An Explanation of the Guide
Duties and responsibilities regarding the stewardship of agricultural land can be a complex issue for any landowner. The issue, however, becomes more complex in the context of a farm lease arrangement. While landowners and tenants may sometimes have different views, values, or goals in relation to the property, cooperation is critical to the promotion of a sustainable farm operation.
To promote sustainability through a joint effort, landowners must first understand their role in the landlord-tenant relationship and their duty to the land; both subjects that may be confusing to new landowners or those seperated from the land geographically or culturally. A landowner may grant tenant operators the right to use the land, but the landowner retains the greatest long-term interest in the land and is ultimately responsible for the sustainability of the farm operation.
The purpose of this guide is to introduce you to important issues regarding the sustainability of your leased farmland and provide some insight on how to encourage your tenant to take an active role in the sustainability of the operation. It is important to point out that a sustainable lease does not necessarily ensure a farm operation will address all the aspects of a sustainable system. Rather it provides a step in the direction of sustainability. Of course, the size of that step depends on a number of circumstances, including the needs and values of you and your tenant.
This guide briefly presents the economic, social, and ecologic benefits of sustainable agriculture, but it is not the intent of the guide to persuade landowners of a particular set of values or to promote a specific manner of farming. As will be discussed in Chapter One, there are a variety of ways to farm sustainably, and a truly sustainable lease must fulfill the concerns and needs of the landowner and tenant.
This section provides a brief introduction to sustainable agriculture and the basics of a farm lease. This includes a brief discussion of the different issues encompassed by sustainable agriculture, the ecological and economic benefits of sustainable farm practices, and the particular relevance of stewardship issues regarding leased farmland. This chapter also discusses the importance of a written lease, provides a list of important provisions to include in any farm lease agreement, and provides an introduction to the most common types of farm lease arrangements.
Chapter Two explains the importance of determining priorities for both yourself and the land. It is also provides a list of important questions to ask yourself before talking with your tenant and negotiating the terms of a lease.
This chapter provides information you might consider when talking to your tenant. The chapter focuses on understanding the tenant’s perspective, provides resources for basic farm and leasing terminology, and concludes by emphasizing your role, as the landowner, in ensuring the sustainability of the property.
Chapter Four discusses the interaction of farm leases with the law and how this interaction can impact the sustainability of the lease arrangement and farm operation.
This provides the heart of the guide. This chapter examines the key considerations for developing a sustainable farm lease arrangement. The issues addressed are the term of the lease, reimbursement for unused improvements, cost-sharing and risk-sharing arrangements, conservation provisions, and landlord-tenant communication.
This chapter discusses a few specific matters related to sustainable agriculture on leased farmland. The topics include recreational uses, ecosystem services contracts, agricultural and conservation easements, and assisting new farmers.
Obtaining Additional Assistance
As noted throughout the website, this information is not intended as legal advice and is not a substitute for consultation with competenent professionals. These disclaimers highlight the importance of seeking assistance to ensure a fair, legal, and sustainable lease agreement. There are a variety of professionals ready to assist landowners. The list below discusses some of the most common sources of information on leasing farmland and ensuring its sustainability. The last section specifically addresses assistance for women landowners.
The value of sound legal advice is critical to ensure the priorities of the landowner and the sustainability of the farm are protected. While legal advice is often sought in order to enforce the rights of a party after a dispute has arisen, it can be beneficial in terms of finances, good will, and even the well-being of the land to seek legal advice prior to entering an agreement.
A farm lease is a legally binding contract that creates important rights and obligations for both parties. However, landowners often enter oral lease agreements or simply fill in the blanks of form leases without an adequate understanding of the terms and conditions. Attorneys can assist in explaining the rights and duties that arise from such contracts and negotiating the terms of the lease agreement to ensure the landowner’s priorities and the sustainability of the farm are protected.
The legal ramifications of a farm lease can also extend beyond the duties and responsibilities of the lease contract itself. There are issues involving taxes, social security, estate planning, and the availability and distribution of benefits from government farm programs to name a few. An attorney can assist in explaining and planning for these additional consequences.
The Department of Agriculture has numerous programs designed to provide assistance to both farm operators and landowners. Many of the programs are designed specifically to improve conservation on the farm and prevent environmental degredation stemming from agricultural activities. These programs include financial incentives, cost sharing, and providing expertise to farmers and landowners. There are also programs addressing farm tenure issues, particularly relating to increasing access to beginning or disadvantaged farmers.
Specific programs are addressed in more detail in relevant sections of this site. For example, more information on the USDA’s Transition Incentives Program (TIP), which provides financial incentives to landowners who enter long-term leases with beginning or disadvantaged farmers, is found in the section on “Assisting a New Farmer” in the final chapter.
The staff in the USDA’s Farm Service Agency (FSA) and Natural Resources Conservation Service (NRCS) can explain the available programs and help develop conservation plans that can be incorporated into a farm lease. Click on this link to find your USDA Service Center.
America’s Land Grant Colleges and Universities have Extension Offices focused on researching and providing information to the agricultural sector. There are over 2900 extension offices nationwide that provide practical information and education on a variety of agricultural topics, including farm management skills, farmland leases, improving productivity, and protecting natural resources. The Iowa State University Extension’s Ag Decision Maker tool provides a wide range of information related to agricultural leases. Find your Cooperative Extension Office here or visit the national eXtension web site for more information from Land-Grant University System experts.
Farm Management Services
Many landowners choose to use the services of a private farm management business. Farm managers provide a variety of services including negotiating and implementing lease agreements, establishing soil conservation and nutrient management plans, coordinating the use of government programs, and maintaining financial and other farm records. These services are provided for a fee, often a percentage of the rent. Landowners should speak extensively with potential farm managers to ensure any lease arrangements reflect their priorities.
Other professionals that can provide assistance include CPAs and insurance agents. These professionals can offer advice and services regarding specific aspects of your farm lease.
There are numerous non-profit organizations providing information and assistance in a variety of areas. These organizations provide services ranging from information on sustainable farm practices to networking for landowners and beginning farmers. Links to relevant non-profit organizations are found in the Links category of the website and are embedded in relevant sections throughout this guide.
The knowledge and experience of other landowners can provide a useful resource. Other landowners can share their expertise regarding the farm sector in general, sustainable practices, relationships with tenants, and more. They can also provide a useful network to find competent tenants who share your values and priorities. Practical Farmers of Iowa is an organization of farmers dedicated to researching and sharing information on profitable, ecologically sound, and community-enhancing approaches to agriculture.
Landowners often depend on their tenants for information on matters including typical rental rates, customary farm practices, and appropriate conservation measures. This dependence can be due to a landowner’s close relationship with a tenant, lack of knowledge or experience in agriculture, or perhaps even a sense of alienation from the farm operation.
In many landlord-tenant relationships reliance on a tenant for information regarding lease arrangements might produce a fair agreement for both parties and may even include consideration for the sustainability of the land. However, it is important for a landowner to recognize the different and often opposing motivations and objectives of the two parties.
Assistance for Women Landowners
Seeking assistance outside of the tenancy relationship or even the local agricultural community can be particularly important for women landowners. Women landowners have often expressed a sense of alienation from the agricultural community. This limits their access to vital information and networking with other landowners and farm operators. Such limitations can result in less than fair lease arrangements and a lack of input on how the farm is operated. This affects the sustainability of agricultural lands in particular as women landowners have indicated a higher regard for stewardship than many of their male counterparts. There are organizations specifically focused on providing information and networking to women landowners and representing their interests in the larger agricultural community. The Women, Food, and Agriculture Network is one such organization.