Governor McDonnell Announces Agriculture and Forestry Industries Development Fund Now Open to Applicants

Governor Bob McDonnell has announced  that guidelines for the newly created Agriculture and Forestry Industries Development (AFID) Fund have been finalized and localities are now able to apply for AFID grants that will enable them to support economic development and job creation efforts. With the release of these guidelines, Virginia, for the first time, has an economic development grant program designed specifically to support agriculture and forestry development projects.

“Agriculture and forestry are Virginia’s largest industries, but we learned that too often economic development projects within these important business sectors didn’t meet the necessary criteria for the Commonwealth’s major incentive programs,” said Governor McDonnell, who has made agriculture and forestry key components of his overall economic development and jobs creation agenda. “That’s an omission that we’ve addressed as the AFID clearly recognizes the sometimes unique aspects of agriculture and forestry projects. We hope this program will encourage local governments to work closely with these important industries to create new jobs and increased economic opportunity in communities throughout the Commonwealth.”

The creation of the AFID was part of Governor McDonnell’s jobs creation and economic development agenda during the 2012 session of the General Assembly. The Governor signed the AFID bill into law on May 9 at Cave View Farm in Weyers Cave. Senator Bill Stanley (R – Glade Hill) and Delegate Steve Landes (R – Augusta) sponsored the AFID legislation, which is funded at $1 million in each year of the biennium. AFID funds are broken into two categories with $750,000 going to large grants to assist local efforts in expanding current or attracting new agriculture and forestry processing/value-added facilities using Virginia grown products and $250,000 dedicated to small grants to assist localities in improving local economic development efforts relating to agribusiness. The guidelines being released today are for applicants seeking an AFID grant for a processing or value-added facility. Guidelines for the assistance to localities will be released later this year.

“The AFID is a powerful new tool in Virginia’s already impressive economic development and jobs creation portfolio of incentive options and will further enhance our ‘best for business’ reputation,” said Lieutenant Governor Bill Bolling. “The fund is particularly important to rural areas, regions of the state where the Governor and I pledged to focus significant attention and job creation efforts after we were elected in 2009. Agriculture and forestry typically are significant economic drivers in rural Virginia, so new investments in these industries will help to build on these region’s existing strengths.”

Under the processing/valued-added guidelines, program funds are now available to local governments and other political subdivisions as one to one matching grants of up to $250,000 to attract economic development prospects involving agriculture and forestry operations to locate or expand in Virginia. In order to qualify, a minimum of 30 percent of the agricultural or forestry products to which the facility is adding value must be grown or produced in the Commonwealth. Grant awards will be determined based on such factors as amount of private capital invested, projected state and local tax revenue generated as a result of capital investment and jobs created, anticipated amount of Virginia-grown product used by the project, projected impact on agricultural and forestal producers, a total return on investment analysis and an analysis of the impact on competing businesses in the area.

“The AFID’s ‘buy local’ provisions will encourage agricultural and forestry operations receiving grant funds to explore all the ways they can source a significant portion of their inputs from within the Commonwealth,” said Todd Haymore, Virginia’s Secretary of Agriculture and Forestry. “In addition to allowing investing companies to utilize and enjoy the benefits of Virginia’s high quality agricultural and forestry products, this provision expands existing markets or opens new ones for Virginia producers, helps preserve working farmland, and encourages investments in our rural communities.”

Businesses interested in an AFID grant should first contact their local economic development professional or other appropriate representative of the political subdivision to discuss the proposed project. If the political subdivision is interested in applying for the grant and providing the required local match, they should contact Stephen Versen, AFID program contact at the Virginia Department of Agriculture and Consumer Services (VDACS) at stephen.versen@vdacs.virginia.gov or 804.786.6911 to discuss the program and share initial project details. AFID Guidelines may be obtained on the VDACS website at http://www.vdacs.virginia.gov/agribusiness/afid.shtml.  Applications will be taken on a rolling basis. The AFID program will be administered by the Secretary of Agriculture and Forestry with assistance from VDACS and Virginia Department of Forestry staff.

Agriculture and forestry are Virginia’s largest industries, with a combined economic impact of $79 billion annually: $55 billion from agriculture and $24 billion from forestry. The industries also provide approximately 500,000 jobs in the Commonwealth according to the Weldon Cooper Center for Public Service at the University of Virginia.

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