1. 1
Supporting a New
Generation of Farmers
FARMSTART

2. 50% of our farm assets will be
transferred
75% of our retiring farmers
don‟t have successors
Agriculture Agri-Food Canada, 2006
In the next 10 years…

3. Speculative land values
„Sun-set‟ agriculture
“Crisis” farm sales
Challenges of Farmland
Transfer

8. New Entrants

9. Innovation, Diversification, Resilience

10. Farm Community Revitalization

11. 900 registered users ~ 390 active farm-seekers ~ 150 active farm-listings

12. 40,000 eat Soup to “save the farmlands that feed
us!”

13. Community FinancedFarms
> Shared farm model
Farmland Futures Equity Fund
> Succession, lease-to-own
Farmlands for Farmers
Feasibility Assessment of 2 models

14. COMMUNITY FINANCED; SHARED FARM MODEL
Owner NGO owns and manages
On-going Management and maintenance carried by rents from farmers.
Land Base Divides into several distinct lease sections, minimum 20 acres workable. Some shared
infrastructure.
Likely for intensive vegetable production and small animal operations.
Housing • Farms on settlement boundaries don‟t offer housing?
• Build housing units in a “living centre” close to original homestead?
• Sever housing lots and tie to land rents?
Tenure Land leases and housing leases.
5 years to start, then 60 years ?
Equity Farmers can sell their farm business and access to lease, &leasehold improvements
Financing Community Bonds & Patient mortgage holder
Return on
Investment
Rents from farmers.
Fixed ROI for bond holders;Amortization of mortgage?
Income tax breaks for farmland easement?
Exit of Capital Optional buy back of Bonds? Amortization of loans?
Farmland Protection NGO holds land forever, for farming, (Easement?)
Risks Lack of investment; Economic crisis (reducing investor appetite)
Planning rejections;zoning/ planning problems
Difficulty in negotiating for land
Rapid changes in land prices
Rapid changes in interest rates
Tenantturnover, RFPs increase management costs, breaks in cash flow

15. FARMLAND FUTURES; LEASE TO OWN
Owner Fund buys farm. Original farm owner can stay lease free for 10 years.
Fund places a farmland easement on the property.
Land Base Full farm and infrastructure.
Any scale or type of production.
Housing Build secondary house for new entrant, if not there. (close to original farm house on property;
or on „retirement‟ lot – that can be tied to the farm property?)
Tenure Net Farm lease,
5-year terms with on-going right to renew and option to buy?
Or lease-to-own after 5 years?
Equity Farmers can sell business and right to renew lease?
Farmers have right to purchase, so can invest in business in start-up stage.
Financing Equity Fund Investors & a Patient mortgage holder.
Return on
Investment
Rents from farmers.
Investor dividends. Appreciation?
Interest and Amortization of mortgage loan?
Income tax breaks for farmland easement?
Exit of Capital Sale capital in a lease-to-own arrangement.
Farmland Protection Farmland easement held by Ontario Farmland Trust, must be used for farming.
Risks Lack of investment; Economic crisis (reducing investor appetite)
Planning rejections;zoning/ planning problems
Difficulty in negotiating for land
Rapid changes in land prices
Rapid changes in interest rates
Tenantbusiness fails, new tenant negotiations take time

16. 1616
OPTIONS FOR FARMERS
What will motivate the retiring farmers to be involved?
What value can we offer them?
How can we negotiate a reasonable sale price?
How do we offer a reasonable rent for new entrants?
IMPACT INVESTING
How can we find large patient capital partners?
What are reasonable returns on investment?
EXIT STRATEGY FOR INVESTMENT CAPITAL
How do we create the ability to get investment capital out?
Esp. if we don‟t sell the farm?
And if we sell the farm with an easement, for less than purchase price?
PLANNING AND TAX IMPLICATIONS
Does this require charitable income tax receipts for farmland easements?
Are the costs of planning exemptions too much?
Implementation of PPS is varied across municipalities. Can we influence
planning approach changes to make it easier over time?

17. 17
Prime farmland protection
Tax incentives (for farmers and
investors)
Community Investment Tools
Changes in planning policies
Shared savings programs for new
farmers (RFSP)
Enabling Environment

20. Our Farmlands for Farmers
Feasibility Assessment is
supported by:
Our Supporters

21. 21
FARM A 2009 2010 2011 2012
Gross income 23,000 162,000 247,000 328,000
Expenses 15,000 81,000 123,000 164,000
Net income 8,000 81,000 124,000 164,000
FARMB 2009 2010 2011 2012
Gross Income 102,000 147,000 182,000 269,000
Expenses 98,000 99,000 110,000 182,000
Net Income 4,000 48,000 72,000 87,000
Farm B owns 100 acres,,
approximately 20 in production. 2
lead farmers, who work part time off
farm.
Expenses include salary.
Farm A leases 7 acres, primarily
greenhouses production. 2 lead
farmers.
Expenses include salary.
FARM C 2009 2010 2011 2012
Gross Income 19,000 38,000 64,000 84,000
Expenses 14,000 48,000 50,000 44,000
Net Income 5,000 -10,000 14,000 40,000
FARM D 2008 2009 2010 2011 2012
Gross Income 34,000 50,000 67,000 76,000 80,000
Expenses 25,000 32,000 37,000 40,000 46,000
Net Income 9,000 18,000 30,000 36,000 34,000
Farm C rents 5 acres of land. 1
lead farmer who works part time off
farm.
Expenses do not include salary
Farm D leases 5 acres of land on
another farm, for no rent. Lead full
time farmer.
Expenses do not include salary.
New Farmers : The complexity of Start Up, Viability and Equity