Farm Transition Tactics

— Written By William Hamilton sunsetting upon a farmer and his field

William Hamilton is a 15-year veteran dealing with farmland in North Carolina, specializing in a wide array of issues that families may face when considering passing the farm on to the next generation or getting out of it altogether. Considerations include short- and long-term lease arrangements, general land management, property taxes, multiple owners, farm subdivision, conservation easements, and perhaps most compelling, creating opportunities for the next generation of farmers to access farmland. Serving as the co-director of NC State Extension’s statewide NC FarmLink Program, he describes himself as “ready to talk about farmland and related matters with anyone.”

Hamilton and Co-Director Dr. Noah Ranells have become well-versed in North Carolina’s challenge to retain farmland in the face of development pressures, the realities of farming, and the pressures that younger farmers face as they go about building their own careers in agriculture. Hamilton and Ranells have shared information, tools, and resources on their web page at NC FarmLink and have assisted in on-the-ground solutions as they have educated North Carolina landowners in strategically developing farm transition plans.

When Jane Tanner, of Growing for Market magazine, called Hamilton to discuss her next article, “Succession Planning – retiring farmers keep the land in farming”, he was prepared to address the growing North Carolina challenge of farm succession or farm transition with another field specialist.

What prompted you to contribute to the succession planning article?

Jane Tanner called last spring to talk about issues for an upcoming article about farm succession planning. I had never heard of Growing for Market magazine, but I am always willing to talk to anyone who wants to discuss matters related to farmland, especially a journalist. I’m always happy to get exposed to new people in this specialized field, as well to take advantage of opportunities to expose others to NC FarmLink. 

Does succession planning only impact retiring farmers?

No. Farm succession planning will ultimately affect all of us whether we are farmers, landowners, or neither. 

Why is it important to focus on farm succession planning?

Like everything else in life, as life goes on, things change. I believe that farm landowners have a unique responsibility (some might call it a burden), to at least try to set up a future for their farmland so it can continue to be available for the production of food and fiber and to provide all the other intrinsic environmental benefits, including wildlife habitat, groundwater recharge, and scenic beauty. It’s not always possible, but it’s worth trying. It’s no secret how rapidly farmland is being gobbled up by residential and commercial development in certain areas of our state. North Carolina ranks second in the country in the conversion of farmland to developed uses, having converted on average 133 acres a day between 2001 and 2016. And just a few months ago, I heard we flipped from being a majority rural state to being a majority urbanized state. North Carolina is an attractive place to live and people will keep coming here. I think it’s great for our state to continue to attract people. It’s been very clearly documented that population growth is usually not the problem; the problems are poor land-use planning or lack of planning at all.

How is FarmLink solving this challenge?

Our societal issues in this country related to land-use decisions, and food and farming, are complex. Farm succession, also known as farm transition or farm transfer, is a fairly specific term that relates to the passing on of a farm enterprise to a new operator. It’s actually only one of the several tools in the toolbox to mitigate the demise of agricultural opportunities for the next generation of farmers. The spectrum of tools that we focus on includes land leasing that comes in a huge variety of forms (“from soup to nuts” as Buncombe County Extension Center Steve Duckett would say), including short- and long-term leases, leasing with an option to purchase, graduated buy-out plans, conservation easements blended with some development, making land available for socially disadvantaged people, and addressing heirs property issues that have often plagued the land ownership tenure of African American landowning families.

FarmLink takes a broad approach to approach these challenges, while also providing on the ground customized expertise tailored to the individual. Our two-pronged approach, Creating Awareness – Offering Solutions, is working, but we have a lot of work to do to get the word out. It’s vital that we also get good information to people who are relying on us. We know about land seekers and landowners who have gone into agreements with the best intentions only to feel like it was a waste of effort after a year of trying. Those kinds of situations are avoidable if both parties go into an agreement that is well thought out and crafted. There is very helpful information that has already been developed about all of the things we are working on. Land For Good, an organization based in the northeast, has the most comprehensive source of prepared information on this subject than any other I know about. Land trusts in the state are proving to be invaluable partners because they have the capacity to permanently protect the land from development and have become increasingly interested and have embraced the need for a stable farmland base that can sustain us going forward. Land Loss Prevention Project (LLPP) was founded in 1982 by the North Carolina Association of Black Lawyers to curtail epidemic losses of Black-owned land in North Carolina. We don’t have to reinvent the wheel. We just need to continue to build our capacity to get good information in front of the people that are relying on us. 

A big driver of traffic to our website is our robust online database that is capable of connecting those seeking land directly to landowners. Landowners can create a profile description of their land that includes pictures and narratives. We have some great opportunities on there right now, and scrolling through the long list of those seeking land is interesting. Land seekers can create a public profile that describes their background, experience, and goals. By letting individuals from these two groups find each other online, it allows Dr. Ranells and I to develop educational materials and also be available to respond to specific inquiries for personal assistance. There are many considerations that need to be addressed by land seekers and landowners when forming an agreement such as soil types, lease terms, irrigation supply, and building trust. Many of our phone calls and emails end up being geared to doing all we can to keep things in perspective and coaching the landowner or land seeker on having realistic expectations for each other. For the moment, the majority of the transactions being made through NC FarmLink are short- or long-term lease agreements. If nothing else, we feel like giving landowners a chance to find a valuable farm tenant can take the pressure off of a landowning family that is trying to figure out what to do with the asset next. Finding and forming an agreement with a valuable tenant might only be the first step. We can take it from there to deal with ownership issues or liquidity problems that landowners may face. 

We have hope that our efforts, and the efforts of our many collaborators, will allow for a future in North Carolina where agriculture always has enough momentum to maintain all the moving parts that require a diverse and varied agricultural economy to keep going. NCDA, NC State Extension, and Cooperative Extension, and USDA have provided so much success to farmers in North Carolina that agriculture remains the #1 economic industry in the state. We have that going for us, but the ongoing threat of losing our land base to development to the point where it will longer make sense to farm in some places in the state is real. It’s going to need to be an ongoing joint effort between farmers, landowners, city and county land-use planners, land trusts, NCDA, and NC State. When I first started in this field in 2005, I used to hear people say the best way to preserve farmland is to keep farming profitable. I still believe that is true, but when we have farmland being sold for $30,000 to $50,000 an acre in some cases, huge transfers of ownership going into tenants in common situations among siblings, and the fact that farming still requires someone to be out there sweating it out, it’s vital that we take an all-hands-on-deck approach to protect the one natural resource that ties everything together for future generations.

Based on the article Succession Planning — retiring farmers keep the land in farming (PDF) by Jane Tanner, Growing For Market, March 2020.