OMB No. 0581-0324

DAIRY BUSINESS INNOVATION INITIATIVES

PROGRAM-SPECIFIC TERMS AND CONDITIONS

In addition to the AMS General Terms and Conditions, the following terms and conditions apply for Dairy Business 

Innovation (DBI) Initiative. If there is inconsistency between the AMS General Terms and Conditions and the following 

DBI program-specific terms and conditions, this document will take precedence.

EQUIPMENT PURCHASING AND CONSTRUCTION ACTIVITIES

Initiatives shall provide subawards to new and existing businesses for the purposes outlined in the statute. (See 

“Subawards to Dairy Businesses” section of the Request for Applications.) These purposes are:

1. Modernization, specialization, and grazing transition on dairy farms;

2. Value chain and commodity innovation and facility and process updates for dairy processors; and

3. Product development, packaging, and marketing of dairy products.

DBI subawards that include special purpose equipment are allowable if the special purpose equipment aligns with one 

or more of the above goals and the criteria outlined below. The following chart describes the difference between 

general and special purpose equipment purchases by both the Initiative and its subrecipients.

Cost Category Description, Guidance and Exceptions

Equipment Unallowable for acquisition costs of general purpose equipment (e.g., office furniture, air conditioners, 

or printers and copiers) or lease agreements to own (i.e., lease-to-own or rent-to-own).

Allowable for special purpose equipment (e.g., milking equipment, refrigerated storage units, or dairy

product delivery vehicles), when included in the approved budget or with prior written approval for 

acquisition costs and rental costs of special purpose equipment provided the following criteria are met:

1. Necessary for the research, scientific, or other technical activities of the grant agreement;

2. Not otherwise reasonably available and accessible;

3. The type of equipment is normally charged as a direct cost by the organization;

4. Acquired in accordance with organizational practices;

5. Must be used solely to meet the legislative purpose of the grant program and objectives of the 

grant agreement; and

6. Equipment is subject to the full range of acquisition, use, management, and disposition 

requirements under 2 CFR § 200.313 as applicable.

a. The non-Federal entity must not use equipment acquired with the Federal award to 

provide services for a fee that is less than private companies charge for equivalent 

services.
OMB No. 0581-0324

Cost Category Description, Guidance and Exceptions

Building and 

LandConstruction 

and /or 

Renovation of 

Facilities 

Construction

Unallowable for new construction of building/facility or structural changes to an existing 

building/facility resulting in expansion of square footage, building floor, foundation, and exterior or load 

bearing walls. A building is any permanent structure designed or intended for support, enclosure, 

shelter or protection of people, animals, or property, and having a permanent roof supported by 

columns or walls. This may include construction and construction-related materials, which may include, 

but are not limited to, the purchase of building materials such as wood, nails, concrete, asphalt, roofing, 

gravel, sand, paint, insulation, drywall, plumbing, or electrical wiring.

Allowable for upgrading or modernizing existing facilities, as well as to expand processing capacities. 

Funding requests that include building and facility upgrades can include improvements, rearrangements, and/or alterations to a facility that are required to use a space more effectively and to 

accommodate new or upgraded equipment and processes.

Any such construction activities must meet one of the purposes listed above.