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By Dr. Donald J. Jonovic
The problem: How can a family with no farm heirs keep their land while helping a neighbor's son get started?
Submitted by S.K., via email
We have eight children. None of them is in a position to take over the family farm, so we're considering the son of a friend who wants to farm.
Ours is only a small farm, approximately 170 tillable acres. The house and machinery are old but in excellent shape.
Most of the buildings are not adequate for storing the larger farming equipment used today.
We want to retire, but we do not want to sell the farm. We would like to sell the equipment (to the friend's son if possible), our home, and the farm buildings. We also want to help a young man with limited assets get into farming.
Is there a way to make this transition fair to this young man and to us?
The problem posed by S.K. reminds me of a couple I knew who owned and managed a bed-and-breakfast where I often stayed. Like S.K., they thought more of their dream and their homeplace than their financial future.
They were both teachers (I'll call them Bill and Susan) and bought a large lot along a picturesque state road a few years before I met them 12 years ago.
Bill poured their dreams into the design of a multiple story, Victorian-style home, then he built it himself. Financing Peach Hill with their savings and sweat, they built it, decorated it, stocked it, put up a pretty white fence, and opened.
Bill worked full time as a teacher; Susan ran the reservations, accounting, and the B&B operations.
Peach Hill was a modest success. For the next 15 years, they fulfilled their dream, and many people enjoyed their home and hospitality.
Over time, their children married and moved. As Bill and Susan approached retirement age, they hoped to find a younger couple with their own dream who could buy and continue Peach Hill.
As they considered this, a new project was announced. Their quaint state road was to be widened into a four-lane highway. While they debated selling, construction began.
First it was detours and barricades. The white fence fell one day to ditching machines. Bill and Susan sued, but that brought little. Exhausted, they decided it definitely was time to sell, and the sign finally went up.
Construction continued. Dozers changed the drainage. One day half of their property flooded. Then came the dust and the asphalt smell. The road opened. Heavy truck traffic increased. You can imagine the rest of the story.
Today, Peach Hill is a vacant building haunted by a betrayed dream and owned by a bank through foreclosure. Bill and Susan have moved away.
S.K.'s dream is to keep their land a small farm and their treasured, hard-built assets used as they were intended by a young man who wants to farm.
What, S.K. asks, would be "fair" to her family? To the young man?
Is S.K.'s dream much different from that of Bill and Susan's, who not only let their business assets diminish but also lost them entirely? Were they fair to themselves?
Farm people care about their assets and want to help the next generation, but they tend to forget about their own security.
Perhaps S.K. and her husband could sell some of the assets now and rent the land with an option to buy in the future. But whatever plans they make, their financial security must be the first consideration in the equation.