Kate Edwards has built her farm from scratch three times in the ten years she has been in business. In 2019, after years of searching, she finally found a permanent home for Wild Woods Farm in Newport Township, near Iowa City, Iowa, where she was born. Following organic practices, Kate grows primarily vegetables alongside five full- and part-time employees on the 16 acres of farmland she purchased, serving over 250 families through summer and fall CSA shares.
In addition to farming, Kate helps other young and beginning farmers connect with land through her role as a Farmland Access Navigator with Renewing the Countryside’s Farmland Access Hub, and is active advocate with the Iowa Farm Bureau, Practical Farmers of Iowa, and the Eastern Iowa chapter of the National Young Farmers Coalition.
Kate’s grandparents were farmers but her parents were dissuaded from entering the profession because of the 1980s farm crisis—a time of plummeting profits, rising debt, and sweeping farm foreclosures. The crisis came about due to a combination of factors, including international trade policy, interest rates, overcapitalization by banks, and incentives for overproduction from the U.S. government, and resulted in thousands of farmers going out of business.
Learn more about the 1980s farm crisis here.
A generation removed from her grandparent’s land and mentorship, Kate began searching for a place to farm in 2010. Her strategy at the time, and her advice now to other aspiring farmers searching for land: “figure out what you want and tell absolutely everyone you know.” Eventually, her parents met with a long-time family friend and mentioned that Kate wanted to farm but didn’t know where. “Have her call me,” he responded. Kate soon secured a verbal agreement to rent a one-acre plot of land from him and began growing.
The first farm move
Beginning with just an 11-member CSA, the farm grew to 150 members over the next five years. During her first four seasons, Kate operated under the verbal, or handshake, agreement she had made with the landowner—a fairly common, if tenuous, model for land access. There are often a lot of power dynamics and community relations at play between tenants and landlords. Asking for a written lease can feel awkward or rude, as though you are questioning your landlord’s character or sincerity. The result is that many farmers end up in vulnerable positions that, at best, lead to misunderstanding from a lack of clearly defined intentions and, at worst, a sudden loss of access to land.
After learning written leases were good practice, Kate and the landowner worked together in her fourth season to create a one-year written lease. She expected to stay at the farm for many more years, maybe even buying it one day. Part-way through her fifth summer, the owner approached Kate and indicated the land use would be changing and she would need to leave. While this was within the landowner’s rights, “It was shocking to learn land access is not stable unless you own it or have long-term security,” Kate says.
Looking for farm number two
Moving a farm is incredibly stressful for farmers at any time of year, but dealing with a move mid-summer is very challenging. While it may seem like the next growing season is a year away, preparation starts nearly immediately after—if not before—the prior season ends. Kate had plans to plant garlic, which must be planted in the fall for the next summer’s harvest, that had to be scrapped as she launched into searching for land again.
She knew if she couldn’t afford to buy land, which goes for over $10,000 per acre where she lives, she at least wanted a five-year lease. She relied on her mentor, Susan Jutz, a farmer who she met through Practical Farmers of Iowa’s (PFI) Beginning Farmers Program, and began asking around the community for available land. Kate told everyone she knew she was looking. She first planned out multiple scenarios, creating a financial analysis for what she could afford in different land access opportunities presented themselves (for example, if a farm had housing but no barn, or great soils but no well). She made lots of phone calls and together she and Susan looked at numerous farm properties, including land that a neighboring farmer with thousands of acres was willing to carve out a small parcel from for her. Ultimately these options fell through, however, Kate was still searching with Susan’s guidance.
Eventually, Kate called another woman who she had connected with through PFI who had just purchased a farm. “This is going to sound crazy,” Kate recalls saying, “but I no longer have land access, would you lend me some land?” The landowner agreed and after a few months of negotiations she and Kate had worked out a five-year ground lease.
Kate was not aware of the existence of ground leases as a concept when she and the landlord were negotiating. “I just needed a place to live, I needed to build equity, and it was going to be a lot cheaper to make a payment on just the buildings,” she said. The arrangement that Kate and her landlord worked out meant that Kate owned some of the buildings on the land. They included a buy-back provision in the lease that stipulated the landowner would purchase the buildings back from Kate at a predetermined cost when she left.
What is a ground lease?
A ground lease is a way of sharing property ownership and equity between two parties in which the property owner retains ownership of the land and provides the tenant with a long-term (up to 99-years) lease. At the same time, the tenant owns the buildings and can earn equity by selling the infrastructure to the next lessee or back to the property owner. This structure is commonly found in the realm of commercial real estate or affordable housing. Equity Trust, a national non-profit working to help communities gain ownership interests in and other local resources in ways that balance the needs of individuals with the needs of the community, earth, and future generations, has been working to bring the model to farmland access for many decades.
A ground lease can be beneficial to farmers not only because they are building equity in the property, but also because the cost of buying just the buildings while renting the land is typically much less than a mortgage for the whole property. This can make a critical difference during the start-up stage of the farm business when cash is needed for many other projects.
Read a case study about farmers using the ground lease model to make land access a possibility in this 2015 California FarmLink publication.
Although Iowa law says that farmers can have until March 1st to leave a farm if their lease is terminated, Kate figured out she was being told to leave her first farm property in December 2015 and didn’t feel it was worth fighting over. The move was hard, but her grandparents had been tenant farmers for 15 years before buying their own place and, as a result, her mom’s brothers had grown up knowing how to move a farm. In one day, her uncles packed all her tools, tractors, implements and equipment (no small feat to do in one day) and moved her ten miles down the road to the new land. Because there was no infrastructure on the land when she moved, everything from her previous farm had to be covered in tarps for the winter.
With the ground lease in place, Kate started building her farm for a second time—a process that took months of labor. “The amount of emotional, physical, and energy that went into getting a new farm and buildings built was intense,” she says. She got to work finding a contractor, figuring out financing, and building a structure that doubled as machine shed and apartment. Kate explained the decision to combine home and work: “I realized if I was going to grow my business and put more money into equipment, I needed to cut my living expenses somehow and that meant I needed to combine my apartment, machine shed, and pack shed.”
She also needed refrigeration for her crops and decided to apply for a Farm Storage Facility Loan. This program, which provides low-interest financing so producers can build or upgrade facilities to store products, is administered by the USDA Farm Service Agency (FSA) on behalf of the Commodity Credit Corporation. Kate was one of the first farmers in Iowa to use this type of loan for cold storage for vegetables. Opening the program eligibility to non-commodity crops, such as vegetables, was a change that Young Farmers’ successfully advocated for in 2014.
Beginning with five acres, she eventually ended up with nine as she and the landowner worked to make sure their mutual needs were met. Despite the new opportunity, and growing farm business, Kate was still interested in finding land that she could own and build equity in more permanently. “Basically, I’ve had to be a portable business from the start,” she says. “Everything I’ve ever owned can be moved, because I knew I wanted to own land one day.”
The final move
In 2019, after five years of casually searching and a year of actively looking at farms every weekend a strong lead emerged. In the grocery store, Kate ran into the owner of a 16-acre property that she had had her eye on for years. The land was directly across the road from the first property where she farmed. The farm had been used as a residential property and had not been actively farmed for over 25 years. It was potentially slated for development. She approached the owner about buying it and he quoted her a huge price. Half joking, Kate shot back, “how about $200,000 less?” They both laughed, but a few weeks later he called her and said he was ready to negotiate. Through extensive negotiation, including an old fashioned kitchen table conversation directly with the seller, they eventually agreed upon a price. Kate said “my relationship with my USDA FSA loan officer was key to the negotiations.”
Five years into farming, her mentor, Susan, had given her the advice to take out a small loan with FSA to start a relationship even if she didn’t feel she needed it. That advice paid off and made the process of accessing financing easier when it came time to buy land. Kate used the FSA Microloan Program as her foot in the door and also as critical funding to help her rebuild her farm business after each move. “I couldn’t have gotten access to the financing I needed without the microloan program,” she says.
Even with the agreed upon price for the farm, Kate knew taking on the financial burden of a mortgage was a risk. After talking with her loan officer, whom she trusted, and weighing her options carefully, she decided to make the commitment to purchase it. Wild Woods Farm had been profitable since the first year and Kate had saved enough for a down payment. She secured the remainder of the financing through a Direct Farm Ownership Loan from the USDA Farm Service Agency (FSA).
Advocacy work around the 2018 Farm Bill from the National Young Farmers Coalition and other partners resulted in the FSA Direct Farm Ownership loan limits being raised from $300,000 to $600,000, which ended up making the difference for Kate.
“If the loan limit hadn’t changed I wouldn’t have been able to buy a farm.”
Typically, FSA sets up mortgage payments with farmers as annual lump sums due in December because that is the time of year after the fall harvest when commodity crop farmers have the most income. As a diversified vegetable farmer, Kate’s financial situation was different, with most of her income coming in the spring when customers sign up for CSA shares. She negotiated with FSA for only half of her mortgage payment to be due in December and pays the other half monthly over the course of the year.
Kate and her husband, who works as an engineer, own the land together and rent it to the farm business, with Wild Woods Farm covering a substantial portion of the mortgage, utilities, and property taxes. “Collaboration is necessary when it comes to purchasing land, but it doesn’t need to be a partner with an off-farm job,” Kate stresses. She points to the option of partnering with a land trust to place a conservation easement on the land and examples of other women farmers who own land on their own nearby because they purchased land when it was cheaper. She could have bought a farm herself an hour away from her customers, but by working with her partner she was able to look at opportunities closer to market. “Farm businesses can be profitable,” she believes. “As a society we need to prioritize land access and affordability for farmers growing food.”
Land access challenges are complex, but a public policy solution that Kate believes would help is changing capital gains tax policy, which currently disincentivizes landowners from selling off land assets before they die.
The federal capital gains rate of 20 percent, based on a property’s appreciation in value since purchase, can be significant for land that has been held for a long time or has appreciated significantly in value. Land that transfers at death, however, is exempt from federal estate tax provided it is within current exclusion levels, thus penalizing farmers and ranchers who want, or need, to sell land to finance retirement or to help a next generation farmer get started while incentivizing them to hold land assets until death.
“This is why we have 80-year-old farmers,” Kate says. “They won’t sell to their 60-year-old children or non-family young farmers because the basis hasn’t been stepped up yet, and the tax burden from selling would eat up their profit.” When she first lost her lease, Kate had approached her grandmother about leasing or purchasing the land her grandmother owned. Kate ultimately decided the location was too far from her markets. However, purchasing it would not have panned out because the value of the property had increased so much since its last step up in basis ten years prior when her grandfather passed away. The capital gains taxes would have been crippling. If she had wanted to farm there she would have had to wait for her grandmother to pass as well. Kate believes that capital gains taxes on farmland are antithetical to the land access needs of young farmers and financial needs of retiring farmers. Kate says, “It’s really sad that older farmers have to die before they can see their dreams met by the next generation owning the farm.”
Excluding the proceeds from the sale of agricultural land from capital gains tax when selling to qualified young, beginning, and BIPOC farmers would spur landowners to seek out these farmers. This incentive would increase land access for a new generation of farmers, while supporting farmers who are transitioning out of farming or planning for retirement.
“It’s a huge factor for succession planning,” says Kate. “It would be immensely helpful to the farmer and landowner to be able to transfer over time. If you have to wait until the person dies it doesn’t help at all.” She believes this change needs to come in concert with other federal policy changes, too, such as funding for more roles similar to the Land Access Navigator job she holds and more support for high tunnels and irrigation systems through the NRCS Environmental Quality Incentives Program (EQIP).
While moving farms, Kate was also fighting for change at the local level. Iowa is one of the few states that exempts farms from all zoning regulation. Restrictions at the county level stipulating that a farm could not be under 40 acres, however, meant that Wild Woods Farm, at less than half of that size, did not qualify for immunity and would have to comply with expensive commercial building codes. “In order to access land, I had to take it all the way to the state house,” Kate says. She and a group of farmer friends built a coalition around the issue, wrote op-eds, and through extensive advocacy, eventually wrote a bill and advocated for it to be passed. The state bill was passed with incredible bi-partisian support. The county was required to change their rule. The Eastern Iowa Young Farmers Coalition chapter is continuing to push the county and the state towards more small-farm friendly policies.
Helping other farmers
Kate’s final farm move to the land she and her newly-wed husband purchased, took a few days of driving equipment, ironically right back to across the road from where she had moved it all away from four years earlier. Kate credits the power of relationship building with making it all possible—on the day that she moved 22 volunteers showed up to help.
Now on her own land, Kate has left a bit of a land access legacy behind her. “We don’t often talk about succession planning in leasing,” Kate points out. But the first two farms that Kate built have since had other vegetable farms on them, which she feels is a measure of success. “I’ve built so many greenhouses for other people,” Kate remarks. “On one hand, this is a happy story in which I’ve helped other young people get access to land by turning crop fields into vegetable fields and building useful infrastructure on multiple properties.” On the other hand, all the moves have set her back financially and taken their toll physically and emotionally.
Kate recognizes the privilege of her connections and her position as a white farmer, and the role that played in helping her access land. She also describes having “the tenacity to keep going,” despite the challenges she faced. “You have to want to farm, and even if you want to farm it’s really hard,” she says. “My experiences give me a lot of compassion for others’ land access journeys.”
This care and concern led Kate to take on a role with Renewing the Countryside as a Farmland Access Navigator, a role she began in 2017.
Kate’s advice after going through so many moves is to build relationships and cultivate tenacity. “There are a lot more people out there who want to help you than you think,” she says, adding, “Always be aware. There are possibilities in more places than you can imagine.”
Photo credit: Preston Keres, USDA.