Value-Added Stock Loan Participation Program

July 27, 2020


The Value-Added Stock Loan Participation Program was created in 1994 and is designed to help farmers finance the purchase of stock in certain types of cooperative, limited liability company, or limited liability partnership that will produce a "value-added agricultural product." This may include wind energy and anaerobic-digestion cooperatives if they meet the eligibility requirements (see Statute and Rules for details).

Like Minnesota's Agricultural Improvement Loan Program, this is a "participation loan" program, where loans are made by individual financial institutions working with the Rural Finance Authority (RFA). The RFA purchases up to 45% of the loan principal up to $40,000. The interest rate offered by the RFA is then set at a fixed rate of 2.0% or half the lender's effective rate at closing. Loans are for a maximum of 8 years, and interest-only payments are permitted for the first 2 years. Interest and loan principal repayments are deposited back into a revolving loan account. The RFA is not permitted to make stock loans cumulatively totaling more than $2 million for the financing of stock purchases in any one cooperative.

The program will not finance more than 95% of the price of the stock purchased by the participant. To qualify, an applicant must have a total net worth of less than $450,000 (indexed for inflation), including the assets and liabilities of the applicant's spouse and dependents.

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: Minnesota
Incentive Type: Loan Program
Web Site:
Administrator: Rural Finance Authority
Start Date: 1994
Eligible Renewable/Other Technologies:
  • Solar Photovoltaics
  • Wind (All)
  • Biomass
  • Wind (Small)
  • Anaerobic Digestion
Maximum Loan: RFA provides up to 45% of the loan up to $40,000 of loan principal
Loan Term: Maximum term of eight years
RFA portion at lesser of 4% or half of lender's effective rate for the non-RFA portion
Interest-only loan payments permitted for 2 years


Name: Minn. Stat. § 41B.046
Date Enacted: 05/11/1994 (subsequently amended)
Name: Minn. Stat. § 500.24


Name: Gary Blahosky
Organization: Minnesota Department of Agriculture
Address: 625 Robert Street North
St. Paul MN 55155-2538
Phone: (651) 201-6666
Name: Ryan Roles
Organization: Minnesota Department of Agriculture
Address: 625 Robert Street North
St. Paul MN 55155-2538
Phone: (651) 201-6666

This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.