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No. Maple syrup tapping and processing equipment would be considered production-related expenses. Production-related expenses are ineligible. Finished maple syrup could be an eligible expense, however.

No. Apple trees would be considered production-related expenses. Production-related expenses are ineligible. Apples could be an eligible expense, however.

No. Plants and seeds would be considered production-related expenses. Production-related expenses are ineligible.

No. Field labor would be considered a production-related expense. Production-related expenses are ineligible. 

No. The acquisition of or improvements to buildings and facilities are not an eligible expense. Lease or rental of an underground cellar/greenhouse would be eligible if directly associated with the food procurement under this program, provided the lease or rental agreement terminates at or before the end of the grant cycle.

Yes, they would be considered a minimally processed food and would be eligible provided they meet the definition of local and regional food.

Yes, waxed boxes are an eligible expense provided they are used as part of the storage/distribution functions of the program. Boxes used for production-related functions are not allowable expenses.

Foods procured using LFPA funding may be distributed through a variety of channels, including through food service. The full cost of a prepared/cooked meal is not an eligible cost because it is fully processed and LFPA funded foods must be raw or minimally processed. However, LFPA can fund the cost of the raw or minimally processed local ingredients that may be part of meals. If a meal has LFPA funded ingredients it must be distributed at no cost, without conditions for the end users.  

Yes, provided that the outreach activities are related to approved activities of the grant project. To expand on Example 3 from Appendix B of the Request for Applications – if 5 farmers are partnering on an application, the time those farms spend going out to other new farms to build relationships with potential additional collaborators and talk about the LFPA program would be an approved outreach expense. Time spent documenting purchases and distributions for reporting purposes would be an allowable administrative expense.

The grant does not set limits on prices. Because grantees have a Federal subaward, they must follow the general procurement standards in 2 CFR 200.318. This includes having and using their own documented procurement procedures which follow applicable state and local law and regulations. These procedures must conform to applicable federal law and the standards found in 2 CFR 200.302-325. Additionally, your organization must follow the same policies and procedures for procurements from non-federal sources.

For your reference, the procurement (i.e. contracting and bidding) standards that the state requires for Non-Governmental Organizations are available in Section 4.3 of the Competitive Grant Agreement for Non-Governmental Organizations (Microsoft Word, updated June 2020). These standards should conform to most Federal law and standards for most non-profit or for-profit grantee organizations for typical MN LFPA grant project procurement purchases.

If LFPA funds are used to purchase food through a food hub the price of the food can be marked up following the hub’s standard practices. This can include markups to cover costs associated with aggregation. An organization cannot, however, charge a markup and charge expenses (e.g. an hourly staff rate) to LFPA for the same services that the mark up is intended to address. Food aggregation services should be aware of what expenses their mark up is intended to cover and be sure that other services billed to LFPA do not duplicate these expenses.

Mileage that’s involved with food procurement and distribution can be an allowable cost as long as it’s directly supporting an approved LFPA activity and program. If the driving is done by volunteers, the mileage is an eligible expense as long as there is a financial transaction taking place with the volunteers. Services that are donated are not an allowable cost.  

Transportation expenses can fall under three budget categories. As indicated on the budget templates, the “Transportation” budget category is intended to address expenses associated with food transportation (not including personnel). Transportation costs in the form of travel, including personnel expenses, can also be part of the Administration budget category and/or the Engagement and Outreach budget category depending on the activities the transportation is associated with. Please see Appendix D for additional examples and clarification.

We suggest grouping expenses based on the estimated activity and creating one or more line items within each relevant budget category. For example, as applicable:

• Food Transportation: one line for mileage, one line for distribution contracts
• Administration: one line for staff time, one line for mileage
• Engagement and Outreach: one line for staff time, one line for mileage

Further details, including specific or general locations and any equations used to estimate total miles, can be provided as part of the budget table along with information on the sources of the estimates. Details on the expense purpose can also be included in the budget narrative as necessary. If exact locations are not yet known, a rough estimate based on region (“SE Minnesota,” for example) can be provided.

The size and contents of a food box could vary widely depending on farm sources and the preferences of individuals receiving the food. The grant does not set limits on prices. Because grantees have a Federal subaward, they must follow the general procurement standards in 2 CFR 200.318. Please refer to question #10 in the Project Expenses and Budgeting section for more information on procurement standards.

During the presentation when this question was asked, another attendee provided an example from their own experience in a MN town that did a Veggie Rx program with farmers last year, where it was $20 a "box" for 12 weeks.

Based on the information shared, the produce and herbs purchased for samples would not be an eligible expense. The MN LFPA Program is intended as a hunger relief program. From what was described, the samples would be used to encourage paid sales between farmers and farmers market customers. Within the context of the MN LFPA program, food must be distributed at no cost and be distributed primarily (at least 75%) to underserved communities. Although the samples are free, their purpose as a motivator for financial transactions with customers would disqualify the local ingredients used from being an eligible MN LFPA expense.

MN LFPA funds would also not be able to be used to compensate chefs at a standalone rate for their food preparation services. This would be true even if the samples were being used to promote foods that were being distributed at no cost. This is because production-related expenses are not eligible.

No, EBT equipment and staffing related to EBT transactions are not eligible expenses for this grant. The MN LFPA Program is intended as a hunger relief program where the food is distributed at no cost, without conditions for the end users. Expenses associated with EBT transactions are not eligible because during an EBT transaction the SNAP customers are providing a form of payment for the food rather than receiving the food at no cost.

The Minnesota Department of Human Services (DHS) offers no-cost, EBT-only equipment to SNAP authorized farmers markets (and direct marketing farmers). Please contact us if you’d like us to direct you to the appropriate contact at DHS.

Yes, uncooked pasta is considered minimally processed and would be an eligible expense. If the pasta business is located in Minnesota and the ingredients (e.g. flour, eggs) meet the definition of local provided in the Request for Applications (see page 10), the pasta would be considered a Minnesota product for the purposes of meeting the requirement that 70% of food purchased must be sourced from within the geographic boundaries of Minnesota.

The grant asks applicants to identify as a part of their budget how much they will spend in year one versus year two. If the bulk of expenses come in year two, that isn’t a problem.

We believe the reference in the question to “split 50% per annual year” stems from the questions in the application about advance funds. That portion of the application states that an applicant can request advance funding for up to 50% of their total year one budget, and up to 50% in advance funding for their total year 2 budget. It does not mean that an applicant’s budget must be spent 50/50 between years 1 and 2.

No. LFPA funds can only cover short term rentals or leases of equipment, with the expiration or finish date no later than the end of the grant program. 

No. Currently these are considered fully processed by USDA and not eligible as an MN LFPA expense.

Documentation is always required. The documentation needed will depend on who is conducting the work, and how those expenses are reconciled internally. As examples:

• If a lead applicant organization is paying staff from their organization to transport food using the org or staff’s vehicles, the organization may choose to use LFPA funding for expenses such as staff time, gas, and/or mileage. If that is the case, when developing your application budget, estimated gas and mileage expenses should be grouped within the “Food Transportation” budget category. Staff time should be grouped within the “Administration” budget category. If selected as a grant recipient, required documentation will include items such as:
  • Timesheets and cleared checks/direct deposition documentation for staff time
  • Receipts for gas purchases
  • Mileage logs (and pay stubs if expenses are reimbursed to employees)
• If the lead applicant organization is renting a vehicle and choosing to use LFPA funding for that rental, estimated rental expenses should be grouped within the “Food Transportation” budget category. Examples of documentation would include invoices and proof of payment.
• If a lead applicant conducts their own delivery and chooses to calculate expenses differently, for example by setting a flat charge per box rather than by submitting for reimbursement for staff time, mileage, etc., then that pricing must follow a standard. If a standard does not currently exist, for example if an org does not currently offer this service, then a standard must be established that remains consistent through the duration of the program.
• If a lead applicant is working with a partner (i.e. a subrecipient) to carry out services that relate to food transportation, that partner may choose to expense their services in a variety of manners, similar to the options available to the lead applicant (should the lead applicant be conducing transportation services themselves). The lead applicant will be responsible for collecting and maintaining documentation of these expenses.
• If a lead applicant is working with a contractor for delivery services, then the project budget should align with the way that you will be paying for these services from the contractor and accompanying documentation you’d have in the form of an invoice. For example, the contractor may charge a flat fee, or a specific rate per box, etc. If the contractor’s billing format includes a distinct line item for their time, that should be grouped under the “Administration” section of the budget. Otherwise, all expenses would likely be grouped within the “Food Transportation” budget category. Awardees would need to submit proof of purchase and proof of payment for services contracted for.

Your budget should align with the way that you will be paying for these services and accompanying documentation you’d have. If you are purchasing food from a partner or a collaborator and the prices that they are charging for the food include storage and transportation costs, then the expenses should be considered “food procurement” expenses and should not be broken out into procurement vs. storage vs. transportation expenses. You may want to note in your budget that that those prices included for food procurement incorporate storage and transportation, so that reviewers can have an accurate understanding of your budget.