Agriculture & Forestry Industries Development Fund (AFID)
AFID is a discretionary incentive to grow Virginia’s agriculture and forestry industries.
AFID grants are made to localities at the discretion of the Governor with the expectation that the grant will be critical to the success of a project, which will result in creation of new jobs and investment from companies that add value to Virginia-grown agriculture and forestry products.
Grants may be used for a variety of purposes, including public and private utility extension or capacity development on- and off-site; high-speed or broadband internet access extension or capacity development; road, rail, or other transportation access costs beyond the funding capability of existing programs; site acquisition; grading, drainage, paving, and any other activity required to prepare a site for construction; construction or build-out of buildings; or training.
For more program information, please refer directly to the Virginia Department of Agriculture and Consumer Services.
In order to qualify for an AFID grant, the project should:
Be a facility that produces "value-added agricultural or forestal products," meaning any agricultural or forestal product that (i) has undergone a change in physical state; (ii) was produced in a manner that enhances the value of the agricultural commodity or product; (iii) is physically segregated in a manner that results in the enhancement of the value of the agricultural or forestal product; (iv) is a source of renewable energy; or (v) is aggregated and marketed as a locally-produced agricultural or forestal product.
Demonstrate that a minimum of 30% of the agricultural or forestry products to which the facility is adding value will be grown or produced within the Commonwealth on an annual basis in normal years.
Grants are made to a local government under the following conditions:
- The project is creating new capital investment and jobs in Virginia.
- The local government applying for the grant provides a matching financial commitment.
- A performance agreement is executed between the applicant and the business outlining the agreed-upon job creation, capital investment, and purchase of Virginia-grown agricultural or forestry products.
- Public announcement of the project is coordinated with the Governor’s Office.
In determining grant awards, the following criteria will be considered by the Department of Agriculture and Consumer Services:
- Expected number of jobs to be created.
- Anticipated amount of private capital investment.
- Estimated additional tax revenue expected to accrue to the state and affected localities as a result of the capital investment and jobs created.
- Anticipated amount of Virginia-grown agricultural and forestal products used by the project.
- Projected impact on agricultural and forestal producers.
- A Return-on-Investment (ROI) analysis.
- An analysis of the impact on competing businesses already located in the area.
- Other factors deemed appropriate by the Secretary of Agriculture and Forestry.
Applications are made to the Secretary of Agriculture and Forestry by a local government in partnership with the business based on the following process:
- Businesses interested in receiving AFID grant funds contact their local economic development professional, or other appropriate representative of the local government, to introduce the qualifying project to him/her.
- If there is support from the local government to apply for an AFID grant and provide the required local match, the economic development professional (or appropriate representative) contacts the Virginia Department of Agriculture and Consumer Services (contact information provided in the Contact section above) to discuss the project.
- If the project meets all requirements for an AFID grant, the initial project information is reviewed by the Secretary of Agriculture and Forestry. During this period, the applicant and business may be asked for additional information and assurances related to proposed targets for jobs, capital investment, and purchase of Virginia-grown products.
- If an AFID application meets the initial approval of the Secretary of Agriculture and Forestry, the Secretary communicates the proposed AFID fund amount and any required agreement terms to the local government.
- The local government and the business submit a formal letter to the Secretary of Agriculture and Forestry requesting AFID grant funds based on the approved terms communicated by the Secretary.
- The Secretary of Agriculture and Forestry recommends the AFID grant to the Governor, who gives final approval or rejection to the grant and coordinates the announcement with the parties involved.
- The local government is given a deadline for full execution of the performance agreement between the local government and the business, as well as a separate deadline for requesting the approved AFID grant funds.
- Once the performance agreement is fully executed and submitted to the Secretary of Agriculture and Forestry, the local government may request the approved AFID funds up until the deadline agreed to in the performance agreement.
Upon receipt of the award, and as a condition of the performance agreement, the business’s progress toward achieving the targets for new jobs, capital investment, and purchases of Virginia-grown products must be reported annually to the Secretary of Agriculture and Forestry. The format for these reports will be provided to the local government which, in coordination with the business, will complete the report and verify the data.
A report will be required within 30 days of the end of the grant period, which is typically three years, and on that same date for each of the preceding years. The Secretary of Agriculture and Forestry may work with the local government’s commissioner of revenue, Virginia Employment Commission, and other resources to verify the accuracy of these reports. If discrepancies are found, the business will have an opportunity to explain them.
How are agricultural and forestal products defined?
"Agricultural products" means crops, livestock, and livestock products, including field crops, fruits, vegetables, horticultural specialties, cattle, sheep, hogs, goats, horses, poultry, fur-bearing animals, milk, eggs, aquaculture, commercially harvested wild fish, commercially harvested wild shellfish, and furs.
"Forestal products" means saw timber, pulpwood, posts, firewood, Christmas trees, and other tree and wood products for sale or for farm use.
If unsure whether a business qualifies, contact the Virginia Department of Agriculture and Consumer Services.
How is a new job defined for this program?
New job means employment of an indefinite duration, created as the direct result of the private investment, for which the firm pays wages and standard fringe benefits for its employee, requiring a minimum of either (i) 35 hours of the employee's time a week for the entire normal year of the firm's operations, which "normal year" shall consist of at least 48 weeks, or (ii) 2,000 hours per year.
What positions do not qualify as new jobs?
Seasonal or temporary positions, positions created when a job function is shifted from an existing location in the Commonwealth to the location of the economic development project, positions with suppliers, and multiplier or spin-off jobs shall not qualify as new jobs. The term "new job" shall include positions with contractors, provided that all requirements included within the definition of the term (provided in the previous answer) are met.
Can part-time or seasonal positions count as new jobs?
Although not considered new jobs, part-time and seasonal positions created by the project on a predictable, annual basis will be included when evaluating the project. For the purposes of the AFID application, these positions should be converted into full-time equivalent (FTE) positions (based on one FTE = 1,680 hours per year), along with average annual wage, and listed separately alongside the “New Jobs” figure.
How is capital investment defined for this program?
“Capital investment” means a private capital expenditure by the company in taxable real property, taxable tangible personal property, or both at the company’s facility in the locality. Capital investment does not include the amount of grant proceeds, AFID or any other, and other incentives applied to the costs of capital assets.
What types of investment do not count toward qualifying for this program?
Capital investment generally will not include operating expenses. Also, the cost of the acquisition of land and existing buildings will not count toward the required capital investment thresholds, unless the land and existing buildings are being purchased from a governmental entity and/or are being returned to the tax rolls.