What is The Sheep & Goat Innovation Fund?

The Sheep and Goat Innovation Fund is a revolving fund established within the National Livestock Producers Association to assist the U.S. sheep and goat industries by strengthening and enhancing the production and marketing of sheep and goats and their products in the United States.

The Fund is the result of a joint effort of the American Sheep Industry Association (ASI) and the National Livestock Producers Association (NLPA). Through Congress, funds were made available to NLPA, which serves as a loan intermediary and established the Sheep and Goat Innovation Fund.  NLPA has the ability to service and administer this important program and was selected for their ability to provide:

• Expertise with livestock production, processing and marketing-related lending;

• Nationwide capability in urban and rural areas; 

• Servicing of loans from all segments of the sheep and goat industries; from production through the packer/processor/retail level.

The Sheep and Goat Industry is in need of creative ideas that will add value to sheep and goats and the products they provide. NLPA encourages industry members to evaluate the immediate needs in their area, gather support from others who recognize those needs, and work together to find the most effective solutions to local concerns.

The purpose of the fund has been to assist in financing projects beyond the farm gate; however, recently the fund was given the ability to make term loans to sheep and goat producers for the purpose of flock and herd expansion. 

Quick Facts:

It is the mission of the Sheep & Goat Innovation Fund to encourage innovation and efficiency in the sheep and goat industries by providing credit to eligible and qualified entities. NLPA has established the following goals for the Sheep & Goat Innovation Fund:

• Make capital available for enhancing production methods and services.
• Improve marketing efficiency, product quality, and industry infrastructure.
• Create opportunities for adding value to sheep and goat products.

Flock and Herd Expansion Loans:

As of June 2013, the Fund has had the ability to make term loans to sheep or goat producers for the purpose of flock or herd expansion. Up to $2 million of the Sheep and Goat Fund has been identified for qualified applicants to be used specifically for the purchase of breeding animals. This new loan program is the result of a joint effort between NLPA and the American Sheep Industry Association (ASI) in the spirit of ASI’s Let’s Grow initiative.

A few of the conditions of the lending program include:

• A minimum loan amount of $35,000 with the maximum loan amount based on credit worthiness of the borrower;
• Five-year maturity date;
• Proceeds may only be used for the purchase of breeding animals and may not be used for other operating expenses; and
• Prospective borrowers must demonstrate their ability to successfully produce sheep or goat in a production setting which may include the establishment of a mentor relationship, participation in educational programming for sheep/goat and financial management and the development of a marketing plan for the enterprise.

Who is an Eligible Borrower?

An individual (sole proprietor) is not considered an eligible entity. This restriction was written into the legislation that set up and funded the Sheep Center. However, applicants may be a public, private, or cooperative organization; an association; corporation; nonprofit organization; a partnership; a limited liability company; a federally recognized Indian Tribe; a public or quasi-public agency; or any other recognized business organization.

However, for the Flock Expansion Loan product, sole proprietors are eligible to borrow funds.

Basic Facts about the Fund:

• Loans from the Fund are delivered through direct loans; grants are not available.
• The Fund is revolving, therefore a loan repayment plan is required from applicants.
• Applications are reviewed by the NLPA Sheep & Goat Fund Committee.
• Loans are available in any amount up to $1.5 million per applicant.
• Interest rates and terms are determined during the approval process.
• In most cases, matching funds are not required. However, if matching funds are available, that information should be provided. It will help demonstrate that there is a financial commitment by those advocating the project and others who have an interest in seeing the project succeed. Loans from other sources should be included in the matching fund information.
• The maximum term of the loan will be determined by the individual needs of the proposed project. The Sheep & Goat Fund Committee has the flexibility to tailor a repayment plan in accordance with the needs of each individual project.

How Can the Funds be Used?

• Investment in the development, processing and commercialization of new sheep or goat products.
• Improve marketing efficiency and product quality.
• Purchase of equipment, leasehold improvements, machinery, or inventory for sheep or goat processing.
• Business conversion, construction, enlargement, repair, modernization or development in processing facilities for sheep, goats or their products.
• Investment in development and use of new equipment and methods to process sheep or goat products.
• Facilitate infrastructure and business development in the sheep and goat industries.
• Purchase and development of land, buildings, or facilities for the purpose of sheep or goat processing.
• Investment in efforts to manufacture and market new products for sheep or goat disease prevention and control; predator control; genetic and reproductive performance.
• Commercialization of sheep or goat products that have been developed by public or private institutions.