Land Matters: What’s Going to Happen to the Farms?

July 31, 2017Rebecca

What’s Going to Happen to the Farms?

 We’re approaching the peak of the growing season.  The corn fields have acquired their late summer height. The second cutting of hay is underway. Our farmers’ markets are bursting with produce, meat and processed products of all kinds. Pretty soon the fall harvest will begin.

Just about everyone who lives in Columbia County places a lot of value on all of this.  The agricultural character of our landscape and our communities is one of the most distinct aspects of our area. It is central to our sense of who we are. It is a major reason people chose to make a home here. We all take pride in it – though most of us no longer have a direct connection to the land or personal knowledge of the farmer’s life that was universal in prior generations.

But there is a major question hanging over us: what is going to happen to the roughly 100,000 acres of land in Columbia County that is currently in pasture or production?   That represents 25% of our entire land base.  Most of our farmers are “getting up there.” The average age of a farmer in the United States is 58. It’s almost 60 in Columbia County. Nationwide, for every six farmers over the age of 65 there is only one under 35.  And it is estimated that within the next twenty years, 70% of the nation’s farmland will transition to new ownership. These statistics may vary a bit in our county, but the general challenge is the same.

At the same time, the price of farmland has shot up, particularly in places like Columbia County where there is an active second home market for rural properties. The result is that the going price of farmland is often more than most farming businesses can sustain.

So – when the current generation of experienced farmers decides to retire or pass away, what is going to happen to all this land? Who is going to acquire it? If one of their children wants to continue, will they be able to afford to pass it along? Will active farming remain a central feature of our landscape and our communities, or will Columbia County become more of an exurban-second home- vacation spot?

CLC Works to Protect Farming As Well As Farmland

I hope that by now most readers know that farmland preservation is a core aspect of the Columbia Land Conservancy’s work. Farms make up much more than half of the 26,000+ acres of private property we have conserved to date by creating conservation easements; more than 11,000 of those acres are in pasture or active cultivation. Those lands are permanently protected from development that would be inconsistent with continuing agricultural uses. That’s a good start. However, in most cases there is no requirement that these properties must be used for farming. And although the elimination of development rights typically reduces the value of a property, in many cases the reduction does not go far enough to make the land “affordable” to most farm operations.

If farming is going to survive and thrive here, we have to figure out how farmers can maintain or acquire access to farmland, how to make it affordable within the economics of agriculture, and how to ensure that the massive amount of farmland that is going to be turning over in the next twenty years ends up in the hands of a new generation of farmers.

How Can We Do This?

As far as I’m aware, no one has figured out a comprehensive answer to this question, and there will no doubt never be one single answer. But there are a lot of ideas floating around, a number of models that people are trying on for size. We are in the thick of these issues at CLC. Here are some of the things we are doing.

  • Historically, most of our conservation easements have been donated by the landowners, but sometimes we are able to buy them – to purchase the development rights (PDR).  This results not only in the protection of the land from uses incompatible with farming, but enables the farm owner to cash out the development value of the land, making significant dollars available to the farm operation. We will soon close on our 47th PDR transaction, and with that will have conserved 11,500 acres in the county and freed up almost $27 million of capital for those farms to invest in their operations.  In many cases, someone in the next family’s generation would like to continue the business, and these transactions materially assist to enable that to happen.
  • But even with PDR transactions, the basic limitation of the conservation easement tool remains – there is no structural assurance that the land will be used for farming.  We have recently employed an additional tool – the pre-emptive purchase right (PPR) – to address this limitation. In these cases the conservation easement contains a clause that requires the land be sold to a farmer at its agricultural value. CLC retains the option to purchase the land at that value in the event the owner contracts to sell to anyone else. We are optimistic that this tool may be particularly effective, as it acts to further reduce the market value of the land – theoretically to its actual value as a farm. Funding for this option has been available on a limited basis through Equity Trust, a Massachusetts-based farmland preservation group. We are hopeful that a permanent funding source can be found for such transactions.
  • There is a very different tool, a long-term ground lease, that has been used on a somewhat limited basis to date. In this scenario, a non-profit organization such as CLC owns the farmland outright and enters into a very long-term lease with the farmer. The farmer owns the buildings – the house, barn, sheds, fences, etc. This structure guarantees the continued use of the property as a farm, yet provides the farmer with a secure right of access to the land and an equity interest in the operation. CLC is hoping to employ this tool to conserve the Thompson-Finch Farm in Ancram. We are working with the farmers, Don and Marnie MacLean, and with Equity Trust to raise the money to buy the land. Click here to learn more.  We are optimistic that we will succeed and that this approach will add a significant and effective new means to support farming in Columbia County.
  • A lot of people are thinking about these issues and trying to develop solutions. A number of structures have been created by individual private “social” investors, or groups of them, to acquire farmland and create long-term lease or lease-to-buy arrangements that will be affordable to the farmers and at the same time provide an acceptable, modest investment return.  A notable example here in Columbia County, in which CLC played a significant role, is the Farmland Renewal project in Copake.  See http://nefarmaccess.com/selected-project-profiles/copake-agricultural-center/. We are engaged with any number of groups and individuals exploring variations on this theme.

 

Conclusion

 

There is tremendous energy in Columbia County’s agricultural sector. We still have a robust group of established family farms and we have a huge number of (mostly but not only young) people who have started or want to start their own farm operations. We’ve got the skills, the infrastructure, the accessible markets, the demand – and we’ve got the land, without which none of the other things will matter very much. It is a precious natural resource. Hopefully, with these tools and others, and with the great energy and skill of so many people and organizations in our County’s farm community, we’ll be able to ensure that it continues to be available for farming long into the future.

 

 

  • Peter Paden is Executive Director of the Columbia Land Conservancy, a community-based land trust dedicated to land conservation in Columbia County.  He may be reached at peter.paden@clctrust.org.  His column appears on the first Wednesday of every month.  Prior columns may be viewed on CLC’s website: http://clctrust.org/category/publication/.

 

 


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