USDA Faces Calls to Drop Dairy Grant Matching Rule
In letters sent to the US Department of Agriculture on October 12, Senator Tammy Baldwin, a Wisconsin Democrat, and representatives of 28 dairy organisations opposed the newly introduced cost-sharing rule. The signatories include the Wisconsin Cheese Makers Association, the International Dairy Foods Association and the National Milk Producers Federation.
The groups asked Agriculture Secretary Brooke Rollins to remove the 25% match, publish a revised fiscal 2026 Notice of Funding Opportunity and move the November 1, 2026 application deadline back by 60 days. They said the additional time would allow the regional administrators to prepare their applications.
Regional programme structure
The Dairy Business Innovation programme was created under the 2018 Farm Bill through legislation authored by Baldwin. It is administered through four federally funded regional centres: the Dairy Business Innovation Alliance, run by the University of Wisconsin-Madison’s Center for Dairy Research and the Wisconsin Cheese Makers Association; the Northeast Dairy Business Innovation Center, hosted by the Vermont Agency of Agriculture; the Southeast Dairy Business Innovation Initiative at the University of Tennessee; and the Pacific Coast Coalition at California State University, Fresno.
Together, the centres serve dairy producers and processors in 41 states and territories, covering 87% of the US milkshed. Since the programme began, they have distributed tens of millions of dollars through direct sub-awards and technical advice. The support has been used by small and mid-sized farms and cheesemakers for processing upgrades, value-added products and export preparation.
Funding and administration
Rebekah Sweeney, the Wisconsin Cheese Makers Association’s senior director of programmes and policy, and other coalition leaders said the host organisations did not have the unrestricted reserves needed to provide a 25% match worth several million dollars. The four initiatives are housed at public land-grant universities, a state agriculture department and a partner non-profit trade association. Most federal funds are passed on to private dairy businesses through competitive sub-grants, and the administrators do not receive direct commercial revenue from the programme, according to the letters.
The programme has awarded grants of up to $100,000. The coalition said those grants have provided seed funding for family-owned plants seeking bank financing and processing investments. Examples of equipment used in value-added dairy manufacturing include high-temperature short-time pasteurisers, centrifugal separators, cooling tanks, automated packaging lines and food-safety infrastructure. The groups said that requiring the regional centres to supply the match could prevent the existing hosts from applying for fiscal 2026 funds, while transferring the cost to sub-awardees could affect smaller operators without large corporate balance sheets.
Industry concerns
Baldwin said the proposed requirement would add a financial hurdle for dairy producers facing higher fuel and input costs, trade tensions and narrow operating margins. She also said that expansion by specialty cheesemakers and independent processors creates local markets for farm milk and supports payments based on milk components. The organisations asked the USDA to withdraw the rule before the fiscal 2026 funding cycle closes.
