# Land lease questions



## JD3430 (Jan 1, 2012)

Not sure where to post this, but here goes.
A fellow farmer I know hays a fairly large property (90+ acres). It was a large horse farm with about 60 acres of hay.
He has reduced his operation greatly, to the point where last year, he only small square baled 25 acres of it. The rest was rotary mowed by the property caretaker. The owner was ok with it because she was 90+ years old and slowing down greatly. 
The owner of the property died spring of 2017 and wished to have her property to be deeded to one of the local conservancies.
So my friend asked me if I'd like to join him in baling the property this season since 40 acres was simply rotary mowed. 
In the meantime, the conservancy has taken over the decisions made as to farming the property. 
They asked us to bid the acreage. We bid $30/acre and got awarded the acreage. Enclosed with the lease is a map. The map shows ~64 acres of hay. The remaining 25+ acres is riding paddocks, lawns, buildings, driveways and some woods. In an email sent to me and my friend, who has been haying the property without paying rent for 10 years before the owner died, they are asking for $1,200 from each of us, total of $2,400. $2,400 divided by $30/acre is 80 acres, so we're paying for 16 extra acres of farm that cannot be easily farmed. It's paddocks and riding areas. I will be haying about 45 acres, he will be haying about 19.
Furthermore, they want us to mow the remaining paddocks that can't be hayed. So now we're renting paddocks AND rotary mowing them! 
Then there's removing the hay. They want all the hay off the field in 14 days. My mushroom hay buyers won't touch a bale that hasn't sat in the field for 90 days. Now I know that's "my problem", so I will try to work that out with the lessor and see if they are open to bales lined up along fields edge until winter. 
Has anyone ever encountered a situation with a lease where the lessor wants you to rent a decent amount of paddock acreage that won't produce much, if any hay? 
Shouldn't we only have to pay rent on the hay fields?


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## carcajou (Jan 28, 2011)

At $30/ acre just smile and write the chq. But try for a long term rental agreement.


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## JD3430 (Jan 1, 2012)

Man I don’t know???,,. $30/acre for hay that sells for $105/ton isn’t that great. Exspecially when you have to fertilize and it’s only a 1 yr lease. Can’t figger out why it’s only 1 year???


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## Northeast PA hay and beef (Jan 29, 2017)

I would go back to them, saying you'll pay the 30 per acre for the 64 usable acres. On one year lease i would tell them you aren't mowing paddocks. If they want to sign a 5 year lease, then i would agree to mow paddocks. But would also limit the mowing to maybe twice a year in writing.


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## PaMike (Dec 7, 2013)

I would think long and hard about this and get EVERYTHING is writing. Get it all laid out how you want it the first year, and if you cant get it how you want it just walk away. Mowing paddocks is time consuming. Opening and closing gates, going slow by the fences..., how close do you have to mow to the fence, do you have to weed wack to make it look nice??...the list goes on and on.


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## Tim/South (Dec 12, 2011)

They need some educating. I know things are different in other areas.

Tell them you charge to do mowing that is not productive as hay.

You are paying to rent land that you have a chance to make money on.

You won the bid at $30. People are not beating their door down trying to rent the property.


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## mlappin (Jun 25, 2009)

Can't touch any ground here for less than $100/acre.

Like has been pointed out, for $30/acre write the check and don't worry about it.


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## JD3430 (Jan 1, 2012)

mlappin said:


> Can't touch any ground here for less than $100/acre.
> Like has been pointed out, for $30/acre write the check and don't worry about it.


The REALLY strange thing is that I hay 2 other parcels for them and they don't charge ANY land rent and they PAY me to mow Unhayable areas. 
Now on this farm, they want rent and unhayable areas mowed 2X/yr for free.


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## JD3430 (Jan 1, 2012)

Tim/South said:


> They need some educating. I know things are different in other areas.
> 
> Tell them you charge to do mowing that is not productive as hay.
> You are paying to rent land that you have a chance to make money on.
> ...


They asked for one other bid from another farmer and out of respect for my buddy, the other bidder/farmer said "I'm not interested in bidding". So we were in effect, the only bidders. 
I scheduled a meeting with the conservancy to "discuss" the storage of the bales and paying rent on un-hayable land. 
I'm not paying rent on 1 acre played-out paddocks. Plus they just awarded us the property yesterday. Too late for liquid fertilizer. It's getting very warm for it and the rundown would really burn the grass. I guess dry is a possibility, but may take too long to get into the roots.
One other thing worth mentioning is they are having the old caretaker to remove split rail fence, but he's removing it VERY slowly as you would expect. IF they got rid of all the paddock fencing, I could possibly see paying rent on them IF the lease was longer term. 
I mean, who can do a 1 year lease? You can't really do any soil amendments much other than short term liquid nitrogen.


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## Tim/South (Dec 12, 2011)

Like I said, things are different in different areas.

Here if you lime it is 3 years free lease. If you lime and fertilize it is 5 years free. Not much Ag going on here and hay prices are break even. My friends and I turn down a lot of free ground every year.

I am not in the lawn care business.


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## r82230 (Mar 1, 2016)

It appears to me that some details where not understood from both parties (you were thinking renting 64 acres, they were renting 105 acres).

I look at it as two separate transactions:


 hay rental ground - 64 acres or rent/lease - soil amendments included
 padlock mowing - x amount of acres.

Going rental rate for hay ground (let's use $50 per acre), equals $3,200 for the 64 acres, (at least a 2 year lease perhaps).

Going custom mowing of x amount of paddock acres, at IDK say $30 an acre (per mow), with x equal to 40 acres. Comes to a mowing cost of $30 x 40 x 2 = $2,400

If same person rents hay ground and does mowing, net is $800 ($3,200 - $2,400).

If different folks, rent / mow you get the same end results. As more paddocks become available as hay ground, rental income increases and mow expense reduces, naturally.

I'm not arguing the rental cost, because ever area is different and maybe hay ground isn't the best use for this ground (back to $105 ton hay pricing, let alone fertilizer pricing).

Ditto to PaMike's suggestion, get in writing,

My one cent today (shorted you a penny). :huh:

Larry


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## JD3430 (Jan 1, 2012)

New details coming in each day. Just got a call from head honcho at conservancy and we got some more details ironed out.
First, I called to attention paying rent for land that cannot be hayed. I told him I cant hay a driveway, a barn, a lawn, etc. He agreed and reduced the rent to land that can only be hayed and a small parcel where hay can be stored. 
Second: I called attention to the part of the lease where it says I have to remove all hay from the property in 14 days after the hay is baled. 14 days to remove 400 bales? 
I told him I need 90 days after the end of each cutting. Mushroom hay buyers wont touch any hay less than 60 days old. He seemed to agree with my 90 day waiting period, but proposed a 50 cent/bale/week penalty for each bale not removed within 90 days. I said that sounds OK. Wasnt thrilled with it, but I figured I had to conceed something.
He said he'd let me know by the end of the day.

On edit: at the end of today he extended my bale storage period to 100 days after each cutting. I agreed to remove about 1500 feet of split rail fence entangled with vines. That divides the 2 biggest hay fields which are about 17 acres each. It will make my haying job easier by making it one big field. They don't think the old guy living on the farm is going to be able to do it.


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## endrow (Dec 15, 2011)

Over the years I've had a lot of different scenarios where I've done things for the landlord. Plow the snow , cut the pasture, loaded and hauled his manure. Trim the trees,, loan pick up , loan loader ,loan tools... Most of the time it works out well. You just can't let things get out of hand I've had that already too.


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## JD3430 (Jan 1, 2012)

endrow said:


> Over the years I've had a lot of different scenarios where I've done things for the landlord. Plow the snow , cut the pasture, loaded and hauled his manure. Trim the trees,, loan pick up , loan loader ,loan tools... Most of the time it works out well. You just can't let things get out of hand I've had that already too.


Yeah, They want "goodies" in return for giving you the land to farm.
They have a work crew of 2-3 retired guys who don't work overly hard and I think pulling the fence posts is a bridge too far for them. They mostly cut lawns and plow driveways on conservancy property.
I have a couple farms that I plow the snow and cut the lawn for, too.

The way I look at the fence line removal is although I will lose a couple days of life removing it, it will make my job easier in the future IF they keep me on board. Based on their satisfaction with other properties I hay for them, I think they'll keep me around.

Not crazy about the new precedent that's been set with paying rent....$1,500 is still a crap ton of money to me, but it was bound to happen someday. These conservancies may be "non-profit", but you'd never know it by the people they hire to twist their farmers' arms for money.


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## r82230 (Mar 1, 2016)

JD3430 said:


> Not crazy about the new precedent that's been set with paying rent....$1,500 is still a crap ton of money to me, but it was bound to happen someday. These conservancies may be "non-profit", but you'd never know it by the people they hire to twist their farmers' arms for money.


Non-profit usually means they don't have to pay taxes (fed income taxes, state income taxes, sales taxes and/or property taxes), they still want ALL the 'profits' possible, for stuff, including "administration" costs (officer/director's pay usually falls in here ).

Larry


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## Wethay (Jul 17, 2015)

One of my neighbors wanted me to do some hay on a couple of small parcels. I offered to do some field chopping, etc in exchange for rent. No he wanted a check. No problem, he got a check, then his bill for the other stuff he asked me to do. Now I do the hay without paying rent.


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## mlappin (Jun 25, 2009)

Paying $205/acre for some ground, non irrigated.

Heard of some that just went for $260/acre non irrigated.

Pay the $30/acre and hope big ag never makes it to your area.


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## JD3430 (Jan 1, 2012)

mlappin said:


> Paying $205/acre for some ground, non irrigated.
> Heard of some that just went for $260/acre non irrigated.
> Pay the $30/acre and hope big ag never makes it to your area.


Well, it's not in my immediate area, but you'd be surprised. Go 20-30 miles west and there's plenty of fairly big Ag going on. Not like Texas, Iowa or Kansas, but PA has plenty of farming going on.

At $50/acre, I'd break even with minimal fertilizing
At $100/acre, I'd be losing money.

At $200/acre, I wouldn't be a hay farmer, I'd be a philanthropist.


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## mlappin (Jun 25, 2009)

JD3430 said:


> Well, it's not in my immediate area, but you'd be surprised. Go 20-30 miles west and there's plenty of fairly big Ag going on. Not like Texas, Iowa or Kansas, but PA has plenty of farming going on.
> 
> At $50/acre, I'd break even with minimal fertilizing
> At $100/acre, I'd be losing money.
> ...


 Thats the difference in hay markets between various parts of the country. Here if I couldn't afford fertilizer on my $150/acre ground then I ain't doing something right. My cheap hay starts at $50/bale which works out to $125/ton, they come and get it, delivery is more. I like to see 5 bales/acre on first cutting or $250/acre revenue on just first cut.


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## luke strawwalker (Jul 31, 2014)

JD3430 said:


> The REALLY strange thing is that I hay 2 other parcels for them and they don't charge ANY land rent and they PAY me to mow Unhayable areas.
> Now on this farm, they want rent and unhayable areas mowed 2X/yr for free.


Yeah, on a farm that was GIVEN to them...

Later! OL J R


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## JD3430 (Jan 1, 2012)

mlappin said:


> Thats the difference in hay markets between various parts of the country. Here if I couldn't afford fertilizer on my $150/acre ground then I ain't doing something right. My cheap hay starts at $50/bale which works out to $125/ton, they come and get it, delivery is more. I like to see 5 bales/acre on first cutting or $250/acre revenue on just first cut.


Yeah I'm just making mushroom hay.
$105 (about $48/900lb bale) and I have to deliver a short distance.

I need more feed customers.


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## JD3430 (Jan 1, 2012)

luke strawwalker said:


> Yeah, on a farm that was GIVEN to them...
> 
> Later! OL J R


It's pretty scary. They have become the biggest landowner in the county since the King Ranch closed their 14,000 acre cattle operation back in the 80's.
In fact, they bought most of the King Ranch!

They lure you into massive tax breaks and some cash in exchange for promising not developing the property for "eternity" and lots of regulations on the use of the property.
Land taxes getting really high, so it's an attractive alternative


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## Hayjosh (Mar 24, 2016)

endrow said:


> Over the years I've had a lot of different scenarios where I've done things for the landlord. Plow the snow , cut the pasture, loaded and hauled his manure. Trim the trees,, loan pick up , loan loader ,loan tools... Most of the time it works out well. You just can't let things get out of hand I've had that already too.


 In my case for one particular 5 acre field, my rent for the year was $200, 8 bales of hay for her garden (I gave her some first cut straw hay), put up a no trespassing sign on the field, and keep an eye on it (which I do anyway, twice a day as I drive by it). Ok whatever.

The field is only 1/4 mile from my house, she's a nice lady, and it makes some niiiiiiiice grass/clover hay, so totally worth it in my book.


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## swmnhay (Jun 13, 2008)

JD3430 said:


> At $50/acre, I'd break even with minimal fertilizing
> At $100/acre, I'd be losing money.
> At $200/acre, I wouldn't be a hay farmer, I'd be a philanthropist.


You must use different math.
Useing custom rates I figure I can make hay and deliver it for $55 a ton for machinery and labor.
4 ton X 105 = $420 gross
Minimal fertilizer $30?
55 x 4 ton = $ 220 
$250 acre costs/ but actually makeing custom rates!

$170 net before rent


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## JD3430 (Jan 1, 2012)

.


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## Palmettokat (Jul 10, 2017)

JD3430 A thought came to me regarding fertilizing, could you not spray liquid nitrogen while it is raining? Not down pours but good steady rain.

Will even ask, depending on the crop you might can use what we call drop tubes, I use lowest price tubing I can find and slip it over the spray nozzle and cut it long enough it just clears the ground or even drags. Yes you can burn crop but it gives you narrow burnt area and not the full crop. This is how I would apply nitrogen to corn for last application. Of course corn was in rows. You can use anything for the tubing I found some hosing for discharge pipe on pumps was cheap, cut easy and was easy to work with.


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## JD3430 (Jan 1, 2012)

Palmettokat said:


> JD3430 A thought came to me regarding fertilizing, could you not spray liquid nitrogen while it is raining? Not down pours but good steady rain.
> 
> Will even ask, depending on the crop you might can use what we call drop tubes, I use lowest price tubing I can find and slip it over the spray nozzle and cut it long enough it just clears the ground or even drags. Yes you can burn crop but it gives you narrow burnt area and not the full crop. This is how I would apply nitrogen to corn for last application. Of course corn was in rows. You can use anything for the tubing I found some hosing for discharge pipe on pumps was cheap, cut easy and was easy to work with.


I suppose I could, but its a "historical farm" owned by a conservancy that would get upset with burning/ streaking. Mt guy does have the tubes on his rig, IIRC.

I don't feel like I'd be lucky enough to be able to get my spraying contractor here right before it rains, but I like your ideas and I appreciate your suggestions and your help!

I'm also wondering if a slower release applied now might not help with second cutting, too? More so than liquid?


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## Palmettokat (Jul 10, 2017)

My soil test on coastal bermuda has me applying nitrogen after each cutting.

Put this in the smart donkey file: why would they not like a stripped field. I mean the pro sports fields are. You might better be sure you do not get it stripped, they may require it from then on and boy...


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## JD3430 (Jan 1, 2012)

Palmettokat said:


> My soil test on coastal bermuda has me applying nitrogen after each cutting.
> 
> Put this in the smart donkey file: why would they not like a stripped field. I mean the pro sports fields are. You might better be sure you do not get it stripped, they may require it from then on and boy...


It's got walking trails all around it. 
While I agree with everything you say, I Gotta tread lightly, if I want to come back in the future.


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## Palmettokat (Jul 10, 2017)

JD3430 said:


> It's got walking trails all around it.
> While I agree with everything you say, I Gotta tread lightly, if I want to come back in the future.


Please understand I was being smart there. I watched much of the open questioning of of the Lady nominated for CIA and it amazes me how people with so little sense can be so rich or be elected to office or convince people they will take care of their land as God meant for it to be when they die. Think God made the land to be farmed for he told Adam he would "till" the ground. By his sweat he would fight the weeds and briers. My translation, but have the meaning I think right clear.


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