Introduction

This is a quick overview of the objectives for the course, the different modules, and references that may be helpful as you learn about Farm Leasing Arrangements.

Cash Farm Leases

Cash farm leases are the most popular type of farm lease. Module 2 focuses on these leases and all aspects related to them. A short history of cash leases in Iowa is given to show their popularity. For leases to be fair, it is important for both parties involved to know the advantages and disadvantages for them. These points are covered along with formulas and different approaches for reaching a leasing contract that both sides can easily agree on. Work problems are included for you to estimate fair cash rental rates for different types of farms.

Crop Share Leases

This module takes a look at crop share leases. Advantages and disadvantages for all parties are included along with common provisions most crop share leases have. This information is used in an example to show possibilities of how costs and income can be shared. The spreadsheets used are available to download for your personal use.

A common crop share lease may not be right for everyone; one section is devoted to modifying a lease to fit the needs of your personal operation. Tips on how to choose a tenant or landlord and basic principles for a crop share lease to be successful are included. Several exercises are available for you to analyze a crop share lease and use information from your own farm to come up with a fair lease for you.

Flexible Cash Leases

The third type of lease discussed is the flexible cash lease, which is a variation of the more straightforward cash rent lease. Making a payment at the beginning of the growing season may seem like a daunting task for you and your budget. To ease the financial strain a large rent check can make, you may want to choose a flexible cash lease where the payment is not determined until the crop is harvested. Rates can be based on yields, prices, or both. Links to lease analyzer spreadsheets and flexible lease agreements are available to download for use in your operation.

Custom Farming

This module looks at custom farming as an alternative to leasing. It discusses the responsibilities involved in performing the field operations for someone else's farm. A sample contract is provided to get you started. Advice on determining payments is given along with links to Extension publications from Iowa State University and other universities in the Midwest. The publications give rate estimates for individual field operations. An average and range is given for most operations listed.

Renting Hay and Pasture Land

There are areas in the Midwest that are not suitable for row crops. A possibility for making a profit off this land is to rent it out for hay and pasture. These acres are treated differently than land rented out for corn and soybeans and this module goes over those differences. Commonly used hay and pastureland leases are explained and examples of average rental rates in different areas are given. Pasture land can be handled in a few different ways; these options are all discussed along with common provisions for a pasture land lease. References with links to lease forms and more examples of lease arrangements are included along with a worksheet to figure a fair cash rent agreement for pasture and hay land.

Renting Farm Buildings

With changes in farming today and shifts in types of operations, buildings and livestock facilities now often outlast the owner's needs. Tenants can get the use and benefits of buildings and facilities without the large investment of building new. The owners also benefit by getting income from the facilities that are sitting unused on their property.

From this module, you will learn how to decide the value of the facilities to you as a renter and figure the costs for the owner that rent must cover. To find the owner's cost you must analyze such variables as the current value, depreciation, and interest. Information on calculating all these costs plus more are included to find the total costs of ownership. Help on making a contract that addresses who covers repairs, water facilities, and insurance are available to make renting farm buildings easy on all parties involved.

Legal and Tax Considerations

A lease agreement is a legal contract and includes obligations for both parties.

You will learn why you should have a written lease, what legal rules apply to oral leases, and the different options for terminating a lease. Also covered is what constitutes material participation, tax implications, and what a landlord can do to secure payment.

A very common legal issue that often arises is who has the responsibility for fences. A summary of fencing laws from the Iowa Code is included so you can know what legal rights you have when it comes to fences. References for further study include links to the National Ag Law Center and sample farm lease forms.

Environmental and Conservation Concerns

Do you know what effect your farming operation has on the environment? To help entice producers to adopt new practices, farm programs provide incentives for a variety of conservation practices. A breakdown of different environmental programs and what they could mean for you is available in this module.

Alternative options such as sustainable agriculture practices and organic operations are covered and examples are included to show how farmers and landlords have customized lease agreements for these different types of production. This module concludes with weed control and other environmental concerns that should be taken into account. References to environmental agriculture websites are listed along with links to organic crop research results.

Owner and Tenant Relations

Owner and tenant relationships can make a huge difference on your stress level and productivity. Learn tips on how to relate to your landlord whether they are nearby and involved with the farming operations or live away from the farm and unknowledgeable about agricultural production. Find out different methods of keeping your landlord involved and how to converse with them. Test yourself by answering questions based on situations that may arise with a landlord.

USDA Agencies and Programs

This module is a basic overview of the many USDA agencies and programs available to agricultural producers. Links are included to agency websites along with explanations of payment programs. The purpose of this module is for you to see options you may not have known about and to give more information on how government programs can benefit your operation financially.

Rogers Family Case Study: Renting the Farm Right

Use the information from throughout this course and apply it to a realistic farm situation. Decide on goals for the farm, a lease plan, and how to select the tenant. Video clips are included that explain possible plans for the farm. This case study will help you use the information from the course so that you are more prepared to apply it to your operation after completion.

Course Registration and More Information

The on-line registration form for Farm Leasing Arrangements is available here.

The course fee is $100.00.