer-based business ventures develop strategies to create marketing 
opportunities and to help develop business plans for viable marketing 
opportunities. RBS will competitively award grants to fund one of the 
following two activities: (1) Planning activities needed to establish a 
viable value-added marketing opportunity for an agricultural product 
(e.g. conduct a feasibility study, develop a business plan, develop a 
marketing plan); or (2) acquire working capital to operate a value-
added business venture that will allow 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. 
Applicants must limit their proposals to emerging markets. Grants will 
only be awarded if projects or ventures are determined to be 
economically viable and sustainable. These grants will facilitate 
greater participation in emerging markets and new markets for value-
added products. No more than 10 percent of program funds can go to 
applicants that are majority-controlled producer-based business 
ventures.

Definitions

    The definitions at 7 CFR 4284.3 and 4284.904 are incorporated by 
reference.
    Bioenergy Project--A Renewable Energy system that produces fuel, 
thermal energy, or electric power from a Biomass source, other than an 
anaerobic digester.
    Biomass--Any organic material that is available on a renewable or 
recurring basis, including agricultural crops; trees grown for energy 
production; wood waste and wood residues; plants, including aquatic 
plants and grasses; fibers; animal waste and other waste materials; and 
fats, oils, and greases, including recycled fates, oils, and greases. 
It does not include paper that is commonly reclycled or unsegregated 
solid waste.
    Farm or Ranch--Any place from which $1,000 or more of agricultural 
products (crops and livestock) were raised and sold or normally would 
have been raised and sold during the previous year.
    Feasibility Study--An analysis of the economic, market, technical, 
financial, and management feasibility of a proposed Project.
    Project--Includes all proposed activities to be funded by the VAPG 
and matching funds.
    Renewable Energy--Energy derived from a wind, solar, biomass, or 
geothermal source; or hydrogen derived from biomass or water using 
wind, solar, biomass, or geothermal energy sources.
    Venture--Includes the project and any other activities related to 
the production, processing, and marketing of the value-added product 
that is the subject of the VAPG request.

II. Award Information

    Type of Award: Grant.
    Fiscal Year Funds: FY 2006.
    Approximate Total Funding: $19.475 million.
    Approximate Number of Awards: 250.
    Approximate Average Award: $78,000.
    Floor of Award Range: None.
    Ceiling of Award Range: $25,000 for set-aside grants; $100,000 for 
Planning Grants; and $300,000 for Working Capital Grants.
    Anticipated Award Date: August 31, 2006.
    Budget Period Length: 12 months.
    Project Period Length: 12 months.

III. Eligibility Information

A. Eligible Applicants

    Applicants must be an independent producer, agriculture producer 
group, farmer or rancher cooperative, or majority-controlled producer-
based business venture as defined in 7 CFR 4284, subpart A. If the 
applicant is an unincorporated group (steering committee), it must form 
a legal entity before the grant agreement can be signed. Please note 
that a steering committee may only apply as an independent producer. 
Therefore, the steering committee must be composed of 100 percent 
independent producers and the business to be formed must be owned by 
100 percent independent producers.

B. Cost Sharing or Matching

    Matching funds are required. Applicants must verify in their 
applications that matching funds are available for the time period of 
the grant. Matching funds must be at least equal to the amount of grant 
funds requested. Unless provided by other authorizing legislation, 
other Federal grant funds cannot be used as matching funds. Matching 
funds must be spent at a rate equal to or greater than the rate at 
which grant funds are expended. Matching funds must be provided by 
either the applicant or by a third party in the form of cash or in-kind 
contributions. Matching funds must be spent on eligible expenses and 
must be from eligible sources.

[[Page 75782]]

C. Other Eligibility Requirements

    Product Eligibility: The project proposed must involve a value-
added product as defined in 7 CFR 4284, subpart A. There are four 
categories of value-added. The first category is the incremental value 
that is realized by the producer from an agricultural commodity or 
product as the result of a change in its physical state. The second 
category is the incremental value that is realized by the producer from 
an agricultural commodity or product as the result of differentiated 
production or marketing, as demonstrated in a business plan. The third 
category is the incremental value that is realized by the producer from 
an agricultural commodity or product as the result of product 
segregation. The fourth category is the economic benefit realized from 
the production of farm- or ranch-based renewable energy. Applicants 
should note that a project meeting only the second category of value-
added must already have a business plan in place at the time of 
application. The applicant must reference this business plan in the 
application. Because of this requirement, projects meeting only the 
second category of value-added will be ineligible to apply for a 
planning grant. In order to be eligible under the fourth category, the 
project must generate energy on-farm or on-ranch.
    Activity Eligibility: The project proposed must specify whether 
grant funds are requested for planning activities or for working 
capital. Applicants may not request funds for both types of activities 
in one application.
    If the grant request is for planning activities, working capital 
expenses are not eligible for funding. If more than 20 percent of the 
total project cost (both grant and matching funds) for a planning 
activities application is for working capital expenses, the entire 
application will be determined to be ineligible and will not be 
considered for funding. However, if an application with 20 percent or 
less of working capital expenses is selected for funding, all working 
capital expenses must be removed from the project and replaced with 
eligible planning expenses or the amount of the grant award will be 
reduced accordingly.
    If the grant request is for working capital, planning activities 
are not eligible for funding. If more than 20 percent of the total 
project cost (both grant and matching funds) for a working capital 
application is for planning activities, the entire application will be 
determined to be ineligible and will not be considered for funding. 
However, if an application with 20 percent or less of planning expenses 
is selected for funding, all planning expenses must be removed from the 
project and replaced with eligible working capital expenses or the 
amount of the grant award will be reduced accordingly.
    Applicants that propose budgets that include more than 10 percent 
of total project costs that are ineligible for the program will be 
ineligible and the application will not be considered for funding. 
However, if an application with 10 percent or less of ineligible costs 
is selected for funding, all ineligible costs must be removed from the 
project and replaced with eligible activities or the amount of the 
grant award will be reduced accordingly.
    Applicants other than independent producers applying for a working 
capital grant must demonstrate that the venture has not been in 
operation more than two years at the time of application in order to 
show that they are entering an emerging market.
    Grant Period Eligibility: Applications that have a timeframe of 
more than 365 days will be considered ineligible and will not be 
considered for funding. Applications that request funds for a time 
period ending after December 31, 2007, will not be considered for 
funding.
    Completeness Eligibility: Applications without sufficient 
information to determine eligibility will not be considered for 
funding. Applications that are missing any required elements (in whole 
or in part) will not be considered for funding, except for exceptions 
noted in the following paragraphs.
    Multiple Grant Eligibility: An applicant may not receive more than 
one grant in any one funding cycle. An applicant may submit multiple 
applications, but if more than one application scores high enough to be 
funded, only the highest ranked application will be funded.
    Applicants who have already received a planning grant for the 
proposed project cannot receive another planning grant for the same 
project. Applicants who have already received a working capital grant 
for a project cannot receive any additional grants for that project. 
Please note that the Agency penalizes an applicant who is applying for 
a planning grant when it has already received a planning grant or who 
is applying for a working capital grant when it has already received a 
working capital grant by deducting ten points from the applicant's 
score under Section V.1.ix. and V.2.ix.
    Current Grant Eligibility: If an applicant currently has a VAPG, 
the grant period for that grant must be scheduled to expire by December 
31, 2006.

IV. Application and Submission Information

A. Address To Request Application Package

    If you plan to apply using a paper application, you can obtain the 
application package for this funding opportunity at http://www.rurdev.usda.gov/rbs/coops/vadg.htm. If you do not have access to 
the Internet, or if you have difficulty accessing the forms online, you 
may contact your USDA Rural Development State Office. You can reach 
your State Office by calling (202) 720-4323 and pressing ``1''. 
Application forms can be mailed to you. If you plan to apply 
electronically, you must visit http://www.grants.gov and follow the 
instructions.

B. Content and Form of Submission

    You may submit your application in paper or in an electronic 
format. You may view the Application Guide at http://www.rurdev.usda.gov/rbs/coops/vadg.htm. It is recommended that 
applicants use the template provided on the Web site. The template can 
be filled out electronically and printed out for submission with the 
required forms for a paper submission or it can be filled out 
electronically and submitted as an attachment through Grants.gov.
    If you submit your application in paper form, you must submit one 
signed original of your complete application. The application must be 
in the following format:
    Font size: 12 point unreduced.
    Paper size: 8.5 by 11 inches.
    Page margin size: 1 inch on the top, bottom, left, and right.
    Printed on only one side of each page.
    Held together only by rubber bands or metal or plastic clips; not 
bound in any other way.
    Language: English, avoid jargon.
    The submission must include all pages of the application.
    It is recommended that the application is in black and white, and 
not color. Those evaluating the application will only receive black and 
white images.
    If you submit your application electronically, you must follow the 
instructions given at http://www.grants.gov. Applicants are advised to 
visit the site well in advance of the application deadline if they plan 
to apply electronically to insure that they have obtained the proper 
authentication and have sufficient computer resources to complete the 
application.

[[Page 75783]]

    An application must contain all of the following elements. Any 
application that is missing any element or contains an incomplete 
element will not be considered for funding:
    1. Form SF-424, ``Application for Federal Assistance.'' In order 
for this form to be considered complete, it must contain the legal name 
of the applicant, the applicant's Dun and Bradstreet Data Universal 
Numbering System (DUNS) number (individuals and steering committees are 
exempt), the applicant's complete mailing address, the name and 
telephone number of a contact person, the employer identification 
number (EIN) or social security number if the applicant is an 
individual or steering committee, the start and end dates of the 
project, the federal funds requested, other funds that will be used as 
matching funds, an answer to the question, ``Is applicant delinquent on 
any Federal debt?,'' the name and signature of an authorized 
representative (if the signature is of anyone other than a stated owner 
of the proposed venture, the application should include a signed 
statement by either the owner(s) of the entity or the governing board 
stating that the signature is made by an authorized person), the 
telephone number of the authorized representative, and the date the 
form was signed. Other information requested on the form may be 
applicable, but the above-listed information is required for an 
application to be considered complete. Please note that if the 
applicant applies as a steering committee, it will be required to form 
a legal entity and must report a DUNS number and an EIN prior to final 
approval of the grant agreement.
    You are required to have a DUNS number to apply for a grant from 
RBS unless you are an individual or a steering committee. The DUNS 
number is a nine-digit identification number, which uniquely identifies 
business entities. Obtaining a DUNS number is easy and there is no 
charge. To obtain a DUNS number, access http://www.dnb.com/us/ or call 
(866) 705-5711. Additional information on the VAPG program can be 
obtained at http://www.rurdev.usda.gov/rbs/coops/vadg.htm or contact 
your Rural Development State Office. You can reach your State Office by 
calling (202) 720-4323 and pressing ``1''.
    2. Form SF-424A, ``Budget Information--Non-Construction Programs.'' 
In order for this form to be considered complete, the applicant must 
fill out Sections A, B, C, and D. The applicant must include both 
federal and matching funds.
    3. Form SF-424B, ``Assurances--Non-Construction Programs.'' In 
order for this form to be considered complete, the form must be signed 
by an authorized official (if the signature is of anyone other than a 
stated owner of the proposed Venture, the application should include a 
signed statement by either the owner(s) of the entity or the governing 
body stating that the signature is made by an authorized person) and 
include the title, name of applicant, and date submitted.
    4. Survey on Ensuring Equal Opportunity for Applicants. Submission 
of this form is voluntary for non-profit applicants only. For-profit 
applicants should not submit this form.
    5. Title Page. The title page must include the title of the project 
as well as any other relevant identifying information. The length 
should not exceed one page.
    6. Table of Contents. For ease of locating information, each 
proposal must contain a detailed Table of Contents (TOC) immediately 
following the title page. The TOC must include page numbers for each 
component of the proposal. Pagination should begin immediately 
following the TOC. In order for this element to be considered complete, 
the TOC must include page numbers for the executive summary, an 
eligibility discussion, the proposal narrative and its subcomponents 
(project title, information sheet, goals of the project, work plan, 
performance evaluation criteria and proposal evaluation criteria), 
conflict of interest disclosure, certification of judgment, 
verification of matching funds and certification of matching funds.
    7. Executive Summary. A summary of the proposal, not to exceed one 
page, must briefly describe the project, including goals, tasks to be 
completed and other relevant information that provides a general 
overview of the project. In this section the applicant must clearly 
state whether the proposal is for a planning grant or a working capital 
grant and the amount requested. In the event an applicant submits more 
than one page for this element, only the first page submitted will be 
considered.
    8. Eligibility Discussion. A detailed discussion, not to exceed 
four (4) pages, describing how the applicant meets the eligibility 
requirements. In the event that more than 4 pages are submitted, only 
the first 4 pages will be considered.
    i. Applicant Eligibility. The applicant must first describe how it 
meets the definition of an independent producer, agriculture producer 
group, farmer or rancher cooperative, or a majority-controlled 
producer-based business venture as defined in 7 CFR 4284, subpart A. 
The applicant must apply as only one type of applicant.
    If the applicant is an independent producer, the proposal must 
demonstrate that 100 percent of the owners of the business applying 
meet the definition of an independent producer. These owners must 
currently own and produce more than 50 percent of the raw commodity 
that will be used for the value-added product. The applicant must also 
demonstrate that the product is owned by the producers from its raw 
commodity state through the production of the value-added product. Note 
that farmer or rancher cooperatives that are 100 percent-owned by 
independent producers are not considered under the independent producer 
category; these applicants must apply as farmer or rancher 
cooperatives. Also, note that entities that contract out the production 
of an agricultural commodity are not considered independent producers.
    If the applicant is an agriculture producer group, it must state 
its mission and demonstrate that its mission includes working on behalf 
of independent producers. The applicant must also demonstrate that the 
majority of its membership and board of directors are comprised of 
independent producers. The applicant must identify (either by name or 
by class) the independent producers on whose behalf the work will be 
done. These producers must currently own and produce more than 50 
percent of the raw commodity that will be used for the value-added 
product. Note that applicants tentatively selected for a grant award 
must verify that the work will be done on behalf of the independent 
producers identified in the application. Also, note that entities that 
contract out the production of an agricultural commodity are not 
considered independent producers.
    If the applicant is a farmer or rancher cooperative, the applicant 
must reference the business' good standing as a cooperative in its 
state of incorporation. The applicant must also explain how the 
cooperative is 100 percent owned and controlled by agricultural 
producers. If a cooperative is not 100 percent owned and controlled by 
agricultural producers, it may still be eligible to apply as a 
majority-controlled producer-based business venture, provided it meets 
the definition in 7 CFR 4284, subpart A. If the applicant is applying 
on behalf of only a portion of its membership, that portion must be 
identified, and the applicant must demonstrate that all members in this 
portion of its membership meet the definition of independent producers. 
The independent producers must

[[Page 75784]]

currently own and produce more than 50 percent of the raw commodity 
that will be used for the value-added product. Note that applicants 
tentatively selected for a grant award must verify that the work will 
be done on behalf of the independent producers identified in the 
application. Also, note that entities that contract out the production 
of an agricultural commodity are not considered independent producers.
    If the applicant is a majority-controlled producer-based business 
venture, the applicant must demonstrate that more than 50 percent of 
the ownership and control is held by independent producers, or, 
partnerships, LLCs, LLPs, corporations or cooperatives that are 
themselves 100 percent owned and controlled by independent producers. 
It is the Agency's position that the majority ownership must exist both 
in terms of financial interest and in terms of the number of owners. 
The applicant must state number of owners who are independent producers 
and the number of owners who are not independent producers. The 
applicant must also state the independent producers' financial interest 
and the non-independent producers' financial interest. The applicant 
must also demonstrate that independent producers have majority control 
over the business. Majority control must be demonstrated through voting 
rights on the governing body of the business venture.
    The majority of voting rights must belong to independent producers 
who currently own and produce more than 50 percent of the raw commodity 
that will be used for the value-added product. Also, note that entities 
that contract out the production of an agricultural commodity are not 
considered independent producers.
    ii. Product Eligibility. The applicant must next describe how the 
value-added product to be produced meets at least one of the categories 
in the definition of ``value-added'' as defined in 7 CFR 4284, subpart 
A. Regardless of which category is met, the applicant must describe the 
raw commodity that will be used, the process used to add value, and the 
value-added product that will be marketed.
    If the product meets the first category, the application must 
explain how the change in physical state or form of the product 
enhances its value. A change in physical state is only achieved if the 
product cannot be returned to its original state. Examples of this type 
of product include: Fish fillets, diced tomatoes, ethanol, bio-diesel, 
and wool rugs.
    If the product meets the second category, the proposal must explain 
how the production or marketing of the commodity enhances the value-
added product's value. The enhancement of value must be quantified by 
using a comparison with value-added products produced or marketed in 
the standard manner. Examples of this type of product include: Organic 
carrots, identity-preserved apples, and branded milk. Also, a business 
plan that has been developed for the applicant for the project must be 
referenced.
    If the product meets the third category, the proposal must explain 
how the physical segregation of a commodity or product enhances its 
value. The enhancement of value should be quantified, if possible, by 
using a comparison with commodities marketed without segregation. An 
example of this type of product is non-genetically-modified corn. 
Applicants should note that simply sorting produce or livestock by 
grade is not sufficient to meet this definition. Applicants must 
demonstrate that a physical barrier separates the commodity from 
similar commodities during production, that the commodity will continue 
to be separated during processing, and that the value-added product 
produced will be separated from similar products during marketing.
    If the product meets the fourth category, the proposal must explain 
how the renewable energy will be generated on a farm or ranch owned by 
the owners of the venture. Please note that the owners of the farm or 
ranch must currently produce an agricultural commodity and the farm or 
ranch must meet the definition of a farm or ranch as defined in the 
``Definitions'' section of this notice. Applicants should also note 
that ethanol and bio-diesel do not meet this definition unless the 
energy is generated on a farm or ranch.
    iii. Purpose Eligibility. The applicant must describe how the 
project purpose is eligible for funding. The project purpose is 
comprised of two components. First, the applicant must describe how the 
proposed project consists of eligible planning activities or eligible 
working capital activities. Second, the applicant must demonstrate that 
the activities are directly related to the processing and/or marketing 
of a value-added product. If the applicant is applying for a working 
capital grant, it must reference a third-party, independent feasibility 
study and a business plan that have been completed specifically for the 
proposed Project. If the applicant is applying for a working capital 
grant and it is an agriculture producer group, a farmer or rancher 
cooperative, or a majority-controlled producer-based business venture, 
it must demonstrate that its proposed venture has been in operation for 
less than two years at the time of application, in order to show that 
the applicant is entering an emerging market.
    9. Proposal Narrative. The narrative, not to exceed 35 pages, must 
include the following information. In the event that more than 35 pages 
are submitted, only the first 35 pages submitted will be considered.
    i. Project Title. The title of the proposed project must be brief, 
not to exceed 75 characters, yet describe the essentials of the 
project. It should match the project title submitted on the SF-424. The 
project title does not need to appear on a separate page. It can be 
included on the title page and/or on the information sheet.
    ii. Information Sheet. A separate one page information sheet 
listing each of the evaluation criteria referenced in this funding 
announcement followed by the page numbers of all relevant material 
contained in the proposal that address or support each criterion.
    iii. Goals of the Project. A clear statement of the ultimate goals 
of the project. There must be an explanation of how a market will be 
expanded and the degree to which incremental revenue will accrue to the 
benefit of the agricultural producer(s).
    iv. Work Plan. The narrative must contain a description of the 
project and set forth the tasks involved in reasonable detail. The 
description should specify the activity, who will perform the activity, 
during what time frame the activity will take place, and the cost of 
the activity. Please note that one of the proposal evaluation criteria 
evaluates the work plan and budget. Applicants should only submit the 
work plan and budget once, either in this section or as part of the 
work plan/budget evaluation criterion discussion.
    v. Working capital applications must also include three (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.
    vi. Performance Evaluation Criteria. Applicants applying for 
planning grants

[[Page 75785]]

must suggest at least one criterion by which their performance under a 
grant could be evaluated. Applicants applying for working capital 
grants must identify their current customer base, their current revenue 
accruing to independent producers, and the current number of jobs 
existing for the venture. Working capital projects with significant 
energy components must also report current capacity (e.g. gallons of 
ethanol produced annually, megawatt hours produced annually). Working 
capital grant applicants may also suggest additional performance 
evaluation criteria for incorporation into the grant award. Any 
suggested criteria are not binding on USDA. Please note that these 
criteria are different from the proposal evaluation criteria and are a 
separate requirement. Failure to address this criterion by the 
application deadline will result in a determination of incomplete and 
the proposal will not be considered for funding.
    vii. Proposal Evaluation Criteria. Each of the proposal evaluation 
criteria referenced in this funding announcement must be addressed, 
specifically and individually, in narrative form. Failure to address 
the appropriate evaluation criteria (planning grant proposals must 
address planning grant evaluation criteria and working capital grant 
proposals must address working capital grant evaluation criteria) by 
the application deadline will result in a determination of incomplete 
and the proposal will not be considered for funding.
    10. Conflict of Interest Disclosure. If the applicant plans to 
conduct business with any family members, company owners, or other 
identities of interest using grant or matching funds, the nature of the 
business to be conducted and the nature of the relationship between the 
applicant and the identity of interest must be disclosed. Examples 
include in-kind matching funds donated by the applicant's immediate 
family and contracting with someone who has a financial interest in the 
Venture for services paid by grant or matching funds. If the applicant 
believes that no conflicts of interest exist with respect to its 
proposed project, it must state that belief.
    11. Certification of Judgment. Applicants must certify that the 
United States has not obtained a judgment against them. No grant funds 
shall be used to pay a judgment obtained by the United States. It is 
suggested that applicants use the following language for the 
certification. ``[INSERT NAME OF APPLICANT] certifies that the United 
States has not obtained a judgment against it.'' A separate signature 
is not required.
    12. Verification of Matching Funds. Applicants must provide a 
budget to support the work plan showing all sources and uses of funds 
during the project period. Applicants will be required to verify 
matching funds, both cash and in-kind. All proposed matching funds must 
be specifically documented in the application. If matching funds are to 
be provided by the applicant in cash, a copy of a bank statement with 
an ending date within 30 days of the application submission is 
required. The bank statement must show an ending balance equal to or 
greater than the amount of cash matching funds proposed. If the 
matching funds will be provided through a loan or line of credit, the 
applicant must include a statement from the lending institution 
verifying the amount available, the time period of availability of the 
funds, and the purposes for which funds may be used. If the matching 
funds are to be provided by an in-kind contribution from the applicant, 
the application must include a signed letter from an authorized 
representative of the applicant verifying the goods or services to be 
donated, when the goods and services will be donated, and the value of 
the goods or services. Applicants should note that only goods or 
services for which no expenditure is made can be considered in-kind. If 
the applicant is paying for goods and services as part of the matching 
funds contribution, the expenditure is considered a cash match, and 
should be verified as such. If the matching funds are to be provided by 
a third party in cash, the application must include a signed letter 
from that third party verifying how much cash will be donated and when 
it will be donated. Verification for funds donated outside the proposed 
time period of the grant will not be accepted. If the matching funds 
are to be provided by a third party in-kind donation, the application 
must include a signed letter from the third party verifying the goods 
or services to be donated, when the goods and services will be donated, 
and the value of the goods or services. Verification for in-kind 
contributions donated outside the proposed time period of the grant 
will not be accepted. Verification for in-kind contributions that are 
over-valued will not be accepted. The valuation process for the in-kind 
funds does not need to be included in the application, especially if it 
is lengthy, but the applicant must be able to demonstrate how the 
valuation was achieved at the time of notification of tentative 
selection for the grant award. If the applicant cannot satisfactorily 
demonstrate how the valuation was determined, the grant award may be 
withdrawn or the amount of the grant may be reduced.
    If matching funds are in cash, they must be spent on goods and 
services that are eligible expenditures for this grant program. If 
matching funds are in-kind contributions, the donated goods or services 
must be considered eligible expenditures for this grant program. The 
matching funds must be spent or donated during the grant period and the 
funds must be expended at a rate equal to or greater than the rate 
grant funds are expended. Some examples of acceptable uses for matching 
funds are: Skilled labor performing work required for the proposed 
Project, office supplies, and purchasing inventory. Some examples of 
unacceptable uses of matching funds are: Land, fixed equipment, 
buildings, and vehicles.
    Expected program income may not be used to fulfill the matching 
funds requirement at the time of application. If program income is 
earned during the time period of the grant, it may be used to replace 
other sources of matching funds if prior approval is received from the 
Agency. Any program income earned during the grant period is subject to 
the requirements of 7 CFR 3015, subpart F and 3019.24.
    If acceptable verification for all proposed matching funds is 
missing from the application by the application deadline, the 
application will be determined to be incomplete and will not be 
considered for funding.
    13. Certification of Matching Funds. 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 in 
advance of grant funding, such that for every dollar of grant funds 
advanced, not less than an equal amount of matching funds will have 
been expended prior to submitting the request for reimbursement. Please 
note that this certification is a separate requirement from the 
verification of matching funds requirement. Applicants should include a 
statement for this section that reads as follows: ``[INSERT NAME OF 
APPLICANT] certifies that matching funds will be available at the same 
time grant funds are anticipated to be spent and that matching funds 
will be spent in advance of grant funding, such that for every dollar 
of grant funds advanced, not less than an equal amount of matching 
funds will have been expended prior to submitting the request for 
reimbursement.'' A separate signature is not required.

[[Page 75786]]

C. Submission Dates and Times

    Application Deadline Date: March 31, 2006.
    Explanation of Deadlines: Paper applications must be POSTMARKED by 
the deadline date (see Section IV.F. for the address). Final electronic 
applications must be RECEIVED by Grants.gov by the deadline date. If 
your application does not meet the deadline above, it will not be 
considered for funding. You will be notified that your application did 
not meet the submission deadline. You will also be notified by mail or 
by e-mail if your application is received on time.

D. Intergovernmental Review of Applications

    Executive Order (EO) 12372, Intergovernmental Review of Federal 
Programs, applies to this program. This EO requires that Federal 
agencies provide opportunities for consultation on proposed assistance 
with State and local governments. Many states have established a Single 
Point of Contact (SPOC) to facilitate this consultation. A list of 
states that maintain an SPOC may be obtained at http://www.whitehouse.gov/omb/grants/spoc.html. If your state has an SPOC, you 
may submit your application directly for review. Any comments obtained 
through the SPOC must be provided to Rural Development for 
consideration as part of your application. If your state has not 
established an SPOC, or you do not want to submit your application, 
Rural Development will submit your application to the SPOC or other 
appropriate agency or agencies.
    You are also encouraged to contact your Rural Development State 
Office for assistance and questions on this process. You can find the 
Rural Development State Office in the telephone directory under the 
Federal government listings, by calling (202) 720-4323 and selecting 
option ``1'' or at http://www.rurdev.usda.gov/.

E. Funding Restrictions

    Funding restrictions apply to both grant funds and matching funds. 
Funds may only be used for planning activities or working capital for 
projects focusing on processing and marketing a value-added product.
    1. Examples of acceptable planning activities include to:
    i. Obtain legal advice and assistance related to the proposed 
venture;
    ii. Conduct a feasibility analysis of a proposed value-added 
venture to help determine the potential marketing success of the 
venture;
    iii. Develop a business plan that provides comprehensive details on 
the management, planning, and other operational aspects of a proposed 
venture; and
    iv. Develop a marketing plan for the proposed value-added product, 
including the identification of a market window, the identification of 
potential buyers, a description of the distribution system, and 
possible promotional campaigns.
    2. Examples of acceptable working capital uses include to:
    i. Design or purchase an accounting system for the proposed 
venture;
    ii. Pay for salaries, utilities, and rental of office space;
    iii. Purchase inventory (not including delivery of a raw commodity 
to the processing plant), office equipment (e.g. computers, printers, 
copiers, scanners), and office supplies (e.g. paper, pens, file 
folders); and
    iv. Conduct a marketing campaign for the proposed value-added 
product.
    3. No funds made available under this solicitation shall be used 
to:
    i. Plan, repair, rehabilitate, acquire, or construct a building or 
facility, including a processing facility;
    ii. Purchase, rent, or install fixed equipment, including 
processing equipment;
    iii. Purchase vehicles, including boats;
    iv. Pay for the preparation of the grant application;
    v. Pay expenses not directly related to the funded Venture;
    vi. Fund political or lobbying activities;
    vii. Fund any activities prohibited by 7 CFR parts 3015 and 3019;
    viii. Fund architectural or engineering design work for a specific 
physical facility;
    ix. Fund any expenses related to the production of any commodity or 
product to which value will be added, including seed, rootstock, labor 
for harvesting the crop, and delivery of the commodity to a processing 
facility. The Agency considers these expenses to be ineligible because 
the intent of the program is to assist producers with marketing value-
added products rather than producing agricultural commodities;
    x. Fund research and development;
    xi. Purchase land;
    xii. Duplicate current services or replace or substitute support 
previously provided;
    xiii. Pay costs of the project incurred prior to the date of grant 
approval;
    xiv. Pay for assistance to any private business enterprise which 
does not have at least 51 percent ownership by those who are either 
citizens of the United States or reside in the United States after 
being legally admitted for permanent residence; or
    xv. Pay any judgment or debt owed to the United States; or
    xvi. Conduct activities on behalf of anyone other than a specific 
independent producer or group of independent producers. The Agency 
considers conducting industry-level feasibility studies and business 
plans that are also known as feasibility study templates or guides or 
business plan templates or guides to be ineligible because the 
assistance is not provided to a specific group of independent 
producers.

F. Other Submission Requirements

    You may submit your paper application for a grant to Cooperative 
Programs, Attn: VAPG Program, Mail STOP 3250, Room 4016-South, 1400 
Independence Ave. SW., Washington, DC 20250-3250. The phone number that 
should be used for FedEx packages is (202) 720-7558. You may also 
choose to submit your application electronically at http://www.grants.gov. Final applications may not be submitted by electronic 
mail, facsimile, or by hand-delivery. Each application submission must 
contain all required documents in one envelope, if by mail or express 
delivery service.

V. Application Review Information

A. Criteria

    All eligible and complete applications will be evaluated based on 
the following criteria. Failure to address any one of the following 
criteria by the application deadline will result in a determination of 
incomplete and the application will not be considered for funding. 
Applications for planning grants have different criteria to address 
than applications for working capital grants. Addressing the incorrect 
set of criteria will result in a determination of incomplete and the 
application will not be considered for funding. The total points 
available for each set of criteria are 73.
    1. Criteria for applications for planning grants are:
    i. Nature of the proposed venture (0-10 points). Projects will be 
evaluated for technological feasibility, operational efficiency, 
profitability, sustainability and the likely improvement to the local 
rural economy. Points will be awarded based on the greatest expansion 
of markets and increased returns to producers.
    ii. Qualifications of those doing work (0-10 points). Proposals 
will be

[[Page 75787]]

reviewed for whether the personnel who are responsible for doing 
proposed tasks, including those hired to do the studies, have the 
necessary qualifications. If a consultant or others are to be hired, 
more points may be awarded if the proposal includes evidence of their 
availability and commitment as well. If staff or consultants have not 
been selected at the time of application, the application should 
include specific descriptions of the qualifications required for the 
positions to be filled. Also, rather than attaching resumes at the end 
of the application, it is preferred that the qualifications of the 
personnel and consultants are discussed directly within the response to 
this criterion. If resumes are included, they should be contained 
within the narrative section of the application within the response to 
this criterion. If resumes are attached at the end of the application, 
those pages will be counted toward the page limit for the narrative.
    iii. Commitments and support (0-10 points). Producer commitments 
will be evaluated on the basis of the number of independent producers 
currently involved as well as how many may potentially be involved, and 
the nature, level and quality of their contributions. End user 
commitments will be evaluated on the basis of potential markets and the 
potential amount of output to be purchased. Proposals will be reviewed 
for evidence that the Project enjoys third party support and 
endorsement, with emphasis placed on financial and in kind support as 
well as technical assistance. The applicant may submit up to ten 
letters of support with the application. Additional letters will not be 
considered for the purpose of evaluation this criterion. The applicant 
should reference all additional support in the discussion of this 
criterion, and have the additional support letters and commitment 
letters available upon request. These documents will be requested at 
the time of grant award. Failure to produce them shall result in the 
withdrawal of the grant award. Points will be awarded based on the 
greatest level of documented and referenced commitment.
    iv. Project leadership (0-10 points). The leadership abilities of 
individuals who are proposing the venture will be evaluated as to 
whether they are sufficient to support a conclusion of likely Project 
success. Credit may be given for leadership evidenced in community or 
volunteer efforts. Also, rather than attaching resumes at the end of 
the application, it is preferred that the leadership abilities are 
discussed directly within the response to this criterion. If resumes 
are included, they should be contained within the narrative section of 
the application within the response to this criterion. If resumes are 
attached at the end of the application, those pages will be counted 
toward the page limit for the narrative.
    v. Work plan/budget (0-10 points). The work plan will be reviewed 
to determine whether it provides specific and detailed planning task 
descriptions that will accomplish the Project's goals and the budget 
will be reviewed for a detailed breakdown of estimated costs associated 
with the planning activities. The budget must present a detailed 
breakdown of all estimated costs associated with the planning 
activities and allocate these costs among the listed tasks. Points may 
not be awarded unless sufficient detail is provided to determine 
whether or not funds are being used for qualified purposes. Matching 
funds as well as grant funds must be accounted for in the budget to 
receive points. Logical, realistic, and economically efficient work 
plans and budgets will result in higher scores.
    vi. Amount requested (0-1 points). One (1) point will be awarded 
for grant requests of $50,000 or less. In addressing this criterion, 
the applicant should simply state the amount requested.
    vii. Project cost per owner-producer (0-2 points). This is 
calculated by dividing the amount of Federal funds requested by the 
total number of producers that are owners of the venture. The 
allocation of points for this criterion shall be as follows: $1-$25,000 
equals 2 points, $25,001-$50,000 equals 1 point, $50,001-$300,000 
equals 0 points. The applicant must state the number of owner-producers 
that are part of the venture. For independent producers, farmer and 
rancher cooperatives, and majority-controlled producer-based business 
ventures, the applicant must state the number of owners of the venture 
that are independent producers and are also owners of the venture. An 
owner cannot be considered an independent producer unless he/she is a 
producer of the agricultural commodity to which value will be added as 
part of this project. For agriculture producer groups, the number used 
should be the number of producers represented who produce the commodity 
to which value will be added. In cases where family members (including 
husband and wife) are owners and producers in a Venture, each family 
member shall count as one owner-producer.
    Applications without enough information to determine the number of 
producer-owners will receive 0 points for this criterion.
    Applicants must be prepared to prove that the numbers and 
individuals identified meet the requirements specified upon 
notification of a grant award. Failure to do so shall result in 
withdrawal of the grant award.
    viii. Business size (10 points if the application meets the 
criterion or 0 points if the application does not meet the criterion). 
Applicants must demonstrate their amount of gross sales for their most 
recent complete fiscal year. Applicants that have less than $100 
million in gross sales will receive 10 points. Applicants that have 
$100 million or more in gross sales will receive 0 points. For this 
criterion, applicants should simply state the amount of gross sales for 
their most recent fiscal year. Applicants that are start-up operations 
and do not yet have a complete fiscal year should state so state in 
their applications. These applicants will receive the maximum points 
allowed for this criterion. Applicants that do not provide enough 
information to determine gross sales will be awarded 0 points for this 
criterion. If an applicant is tentatively selected for funding, the 
applicant will need to verify the gross sales amount at the time of 
award. Failure to verify the amount stated in the application will be 
grounds for withdrawing the award.
    ix. Number of grants (0 points if the application meets the 
criterion or negative 10 points if the application does not meet the 
criterion). Applicants must indicate whether they have received any 
previous grants under the VAPG program since its inception in 2001. 
Applicants who have already received a planning grant will receive 
negative 10 points. Applicants who have not received a planning grant 
will receive 0 points. Applicants that do not provide enough 
information to determine if they have received previous grants will 
receive negative 10 points for this criterion.
    x. Presidential initiative of bio-energy (0 points if application 
does not meet the criterion or 5 points if application does meet the 
criterion). Those applications that have at least 51 percent of Project 
costs dedicated to planning activities for a qualifying bio-energy 
project will receive 5 points. If you believe this criterion is not 
applicable, you must state that in your application. Partial credit 
will not be given. Qualifying bio-energy projects are limited to on-
Farm or on-Ranch production of energy as defined in the ``Definitions'' 
section of this notice. Applicants that do not provide enough 
information to determine if at least 51

[[Page 75788]]

percent of project costs are dedicated to a bio-energy component will 
receive 0 points for this criterion.
    xi. Administrator points (up to 5 points, but not to exceed 10 
percent of the total points awarded for the other 11 criteria). The 
Administrator of RBS may award additional points to recognize 
innovative technologies, insure geographic distribution of grants, or 
encourage value-added projects in under-served areas. Applicants may 
submit an explanation of how the technology proposed is innovative and/
or specific information verifying that the project is in an under-
served area.
    2. Criteria for working capital applications are:
    i. Business viability (0-10 points). Proposals will be evaluated on 
the basis of the technical and economic feasibility and sustainability 
of the venture and the efficiency of operations.
    ii. Customer base/increased returns (0-10 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 producers that are 
owners of the venture. Applicants should also reference the financial 
statements submitted. Proposals that demonstrate strong growth in a 
market or customer base and greater value-added revenue accruing to 
producer-owners will receive more points than those that demonstrate 
less growth in markets and realized value-added returns.
    iii. Commitments and support (0-10 points). Producer commitments 
will be evaluated on the basis of the number of independent producers 
currently involved as well as how many may potentially be involved, and 
the nature and level and quality of their contributions. End user 
commitments will be evaluated on the basis of identified markets, 
letters of intent or contracts from potential buyers and the amount of 
output to be purchased. Proposals will be reviewed for evidence that 
the project enjoys third party support and endorsement, with emphasis 
placed on financial and in-kind support as well as technical 
assistance. The applicant may submit up to ten letters of support with 
the application. Additional letters will not be considered for the 
purpose of evaluation this criterion. The applicant should reference 
all additional support in the discussion of this criterion, and have 
the additional support letters and commitment letters available upon 
request. These documents will be requested at the time of grant award. 
Failure to produce them shall result in the withdrawal of the grant 
award. Points will be awarded based on the greatest level of documented 
and referenced commitment.
    iv. Management team/work force (0-10 points). The education and 
capabilities of project managers and those who will operate the venture 
must reflect the skills and experience necessary to effect project 
success. The availability and quality of the labor force needed to 
operate the venture will also be evaluated. Applicants must provide the 
information necessary to make these determinations. Proposals that 
reflect successful track records managing similar projects will receive 
higher points for this criterion than those that do not reflect 
successful track records.
    v. Work plan/budget (0-10 points). The work plan will be reviewed 
to determine whether it provides specific and detailed task 
descriptions that will accomplish the project's goals and the budget 
will be reviewed for a detailed breakdown of estimated costs associated 
with the proposed activities. The budget must present a detailed 
breakdown of all estimated costs associated with the venture's 
operations and allocate these costs among the listed tasks. Points may 
not be awarded unless sufficient detail is provided to determine 
whether or not funds are being used for qualified purposes. Matching 
funds as well as grant funds must be accounted for in the budget to 
receive points. Logical, realistic, and economically efficient work 
plans and budgets will result in higher scores.
    vi. Amount requested (0-1 points). One (1) point will be awarded 
for grant requests of $75,000 or less. In addressing this criterion, 
the applicant should simply state the amount requested.
    vii. Project cost per owner-producer (0-2 points). This ratio is 
calculated by dividing the amount of VAPG funds requested by the total 
number of producers that are owners of the venture. The allocation of 
points for this criterion shall be as follows: $1-$50,000 equals 2 
points, $50,001-$100,000 equals 1 point, and $100,001-$150,000 equals 0 
points. The applicant must state the number of owner-producers that are 
part of the venture. For independent producers, farmer and rancher 
cooperatives, and Majority-controlled producer-based business ventures, 
the applicant must state the number of owners of the venture that are 
independent producers and are also owners of the venture. An owner 
cannot be considered an independent producer unless he/she is a 
producer of the agricultural commodity to which value will be added as 
part of this project. For agriculture producer groups, the number used 
should be the number of producers represented who produce the commodity 
to which value will be added. In cases where family members (including 
husband and wife) are owners and producers in a venture, each family 
member shall count as one owner-producer.
    Applications without enough information to determine the number of 
producer-owners will receive 0 points for this criterion.
    Applicants must be prepared to prove that the numbers and 
individuals identified meet the requirements specified upon 
notification of a grant award. Failure to do so shall result in 
withdrawal of the grant award.
    viii. Business size (10 points if the application meets the 
criterion or 0 points if the application does meet the criterion). 
Applicants must demonstrate their amount of gross sales for their most 
recent complete fiscal year. Applicants that have less than $100 
million in gross sales will receive 10 points. Applicants that have 
$100 million or more in gross sales will receive 0 points. For this 
criterion, applicants should simply state the amount of gross sales for 
their most recent fiscal year. If an applicant is tentatively selected 
for funding, the applicant will need to verify the gross sales amount 
at the time of award. Applicants that are start-up operations and do 
not yet have a complete fiscal year should state so state in their 
applications. These applicants will receive the maximum points allowed 
for this criterion. Applicants that do not provide enough information 
to determine gross sales will receive 0 points for this criterion. 
Failure to verify the amount stated in the application will be grounds 
for withdrawing the award.
    ix. Number of grants (0 points if the application meets the 
criterion or negative 10 points if the application does not meet the 
criterion). Applicants must indicate whether they have received any 
previous grants under the VAPG program since its inception in 2001. 
Applicants who have already received a working capital grant will 
receive negative 10 points. Applicants who have not received a working 
capital grant will receive 0 points. Applicants that do not provide 
enough information to determine if they have received previous grants 
will receive negative 10 points for this criterion.
    x. Presidential initiative of bio-energy (0 points if application 
does not meet

[[Page 75789]]

the criterion or 5 points if application does meet the criterion). 
Applicants must indicate whether they believe their project has a bio-
energy component. If you believe this criterion is not applicable, you 
must state that in your application. Those applications that have at 
least 51 percent of Project costs dedicated to working capital for a 
qualifying bio-energy project will receive 5 points. Partial credit 
will not be given. Qualifying bio-energy projects are limited to on-
Farm or on-Ranch production of energy as defined in the ``Definitions'' 
section of this notice. Applicants that do not provide enough 
information to determine if at least 51 percent of project costs are 
dedicated to a bio-energy component will receive 0 points for this 
criterion.
    xi. Administrator points (up to 5 points, but not to exceed 10 
percent of the total points awarded for the other 10 criteria). The 
Administrator of RBS may award additional points to recognize 
innovative technologies, insure geographic distribution of grants, or 
encourage value-added projects in under-served areas. Applicants may 
submit an explanation of how the technology proposed is innovative and/
or specific information verifying that the project is in an under-
served area.

B. Review and Selection Process

    Each application will be assigned to a USDA Rural Development State 
Office, based on the address of the applicant or the location of the 
project. This state will be known as the servicing State Office. For 
example, if an applicant has an address in Kansas, the application will 
be assigned to the Rural Development State Office in Kansas and the 
Kansas State Office will be the servicing State Office. Applications 
will then be initially reviewed by Rural Development field office 
personnel from the servicing State Office for eligibility and to 
determine whether all required elements are complete. A list of 
required elements follows:

 SF-424
 SF-424A
 SF-424B
 Title Page
 Table of Contents
 Executive Summary
 Applicant Eligibility Discussion
 Product Eligibility Discussion
 Purpose Eligibility Discussion
 Project Title
 Information Sheet
 Goals of the Project
 Work Plan
 Pro-Forma Financial Statements (working capital applications 
only)
 Performance Evaluation Criteria
 Proposal Evaluation Criterion i
 Proposal Evaluation Criterion ii
 Proposal Evaluation Criterion iii
 Proposal Evaluation Criterion iv
 Proposal Evaluation Criterion v
 Proposal Evaluation Criterion vi
 Proposal Evaluation Criterion vii
 Proposal Evaluation Criterion viii
 Proposal Evaluation Criterion ix
 Proposal Evaluation Criterion x
 Conflict of Interest Disclosure
 Certification of Judgment
 Verification of Matching Funds
 Certification of Matching Funds.

Incomplete applications that have four or less incomplete required 
elements and appear to be otherwise eligible will receive a letter 
requesting the incomplete items be provided within 12 business days of 
the date the letter was sent. If the requested items are not received 
when requested or are not complete, the application will not be further 
evaluated and will not be considered for funding. Any other incomplete 
or ineligible applications will not be further evaluated and will not 
be considered for funding.

    All eligible and complete proposals will be evaluated by three 
reviewers based on criteria i through v described in Section V.1 or 
V.2. One of these reviewers will be a Rural Development employee not 
from the servicing State Office and the other two reviewers will be 
non-Federal persons. All reviewers must meet the following 
qualifications. Reviewers must have obtained at least a bachelors 
degree in one or more of the following fields: agri-business, business, 
economics, finance, or marketing. They must also have a minimum of 
three years of experience in an agriculture-related field (e.g. 
farming, marketing, consulting, university professor, research, officer 
for trade association, government employee for an agricultural 
program). If the reviewer does not have a degree in one of those 
fields, he/she must possess at least five years of working experience 
in an agriculture-related field.
    Once the scores for criteria i through v have been completed by the 
three reviewers, the scores will be statistically normalized to correct 
for any reviewer tendencies to score applications ``high'' or ``low.'' 
After the normalization is complete, the three scores will be converted 
to ensure compatibility with the additional scores discussed below and 
then averaged to obtain an independent reviewer score.
    The application will also receive one score from the Rural 
Development servicing State Office based on criteria vi through x. This 
score will be added to the independent reviewer score.
    The servicing State Office will also rank its top three 
applications according to how the proposed project is expected to 
benefit the State as a whole. The first-ranked application will be 
awarded three additional points, the second-ranked application will be 
awarded two additional points, and the third-ranked application will be 
awarded one additional point.
    Finally, the Administrator of RBS will award any Administrator 
points based on criteria xi. These points will be added to the 
cumulative score for criteria i through x and any points received from 
the servicing State Office ranking score. A final ranking will be 
obtained based solely on the scores received for criteria i through xi 
and the servicing State Office ranking score. Eligible applications 
requesting $25,000 or less will be funded in rank order until $1.5 
million in set-aside funds are expended. If the Agency does not receive 
enough applications to fully expend the set-aside amount, any remaining 
funds will be used to fund applications requesting more than $25,000. 
If the Agency receives more eligible applications requesting $25,000 or 
less than it can fund with the set-aside funds, the applications that 
rank too low to be funded from the set-aside funds will not be funded. 
Eligible applications requesting more than $25,000 will be funded in 
rank order using the non set-aside funds of approximately $17.975 and 
any funds remaining from the set-aside.
    After the award selections are made, all applicants will be 
notified of the status of their applications by mail. Awardees must 
meet all statutory and regulatory program requirements in order to 
receive their award. In the event that an awardee cannot meet the 
requirements, the award will be withdrawn. Applicants for working 
capital grants must submit complete, independent third-party 
feasibility studies and business plans before the grant award can be 
finalized. All projects will be evaluated by the servicing State Office 
prior to finalizing the award to ensure that funded Projects are likely 
to be feasible in the proposed project area. Regardless of scoring, a 
project determined to be unlikely to be feasible by the Servicing State 
Office with concurrence by the National Office will not be funded.

C. Anticipated Announcement and Award Dates

    Award Date: The announcement of award selections is expected to 
occur on or about August 31, 2006.

[[Page 75790]]

VI. Award Administration Information

A. Award Notices

    Successful applicants will receive a notification of tentative 
selection for funding from Rural Development. Applicants must comply 
with all applicable statutes, regulations, and this notice before the 
grant award will receive final approval.
    Unsuccessful applicants will receive notification, including 
mediation procedures and appeal rights, by mail.

B. Administrative and National Policy Requirements

    7 CFR parts 3015, 3019, and 4284. These regulations may be accessed 
at http://www.access.gpo.gov/nara/cfr/cfr-table-search.html#page1.
    The following additional requirements apply to grantees selected 
for this program:
     Grant Agreement.
     Letter of Conditions.
     Form RD 1940-1, ``Request for Obligation of Funds.''
     Form RD 1942-46, ``Letter of Intent to Meet Conditions.''
     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-1049, ``Certification Regarding a Drug-Free 
Workplace Requirements (Grants).''
     Form RD 400-1, ``Equal Opportunity Agreement.''
     Form RD 400-4, ``Assurance Agreement.''
    Additional information on these requirements can be found at http://www.rurdev.usda.gov/rbs/coops/vadg.htm.
    Reporting Requirements: You must provide Rural Development with a 
hard copy original or an electronic copy that includes all required 
signatures of the following reports. The reports should be submitted to 
the Agency contact listed on your grant agreement and Letter of 
Conditions. Failure to submit satisfactory reports on time may result 
in suspension or termination of your grant.
    1. Form SF-269 or SF-269A. A ``Financial Status Report,'' listing 
expenditures according to agreed upon budget categories, on a semi-
annual basis. Reporting periods end each March 31 and September 30. 
Reports are due 30 days after the reporting period ends.
    2. Semi-annual performance reports that compare accomplishments to 
the objectives stated in the proposal. Identify all tasks completed to 
date and provide documentation supporting the reported results. If the 
original schedule provided in the work plan is not being met, the 
report should discuss the problems or delays that may affect completion 
of the project. Objectives for the next reporting period should be 
listed. Compliance with any special condition on the use of award funds 
should be discussed. Reports are due as provided in paragraph (1) of 
this section. Supporting documentation must also be submitted for 
completed tasks. The supporting documentation for completed tasks 
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.
    3. Final Project performance reports that compare accomplishments 
to the objectives stated in the proposal. Identify all tasks completed 
and provide documentation supporting the reported results. If the 
original schedule provided in the work plan was not met, the report 
must discuss the problems or delays that affected completion of the 
project. Compliance with any special condition on the use of award 
funds should be discussed. Supporting documentation for completed tasks 
must also be submitted. The supporting documentation for completed 
tasks 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. Planning grant 
projects must also report the estimated increase in revenue, increase 
in customer base, number of jobs created, and any other relevant 
economic indicators generated by continuing the project into its 
operational phase. Working capital grants must report the increase in 
revenue, increase in customer base, number of jobs created, any other 
relevant economic indicators generated by the project during the grant 
period in addition to the total funds used for the Venture during the 
grant period. These total funds must include other federal, state, 
local, and other funds used for the venture. Projects with significant 
energy components must also report expected or actual capacity (e.g. 
gallons of ethanol produced annually, megawatt hours produced annually) 
and any emissions reductions incurred during the project. The final 
performance report is due within 90 days of the completion of the 
project.

VII. Agency Contacts

    For general questions about this announcement and for program 
technical assistance, please contact your USDA Rural Development State 
Office at http://www.rurdev.usda.gov/rbs/coops/vadg.htm. You can also 
reach your State Office by calling (202) 720-4323 and pressing ``1''. 
If you are unable to contact your State Office, please contact a nearby 
State Office or you may contact the RBS National Office at Mail STOP 
3250, Room 4016-South, 1400 Independence Avenue, SW., Washington, DC 
20250-3250, Telephone: (202) 720-7558, e-mail: [email protected].

VIII. Other Information

    It is suggested that applicants visit the Agricultural Marketing 
Resource Center (AgMRC) at http://www.agmrc.org for additional 
information on value-added agriculture. AgMRC brings together experts 
from three of the nation's leading agricultural universities--Iowa 
State University, Kansas State University and the University of 
California--into a dynamic, electronically based center to create and 
present information about value-added agriculture. The center draws on 
the abilities, skills and knowledge of leading economists, business 
strategists and outreach specialists to provide reliable information 
needed by independent producers to achieve success and profitability in 
value-added agriculture. Partial support for the center is derived from 
a grant administered by RBS.

     Dated: December 12, 2005.
Thomas C. Dorr,
Under Secretary, Rural Development.
 [FR Doc. E5-7596 Filed 12-20-05; 8:45 am]
BILLING CODE 3410-XY-P