November 1, 2000 | By: Aimee D. Heald
LEXINGTON, KY.

Since its inception in Oct. 1999, the Kentucky Center for Cooperative Development has stayed true to its mission of providing support to farmer co-ops in the Commonwealth.

Partnering with the University of Kentucky College of Agriculture, Kentucky Department of Agriculture, Commodity Growers Cooperative and the Center for Sustainable Systems, the KCCD wants farmers to understand the need to add value and diversify to their operations. Cooperatives provide a good business structure for farmers to market and sell their value-added products.

KCCD Director, Heath Hoagland met with county Extension agents, UK College of Agriculture representatives and CGC members Oct. 24 at the Burley Tobacco Growers Cooperative in Lexington for a roundtable discussion about future opportunities for farmer co-ops. "Our goal is to provide educational resources, technical assistance and financial support through matching funds for feasibility studies," Hoagland said. "We're pushing that emphasis and encouraging farmers to think things through, because just having the cooperative name with a product doesn't mean it will sell."

Colby Blair, UK area farm management specialist, agreed feasibility studies are important but without good management skills, any business can fail before it starts.

The KCCD, in collaboration with the CGC offers two types of grants – feasibility and pre-feasibility study grants. Groups should apply for the pre-feasibility study grants if they are new and exploring the potential of forming a cooperative. If the organization already has a lot of pre- information, they should apply for the feasibility study grant. The largest amount a group can receive is $8,000.

Recipients must match funds received from the KCCD/CGC program with their own resources. It is important to remember these grants are reimbursement grants. Recipients will sign an agreement to be reimbursed for their expenses, up the amount of the grant they receive. All applications will be reviewed by a Cooperative Advisory Board, which is made up of experts from the KDA, USDA, UK College of Agriculture, CSS and the CGC. The deadline to submit an application is September 1, 2001.

Glenn Roberts, Wayne County Extension agent for agriculture and natural resources, has taken advantage of grants in his county.

"One of the things we've done is use these grants to find new growers," Roberts said. "We've been able to buy and share new equipment with new growers in our established vegetable co-op. By doing that, the new growers have been able to be more successful or to find out that it's not for them without having a big initial investment for equipment."

Roberts said their success rate with new growers in the cooperative is extremely high.

Robert Amburgey, Jessamine County Extension agent for agriculture and natural resources, has experienced similar success in his county. He thinks it's a big advantage to be able to share equipment and work together to get the product out to the consumers.

Last year, the KCCD offered its first Cooperative Winter School. Sessions included cooperative basics, cooperative development process, new generation cooperatives, cooperative financing, and cooperative law. They plan to host a second winter school this year.

Call Heath Hoagland for more information on the winter school or the KCCD in general (859) 257-7272 ext. 283.

There's no doubt with 45 farmer cooperatives, and the recent tobacco situation, Kentucky is benefitting from a new focus by the USDA on funding and supporting co-ops. Grants are available from not only the KCCD, but also the Tobacco Communities Reinvestment Fund mini-grant program through the CGC. The deadline for the TCRF grants is November 30, 2000. Applications for both grant programs should be mailed to Commodity Growers Cooperative, 620 S. Broadway, Ste. 206, Lexington, KY 40508. Call 859-252-9255 to get an application or to request more information.

The USDA also provides information for co-op development on its web site. Guidelines for co-ops, by-laws, etc. can be found at http://www.rurdev.usda.gov/rbs/index.html.

Contact: 

Heath Hoagland 859-257-7272, ext. 283