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Value-Added Agricultural Products (VAP)

The Value-Added Agricultural Products and Processes Financial Assistance Program (VAAPFAP) seeks to increase the innovative utilization of Iowa's agricultural commodities. It accomplishes this by investing in the development of new agri-products and new processing technologies. VAAPFAP may assist projects in two primary categories and a third secondary category:

• Innovative Products and Processes encourages the processing of agricultural commodities into higher-value products not commonly produced in Iowa, or utilizing a process not commonly used in Iowa to produce new and innovative products from agricultural commodities.
• Renewable Fuels and Co-Products encourages the production of renewable fuels, such as soy diesel and ethanol, and co-products for livestock feed.
• A third category, Project Creation Assistance, is also available for projects that may be ineligible under the regular program due to their "pre-commercial" status. Project Creation Assistance is limited to projects within certain designated Strategic Initiatives.

Program Eligibility Requirements:

• The proposed project must be located in Iowa.
• The business must have a business plan demonstrating a viable market, and managerial and technical experience.
• The business should also have completed a feasibility study documenting the viability of the proposed start-up business.

Projects are also evaluated according to the following criteria:

• The degree to which the facility will increase the utilization of agricultural commodities produced in the state.
• New and innovative
• Feasibility
• The proportion of local match to be contributed to the project.
• The level of need of the region where the existing facility is, or the proposed facility is to be located.
• The degree to which the facility produces a co-product that is marketed in the same locality as the facility.

Any single project may apply for up to $525,000 in assistance. Financial assistance is provided in the form of loans and forgivable loans. Generally, assistance of $20,000 or more is usually awarded as a combination of loans and forgivable loans, with the forgivable portion decreasing as the award size increases.