USDA Awards Money to 28 Wineries

Value-Added Producer Grants from Farm Bill benefit wineries in 20 states

by Linda Jones McKee
Three sisters whole cluster cuvee
Three Sisters Vineyards and Winery of Dahlonega, Ga., is using funds from the USDA's Value-Added Producer Grants program to launch a whole-cluster sparkling wine.
Washington, D.C.—Passage of the Farm Bill earlier this year was good news for the wine industry as well as other agriculturally based businesses. Based on the funding provided by that bill, U.S. Agriculture secretary Tom Vilsack recently announced the 247 recipients of $25 million in Value-Added Producer Grants (VAPG). The Farm Bill had increased mandatory funding for the Value-Added Producer Grants program from $15 million to $63 million during the next five years and reauthorized an additional $40 million in discretionary funds. A total of 28 wineries and/or vineyards in 20 states received $3,281,928 in grants from this program.

According to the USDA, the main objective of the VAPG program is “to help agricultural producers enter into value-added activities related to the processing and/or marketing of bio-based, value-added products. Generating new products, creating and expanding marketing opportunities and increasing producer income are the end goals of this program.” Priority may be given to beginning farmers or ranchers, socially disadvantaged farmers or ranchers, small- or medium-sized family farms or ranches, and farmer or rancher cooperatives, according to the U.S. Agriculture Department.

Under USDA regulations for this program, the maximum grant awarded for planning grants was $75,000, while the maximum for working capital grants was $200,000. In addition, the program requires a cost-sharing requirement of cash or eligible in-kind matching funds equal to at least the amount of the grant funds requested.

“The funding we are announcing will have far-reaching, positive impacts in rural communities across the country,” Vilsack said. “The investments will help businesses create new products, expand their operations, and support local and regional food systems.”

Wine industry winners
Eight wineries in seven states received the maximum grant of $200,000. Rose Fiore, who owns Fiore Winery  in Pylesville, Md., with her husband Mike Fiore, told Wines & Vines that the grant would “give us a chance to do some marketing and advertising to expand our market share. We’re revamping our labels and plan to hire someone to do marketing for us.” The Fiores founded their winery in 1986 and produce approximately 10,000 cases.

The newest winery getting a grant is Bonobo Winery in Traverse City, Mich. Todd and Carter Oosterhouse plan to open the winery on Old Mission Peninsula this fall, and according to Heather Fortin, Bonobo’s marketing director, “The majority of it (the grant) will be spent on packaging materials and processing materials.”

The oldest of the grant-winning wineries is Casa Larga Vineyards in Fairport, N.Y. Founded in 1978, the winery has 45 acres of vineyard and produces approximately 22,000 cases per year. New York Gov. Andrew Cuomo signed legislation in 2013 that allowed roadside farm market stands to sell wine, and Casa Larga will take advantage of that regulation change and use their grant to launch a farmer’s market for local food products as well as the winery’s wines, ales and sodas.

Several of the wineries receiving the largest grants will use the funds for marketing purposes. For example, Three Sisters Vineyards and Winery in Dahlonega, Ga., plans to market a new sparkling wine product, while the grant to Two Mountain Winery in Zillah, Wash., will help the winery cover the costs of processing and marketing an “estate wine.”

Cobbler Mountain Winery in Delaplane, Va., the smallest of the wineries and one of the newest to get the large grant, will use the funds for working capital to help expand the business and to increase marketing efforts, hire additional labor and pay for operational supplies for processing grapes into wine. The winery, which opened in 2011, currently produces about 1,000 cases.

The grant to Lemon Creek Winery in Berrien Springs, Mich., will also be used as working capital for wine processing and marketing expenses to support expanding their customer base. Cannon River Winery in Cannon Falls, Minn., will purchase inventory and processing supplies as well as hire labor to increase the winery’s retail business.

Each fiscal year, the USDA solicits applications for Value-Added Producer Grants through a notice of funding availability that is published in the Federal Register. Wineries interested in applying for a VAPG in 2015 should consult the Rural Development Value Added Producer Grant Program website for updated information. The closing date for applications in 2014 was April 8. 

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