Schumer, Gillibrand Announce Nearly $2.6 Million For Hudson Valley Agribusiness Development To Provide Direct Access To Capital For Small Farms And Food Businesses
Investment Projected to Create Or Retain Nearly 300 Jobs, Leverage $2 Million In Private Investment; Revolving Loan Fund Will Provide Gap Financing for Businesses in Columbia, Dutchess, Greene, Orange, Sullivan and Ulster Counties
U.S. Majority Leader Charles E. Schumer and U.S. Senator Kirsten Gillibrand today announced $2.6 million in Recovery Assistance funding for the Hudson Valley AgriBusiness Development Corporation. This federal investment was allocated by the Economic Development Administration (EDA) as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was championed by the senators. Specifically, this funding will be used to create a $2,088,000 Revolving Loan Fund (RLF), which will provide gap financing to small farm and food businesses and support long-term economic resiliency in Columbia, Dutchess, Greene, Orange, Sullivan and Ulster Counties. An additional $512,000 will fund technical assistance to operate the fund and assist recipients. This EDA grant is expected to create or retain nearly 300 jobs and generate $2 million in private investment.
“I am proud to deliver this critical $2.6 million in CARES Act funding so the Hudson Valley Agribusiness Development Corporation can invest in promising small businesses to spur recovery and job growth,” said Senator Charles Schumer. “With this new federal Economic Development Agency investment, HVADC will create and retain nearly 300 jobs in the Hudson Valley while also helping the region’s agricultural businesses maintain a robust local food system.”
“Now more than ever, we need to support our small family farms and local producers as we rebuild New York’s economy. The COVID-19 pandemic has put a huge strain on regional food systems and businesses across New York State, and we must make the necessary investments to support their recovery and build local resilience,” said Senator Kirsten Gillibrand. “I am proud to have secured this CARES Act funding that will bring $2.6 million in federal relief to help Hudson Valley farmers and producers recover, and will create hundreds of jobs and opportunities in Columbia, Dutchess, Greene, Orange, Sullivan, and Ulster counties. I am grateful for the leadership of Todd Erling and everyone at Hudson Valley AgriBusiness Development Corporation for their work on this critical project.”
“Having the support of Senators Schumer and Gillibrand and our local state legislators over the years has been instrumental in helping us advance the way HVADC supports upstate farmers and food businesses,” said Todd Erling, Executive Director of HVADC. “The funding of the Hudson Valley AgriBusiness RLF will enable us to build on our years of providing business technical assistance services to agribusinesses and allow us to expand our lending capabilities to further support their business models as they face changing market conditions and demand for local products.”
Senator Schumer strongly supported HVADC’s application to create the Hudson Valley’s first RLF. Schumer’s July 24, 2020 to EDA Regional Director Cruz-Carnall appears below.
I write today in strong support of the application submitted by the Hudson Valley Agribusiness Development Corporation (HVADC) to the Economic Development Administration (EDA) to establish a Revolving Loan Fund (RLF) through the CARES Act Economic Adjustment Assistance (EAA) program. As one of the nation’s first hotspots for COVID-19, businesses across the Hudson Valley continue to suffer from the devastating economic impacts of the COVID-19 pandemic but lack access to any regional RLF to get back on their feet. I strongly urge the EDA to support these businesses by fully funding HVADC’s proposal to create a much-needed Hudson Valley-based RLF that will create an estimated 134 new jobs and retain 200 workers while prioritizing a robust local food system.
Prior to the COVID-19 pandemic, the Hudson Valley’s agribusiness industry reached new heights. The Hudson Valley has over 2,200 farms and 317,000 acres of farmland which has put a focus on a local approach to food production. In its 2019 report, the New York State Department of Labor (NYSDOL) identified food manufacturing as one of the Hudson Valley’s “significant industries” creating over 1,300 jobs in the region in five short years. These processing and distribution facilities use raw materials, like local livestock and vegetables, to make food products. An additional 600 jobs were anticipated in this growing sector with Amy’s Kitchen recent groundbreaking in the region. The same report also cited “business opportunities for local farmers with an increased demand for farm products.”
Despite the Hudson Valley agribusiness industry’s past success, the entire Hudson Valley economic landscape was upended when the region became one of the first national hotspots for COVID-19 in early March. The regional unemployment rate has skyrocketed to 12.7%, the highest rate since modern recordkeeping began in 1990, and the private sector job count plummeted, reaching its lowest level since June 1997. When pandemic-related closures began, local producers relying on bulk sales in the wholesale market to food processing plants, hotels, restaurants, and other institutions quickly experienced massive revenue loss. These economic impacts coupled with health considerations surrounding a sudden need to know where food is coming from made it abundantly clear that the Hudson Valley agribusiness industry would need to make massive adjustments, specifically shifting from wholesale to retail, to survive.
Efforts to build back the local economy with a robust local food production system have already shown great promise. For example, the Hudson Valley CSA Coalition membership is up 400% since COVID-19 began and some local businesses have leveraged online retail targeting individual customers, including the Catskills Food Hub in Sullivan County which has experienced a 600% increase in demand. However, farmers, food processors, distributors, wholesalers, restaurants, and retailers across the Hudson Valley need additional resources and access to capital to transition their business models while also keeping their local employees safe. To add to the need for capital, farm and food businesses across the Hudson Valley had difficulty accessing the SBA’s Paycheck Protection Program and Economic Injury Disaster (EIDL) loans and many struggled to meet all the requirements set forth by traditional lenders. HVADC has been a lifeline for agribusiness during the pandemic, building on over 10 years of experience providing development services involving technical assistance, business planning, marketing, legal counsel, and financial advice to support the industry. They have taken on the task of helping this critical regional sector address these ongoing issues.
HVADC has proposed creating a Hudson Valley agribusiness RLF to support capital access needs, address the increasing demand for local food supply, and enable businesses to adapt operations to protect the workforce. As a lead negotiator, I successfully fought for an additional $1.5 billion for the EDA’s Economic Adjustment Assistance (EAA) program in the CARES Act. Subsequently, the EDA invited select current grantees, including existing RLF administrators, to apply for noncompetitive CARES Act Recovery Assistance funding using specific award conditions in order to expedite funding and implementation timelines. However, local stakeholders in the Hudson Valley quickly realized that there was no regionally-based RLF to unlock the much-needed streamlined stimulus funding for the area. Fortunately, a portion of the CARES Act funding was set aside for competitive grants so that organizations, like HVADC, could establish regional RLFs where there were gaps in service in order to address COVID-19 pandemic-related business needs.
HVADC is requesting a $2 million investment from the EDA to establish an RLF that will create an estimated 134 new jobs and retain 200 more in the Hudson Valley. The EDA funds will provide the necessary match from the existing HVADC Agricultural Loan Fund (ALF) that has been capitalized with $500,000 through the Empire State Development Job Development Authority. Additionally, HVADC’s expertise in development services and access to capital for farm and food puts them in an excellent position to make sure that businesses get the comprehensive support they need to endure these challenging economic times created by the COVID-19 pandemic. Therefore, I strongly urge the EDA to support these struggling businesses and the economic recovery of the region by fully funding HVADC’s proposal to create a much-needed Hudson Valley-based RLF. Thank you for your time and attention to this matter, if you have questions please do not hesitate to contact my staff.
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