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According to a 2020 study done by Iowa State University, about half of all farmland in the Midwest is rented through short term leases (1-2 years). 

“Farmland rental arrangements where tenants may not reap the benefits of conservation investments are a commonly cited barrier to conservation practice adoption in agriculture and may result in lower adoption rates on rented land than on owner-operated fields,”. (Wilde, 2022) . Due to conservation practices being multiyear projects that may not immediately show results, tenants with short term leases are discouraged from investing in conservation as they may not provide a return within the time of their lease. 

The study encourages farmers to sign up for leases 3 years and above to invoke confidence in the return of investment for conservational farming practices and methods. It is vital that proper leasing agreements are done for conservational efforts to be implemented. If no lease documentation is in place, farmers are less encouraged to have important conversations about land care or using cost share resources for conservational practices.

It is recommended farmers and tenants discuss goals, rental rates, future adjustments to the agreement, conservational objectives and any concerns that may be preventing farmers from leasing for a longer time before agreeing to the lease. Foundations such as the Chesapeake Bay Foundation (CBF) and Natural Resources Conservation Service (NRCS) may help farmers to implement consevational strategies on their land such as using science-based approaches to prevent pollution in natural occurring bodies of water. 

In conclusion, a long term lease on agricultural property is necessary for conservational efforts to provide a worthwhile return on investment due to its multiyear process. Farmers who sign on for short term leases may not be able to obtain high returns as their is an adjustment period where harvest may decrease at first, however it will stabilize over time.

Reference:Wilde, M. (2022, June 12). New lease on conservation. DTN Progressive Farmer. Retrieved September 19, 2022, from https://www.dtnpf.com/agriculture/web/ag/magazine/your-land/article/2022/06/12/new-lease-conservation

About only an estimated 50% of farmers and ranchers actually have an up-to-date estate or succession plan, or any estate plan at all. This may be due to a number of reasons including failure to create a retirement plan, wanting total control lof their land, or just lack of awareness. However, it is important for the prolongation of the estate’s success that a proper succession plan is put into place.

Here are some steps towards getting your succession plan in the works:

List your Assets

Be sure to keep a detailed inventory of the assets currently owned, how they are owned, any outstanding debt that may need to be settled and how much your assets are worth currently. Within the document, be sure to include any family and personal details that may bw relevant in the event of succession, a will if there is one ready, documents for trust or entities that may be in place, total assets and businesses in detail, inventory of grain and livestock, automobiles with current value stated, and any other loans or obligations you may have.

Have a Family Meeting

Gather everyone who may be a potential successor to your assets and discuss an agreeable way to divide all assets including inheritance, properties or any personal memorabilia that may hold sentimental value. After a settlement is agreed upon, the current asset holder may reach a decision alone and proceed to document the final agreement.

Seek an Attorney

Once the list of assets as well as the list of successors have been finalized an attorney may provide you more guidance on how to execute the succession process so that it may be successful. This may include deciding which tool to use in the event of succession i.e: a will, LLC, a trust or a combination of these things. An attorney’s advice here is crucial as they may know the ramifications of each route.

After the succession plan is writted and signed, immediate family may be informed. As your assets change overtime, there may come a time where the succession plan will need to be amended, however the process will not be as strenuous as there is already a foundation to work off of.