The sheer beauty of Vermont farmland alone is reason enough to dedicate oneself to farming in the state, but as new farmers aspire to develop farm ventures, it becomes important to ask, how will they approach the topic of farm tenure?
If you are an aspiring, new, or relocating farmer reading this blog article, chances are that you are prepared for farming in the sense that you’ve made a firm commitment to the trade of growing food. You are dedicated to being a steward of Vermont’s farmland, one of the state’s most cherished natural resources. You are willing to work the long hours under unfavorable conditions to make sure your endeavor succeeds. But farmland tenure involves a complex set of variables that can dramatically influence the likelihood of your situation to be vibrant over the long term. Before entering into a farmland tenure arrangement, it pays to consider all of your options. Before locking in your location for the next few years or longer, it is wise to take a step back and look at what you are trying to accomplish in partnership with the land from which your sustenance is derived.
If you are serious about leasing or purchasing land, you should take the time to assess your particular needs as they relate to farm tenure. The key word here is needs. It is well worth the investment of time to sit down with your farming partners and/or family and clarify what features need to exist at a site for your farm or family life to be vibrant over the long term. This is distinct from what you want in a farm. Everyone wants the property on the cover of Farming Magazine, but do you need housing to exist on site? What is the minimum amount of pasture land required for the long term growth of your herd? What is the minimum amount of open vs. wooded acres, water, power, or barn space required for you to start farming now or keep farming into the future? Establishing your needs will enable you to rule out unsuitable properties, thereby saving you significant time and energy when homing in on the right spot. Every potential property will be different and present its unique set of many strengths and weaknesses. Affirming your requirements will enable you to identify these strengths and weaknesses as they relate to your specific farming ambitions.
Another fundamental question to ask before you start visiting prospective farms is whether to own or to lease. Before this question can even be answered, you must have a sense of whether or not the farm will be a commercial venture, and if so, what percentage of your family income it will provide. How much capital will be needed for start-up and operating costs? You can then anticipate the costs of land ownership—the downpayment, mortgage payments, taxes, and insurance—to determine if owning land is even possible with strict regards to the agricultural venture. In other words, will you be able to afford the farm purchase and annual ownership costs and still have enough money set aside to invest in your farm operation?
Several course offerings are available in Vermont to assist new farmers with whole farm planning, goal setting, and start-up business farm planning. The Womens Agricultural Network offers Growing Places, which examines goal setting and pre-farm planning. UVM Extension offers each winter Building a Sustainable Business, a business planning course for farm start-up. Both courses will assist aspiring or new farmers with a detailed examination of what kind of farm venture, and hence farmland tenure option they are prepared to take on.
Leasing farmland can give farmers some of the same rights offered in farm ownership, such as control and management of lands, while avoiding ownership’s high costs. If owning property is a future goal, leasing can often be regarded as a path to farm ownership, as it can enable farmers the chance to build equity in their farm operation which can be useful as leverage for farm purchase. Farm leases can be of short (1-5 years) to long (5+ years) duration, depending on the needs of the farmer or land owner.
Perhaps one of the most comprehensive texts on alternative farmland tenure and leasing is Holding Ground, A Guide to Northeast Farmland Tenure and Stewardship. Published and sold by the New England Small Farms Institute, it is an extensive overview of the various models and mechanisms of non-ownership tenure options for farmers. The guide goes into detail about short and long term leasing and discusses the advantages and disadvantages of both. It navigates through ways by which leasing can be a path to ownership, such as in “land contract” or “Lease with Option to Purchase” arrangements. Holding Ground also contains an in-depth discussion of standards for land stewardship in the context of leasing farms. The 162 page guide is complete with worksheets, case studies, lease samples, and additional resources. Holding Ground is an indispensable resource for any farmer exploring tenure alternatives to owning farmland!
Please check back with this blog and UVM Extension’s New Farmer Project for more information on farmland tenure in the coming months.