Information for Landowners
Access to land is the greatest barrier faced by beginning farmers in the United States largely due to high land prices driven by development pressure and the lack of long term farmland leases. For beginning farmers, leasing land is a great opportunity to get experience, expand their businesses, and save to purchase land in the future. With the average farmer in the U.S. being 57 years old, occupational farmers are disappearing at an alarming rate. With disappearing farmers comes, disappearing farmland. Over 25 million acres of farmland were lost to development in the U.S. from 1982 to 2007 (according to the 2007 National Resource Inventory) with California having lost 1.75 million acres alone, making it the number two state for largest farmland losses.
Why make your land available to lease?
• Support socially disadvantaged farmers: The farmers have participated in IRC farmer training programs and have shown commitment in pursuing agriculture as a livelihood. They have the skills! Now what they need is affordable land. By leasing your land, you will be providing theses farmers with the crucial support they need to overcome the land access barrier and realize an agricultural livelihood.
• Management and stewardship of your land: Land can be expensive to maintain; from brush clearing for fire safety to invasive plant control, unused land accrues unavoidable costs. By lending your land to agricultures uses, you can insure the maintenance and productive use of your land. Your land use concerns and/or requirements can be addressed in the details of your farmland’s leasing agreement after your land has been matched with a refugee farmer’s needs.
• Support local agriculture and food security: Increase the amount of food that is being grown and sold locally and the number of farmers that are doing so. More farms + more local foods = a more food secure San Diego!
• Support the local economy: By making land available you will be expanding the economic opportunities available to refugee farmers. Many of the farmers sell to markets and restaurants in and around El Cajon and City Heights, so you will also be helping to keep money and resources within the local economy. If you haven’t yet, come check out the City Heights Farmers Markets (and the soon-to-be El Cajon Farmers Market), meet some of the farmers, and see the local economy in action!
Things to Consider
From when you first consider leasing your land to the moment that the lease is signed, there are details to consider. The following questions are intended to get you thinking about some of these details and the potential concerns that you might want to address regarding the use of your farmland:
- What are your interests, purposes, and/or goals for leasing your farmland?
- What level and type agricultural activity would you allow on your property?
- What is the suitability of the land that you are considering leasing out?
- Would you allow the farmer to improve the property?
- What compensation would you accept for your leased farmland?
- What length of a lease would you be open to?
- A short term lease is typically 1 to 5 years long, allowing both parties maximum flexibility; however, it is a risky option for farmers, making a farmer less likely to spend time and capital improving the soil, implementing conservation measures, or building value adding structures or improvements to the property.
- Long-term leases are typically between 5 and 10 years; however, by law a lease term can be long as 99 years (the legal maximum). Long-term leases benefit both parties as they are more secure, allowing farmers to make long-term decisions and possibly build equity in the property.
- Lease with Option to Buy (also known as “Lease-option”) is a lease agreement in which a property owner and tenant agree that, at the end of a specified rental period for a given property, the renter will have the option of purchasing the property.
- In a Work to Own agreement, responsibility and farm/property assets are gradually transferred from to the farmer (tenant); the farmer is hired by the farm business or land owner and as part of the compensation the farmer gets a share of ownership of the property. The original farmer/landowner continues their farm business until the new farmer takes over.
- A ground lease is a long term lease in which the farmer purchases or builds some or all of the improvements to the property (i.e. farm structures, residences). At the end of the lease agreement, the tenant (the farmer) can sell the improvements. This type of lease is less common, but very beneficial because it allows tenants to build equity.
- Cash lease is an agreed amount of cash (typically determined per acre) paid per year by the farming tenant. It is beneficial for the farmer if a smaller portion of the yearly payment can be paid at the beginning of the growing season, and the remaining larger portion paid at the end of the season. A cash lease can also be divided into monthly payments.
- Crop share is when, instead of a set amount of cash, the rent is a percentage of the income that the farmer makes from the crops grown on the land. By sharing the risks and rewards of farming with the tenant, you would be helping out beginning farmers that do not have significant start-up capital.
- Flexible cash rent is a combination of the above two options. Both parties agree on a base cash payment that is guaranteed each payment period and that is less than the full cash payment for the land. The remaining payment will be made as a crop share. In a good year when the farmer makes many sales, both parties will benefit; during a bad year, you as the landowner are guaranteed the base cash payment.
- A list of people, companies, or organizations signing the lease
- Description of the property
- Length of the lease
- The amount and type of rent payments, and how and when they will be paid
- Taxes and fees
- Entry of the landlord
- Permitted and prohibited uses of the farmland
- Responsibility for maintenance and repairs
- Investments in capital improvements
- Liability and other insurance
- Default provisions
- Condemnation or casualty provisions
While as a landowner is it important to address your concerns regarding the use of your farmland, it is equally important to remember that farming is a business! In addition to land, farmers need the flexibility to use the land in ways that will insure the success of their small-scale farming operation.
How will I be matched with a farmer?
You have land that you are willing to lease or donate. What happens next? How will you be matched with a farmer? The first step is to fill out the Landowner Application [insert hyperlink] and submit it online, by email, or by mail. IRC staff will process your application and begin the process of making your land available and linking your land use needs with the needs of a farmer. You will be notified when you’ve been linked with a farmer, and arrangements will be made to negotiate a lease agreement between you and the farmer.