Senior Fellow, Farm Transfer
Teresa Opheim helps farmers explore ways to transfer their farms and businesses to the next generation. This work focuses on farmers and farmland owners telling about their journeys, and advice from the experts who will help them get there. She is the editor of The Future of Family Farms: Practical Farmers’ Legacy Letter Project (University of Iowa Press 2016), which features more than 25 PFI members.
Teresa served as Executive Director of Practical Farmers of Iowa from 2006 to 2016. She has served as Executive Director of the Midwest Sustainable Agriculture Working Group and has worked for the Iowa Environmental Council, the Environmental Law Institute and the U.S. Environmental Protection Agency. Teresa has journalism and law degrees from the University of Iowa. She and her family reside in Minneapolis.
Dan Wilson, who farms in Northwest Iowa, recently suggested I read Joel Salatin’s post in the latest Stockman Grass Farmer. I am summarizing some of the column here. Not to embarrass Dan, but he and wife Lorna are working hard to put into place the tips listed below, including their amazing work to develop a multi-salaried, multi-enterprise operation. Right now, they are farming with two sons, one daughter and two daughters-in-law on a farm that includes row crops, beef cattle, dairy cattle, hogs and much more.
Many of you have read Joel Salatin’s work and some of you have even seen him speak at PFI or other events. He is a firebrand advocate for small sustainable agriculture (and a funny guy as well). He has added editing the Sotckman Grass Farmer to his speaking and farming enterprises.
Salatin writes: “Within half an hour of our farm I can take you to 100 farms that are either on the market now, will be in the next five years or have been sold in the last five years. If this were a disease, it would be called an epidemic. The fact that in the next 15 years 50 percent of America’s agricultural equity — land, buildings, equipment — will change hands is imply unprecedented and undeniable.”
Salatin writes that families who have successfully transferred farm businesses to the next generation have commonalities:
1. They view the farm as a business and not a hobby.
2. They talked about the transfer respectfully with each other, often with a mediator.
3. They honored the child/children who stayed on the farm and did not saddle that sibling with payments to non-farming ones.
4. They endeavored early on to develop multi-salaried, multi-enterprise operations.
5. They cultivate family time.
For more on the Stockman Grass Farmer: https://www.stockmangrassfarmer.com/index.php
For more on Salatin: http://www.polyfacefarms.com/
For more on Dan and Lorna Wilson: http://www.practicalfarmers.org/news-events/newsroom/news-release-archive/20320/
How wonderful that the PFI Board has chosen Angela and John Tedesco to be the 2017 recipients of the Farmland Owner Award!
I admire the Tedescos because, as they thought about their farm legacy, they first decided on a clear goal: To keep their land “as a farm for someone to continue using it in a sustainable manner.”
An ambitious and admirable undertaking for any farmland owners; even more so for this couple who watched the unending urban sprawl around Granger swallow up farmland around them. In the end, they realized their goal of keeping their land a farm with a donation of 13 acres of farmland to Practical Farmers of Iowa in 2016.
“Because it’s right on Highway 17 in Granger, I knew if we sold the land to another farmer, eventually it could get sold for development prices,” Angela says. “It’s important to us that it remain a farm for someone to continue using it in a sustainable manner.” Continue reading
They are leaders on farm transitions. (And there are so many more!)
The late William and Mary Gilbert, Iowa Falls, Iowa, for leaving an agricultural legacy. William and Mary rewarded their offspring according to the contributions they made to the farm. Their vision and practice made it easier for son John and wife, Beverly, to thrive today at their Gibralter Farm. Now John and Beverly are easing the way for the next generation to take over.
Susan Jutz, for her perseverance in finding the right person to be her successor, and then working hard to get the Solon, Iowa, business and land transferred to fellow PFI member Carmen Black. The farm is in a rapidly developing area, so Susan could have sold the land for a pretty penny to a non-farmer, but her goal was clear: Her land would remain a farm for a farmer to work.
Del Ficke, Pleasant Dale, Nebraska, for his clarity that family—not land—comes first. The land has been in the Ficke Family seven generations now, but “the key is family,” Del says. “[My father] had a lifelong commitment to clearly communicate to all of us how we were the most essential part of keeping the farm going. We were his legacy, not the land and the livestock.”
Jim and Lisa French, Partridge, Kansas, for knowing there are ways to carry on your values even if your children don’t want to farm. “There is more to consider for the future beyond my family,” Jim writes. “I am not as concerned if my children don’t want to come back to farm, because I’m reinforcing my values in the community I live in. I hope I can have a community where kids can ride their bikes, enjoy nature, and have clean water. That’s our vision for rural America.”
Bonnie Haugen, Canton, Minnesota, for helping her father write a farm legacy letter to document some of the past, present and his future hopes for the farm. Bonnie and husband, Vance, are writing letters later this year as well, and Bonnie is arranging for other women to do the same. (There’s a helpful template available for writing your own at practicalfarmers.org/farm-transfer.)
Tom and Irene Frantzen for showing and sharing about what it takes to be a leader in this field. Says Tom: “When the older generation tries to dictate the vision for the younger generation, you have a lightning rod for future problems.” Irene adds: “If we said that our farm has to be an organic farm in the future, for example, we would be setting that vision for the next generation. Instead we, as the retiring couple, need to listen, to accept that the farm may look different in 10 years.”
Jim and LeeAnn VanDerPol, Kerkhoven, Minnesota, for being willing to share—and learn—as they work through the myriad of decisions involved in transferring the farm. Their situation has many of the elements farmland owners are facing—farming and non-farming heirs, grandchildren who also want to farm, land and business ownership decisions and more. They know we are on a journey, and connecting with fellow travelers helps ease the way.
Happy Fourth of July to you all!
On this holiday, it’s appropriate to reflect on how the farmland we own and work has shaped our nation and ourselves. As Southwest Iowa farmer Jon Bakehouse writes in his farm legacy letter: “My parents and grandparents provided me with such an amazing life. There is such turmoil in the world; I wish others could have what I have. Our son needs to understand that he’s very lucky, and he should be compassionate with others.”
My family’s story is a good example of the gift that farmland provides. In the 1920s, my grandparents, Carl and Selma Opheim, were busy working a northwest Iowa farm Carl’s father owned, and raising eight children when their world fell apart. In 1929, the stock market crashed, the Bode State Bank failed, and the family lost the farm.
“They lost so much,” my dad, Wayne Opheim, reports, “and my family became so poor. I always wondered about the psychological effect of losing so much.” Wayne was born later that year, and the family moved into town. “My dad then worked as a janitor at the Lutheran Church. I think the church felt sorry for him having all those kids and no job. In 1939, he applied for a job at the Bode schools. He came home one day and said ‘I got the job!’ We all cheered. And he was a school janitor for the rest of his life.”
Twenty miles away, my mother’s farming family thrived, and it is on this farm that my grandparents spoiled me when I was young. As with so many families, no one in the next generation wanted to farm, and my grandparents eventually moved into town. Over the years, I watched the farm I knew disappear—the chicken coop, the flower beds, the gardens, the apple trees (one for each grandchild), and the extensive windbreak we dubbed “Fisher Woods.” Toward the end of my grandmother’s life, a neighboring farmer bought the homeplace, but he left it standing until she died. Then, one day, my mother and I cried as we drove by to see neighbors demolishing the house. About 10 years ago, all that was left were two trees in the ditches. Now there are none. A farm obliterated, as if our lives there had never happened.
However, the gift of memories and monthly rental farm income for my parents has made for a comfortable retirement for them, and a financial security as they face possible end-of-life care. Perhaps even a gift of financial security for my siblings and I into the future.
Like my parents, pictured below, we are blessed!
Over the years, Clark Porter and his family have worked hard to increase conservation – including planting cover crops, expanding grassed waterways, incorporating buffer strips, and experimenting with rotations of oats — on the Grundy County land the family has owned since 1873.
“I grew up riding my pony behind my grandfather on our land, and spent summers throughout high school and college working for various farmers,” Clark says. “My great-great grandfather farmed this land – and I want my great-great grandchildren to be as rooted as I am in this soil. That means I have to take care of that soil. For me, it is a living entity.”
How can Clark make it more likely his heirs will follow his conservation ethic? As he worked with an attorney on estate planning, Clark learned he could put some language in his trust document that would assure the farm is managed sustainably. “I knew my children would take care of this if possible,” he said, “but I could not be sure they will be anywhere in the area.”
The attorney hadn’t had a request like this before, but developed the following language for the trust document:
“During the Trustor’s lifetime he has consistently worked to conserve the land and improve the fertility of the soil in his management of the family farming operation; he directs the Trustee to continue these best conservation and soil fertility practices.”
Map of My Kingdom has now been performed 56 times — and two more performances are already scheduled. An average of 50 people have attended each performance, so that’s 2,800 who have seen this PFI-commissioned play!
After Iowa Poet Laureate Mary Swander wrote this work that covers the tough questions involved in farmland transitions, Mary and I both thought there would be a handful of performances around the state.
And then the kudos started and the crowds came, leading to more kudos and more crowds.
“We’ve performed in farmers’ barns and the Federal Reserve Bank of Chicago,” Mary says. “We’ve performed in church basements and New York University. We’ve made a video that can be shown anywhere around the world. And we’ve begun a conversation about our vision for our land, who’s going to get the farm, and how we’re going to handle that succession in a positive way within our own families.”
In Map of My Kingdom, Angela Martin, a lawyer and mediator in land transition disputes, shares stories of how farmers and landowners she has worked with over the years approached their land successions. “Some people literally killed each other over this issue,” Martin says. Some almost came to blows, struggling to resolve the sale or transfer of their land, dissolving relationships. Others found peacefully rational solutions that focused not only on the viability of the family, but also of the land.
Land is the thread that binds all of the stories together. “For most farmers I know, owning land means everything,” Angela Martin says. I am confident there will be 100-plus performances of Map of My Kingdom, because it resonates with those who have been through or are working through challenging land transfer issues that include division of the land among siblings, selling out to neighbors, and attempts to preserve the land’s integrity against urban sprawl.
To book a performance of Map of My Kingdom or Mary’s other wonderful plays, or to order a copy of the DVD of Map of My Kingdom, see www.maryswander.com
Peoples Company of Clive has just released a new guide on farmland transfer–and the guide is peppered with quotes, photos and tips from PFI members.
In “Your Farmland and the Future: Setting Goals, Taking Action” we hear from:
- Rick and Jane Juchems of Plainfield, who communicate often with their son and daughter about their legacy plans. “Our children need to know what is going on,” Jane says. “We are trying to get everything on the table so that no one’s expectations are inaccurate.”
- Bob and Linda Lynch of Gilmore City, who share their strategies, such as life insurance and gifting of land, designed to ensure that their son Jay will be able to stay on the land and continue as the fifth generation of Lynches to farm.
- Susan and Rob Fleming of Carlisle and Philadelphia, Pennsylvania, share how they have used their farmland for income, for conservation and to provide land for beginning farmers.
The Van Der Pols tackle farm transitions (Part two of a three-part series)
When Jim and LeeAnn Van Der Pol began farming in 1977 on his family’s Central Minnesota farm, they added pigs to the operation. When their son Josh and his wife Cindy joined the farm in the mid-1990s, they expanded the pasture farrowing. “And then we hit 1998 and the $18 hogs in October and November. That really knocked Josh and Cindy around, because we didn’t have any hogs on contract. And we lost what we thought was going to be a goodly share of our retirement by that time because of what the hogs did to us.”
A terrific opportunity opened up, though, and Jim took a job building the facilities for a low-input swine facility at the University of Minnesota’s experiment station near Morris. Jim and LeeAnn turned over a portion of his salary to Josh because the farm wasn’t able to pay him much out of the farm budget. LeeAnn and Cindy both worked off-farm jobs too, LeeAnn at a nursing home and Cindy at her parents’ garden shop.
The Van Der Pols recovered from the hog price collapse and expanded their production again, building a new hog house four years ago and adding a couple of hoop houses. They also put a lot of time and energy into starting a meat business, Pastures A Plenty, through which they now sell to stores, restaurants and direct-to-consumer throughout Minnesota. “That meat company is going to provide a lot of opportunity for those who want to work at it and work in it,” Jim says. LeeAnn adds that, while “the farm checkbook sucks money all the time, like most farms do, the meat company has six figures in the checking account. Sometimes we plot about how we can get money from the meat company to the farm.”
“When we started selling pork and later beef and chicken direct, we decided we needed a separate accounting structure for the meat business,” Jim says. “We needed the farm to be selling the farm animals into this other entity, which would pay to have them processed and to sell the products. That way, we could tell if we were making money on the farm or on the business.” They chose a subchapter S corporation, with Jim, LeeAnn, Josh and Cindy all partners in the company.
This is a guest editorial from Steve Bruere, President of Peoples Company, a PFI member based in West Des Moines.
Farming is in my blood. I grew up on a farm in Warren County, Iowa, where my parents farm together with my older brother. My brother will be expected to carry on the farming legacy as the on-farm heir, while I will be an off -farm heir – maybe! So, what does that mean for me when the difficult time comes, when both of my parents are gone and the assets are passed on?
As my dad says to us boys, without a well-thought succession plan, “your inheritance will go to the dog.” I’m not convinced he is joking given the close relationship he has with his Great Dane.
When I got into the real estate business in 2003, many of my first real estate transactions were with farm families I grew up with. I started to observe early on how close-knit and very successful families were destroyed after there was a death and the kids fought over who gets the farm and what Mom and Dad’s intentions were. Oftentimes, these started out as very casual disagreements, but as the value of farmland began to appreciate, so did the tension of settling these matters. Many times, it wasn’t the heirs themselves, but the spouse of the heir, who would begin to stir the pot that led to conflict.
Like many farm families, the Van Der Pols, of Kerkhoven, Minnesota, are in the middle of a farm transition journey. They will share their story at the PFI conference Jan. 21 and also at the MOSES conference Feb. 25. This is the first of a three-part series.
Jim and LeeAnn Van Der Pol are in their 60s and in the thick of farming—and of shifting their roles and ownership on their Central Minnesota farm. Jim’s parents started out with a “team of mules and 600 dollars,” as Jim’s father liked to quip. They were children of the depression and dropped out of school to work. “My dad was raised very rough, malnourished and worked too early and too hard,” Jim says.
- By the time Jim and LeeAnn came back to farm in 1977, his parents owned 480 acres — quite an accomplishment. But Jim’s father had had enough of farming by then, and he and his wife promptly retired and moved to town. Jim and LeeAnn moved into their house. “My dad walked away from management when I came back. He would drive the tractor and that’s all he would do. I didn’t wish he could provide more guidance, but I probably should have. There was never an idea in his mind that he was still running things. He basically said ‘now this is yours.’” The farm was Jim and LeeAnn’s to operate, but ownership proved to be a lot more complicated.