HR 1093 IH

To provide for grants to assist value-added agricultural businesses.

To provide for grants to assist value-added agricultural businesses.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Value-Added Development Act for American Agriculture'.

SEC. 2. AGRICULTURE INNOVATION CENTER DEMONSTRATION PROGRAM.

(a) PURPOSES- The purposes of this section are to carry out a demonstration program under which agricultural producers are provided--

(1) technical assistance, including engineering services, applied research, scale production, and similar services to enable the producers to establish businesses for further processing of agricultural products;

(2) marketing, market development, and business planning;

(3) overall organizational, outreach, and development assistance to increase the viability, growth, and sustainability of value-added agricultural businesses.

(b) NATURE OF PROGRAM- The Secretary of Agriculture (in this section referred to as the `Secretary') shall--

(1) make grants to eligible applicants for the purposes of enabling the applicants to obtain the assistance described in subsection (a); and

(2) provide assistance to eligible applicants through the research and technical services of the Department of Agriculture.

(c) ELIGIBILITY REQUIREMENTS-

(1) IN GENERAL- An applicant shall be eligible for a grant and assistance described in subsection (b) to establish an Agriculture Innovation Center if--

(A) the applicant--

(i) has provided services similar to those described in subsection (a); or

(ii) shows the capability of providing the services;

(B) the application of the applicant for the grant and assistance sets forth a plan, in accordance with regulations which shall be prescribed by the Secretary, outlining support of the applicant in the agricultural community, the technical and other expertise of the applicant, and the goals of the applicant for increasing and improving the ability of local producers to develop markets and processes for value-added agricultural products;

(C) the applicant demonstrates that resources (in cash or in kind) of definite value are available, or have been committed to be made available, to the applicant, to increase and improve the ability of local producers to develop

(D) the applicant meets the requirement of paragraph (2).

(2) BOARD OF DIRECTORS- The requirement of this paragraph is that the applicant shall have a board of directors comprised of representatives of the following groups:

(A) The 2 general agricultural organizations with the greatest number of members in the State in which the applicant is located.

(B) The Department of Agriculture or similar State organization or department, for the State.

(C) Organizations representing the 4 highest grossing commodities produced in the State, according to annual gross cash sales.

(d) GRANTS AND ASSISTANCE-

(1) IN GENERAL- Subject to the availability of appropriations, the Secretary shall make annual grants to eligible applicants under this section, each of which grants shall not exceed the lesser of--

(A) $1,000,000; or

(B) twice the dollar value of the resources (in cash or in kind) that the applicant has demonstrated are available, or have been committed to be made available, to the applicant in accordance with subsection (c)(1)(C).

(2) INITIAL LIMITATION- In the first year of the demonstration program under this section, the Secretary shall make grants under this section, on a competitive basis, to not more than 10 eligible applicants.

(3) EXPANSION OF DEMONSTRATION PROGRAM- In the second year of the demonstration program under this section, the Secretary may make grants under this section to not more than 10 eligible applicants, in addition to any entities to which grants are made under paragraph (2) for such year.

(4) STATE LIMITATION- In the first 3 years of the demonstration program under this section, the Secretary shall not make a Agricultural Innovation Center Demonstration Program grant under this section to more than 1 entity in any State.

(e) USE OF FUNDS- An entity to which a grant is made under this section may use the grant only for the following purposes:

(1) Applied research.

(2) Consulting services.

(3) Office equipment.

(4) Hiring of employees, at the discretion of the board of directors of the entity.

(5) The making of matching grants, each of which shall be not more than $5,000, to agricultural producers, so long as the aggregate amount of all such matching grants shall be not more than $50,000.

(6) Legal services.

(f) LIMITATIONS ON AUTHORIZATION OF APPROPRIATIONS- For grants and assistance under this section, there are authorized to be appropriated to the Secretary not more than--

(1) $10,000,000 for fiscal year 2002;

(2) $20,000,000 for each of fiscal years 2003 and 2004.

(g) REPORT ON BEST PRACTICES-

(1) EFFECTS ON THE AGRICULTURAL SECTOR- The Secretary shall utilize $300,000 per year of the funds appropriated pursuant to this section to support research at a land-grant university into the effects of value-added projects on agricultural producers and the commodity markets. The research should systematically examine possible effects on demand for agricultural commodities, market prices, farm income, and Federal outlays on commodity programs using linked, long-term, global projections of the agricultural sector.

(2) DEPARTMENT OF AGRICULTURE- Not later than 3 years after the first 10 grants are made under this section, the Secretary shall prepare and submit to the Committee on Agriculture, Nutrition, and Forestry of the Senate and to the Committee on Agriculture of the House of Representatives a written report on the effectiveness of the demonstration program conducted under this section at improving the production of value-added agricultural products and on the effects of the program on the economic viability of the producers, which shall include the best practices and innovations found at each of the Agriculture Innovation Centers established under the demonstration program under this section, and detail the number and type of agricultural projects assisted, and the type of assistance provided, under this section.