This is the third in a four-part series exploring how Vermont has spent its $1.25 billion share of the federal Coronavirus Relief Fund. VTDigger is diving deeper into where the money went and the impact on Vermonters in the crucial small business, agriculture and housing sectors.
When the state Department of Agriculture unveiled its $25 million grant program for dairy farms in mid-July, it sounded like a lifeline for an industry that was already shrinking 10% each year.
The grant program, one of the first introduced for Vermont businesses this summer, was designed to make up some of the losses that dairy producers and processors suffered as a result of the Covid-19 pandemic. State officials set an application deadline of Oct. 1 and expected the money to vanish quickly as restaurants and schools closed and milk prices dropped.
Three months later, only about half of the state’s dairy farmers and just a quarter of the state’s processors have been approved for grants, and the program still has about half of the original money to give away. An additional 300 applications from farms and processors are pending.
Lawmakers also allocated $8.5 million in three bills for the agriculture and working lands program, again setting a deadline of Oct. 1. Only about a quarter of that money has been allocated. The deadline for both programs has been extended to Nov. 15.
Why haven’t more farmers applied? State officials are puzzled, said Laura Ginsburg, director of the Ag Development Division for the state Agency of Agriculture.
“It is a low number considering the level of loss that we know everyone has experienced,” Ginsburg said Oct. 16. She speculated that some people might be deterred by the complex application, which must be prepared online. The median age of farmers is now somewhere in the 50s, depending on what source you use, and not all farmers are comfortable filling out forms on a computer. Some people keep only paper records, and don’t want to digitize them to use in the application, Ginsburg said.
But “we’re not quite sure exactly the reason why so many people haven’t applied, because there were technical service providers available to help for free to get people’s applications submitted,” she said. Banks, credit unions, milk cooperatives and other businesses offered to scan in farmers’ receipts and milk checks to help them apply, and farmers who were computer-savvy also worked to help others apply.
“It has been interesting for us to message out to the community that there is assistance available,” Ginsburg said.
Dairy farms closures continue
About 20 Vermont dairy farms have closed since March, continuing a general decline.
Vermont lost nearly 50 dairy farms in 2019, leaving about 677 at the beginning of the year, according to the Agency of Agriculture. That decline has continued this year at about the same pace or a little more slowly, Ginsburg said.
Last spring, as the pandemic closed stores and restaurants, dairy farmers dumped milk as prices — already stuck for years below the cost of production — fell even further. And on Oct. 1, the 99-year-old Thomas Dairy in Rutland closed its doors. The family that owned it explained that the drop in demand from colleges, restaurants and tourism during Covid was a factor.
Complex and competing grants programs
One reason the Agency of Agriculture grant program hasn’t been fully subscribed is that another state program, the Agency of Commerce and Community Development’s business grants program, offers much more money to businesses: up to $300,000, based on losses. Agriculture’s grant program has a cap of $50,000.
The latest report from the Agency of Commerce grants program, published Sept. 28, shows that several farms have received business grants.
Some farmers believe it wasn’t worth the trouble of applying for the agriculture agency’s grant program, Ginsburg said.
“There has been a lot of mixed messaging in the dairy community,” she said. “That’s an unfortunate narrative that is out there. There are so many farms that are small that are getting $15,000, $20,000, $30,000. You don’t really know until you do the application.”
It wasn’t the messaging that stopped Michele Capron of Derby from applying for grants to assist her with the family’s Lavender Essentials of Vermont; it was the application, which was due at a time when she was already juggling too many duties.
“These programs want a lot of paperwork,” said Capron, who has spent thousands of dollars this year beefing up the agritourism side of her farm business. The family added pigs and chickens to her workload because of uncertainty last spring about the food supply. They grow lavender, broom corn, buckwheat, chamomile and other crops on their 12 acres.
“Frankly, my husband had to go back to work, the kids are in school; I have to run the farm by myself,” said Capron. “Throwing that paperwork together myself in the middle of the season was impossible.”
Covid-19 isn’t the only problem
It didn’t occur to Karen Ward to apply for grants to cover losses at her family’s Ward’s Berry Farm in Strafford. She said an invasive fruit fly did more economic damage than the virus did, though the latter forced the family to create new paths and stations for safety at the pick-your-own blueberry and raspberry farm.
“We just decided that there might be somebody else out there that needed it more than we did,” Ward said. “We just incurred the extra costs and made up our own signs and did all that kind of stuff. Plus, we lost thousands of pounds of berries to the ground and it wasn’t because of Covid; that was because of the bug. And that has been going on for a while.”
Ginsburg noted that, under the federal rules accompanying Vermont’s $1.25 billion share of the CARES Act money, the grant funding must be assigned by Dec. 20 or control over the money returns to the feds.
“If we could have all the funds expended (as grants) by Nov. 15 or shortly thereafter, that’s a win for everybody, because we will have put $33 million into the ag sector,” she said.
Fat Toad Farm, a caramel company in Brookfield, has used a $11,423 grant for dairy processors to update its website and online marketing. The company’s profits from national specialty store sales had dropped 50% by the end of the summer, said co-owner Calley Hastings. But its web sales rose more than 300% between July and the end of October, she said.
“I’m sure some of that is the overall trend towards online buying, but it does sync up with when we started making changes too,” Hastings said.
Capron said her family opened its lavender farm in Derby to campers during the summer and adapted a gazebo on the farm to serve as a “date night” location where couples could enjoy views of Canada and distant farms, along with a charcuterie board, s’mores, tableside fire and gift basket. She estimates it was booked 70 times this summer, and credits Covid with forcing the family to be creative.
Capron said the farm’s only business grant so far has been $500 from the Center for an Agricultural Economy in Hardwick.
“We know we have something precious here,” she said of the farm, which used to belong to her grandparents. “If we continue to find ways to market this and give the public what they want, we believe we will make it. We’re not going to give up.”
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