New Ulm lawyer helps farm families navigate tricky succession matters

Kate Graham is a lawyer in New Ulm focused on farm transition and elder law. The issues increasingly intersect as farmers — average age 59 in Minnesota — try to figure out what to do with their land when they retire. Excerpts from a recent interview:

Q: You just attended a Farmland Summit in Red Wing. Can you describe the problems that summit was meant to address as you see them?

A: Nationwide we're seeing the average age of farmers increase every year. These folks are either going to be retiring or they're going to pass away while they're still farming. Whether it's retirement or an unexpected death, it creates a lot of challenges for the succession of that farm. Are we going to keep farmers on the land? This problem is compounded by our current economic situation for farmers, which is not good. It can become a real crisis situation if the primary operator doesn't have a succession plan in place and the people who might otherwise be the heirs to take over that farm are not prepared to do that. And that's when we can see situations where basically the land is sold to satisfy cost expenses, estate taxes, creditors — and we've lost another farm, essentially.

Q: What would happen then — the land just gets swallowed up by large neighboring farms?

A: That's certainly something we're seeing, the consolidation of farms into fewer and larger. One of the issues with that from a rural community standpoint is, as those farms get bigger and the number of farmers gets smaller, we continue to see our farm communities get smaller. And then there's less investment in towns and schools. All the things that make up a thriving, vibrant community can begin to fall apart.

Q: When you say "keep farmers on the land," what do you mean?

A: A couple things. One is particularly for communities closer to development, where farms stop being farms and start being housing developments or shopping malls. We have a finite amount of farmland. We can't make more. And once you've built on it there's really no going back. The other piece of it is maintaining the vibrancy of those rural communities, keeping people in those communities. And that means keeping that small farm economy vibrant and working.

Q: Do you really think that's still possible?

A: I do think it's possible. I think it takes work on the part of communities to address the problem. There's a lot of interest among young people in farming today, which is exciting to see. But there are so many challenges for these young people to overcome in order to get into farming because these are people who for the most part did not come from a farming background and they may not be interested in the kinds of farming that we traditionally see right now. Building bridges for these young people between their farm dream and the farming communities where they want to establish a successful farm business is really essential and it takes a lot of work and support.

Q: You have challenged the assumption that land should stay in the same family generation after generation. Can you talk about that?

A: People who have inherited farmland, they feel an obligation, maybe to their parents or grandparents or ancestors, to keep the land in the family name. In their bloodline. Even if they've never been on the farm. Their only connection to it is this distant relative who once farmed. I think it's to the benefit of our natural resources, I think it's to the benefit of our rural communities, that the people investing in the land are the people who also live and work on the land. I would really like to see people think of that inheritance in a broader way. Instead of just thinking of it as, 'I'm passing down my family lineage,' maybe 'I'm passing down a farm legacy, business, a way of life' and that your farm successor doesn't have to be related to you by blood, but they could share your values. That, I think, is a beautiful thing. I do see this happening more.

Q: What are the negatives of having so much land owned by people who are disconnected from it?

A: Absentee landowners often don't have any farm background or farm experience, and they may view the land as just another asset like a unit of stock. But land needs to be invested in, and reinvested in. The way you make that investment is through conservation practices. You need to understand what conservation tillage is, low till or no till. You need to understand where the riparian buffers on your land need to be, or the wildlife habitat that needs to be protected. All of these elements of soil and water conservation are a necessary part of maintaining your investment in farmland, and I don't see that very many absentee landowners have a good understanding of what that is. Most of the time they get a check, once or twice a year. They may or may not have a written lease agreement with the farmer leasing the land from them, and they probably don't have any idea whether that farmer is investing in conservation practices or not. From the farmer's perspective, if they have only a one-year lease agreement, which is most often the case, they don't have a lot of incentive to invest in maintaining the integrity of the soil. The other element is that it makes it difficult to have communities when you have landowners that are clearly invested in the community because they own land in that community but they don't live there. They don't participate in all of the governance structures and the school programming and all the other things that make a community vibrant and viable and a healthy place for people to be.

Q: When should farmers make a transition plan?

A: I would say yesterday. As soon as possible.

Q: Anything I'm missing here?

A: The relationship that farmers have with their land is extraordinary. It's a beautiful way to understand our connection to the earth in a very tangible way. I hope that people can get interested in these issues even if they're city people, because I think hanging onto that understanding of our connectedness to land is something that as modern urban people we don't get to experience most of the time. Farms have a lot in common with other small businesses, but the thing that really makes it different is that connection to land. It's hard to sum it up in words. It's an emotional, physical, spiritual connection that people have and it can't be reduced to the same kind of fungible, transactional nature of other types of properties. And that's a good thing, because we depend on it for our existence and I think we forget that.