Canadian Government Funding for Agri-Processing Initiative Overview
Overview of this Canadian government funding for small business program:
Amount: Repayable contributions of up to $2 million per project, or up to 50% of eligible costs, whichever is less. Contributions are non-interest bearing and unsecured.
Timeline: Applications accepted until funding is exhausted. Projects must be completed by March 31, 2014.
Eligibility Factors: Incorporated food-processing companies with ≥51% of revenue coming from food processing activities.
Projects:
- The purchase and installation of new-to-company machinery and equipment to adopt innovative and new-to-company manufacturing technologies and processes, and /or introduce new products;
- The contracting of external expertise for services related to equipment installation, and consultation, design, and advice regarding new-to-company manufacturing technologies, processes and products; and
- The provision of environmental information needed by Agriculture and Agri-Food Canada (AAFC) to meet its obligations under the Canadian Environmental Assessment Act (CEAA).
Government Funding for Business Applicant Eligibility
The following are eligible for funding for small business through the Agri-Processing Initiative:
- Co-operatives and for-profit companies incorporated in Canada
- Predominantly engaged in the processing (physical or chemical transformation) of raw agricultural commodities or agri-based ingredients; 51% of the company or co-operative revenues must come from the processing segment of the business
- Operate processing facilities in Canada;
Activities Eligible for API Funding for Small Business Coverage
According to the AAFC, the following are deemed eligible project activities under API business funding Canada:
- The purchase and installation of new-to-company machinery and equipment in Canadian facilities in order to adopt innovative and new-to-company manufacturing technologies and processes, and /or introduce new products;
- The contracting of external expertise for services related to equipment installation, and consultation, design, and advice regarding new-to-company manufacturing technologies, processes and products; and
- The provision of environmental information needed by Agriculture and Agri-Food Canada (AAFC) to meet its obligations under the Canadian Environmental Assessment Act (CEAA).
API Canadian Government Funding Eligible Costs
Costs eligible for API government funding for small business loans includes the following:
- Costs for purchase of proven equipment and/or technology, including required software and licenses and essential ancillary systems, that is new-to-company and will improve the productivity, efficiency, profitability and/or environmental sustainability of the operation;
- Costs related to shipping or transportation of equipment and/or technology;
- Costs related to the installation of the equipment and/or technology;
- Materials purchased and required specifically for the project;
- Forklifts;
- Short term training related to the implementation of equipment or technologies;
- Costs associated with the provision of environmental information needed by Agriculture and Agri-Food Canada (AAFC) to meet its obligations under the Canadian Environmental Assessment Act (CEAA). In no case may these costs be considered eligible if incurred more than 12 months prior to the signing of a contribution agreement or earlier than June 18, 2009;
- Incremental pay and benefits and consulting costs essential to and, based on time dedicated to, the project including, but not limited to, engineers, technicians, draftsmen, inspectors, shop labour, project management and accountants/bookkeepers;
- Costs related to defining specifications of eligible products, services or processes, including the use of sub-contracts and consultants;
- Federal and provincial taxes, including the non-refundable portion of the Goods and Services Tax (GST), if any, paid by the recipient; and
- Translation of public information, including those related to compliance with the Official Languages Act.
Costs Ineligible under API Funding for Small Business
API Canadian government funding does not cover these costs listed below:
- Equipment, machinery, material and all other costs not specifically required for the execution of the project;
- Any portion of cost, or any cost or assistance that, in the Minister’s opinion, exceeds the fair market value for that cost item or assistance;
- Unreasonable compensation for employees, officers or consultants;
- Any cost, such as amortization, and working capital including provisions for contingencies and cash reserves, that would not result in a direct, out-of-pocket expense for the applicant;
- Land, goodwill, and existing equipment or buildings owned by a related party;
- Costs related to the acquisition of land or buildings
- Construction costs for new, or expansions to existing, plants;
- Research and development costs
- Preparation of business plans and feasibility studies;
- Vehicles (excluding forklifts);
- Marketing, promotion and public relation expenses;
- Insurance;
- Costs related to regular ongoing operational and managerial activities of the organization. Any costs which cannot be directly tied to the project and which are part of ongoing operations;
- Performance bonuses;
- Project activities which support industry efforts to lobby or influence government;
- Refundable portion of the Goods and Services Tax, value added taxes, or other
- Items for which a refund or rebate is received;
- Dividends, profit and loss of profit;
- Losses on investments, other projects or investments, bad debts, and expenses for the collection thereof;
- Travel, hospitality, entertainment, gifts, and charitable donations;
- Income tax, surtax, and property tax;
- Financing and legal fees;
- Interest and principal payments related to debt;
- Fines and penalties, including interest; and
- Dues and other membership fees.
Learn More about API Canadian Government Funding
Looking to learn more about Agri-Processing Initiative? Choose from the following list of informative Agri-Processing blog topics:
You can also choose to view our Agri-Processing Initiative FAQ page.
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