Organic Broadcaster

Young farmers work with FSA to find land tenure

By Lauren Langworthy, MOSES

Lauren and Caleb Langworthy and their dog watch their new Highland cattle interact with their flock of sheep. The Langworthys were able to purchase their 153-acre farm in part thanks to an FSA loan.
Photo by Lauren Langworthy

My 153-acre farm would not be what it is today without the support of the Farm Service Agency (FSA).

About four years ago, my husband and I were coming to the end of an annual lease and feeling frustrated about year-to-year rental situations. We wanted to be organic farmers, but the lack of tenure on the land made it difficult to justify the immense expense and time that we were putting into land we may not have access to in a couple of years. At the time, we were custom-grazing livestock and managing our own vegetable operation. We were developing market relationships, but really needed stability on the land to grow our business.

The uncertainty of short-term land leases were holding us back from pursuing the organic label and from some of the best management practices we wanted to be integrating into our farm. As most organic farmers know, there is a three-year transition process between conventional cropping systems and the potential to certify land as organic. We thought the USDA organic label would help our vegetable enterprise grow and prosper in new marketplaces. However, land tenure would mean more than just the organic label; it would also allow us to start cover cropping more intensively, developing longer rotations, and adding necessary infrastructure that requires more time, capital, and a long-term view to carry out properly.

The two of us had participated in the Land Stewardship Project’s Farm Beginnings course and had used the opportunity to develop holistic goals for our farm’s future. We had taken the course’s planning process very seriously and had developed a business plan to use as a road map that was reviewed by more experienced farmers who gave us a few welcomed doses of reality that we used to revise our plans. With all of that work under our belts and the plan in hand, we had a pretty good idea of what we were looking for and a lot of support from our community as we sought the solution. We posted on land links and in classified ads, fielded calls from many landowners to see if we shared the same goals, and looked at dozens of farms on the market, and even met some wonderful private investors.

I won’t go into our story of finding land tenure at length. Our solution won’t necessarily fit anyone else’s situation. Besides, we’re still beginning farmers—we don’t know if our story has “a happy ending.” However, I do want to share a key piece to our puzzle that might also help someone else find a solution.

The biggest problem we faced is a problem we share with many beginning farmers. With current land prices and all of the infrastructure, mechanization, and general expenses of starting a new farm, it would be difficult to come up with enough capital to make it all happen. We were entering farming with experience, but we still needed to build many of the assets that our fully grown business would require in order to function smoothly.

Through the Farm Beginnings Course, we’d heard of the Farm Service Agency (FSA) and been given a very brief introduction of some of their programs. However, we’d also heard some rumors and had developed the impression that it would be very difficult to get a loan through this agency. Because of the rumors, we didn’t initially reach out to FSA to see how we could leverage its programs. It wasn’t until much later in our land access story that we struck up a conversation with a very outgoing and informative FSA agent in the exhibit hall at a conference, and learned that there might be some real opportunities in working with FSA to develop the future of our farm.

After that conference, we struck up a relationship with our local FSA office. We set up an initial meeting to ask questions, explain our goals, and explore the potential of working with FSA to purchase a farm. We learned that the interest rates on FSA loans were extremely low and that we would probably qualify to receive one. I was surprised to learn that FSA could help only provide loans for initial farm purchases, but that they can’t refinance one you already own.

We also learned that there are many different types of FSA loans. Several different varieties of Farm Ownership Loans can be used in different ways to purchase farms. There are also Intermediate Loans that can help farmers purchase equipment, certain infrastructure, or breeding stock for their enterprises. Operating Loans can be used for an annual cash flow issue in an operation—for example, if you needed to purchase your year’s hay supply before you would be planning to receive a big payment from livestock sales. There are Microloans that have a shorter application form and can help a producer with smaller projects or investments. There are even special Farm Storage Facility Loans that can be used to help purchase infrastructure such as hay storage or refrigerated storage units.

Depending on the farmer’s enterprises, goals, and willingness to take on debt, there may be several different options for someone to purchase a farm or capitalize the operation they’re already working on.

In our story, the business plan that we had created through Farm Beginnings became a template that we used to “play out” a few different scenarios. What would be the financial cost over time of an implement versus additional annual labor? If our farm changes scale, what does that mean for the farm’s financial situation? We considered the goals we had for our business and our life and looked at different ways we could achieve what we hoped for.

When we finally felt that we understood where we wanted to go, we made the plunge into the world of FSA with our business plan as our guide, trying to be cautious about taking on only debt that we had a plan to repay. The application process did take time and patience, but the staff helped us complete the paperwork and explained the process along the way. With the help of FSA, we were eventually able to purchase farmland and capitalize our operations to fit the scale and needs of the new property.

When we look out over our farm now, we felt that the opportunity was well worth the effort. While we still don’t know our story’s ending, our land tenure now enables us to invest the time, energy, and money into building our soils, adding necessary infrastructure, growing our operations, and moving toward our goal of using best management practices on the land.

FSA’s loan programs are not going to be the solution to everyone’s land access or farm growth puzzle. However, for those who are still looking for a little support to capitalize their farm for the future, I recommend taking the time to investigate what opportunities FSA might be able to offer you. To find your local FSA office, see offices.sc.egov.usda.gov.

Lauren Langworthy is a certified organic farmer and the MOSES Events & Education Specialist.

From the January | February 2017 Issue

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