text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Value-Added Development Act for 
  American Agriculture''.
  
  SEC. 2. AGRICULTURE INNOVATION CENTER DEMONSTRATION PROGRAM.
  
      (a) Purposes.--The purposes of this section are to carry out a 
  demonstration program under which agricultural producers are provided--
              (1) technical assistance, including engineering services, 
          applied research, scale production, and similar services to 
          enable the producers to establish businesses for further 
          processing of agricultural products;
              (2) marketing, market development, and business planning;
              (3) overall organizational, outreach, and development 
          assistance to increase the viability, growth, and 
          sustainability of value-added agricultural businesses.
      (b) Nature of Program.--The Secretary of Agriculture (in this 
  section referred to as the ``Secretary'') shall--
              (1) make grants to eligible applicants for the purposes of 
          enabling the applicants to obtain the assistance described in 
          subsection (a); and
              (2) provide assistance to eligible applicants through the 
          research and technical services of the Department of 
          Agriculture.
      (c) Eligibility Requirements.--
              (1) In general.--An applicant shall be eligible for a grant 
          and assistance described in subsection (b) to establish an 
          Agriculture Innovation Center if--
                      (A) the applicant--
                              (i) has provided services similar to those 
                          described in subsection (a); or
                              (ii) shows the capability of providing the 
                          services;
                      (B) the application of the applicant for the grant 
                  and assistance sets forth a plan, in accordance with 
                  regulations which shall be prescribed by the Secretary, 
                  outlining support of the applicant in the agricultural 
                  community, the technical and other expertise of the 
                  applicant, and the goals of the applicant for 
                  increasing and improving the ability of local producers 
                  to develop markets and processes for value-added 
                  agricultural products;
                      (C) the applicant demonstrates that resources (in 
                  cash or in kind) of definite value are available, or 
                  have been committed to be made available, to the 
                  applicant, to increase and improve the ability of local 
                  producers to develop  markets and processes for value-
  added agricultural products; and
                      (D) the applicant meets the requirement of 
                  paragraph (2).
              (2) Board of directors.--The requirement of this paragraph 
          is that the applicant shall have a board of directors comprised 
          of representatives of the following groups:
                      (A) The 2 general agricultural organizations with 
                  the greatest number of members in the State in which 
                  the applicant is located.
                      (B) The Department of Agriculture or similar State 
                  organization or department, for the State.
                      (C) Organizations representing the 4 highest 
                  grossing commodities produced in the State, according 
                  to annual gross cash sales.
      (d) Grants and Assistance.--
              (1) In general.--Subject to the availability of 
          appropriations, the Secretary shall make annual grants to 
          eligible applicants under this section, each of which grants 
          shall not exceed the lesser of--
                      (A) $1,000,000; or
                      (B) twice the dollar value of the resources (in 
                  cash or in kind) that the applicant has demonstrated 
                  are available, or have been committed to be made 
                  available, to the applicant in accordance with 
                  subsection (c)(1)(C).
              (2) Initial limitation.--In the first year of the 
          demonstration program under this section, the Secretary shall 
          make grants under this section, on a competitive basis, to not 
          more than 10 eligible applicants.
              (3) Expansion of demonstration program.--In the second year 
          of the demonstration program under this section, the Secretary 
          may make grants under this section to not more than 10 eligible 
          applicants, in addition to any entities to which grants are 
          made under paragraph (2) for such year.
              (4) State limitation.--In the first 3 years of the 
          demonstration program under this section, the Secretary shall 
          not make a Agricultural Innovation Center Demonstration Program 
          grant under this section to more than 1 entity in any State.
      (e) Use of Funds.--An entity to which a grant is made under this 
  section may use the grant only for the following purposes:
              (1) Applied research.
              (2) Consulting services.
              (3) Office equipment.
              (4) Hiring of employees, at the discretion of the board of 
          directors of the entity.
              (5) The making of matching grants, each of which shall be 
          not more than $5,000, to agricultural producers, so long as the 
          aggregate amount of all such matching grants shall be not more 
          than $50,000.
              (6) Legal services.
      (f) Limitations on Authorization of Appropriations.--For grants and 
  assistance under this section, there are authorized to be appropriated 
  to the Secretary not more than--
              (1) $10,000,000 for fiscal year 2002;
              (2) $20,000,000 for each of fiscal years 2003 and 2004.
      (g) Report on Best Practices.--
              (1) Effects on the agricultural sector.--The Secretary 
          shall utilize $300,000 per year of the funds appropriated 
          pursuant to this section to support research at a land-grant 
          university into the effects of value-added projects on 
          agricultural producers and the commodity markets. The research 
          should systematically examine possible effects on demand for 
          agricultural commodities, market prices, farm income, and 
          Federal outlays on commodity programs using linked, long-term, 
          global projections of the agricultural sector.
              (2) Department of agriculture.--Not later than 3 years 
          after the first 10 grants are made under this section, the 
          Secretary shall prepare and submit to the Committee on 
          Agriculture, Nutrition, and Forestry of the Senate and to the 
          Committee on Agriculture of the House of Representatives a 
          written report on the effectiveness of the demonstration 
          program conducted under this section at improving the 
          production of value-added agricultural products and on the 
          effects of the program on the economic viability of the 
          producers, which shall include the best practices and 
          innovations found at each of the Agriculture Innovation Centers 
          established under the demonstration program under this section, 
          and detail the number and type of agricultural projects 
          assisted, and the type of assistance provided, under this 
          section.
target: Value-Added Development Act for American Agriculture - Directs the Secretary of Agriculture to make grants to eligible applicants for an agricultural innovation center demonstration program to assist value-added agricultural businesses.Authorizes up to ten initial grants. Sets forth permitted fund uses.
feat_title: To provide for grants to assist value-added agricultural businesses.