May 10, 2018

Luján, Fortenberry Introduce Bipartisan Bill to Bolster Value-Added Agricultural Product Market Development Grants

[WASHINGTON, D.C.] – Today, Reps. Ben Ray Luján (D-NM-03) and Jeff Fortenberry (R-NE-01) introduced the bipartisan Growing Value-Added Economies Act to bolster the United States Department of Agriculture’s (USDA) Value-Added Producer Grant (VAPG) program. This bill would robustly fund the program and build on the program’s successes by making the program more accessible to potential applicants, eliminating potential bias, and increasing program transparency.

“An integral part of New Mexico’s economy is the hard work of our farmers and producers across the state. From chiles to pecans, our crops are part of the fabric of the Land of Enchantment,” said Luján. “By ensuring this vital program is funded and by streamlining the application process, we can provide stability for our state’s agricultural producers and create more opportunities for them to sell their distinct products.”

“This important public policy tool will help the creative process of diversification for farm communities,” said Fortenberry.

The VAPG program helps bridge the gap between producers and the market by helping agricultural producers enter into value-added activities that generate new products, create and expand marketing opportunities, and increase their income. Currently, USDA awards VAPGs to individual producers, groups of independent producers, producer-controlled entities, organizations representing agricultural producers, and farmer and rancher cooperatives. Congress has authorized the VAPG program since 2000. The VAPG program has a proven record of supporting economic growth in rural communities.

The bill would ensure continued funding of the VAPG program, create an independent peer-review panel to evaluate applications, create an outreach and technical assistance program to make the program more accessible, and limit administrative expenses and program evaluation costs to no more than five percent of the funds allocated each fiscal year.

The VAPG program is a proven way to help farmer led businesses succeed. The USDA’s Economic Research Service released a reporton Monday, May 8, 2018 detailing the effect of the VAPG program on business survival and growth. The report found that businesses that received VAPGs were less likely to fail than similar businesses and that VAPG recipient businesses provide an average of five to six more jobs than similar businesses. At a time when farmers are getting the lowest share of the food dollarin 15 years, VAPGs allow farmers to take home a greater share of the value they produce.

Co-sponsors of the legislation include Rep. Michelle Lujan Grisham (D-NM-01) and Rep. Sean Patrick Maloney (D-NY-18), both of whom are members of the House Committee on Agriculture, and Rep. Chellie Pingree (D-ME-01). The National Sustainable Agriculture Coalition (NSAC) also supports this legislation.

"VAPG is a program with a proven track record of success," said Wes King, Policy Specialist at NSAC. "USDA estimates that 73 percent of the producers who received VAPG grants in 2004 are still in operation today – those are pretty great figures given the sluggish state of the farm economy over the last several years. NSAC applauds Representatives Luján and Fortenberry for introducing this important legislation and investing in good food for American families and economic opportunity for American farmers."