The Kent County office of Economic Development is looking to help you get started on the road to owning and operating your own vineyard. MarylandWine.com put out a story last month on their ambitious program for vineyard expansion in Kent County. The County is doing it the smart way, with money.
A vineyard loan program of up to $300,000 was established, to assist in the establishment of new grape acreage within Kent County. The amount was based on establishing 50 new acres by providing funding assistance of up to $6,000/acre.
The last bit there, about the funding assistance, is where the groundbreaking part of this comes in. The County has set up a fantastic loan program to assist new vineyard owners in getting off the ground. Given an estimated cost of $12,000 an acre to set up a new vineyard, Kent County is going to assist in financing $6,000 of that per acre on a five-acre minimum plot. The loan terms are pretty mouth-watering:
- Loan rate is 5%, six months interest free
- Repayment would begin after 36 months, allowing a new winery to establish some cash flow by selling their wine
The goal is the creation of 50 new vineyard acres in Kent County, divided into ten vineyards of five acres each.
Allowing a grace period before paying back the loan is a crucial component to the plan. Boutique custom crush facilities, such as Crushpad in California, advise clients that you sell your first vintage before it is bottled so that you can afford to finance your second vintage. Revenue from the second vintage would go to the third, and so on. Wineries of any scale, from micro custom crush producers to bigger commercial projects, need that initial financial push to get going. The cycle is then self-perpetuating (as long as the wine is drinkable).
I got a chance to speak with Kent County Director of Economic Development Jack Steinmetz by phone about the program. Mr. Steinmetz reports that there has been “significant legitimate interest” even at this early stage and that their office is “very pleased with the initial reception by the public.” Ultimately, says Mr. Steinmetz, a broader reach could be seen by the project, moving from their initial 50 acres into a possible 150 acres of new vineyards reaching into neighboring Cecil and Queen Anne Counties.
This is a great program because it puts good financial terms in play with a good opportunity in a growing wine state like Maryland. New ventures could take advantage of the perks, but also established wineries have an excellent chance to expand their vineyard holdings within the state.
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