Think “local food,” and your mind’s eye produces various images of farmers in vast fields harvesting strawberries as the sun rises. Or you visualize a weekend farmers market offering colorful arrays of fruits and vegetables. These images strike at the idea of a food movement that has grown more diversified and equitable.
But barriers persist, especially for those individuals not born into a farming family. Barriers that include availability, appropriateness, and–most common–affordability. Despite a recent softening in prices, many prime agricultural acres remain too costly for beginning farmers.
A non-farming background
Tim Biello grew up in the suburbs of Saint Louis, Missouri, and moved with his family to Saratoga Springs, New York, when he was 11 years old. As a kid, he enjoyed spending his free time outside, playing games and doing tactile projects. Upon graduating college, he moved around the country working as a naturalist, at one point giving tours at a botanical garden in Hawaii.
“I loved the naturalist work, but I really wanted to do something where I could steward land and be involved in plant lifecycles,” Biello says. “I wanted to produce something to earn my income that felt tangible and needed.”
Although Biello did not come from an agricultural background, farming seemed like a path that would incorporate everything he desired. He took a job as an apprentice on a farm in the Hudson Valley and immediately fell in love with the work. Realizing it was his calling, he spent the next several years learning the ropes in a variety of different farms and earning an advanced degree in rural sociology.
Over time, Biello’s desire to run his own farm business grew. He wanted to combine the skillset he had honed over the years with the kind of work he believed in and wanted to perform.
Land access challenges
When Biello began actively looking for a farm to purchase, he struggled to find land that met his needs without entering into unsustainable debt. He searched for nearly five years, to no avail, before moving back to Saratoga Springs feeling disheartened. There, he took a new job with the American Farmland Trust and shifted his focus toward creating a detailed business plan.
“I was able to settle in the Saratoga Springs area and do work that was in line with what I ultimately wanted to do,” says Biello. “I really knuckled down for about a year and half, running financial numbers and trying to learn that whole side of the farm business a little bit deeper.”
Farmland is expensive nationwide for reasons that vary by geography. In regions close to metropolitan areas, such as the Northeast and Mid-Atlantic, land is appraised for use as residential or commercial property. What results from this valuation approach are price tags too high for beginning farmers to afford.
Lacking the means to purchase farmland outright, some farmers find that leasing land is their only option. And with most traditional leasing agreements, future ownership is neither a possibility nor a guarantee. In the worst cases, farmers build a business on a leased property and then end up getting displaced. That’s a huge setback for a place-based business, especially for sustainable farmers who are investing in their farm’s soil and infrastructure.
A new partner with a “farmer first” approach
Eager to create a solution to this problem, Kevin Egolf and a group of initial investors from Slow Money NYC founded Local Farms Fund in 2014 with the goal of supporting young and early-stage farmers in the New York Tri-State Area. The fund works to provide promising, business-savvy farmers secure land access through a “farmer first” model with lease-to-own arrangements. This model—which entails first identifying a producer, and then finding a farm that meets his or her needs—is what sets Local Farms Fund apart in the agriculture financing sector.
“The innovation comes from having a landowner that wants to see that particular farmer succeed on that particular property,” says Egolf. “Each farmer’s needs and situation is different. Local Farms Fund is reactive to that because, ultimately, we want to create a successful and sustainable farm operation on each property.”
After meeting Biello and reviewing his business plan, Egolf and the Local Farms Fund partnered with him to identify and purchase a property in Saratoga County that met his needs. To help ensure Biello’s ability to gain ownership in the future, they explored approaches that would increase the affordability of the property. One way was to secure a $15,000 grant from RSF to help cover the cost of a conservation easement, a legal agreement that permanently limits a property’s uses and thus lowers its overall price.
Investing for long-term success
Biello has been on the Saratoga County farm for over a year now, focusing largely on developing soil fertility and creating a marketing plan. He will have his first real growing season in 2017 and hopes to bring 30-to-50 families to the farm each week to purchase eggs and produce. He also joined the Local Farms Fund board of directors and actively promotes farmland conservation in the community.
Local Farms Fund now has a second project on track for success as well: a pasture-raised animal farm in Columbia County, New York.
Looking ahead, Local Farms Fund is working hard to grow their pool of investors and support more sustainable agriculture projects in the New York Foodshed. The Fund is open to all investors in the Tri-State area and, unlike most traditional investment opportunities, delivers positive social and environmental impacts in addition to a financial return.
“The investment process is all about building relationships with farmers and providing a sense of security,” says Egolf. “We hope to show our community that alternative financing arrangements can help farmers thrive.”
This post was originally published on RSFsocialfinance.org
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