USDA defines aquaculture as the production of aquatic organisms under controlled conditions throughout part or all their lifecycle — this does not include wild-caught seafood or fish. Equipment and infrastructure for the processing, aggregation, or distribution of aquaculture as an agricultural product are eligible.
The production of fish, shrimp, shellfish, or other aquatic life — including in fish hatcheries — or the marketing of fish and other aquaculture products aren’t eligible because these activities fall outside the “middle of the supply chain."
Yes. Honey, eggs, and dairy are allowable animal products for the RFSI program. However, the cultivation/extraction of honey is considered harvesting, and is not eligible for grant funding.
Bottling and further processing of honey (such as creaming or creating a value-added product) would be considered eligible middle-of-the-supply chain activities. In the case that the proposed facility serves both harvesting and processing functions, the applicant may only apply for funds for the portion of the facility and equipment used for the middle-of-the-supply-chain activities.
Yes. Honey, eggs, and dairy are allowable animal products for the RFSI program. However, the cultivation/extraction of honey is considered harvesting, and is not eligible for grant funding.
Bottling and further processing of honey (such as creaming or creating a value-added product) would be considered eligible middle-of-the-supply chain activities. In the case that the proposed facility serves both harvesting and processing functions, the applicant may only apply for funds for the portion of the facility and equipment used for the middle-of-the-supply-chain activities.
No. Plants and products for human consumption that are federally controlled as illegal drugs (e.g., cannabis) are ineligible for this program. This includes THC and CBD derived from hemp, as these extracts are not considered food products. Food products produced from hemp, such as hemp hearts or hemp protein powder, are allowable.
No. Plants and products for human consumption that are federally controlled as illegal drugs (e.g., cannabis) are ineligible for this program. This includes THC and CBD derived from hemp, as these extracts are not considered food products. Food products produced from hemp, such as hemp hearts or hemp protein powder, are allowable.
No, the purchase of buildings, facilities, or land is not an allowable cost for the RFSI grant.
No, the purchase of buildings, facilities, or land is not an allowable cost for the RFSI grant.
Yes, RFSI funds may be used for construction of a new facility or construction costs involving an existing facility (e.g., expansion, upgrades, additions). We encourage you to review Section 8.0 of the USDA General Terms and Conditions (below) and the RFSI Program Specific Terms and Conditions (below) when determining if a specific cost may or may not be eligible.
Yes, RFSI funds may be used for construction of a new facility or construction costs involving an existing facility (e.g., expansion, upgrades, additions). We encourage you to review Section 8.0 of the USDA General Terms and Conditions (below) and the RFSI Program Specific Terms and Conditions (below) when determining if a specific cost may or may not be eligible.
USDA, which funds this program, breaks the food supply chain into four stages:
- Production
- Processing
- Aggregation/distribution
- Markets/consumers
For the purposes of the RFSI program, “middle-of-the-supply-chain” refers to the middle stages:
- Processing
- Aggregation/distribution
RFSI Infrastructure Grants will fund projects that expand capacity and infrastructure for the “aggregation, processing, manufacturing, storing, transporting, wholesaling, or distribution of targeted agricultural products.” You can see more examples of eligible activities on page 6 of the RFP.
Any activities related to food supply chain stages: 1) production, and 4) markets/consumers, are not eligible under the RFSI program.
For example, agricultural production equipment (e.g., tractors, harvesting equipment, and facilities for livestock production) is not eligible because it falls into the beginning “production” stage of the food supply chain.
Direct-to-consumer marketing costs and retail displays are examples of costs that would not be eligible because they fall into the final “markets/consumers” stage of the food supply chain.
It is important to carefully review the full RFP to understand what kinds of projects and costs are eligible and which are not. A list of ineligible expenses can be found on page eight of the RFP. Some common reasons why a cost would not be allowed include:
- The cost is not part of the middle of the supply chain (e.g., it’s a cost for production, harvesting, marketing, retail, or serving food directly to consumers).
- The cost is related to ineligible agricultural products such as meat, poultry, animal feed, or cannabis.
- The cost is for purchasing land or an existing facility.
Note: You also cannot use ineligible costs as match to your project.
You may apply for the grant to fund the next steps of a project that you already have underway, but any expenses incurred before a grant contract has been signed by all parties are not eligible for reimbursement. They are also not able to be used as your matching contribution.
Note: You cannot apply for a grant for project expenses that have been or will be reimbursed under any federal, state, or local government funding. However, RFSI funds may be used to build on the successes of prior funding to fund subsequent activities or a new phase of your project.
There is no specific definition of specialty crops and grains for the RFSI program. Crops and agricultural products are eligible for RFSI grants if they:
- Are intended for human consumption.
- Are not meat or poultry.
- Are not federally controlled as illegal drugs (e.g., cannabis).
To be eligible for RFSI, your project must be focused on food intended for human consumption. Food ingredients that can be used for applications besides food are eligible, but you must describe in your proposal how the project will focus on food meant for human consumption, rather than the other applications of the ingredient.
The purpose of the RFSI grant program is to invest in infrastructure for aggregation, processing, manufacturing, storing, transporting, wholesaling, and distribution of "locally and regionally produced food."
Your project should be primarily focused on activities involving locally and regionally produced food and activities that will benefit local and regional producers. It is acceptable for projects to include some products or ingredients that are not locally or regionally produced, as long as you can demonstrate the use of other local or regional products and the benefit to local and regional producers.
For example, a value-added hummus product that mostly uses Minnesota-grown chickpeas, but also includes some non-local ingredients such as tahini and olive oil, would be an acceptable product under the RFSI program.
Products are not required to be grown in Minnesota to be eligible. However, projects will be scored based on their potential impact on Minnesota agriculture and will receive additional priority if they involve Minnesota-produced dairy, annual/perennial grains, fruits/vegetables, dry beans, or aquaculture.
There is no specific definition of local or regional foods or producers provided for the RFSI program, but USDA Agricultural Marketing Services talks about local food as a “food product that is raised, produced, aggregated, stored, processed, and distributed in the locality or region in which the final product is marketed.” Some other USDA programs use a definition of less than 400 miles from the origin of the product or within the state in which the product is produced, but these definitions haven’t been applied to the RFSI program.
Because no specific definition was provided, there are no specific sourcing requirements for RFSI and the eligibility of the food products you use in your project will not be determined based on where they are sourced from. However, your application will be scored based on how well it addresses the goals of the RFSI program, which include expanding capacity in the middle of the food supply chain for “Minnesota food products and producers.” Because RFSI focuses on both local and regional foods, reviewers may take into consideration the regionality of products sourced from nearby states, but priority points are specifically available to products involving Minnesota-produced dairy, annual/perennial grains, fruits/vegetables, dry beans, or aquaculture.
In the application, you will be asked to explain how your project will impact Minnesota agricultural products and to list your current or anticipated sources of Minnesota agricultural products and the estimated amounts you will use per year during your project. You are not required to submit any type of documentation with your application to demonstrate your use of local or regional foods. You may opt to provide letter(s) of support from farmers or vendors of the food products you use to help demonstrate project impact, but it is not required.
Your project should be primarily focused on foods that are eligible for the RFSI program. It is acceptable for projects to include some products or ingredients that are not eligible, as long the primary ingredients are eligible.
For example, a value-added cheese product that includes a small amount of bacon as flavoring would be an acceptable product under the RFSI program, but you may only request funds for the activities and expenses relevant and proportional to cheese production and not for bacon processing.
Your project should be primarily focused on foods that are eligible for the RFSI program. It is acceptable for applicants and projects to handle ineligible meat and poultry products, as long the primary focus of the project is eligible products and you do not request funding for the ineligible products. In your application, you should describe the tracking mechanisms that will be used to ensure that RFSI funds are not used to support ineligible products.
For example, if a food hub moves 80% produce and 20% meat, the food hub may request funds for the activities and expenses relevant and proportional to handling produce (80%) but not for handling meat (20%).
It is acceptable if your organization or overall project includes activities or products that are not eligible for RFSI. However, you can only request funds to support eligible activities or products. You should describe in your application how you will ensure that RFSI funds will focus on eligible activities or products.
USDA defines aquaculture as the production of aquatic organisms under controlled conditions throughout part or all their lifecycle — this does not include wild-caught seafood or fish. Equipment and infrastructure for the processing, aggregation, or distribution of aquaculture as an agricultural product are eligible.
The production of fish, shrimp, shellfish, or other aquatic life — including in fish hatcheries — or the marketing of fish and other aquaculture products aren’t eligible because these activities fall outside the “middle of the supply chain."
Yes. Honey, eggs, and dairy are allowable animal products for the RFSI program. However, the cultivation/extraction of honey is considered harvesting, and is not eligible for grant funding.
Bottling and further processing of honey (such as creaming or creating a value-added product) would be considered eligible middle-of-the-supply chain activities. In the case that the proposed facility serves both harvesting and processing functions, the applicant may only apply for funds for the portion of the facility and equipment used for the middle-of-the-supply-chain activities.
The location of your project does not determine your eligibility. On-farm projects are eligible for RFSI funding as long as they focus on eligible middle-of-the-supply-chain activities and not production or harvest.
For example, the purchase of an irrigation system for a vegetable farm would not be eligible, because it is infrastructure used for the production stage of the food supply chain. The construction of an on-farm processing facility or commercial kitchen to produce a value-added vegetable product would be eligible.
On-farm storage facilities or equipment used only to benefit a single producer would not be eligible for RFSI funding because this is considered part of the production and harvesting stage of the food supply chain. However, in some cases, on-farm storage may be eligible as a middle-of-the-food-supply-chain activity if the on-farm storage facility/equipment is used to aggregate products for multiple producers or store products that have undergone further processing.
No. Plants and products for human consumption that are federally controlled as illegal drugs (e.g., cannabis) are ineligible for this program. This includes THC and CBD derived from hemp, as these extracts are not considered food products. Food products produced from hemp, such as hemp hearts or hemp protein powder, are allowable.
No, the purchase of buildings, facilities, or land is not an allowable cost for the RFSI grant.
Yes, RFSI funds may be used for construction of a new facility or construction costs involving an existing facility (e.g., expansion, upgrades, additions). We encourage you to review Section 8.0 of the USDA General Terms and Conditions (below) and the RFSI Program Specific Terms and Conditions (below) when determining if a specific cost may or may not be eligible.
Yes, construction costs may also include “soft costs” or pre-build costs tied to construction. These could include administrative or legal expenses, relocation expenses, architectural and engineering fees, or project inspection fees, as long as they occur after your grant contract agreement has been executed.
No, according to Section 8.0 of the USDA AMS General Terms and Conditions (below), contingency costs are not an allowable cost.
No, utility costs are not allowable as direct costs. However, these could potentially be covered by including an indirect cost rate in your budget.
“Developing, customizing, or installing climate-smart equipment that reduces greenhouse gas emissions, increases efficiency in water use, improves air and/or water quality, and/or meets one of the USDA’s climate action goals” is listed as one of the eligible project examples in the RFSI Program Scope and Requirements (below). Installations of solar panels and equipment, along with other costs or activities related to mitigating and adapting to climate change, are allowable as part of your grant budget.
Yes, you can include the costs for wells, water treatment, or wastewater management infrastructure in your grant budget, as long as these items are connected and necessary to your eligible middle-of-the-supply-chain project.
Yes, used equipment is an eligible expense. Keep in mind that if you don't identify vendors in your application, even for used equipment, purchases may be subject to the state’s bidding requirements. Reimbursement for used equipment also requires the same proof of purchase and proof of payment documentation as new equipment, so make sure the seller provides adequate documentation at the time of sale and payment.
Yes, grant funds can be used to repair equipment as long as the repairs are directly connected and necessary to your project and not general operational costs. If the repair work will be performed by you or employees, the cost should be included in your personnel budget. If the repair work will be performed by a contracted third-party, the cost should be included in your contractual budget.
Yes, grant funds can be used to pay for deep professional cleaning as long as this work is tied directly to your project (e.g., in preparation for the installation of new equipment or as part of a goal to bring a facility to up to a higher level of food safety). Costs for professional cleaning work performed by a contracted third-party should be included in your contractual budget.
No, your travel budget is only intended to cover costs for project-related travel, except that of contractual personnel. Project-related travel costs can include costs such as mileage or per diem to attend trainings or conferences related to your project or for you to drive to pick up equipment you are buying for your project. Travel costs cannot include general operational costs, such as mileage for delivery routes.
Special purpose vehicles necessary to the scope of work for your project, such as delivery vehicles or refrigerated trucks, are allowable as an equipment item under RFSI. However, the purchase of a general-use vehicle is not allowable. There is more information on what is considered special purpose equipment on page 33 of the RFP.
Yes, costs you pay to rent land and buildings are allowable grant costs if they are directly connected to and necessary to your project (i.e., not a general operational cost). However, lease agreements to own (e.g., lease-to-own or rent-to-own) are not allowable.
Yes, it is allowable to make improvements or install equipment in a rented space or facility or repair equipment that is rented or part of a rented space (i.e., owned by your landlord). However, you must provide an Evidence of Critical Resources and Infrastructure letter from your landlord stating that you are allowed to make the proposed changes to the space. A downloadable template for this letter can be found on the main RFSI web page.
The cost for insurance that is directly connected and necessary to your project (i.e., not a general operational cost) can be included in your grant budget under the “other costs” category.
Yes, if the business owner is one of the personnel of the business and is working on the project, you may request grant funds in your personnel budget to pay them at their normal and reasonable rate for their time working on the project. Likewise, cash funds provided by the applicant that are used to pay the business owner at their normal and reasonable rate for time working on your project or the in-kind contribution of their time valued at this rate can also be used as match to your project.
Yes, grant funds can be used to pay personnel from your organization for working on the project, or those labor costs could be used as a matching contribution to the project.
However, any labor costs must be directly connected and necessary to your project (i.e., not a general operational cost). In most cases, the ongoing, day-to-day cost of personnel doing their regular jobs would be considered a general operational cost and not a project cost.
In the Budget Justification section of the application, you must include the following information for all personnel involved in your project: name (if available at the time you submit your application), position title, their role and the activities they will complete in the project, and the timeframe to complete those activities.
RFSI grants will fund projects that expand capacity and infrastructure in the middle of the supply chain. If your food rescue project focuses primarily on aggregation and distribution activities, and not on producing and harvesting food (beginning of the supply chain) or providing food or meal directly to the end consumers (end of the supply chain), you are eligible to apply.
Typically, per Section 8.0 of the USDA AMS General Terms and Conditions (below), software purchases are not allowable. However, the RFSI Program Scope and Requirements (below) does allow for the funding of projects aimed at modernizing via information technology systems. Specifically, for RFSI, software purchases that align with the intent of the grant are allowable.
RFSI grants will fund projects that expand capacity and infrastructure in the middle of the supply chain, specifically for the aggregation, processing, manufacturing, storing, transporting, wholesaling, or distribution of targeted agricultural products. Software or data supporting agricultural production (e.g., production planning) or direct-to-consumer sales (e.g., farmers' markets) does not align with the allowable RFSI middle-of-the-supply-chain activities; however, connecting producers to buyers or new market opportunities would align. If a project focused on data or software will include purposes outside of the middle of the food supply chain or products not eligible for RFSI (e.g., meat or poultry), you may only request funds for the portion of the project that will serve eligible purposes.
No, projects or organizations do not need to be located in a DCI county to be eligible to apply. However, projects that directly and meaningfully benefit DCI counties will receive priority points. The Project Evaluation Profile found on page 19 of the RFP outlines how applications will be scored.
We have a variety of funding opportunities available for farmers and food businesses. Even if RFSI isn’t a fit for your project or organization, you can review our full list of funding opportunities to see if there is another grant that could support your project.
