Take Root: Growing Farms. Seeding Futures.
Last week I had the privilege of attending an information-gathering meeting for Take Root, a new program being launched by the Iowa Farm Bureau Federation to help farmers develop business and succession plans. The objective of this new program is to help farm families work through a step-by-step process of developing a vision for their operation and then taking a managed approach to the obstacles they face in farm growth and transition.
If the turnout to last week’s meeting is any indication, this topic is near and dear to many people’s hearts! I had a hard time finding a place to park at the Fireside Restaurant in Eldora where the meeting was held. After finally securing a spot on the street, I went inside to find standing-room only. The IFBF has expected 20 attendees, but there were more than 40 people in that room!
I’ve been hearing for years about all of the old farmers who will retire, leaving no one to grow our food. Surprise… these fears are unfounded! From what I gathered at the Take Root meeting, young folks are eager take over.
When asked what should be covered in the Take Root series, one young farmer answered, “How do we get the old folks out of our way?” I reminded him there were a few of us old farmers in the room! From this remark, however, I realized some of these young farmers need to see the value of having experience. It’s okay they want to take over, but I hope Take Root blends “old farmers’” experience with the young farmers’ enthusiasm, so we can help them prevent some of costly mistakes from being too eager.
One of the subjects that will be covered by the Take Root program is how to transfer a farming operation. One reason is this is such a challenge is because more than 97 percent of Iowa’s farms are family owned. As any parent knows, you’re going to have more than one opinion if you have more than one child. It’s no wonder that only 30 percent of the farms successfully make the transition from the first to the second generation and only 10 percent of those make it to the third generation. Farm transition is going to be key to keep Iowa agriculture – and Iowa’s economy – strong in the future.
The second priority of Take Root is developing a business plan, which becomes the farm’s road map. Yep… a business plan for a farm! Should you use a C-Corp or an S-Corp? How about a limited liability company (LLC)? In many operations, there can be more than one structure used: livestock might be in one form, land in another and machinery may even be in a third. S-Corp, C-Corp or LLC – all are still examples of a family farm.
There is a need to setup the farm the right way for each family as how the farm is structured is extremely important for that family to pass it to the next generation. Farm structure can play a large role in the financial situation of the operation. Taxes are a large consideration, but I’m not even going to try to cover taxes here today!
We have food to raise and people to feed. We’re in an industry that will not go out of style. Us “old farmers” need not worry who will raise that food. We just need to get out of the way and not get run over. It’s a new world out there, but we still need to eat! For more information about Take Root, go to www.iowafarmbureau.com or contact Nathan Katzer at 515-225-5494 or email@example.com.