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Running with the Big Guns...(Start-up Farming)

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morton(pa) View Drop Down
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Joined: 11 Sep 2009
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    Posted: 07 Sep 2012 at 8:03pm
Welp, I was in the process of doing some "homework" and I found the bid sheet from the last time a property I'm looking at was up for lease. But first, some background information:

As some of you may know, I am a Crop Science student at Delaware Valley College. I've been looking pretty extensively at getting my own farm (renting/leasing) at the conclusion of college. I've been doing some networking and found 1 farm that is owned by the school district (where I attended from K-12), which is 37 acres, all of which are tillable. The property includes a House, Bank barn, and an older tie-stall dairy facility, and a garage. I've talked with FSA and plan to finance equipment, seed, start-up costs etc. through them, as much as possible, while also putting up some of my own cash. I figured I would farm part-time and work a full-time job, until I can pay off the debt and grow the operation to a point of paying enough to make it a full-time job. I have a very good friend who has done exactly this, only dairy farming (tough time to do it, but he's got a good handle on it), and I have learned a lot from what he has told me about his experiences. I would only be interested in doing crops for the time being. At no point to I plan on dairy. Now, come the questions for you guys.

The farm is currently rented by a gentleman who has (Last name) Enterprises. I don't think I need to explain it much further then that, but I will say he has 5+ businesses and farming is one of them. He is quite a ways away from the property and of course outside our school district for quite some time. This year, he planted beans and they look absolutely horrible. The property looks poor. It's currently in its first year of a 3 year lease. 

My problem is, the farm goes up for sealed bid. Being as I am a start-up operation, I'm trying to save money. My question is, 37 acres to him is small, but land is land. I have in mind what I want to bid, but I also have in mind what I'm willing to bid. Question is, do I sit down with the school district and try to pull some negotiations (Such as longer lease, shared use of the property for educational purposes (we do not have an Ag program but I would love to see something, such as an introduction to Ag class), or reimbursement for property improvement costs (I'll do the work, you pay for materials)? I would like to have more then a 3 year lease, considering my investment on equipment, etc. etc. so I know I am secure on my investments. Do I give the current land-leaser a call up and ask him if he would be willing to not bid come next time around? I'm not trying to step on anyones toes, but I'm also not trying to have my dream job crushed by some super farmer. I have a very small window in mind when it comes to time frame for starting up a farm, and that window to "open the doors" falls within 10 years from now. If I miss out on this, I can't say I will have another opportunity considering the way the price of land, equipment, etc. is going...not to mention I will be older and would have less time of life to do everything, including but not limited to paying off debt, and of course the hassle of just finding a complete property to begin with. 

So, with that, tips, suggestions, etc. on handling the big muscle of todays super farmers and the ups and downs that go with land leases, especially those from renting through sealed bid/from government. On the bid sheet, he is the only "super farmer" from what I can tell. Everyone else are/seem to be smaller, local independent operations.

One other question. From your experiences, when they "rent a farm", do they include all buildings? On the bid sheet, they have 3 columns..."Price for land" "Price for buildings" and then "total". I've never heard of renting land and buildings separately...of course being a start up I would need the buildings, which would be even more costly then what I originally figured, since they seem to have them separate. (I was always under the impression, from my experiences and things I've heard, that unless the leaser is uninterested, the buildings on a farm go with the farm when you rent price per acre)


Edited by morton(pa) - 07 Sep 2012 at 8:26pm
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427435 View Drop Down
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Joined: 18 Nov 2010
Location: SE Minnesota
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Post Options Post Options   Thanks (0) Thanks(0)   Quote 427435 Quote  Post ReplyReply Direct Link To This Post Posted: 07 Sep 2012 at 9:40pm
One thing you might want to do is find out what the current renter is paying.  As a school leased it, that should now be public information.
Mark

B10 Allis, 917 Allis, 7116 Simplicity, 7790 Simplicity Diesel,
GTH-L Simplicity

Ignorance is curable-----stupidity is not.
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dt1050 View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote dt1050 Quote  Post ReplyReply Direct Link To This Post Posted: 08 Sep 2012 at 5:28am
Originally posted by 427435 427435 wrote:

One thing you might want to do is find out what the current renter is paying.  As a school leased it, that should now be public information.
dido the "right to know act"
 
talking to the current leasor, could be good or bad. you could ask if he plans on re-leasing the farm and explain what your doing, he may back off, since the farm is in some bit of dissaray, on the other hand, if he knows your interested he may jack up his bid to ensure he get it. biend a "super farmer" he has the money to do it. if ya sit down with the school board and explain the interest in making a class out of it they may be able to work something out, that would have to go throught the soliciter to make sure they aint braking any laws. unfurtanely it's the small guy that has a tough time, the big guy can just shruge it off and find another piece of land some place. there are very few farmers out our way and the ones that are, have to have a full time job to pay for the farm. I hope it all works out. let us know what happens.
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B26240 View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote B26240 Quote  Post ReplyReply Direct Link To This Post Posted: 08 Sep 2012 at 7:35am
Sounds complicated -- since he has two more years on the lease maybe you should look some more maybe another piece will pop up.
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morton(pa) View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote morton(pa) Quote  Post ReplyReply Direct Link To This Post Posted: 08 Sep 2012 at 12:42pm
I am still in college, and the 2 year time frame falls perfectly in line with when I would be capable of taking it over. I do know what he is currently paying, which is between what I want to pay and what I'm willing to pay.
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