PIERRE, S.D. (AP) _ A proposed lamb slaughter plant at Platte is the first project to receive state assistance through a new program aimed at getting more agricultural processing plants started.

Larry Stearns, agriculture development specialist in the state Economic Development Office, said a $7,800 loan has been made to American Livestock and Grain for a feasibility study.

If it's built, chilled lamb carcasses will be shipped to a processor in Los Angeles, where the meat will be cut up for sale to consumers. The California company has even indicated an interest in locating its final processing operations at Platte, Stearns said.

It's the first use of a new law setting up a special $3 million account for agricultural processing by shifting the money from the state's main economic development fund. The money may be used for feasibility and marketing studies for plants that process crops and livestock.

``I wanted to see this thing get off the ground,'' Stearns said of the new program approved by this year's Legislature. ``This was a very good project to start it with. It looks very doable, and it was one where they had their ducks in a row and had some marketing work done.''

The feasibility and marketing program also will receive ongoing revenues of about $400,000 a year by keeping 3 cents a gallon on refunds that go to farmers and others who use fuel for field work and other off-road purposes. That cuts fuel tax refunds to 15 cents a gallon.

Program rules allow the state Economic Development Board to provide up to half the cost of feasibility and marketing studies. The assistance may be provided as loans or as grants that will not have to be repaid.

State assistance may be used for salaries, consultants, services and supplies needed for feasibility and marketing studies. The loans and grants cannot be used for construction expenses or land and equipment purchases.

Stearns said other projects also have applied for assistance, and the board will consider them at its October meeting.

``We've had a lot of inquiries, and I've sent out a lot of application forms,'' he said. ``As soon as the harvest is done and the combines and tractors are put away, I think we'll see a lot of applications come in.''