Summer 1998
Negotiate the best manure agreements and easements
by Kelvin Leibold, extension farm management field specialist
Manure agreements and easements are growing in popularity as livestock operations grow and concerns about manure management rise.
Agreements
Manure agreements typically are one- to five-year leases. A written lease is not required, however it is preferable. In some cases the right to apply manure might be a part of the land lease.
Agreements, which are negotiated between two parties and do not "run with the land," usually are not recorded at the courthouse. However, if the agreement is five years or longer it should be recorded at the courthouse as a lease.
Easements
Easements are binding upon the succeeding owners and "run with the land." Easements must be recorded so they will be public record. Easements tend to run longer in length—from five years to perpetual.
Historically, easements have been viewed negatively by the real estate market. They are seen as restrictions and have a negative impact on appraisals. Some lenders tend to shy away from real estate loans on property with easements due to the rights that have been given up. Lenders for livestock facilities normally want easements that are at least as long as the length of the loan.
Requirements
The Department of Natural Resources currently requires all livestock operations requiring a construction permit to submit manure plans. On Jan. 1, 1999 that requirement will be expanded to include all but small confinement feeding operations (defined as less than 200,000 pounds of pork, or 400,000 pounds of bovine capacity). Many lenders would require written plans, even if the DNR did not. These plans need to show how much manure will be produced and where it will be applied.
Items to be addressed
Manure easements and agreements should address the following questions:
• Where does the manure come from?
• Is the easement or agreement guaranteed? What is its length?
• What are the provisions to terminate the agreement?
• When is the manure to be applied?
• How is the manure to be applied?
• How much manure will be applied? Who decides how much to apply?
• Who will apply the manure?
• Who pays for which expenses?
• Who will be responsible for legal issues such as permits?
• How will disputes be resolved?
The two greatest concerns are cost sharing and deciding when to apply manure.
Some applicators spread manure on frozen ground to combat soil compaction. That’s probably not a long-term solution in today’s environment. Many contracts specify that manure be spread "any time after crop removal and before crop planting." This may be a challenge if the spring or fall weather is too wet.
A future newsletter will further discuss the value of manure, which varies widely. Manure is almost becoming a bulk commodity. In some parts of the state there is plenty to go around, while manure is in great demand in other areas. The greatest interest seems to be in dry poultry manure.
More information
Many individuals and companies are willing to negotiate items in manure agreements and easements. For additional information see Extension Pm-1687, Manure Application Agreements. Manure agreements and easements are legally binding contracts; seek counsel from your legal advisor before signing any legal document.
