Ohio legislators try to throw new farmers a lifeline
When Dave COLUMBUS —
Green started growing corn, soybeans and wheat on his farm outside of New Washington, it was a familiar feeling.
“I’ve been involved in agriculture for my entire life in one way or another,” he said.
Green’s father was a fulltime farmer until the 1980s, and both his mother and his father’s family worked in agriculture. Eager to walk in his family’s footsteps, Green, 34, bought around 80 acres in Crawford County in 2019. The price tag was immense.
“The outright purchase was over half a million dollars,” he said. “Plus, I invested back into the farm.”
In all, Green spent more than $600,000 just to get started.
As the number of Ohio farms declines toward alltime lows and farmland becomes more expensive, officials in the agriculture industry worry such astronomical price tags will discourage young people from following their ancestors into the fields.
Weeks ago the Ohio General Assembly extended a hand to aspiring farmers with House Bill 95, which offers $10 million in tax breaks over five years to beginning farmers and retiring farmers who sell property to younger peers. The law takes effect July 18.
All manner of hurdles face the next generation of farmers, but the steep cost is often described as the biggest barrier. The tax credits are intended to soften the financial blow.
Advocates call the bill a good start but say more action is needed to address additional challenges.
Support for the bill was widespread. Sponsors include Republicans and Democrats and proponents say they faced little resistance.
The sponsors said it was written to avoid any confusion over who will benefit.
“We define ‘beginning farmer’ pretty specifically,” said Rep. Susan Manchester, R-Waynesfield, one of House Bill 95’s primary sponsors. “You can’t have been receiving a farm income for more than 10 years, and you can’t have net worth of over $800,000.”
The bill also requires continuing education, she said.
Keeping it rural
Ohio had 76,900 farms last year, according to the USDA’s National Agricultural Statistics Service. That figure fluctuates, but has fallen steadily in recent decades. The state
had 83,000 farms in 1990.
Without intervention, farmers and agricultural officials worry the number will continue to drop.
“There’s fewer farms and the farms are tending to get bigger on average,” said Robert Moore, owner emeritus of Wright & Moore Law firm in Delaware which focuses on agricultural issues.
Bigger farms can use economies of scale to save money, Moore said, which means farmers might need even more land to turn a profit as inflation pushes up commodity costs.
“The bigger it gets, the harder it is to transition,” said Dianne Shoemaker, an associate professor in Ohio State’ University’s College of Agriculture and Natural Resources and a field specialist for OSU’s extension service.
Proponents say it’s important to keep farmland in the hands of farmers.
Preserving farmland encourages developers to build houses and apartments closer together, limiting urban sprawl, said Bill Lafayette, who owns the Columbus-based Regionomics consulting firm and conducted a study on agriculture in 2020.
House Bill 95 sponsor Mary Lightbody, D-Westerville, said
she sees real estate developers snatching up crop lands in her district.
“I was concerned about how much land is being lost from farming to other uses,” said Lightbody, who operates a family farm near Westerville.
Real estate companies often have the resources to outbid aspiring farmers. The new law is intended to level
the playing field, she said.
‘It’s tough for the farm to provide the cost of living’
Rising land values, however, are just one hurdle aspiring farmers need to jump. Agriculture has evolved since the days of small family farms and technology is now ingrained in the industry.
“Farming as a profession is far, far more technology dependent than most people think,” Lafayette said. “All you have to do is go to the Farm Science Review in September in Madison County to see the laser-guided planters and the drones that can target fertilizer needs.”
This means modern farmers must be better educated and more technologically savvy than their older peers.
In addition, “there are a lot of physical skills and management skills,” Shoemaker said.
And the lifestyle is a demanding one. Someone with a college degree may not find it appealing, she said.
Stacie Anderson, who runs a farm near Bowling Green with her husband, her father, and her uncle, said raising money to buy property isn’t enough. Land must be available for purchase, and finding it requires extensive networking.
“They not only need to make that investment, they also have to have connections with someone to be able to make that opportunity available,” she said of beginning farmers.
And while farmland is pricey, farm machinery is also expensive. Vast fields are often needed to offset the upfront cost of buying farm equipment, Green said.
“It’s really tough to justify on small acres,” she said.
Between expenses like health insurance and crop insurance, most farmers need to take a second job to cover the bills, Green said.
“It’s tough for the farm to provide the cost of living,” he said.
More work to do
Preparing the next generation of farmers goes beyond exchanging land.
Ed Piar, 62, grows corn and soybeans on a 2,000acre farm that spans Knox and Licking Counties. His children chose other careers and he must find someone else to take over his property, he said.
“There are a lot of barriers that don’t apply if it’s a son or daughter taking the farm over,” Piar said.
Farming knowledge is one of those barriers, and it is not easily addressed by the tax credits offered in House Bill 95.
“If it’s a son or daughter, it’s gradual, and you’ve somewhat groomed them,” he said.
Shoemaker called House Bill 95 a good start but noted that farmers have ongoing expenses and need continuous access to capital, which often means low-interest loans.
Securing those loans could be more of a challenge as the federal reserve gradually raises interest rates.
“Typically what happens in the lending community, people who are less qualified pay the highest interest rates, and that gives a new entrant a double whammy,” Shoemaker said.
She noted that government agencies like the USDA have a fixed pool of dollars available to struggling farmers, “but it’s not something that someone can just go out and get,” she said.