USDA sets up fund for rural food, agriculture businesses
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WASHINGTON, May 3, 2016 - Agriculture Secretary Tom Vilsack announced the launch of USDA's newest private capital investment fund for rural America at a White House event on Tuesday.
The Open Prairie Rural Opportunities Fund, the fourth Rural Business Investment Company (RBIC) USDA has launched since 2014, has the potential to invest as much as $100 million into rural food and agricultural businesses with high growth potential, USDA said.
“What excites me about this particular fund is (that) one of its focuses is on precision agriculture and data management,” Vilsack said in his address to attendees of the Rural Opportunity Investment Conference. “As we become more sophisticated in agriculture, we need to become more precise, and we need information and data to be collected and analyzed properly.”
The Open Prairie Fund “will be making investments in the future of production agriculture,” he said.
In a USDA release, Patrick Morand, partner and president of Midwest-based private equity fund manager Open Prairie, said the fund was “unique among other licensed RBICs in that it has broad support from the Farm Credit System, commercial banks and strategic limited partners who care deeply about the success of rural communities.”
In 2014, USDA granted Advantage Capital an RBIC license for its $150 million Advantage Capital AgriBusiness fund. And in 2015, USDA approved the Innova and Meritus Kirchner Capital RBICs.
“We live, breathe and believe strongly in rural America and are pleased to be working with USDA, the Farm Credit System and other entities that share our passion for building successful companies that have a meaningful impact on… the communities in which they do business,” Jason Wrone, Open Prairie partner and vice president, added.
Vilsack said in his speech that USDA has invested over $224 billion in loans and grants in rural communities since the beginning of the Obama administration.
“We've done over a million home loans. We've helped to finance over 11,000 community facility projects. We've worked on a variety of water, electric and broadband projects, and we've helped nearly 24,000 businesses create, support or retain over 400,000 jobs,” he continued. “But that's simply not enough to do the job the president has instructed us to do.”
This new RBIC fund is the next big step in “reenergizing the rural economy,” he said.
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