Dairy Innovation grants provide $750,000 to increase on-farm dairy processing and incorporate labor-saving technology. 

A little more than two decades ago, Jeff and Jill Burkhart’s dairy farm was at a crossroads. Faced with low margins, the Dallas County farmers decided to start bottling their own milk and direct market to consumers. 

Fast forward 22 years, and the Burkharts’ Picket Fence Creamery is thriving with an on-farm processing facility that churns out a range of products including milk, ice cream and cheese curds. The growth has allowed their two children, Jenna and James, to return to the farm to help with the family business.

Iowa Secretary of Agriculture Mike Naig said he hopes the inaugural round of Choose Iowa Dairy Innovation grants awarded last month will help more dairy farmers follow the Burkharts’ path. 

The Iowa Department of Agriculture and Land Stewardship awarded $750,000 in cost-share grants to 20 dairies across 12 counties to increase on-farm dairy processing, incorporate labor saving technology and expand the availability of Iowa-grown dairy products for consumers.

“This is just a way to help de-risk and help incentivize some of those next steps that we want to see folks take on projects, expand their capacity and build new markets,” Naig said recently when announcing the grants at the Burkhart farm near Woodward. 

Picket Fence Creamery was among the grant recipients, landing a $100,000 grant to replace its vat pasteurizer with an HTST (high temperature short time) pasteurizer and chiller, which will reduce pasteurization times from 35 hours to seven hours. The HTST pasteurizer and chiller will also use 80% less water and 50% less electricity and propane, Jeff Burkhart said.

“Our goal is to get our business set up for the future, make it more profitable and efficient,” he said. “This is going to help us reach that goal.”

Stimulating growth

The dairy innovation grants are an off-shoot of the popular Choose Iowa value-added grant program, Naig explained. Since so many applicants for the value-added grants came from dairy farms, the Iowa State Dairy Association (ISDA) pushed for grants specifically geared for dairy farmers. The Iowa Legislature created the Dairy Innovation Fund in 2023, allocating $750,000. 

“We wanted to create a program to help grow the dairy industry,” said Lee Maassen, ISDA president and a fifth generation dairy farmer from northwest Iowa. “I look at this as a stepping stone. I’d love to see the dairy industry in Iowa reinvigorated. We appreciate Iowa’s investment in our dairy industry.” 

Dairy farms have a sizeable economic impact. Economic studies show that each dollar generated from dairy farming turns over seven times in the local community, Maassen noted.

Choose Iowa Program Director Beth Romer said requests far exceeded available funding for this year’s initial round of Dairy Innovation grants. The department received 50 applications seeking $2.6 million in grant funding, she said. 

“We were so impressed with the quality and caliber of the applications,” she said. “It was so competitive …, and unfortunately we just ran out of money before all the deserving applications were able to receive funding.” 

The cost-share grants are helping dairies invest in pasteurization equipment, processing space, packaging and bottling products, robots, health monitoring, automated feeding systems, cleaning assistance and more. 

The program matches 50% of a project’s cost, up to $100,000. Funds aren’t eligible to cover start-up costs, advertising, public relations, salary/benefits/wages, existing debt or any expenses incurred prior to awarding the grant. 

With the legislative intent of assisting smaller dairies and farmers, grant awardees must be located in Iowa, have fewer than 50 employees and be in good standing with regulatory agencies. Only dairies permitted and inspected by the Iowa Department of Agriculture and Land Stewardship were eligible.

The 20 grants awarded this year will leverage an overall investment of more than $2.2 million. 

Choose Iowa is the state’s signature brand for Iowa-grown, Iowa-raised and Iowa-made products. Foods with the Choose Iowa logo must meet or exceed minimum criteria to be considered for the program.

A full list of dairy innovation grant recipients is available at chooseiowa.com/node/632.