Farm Transitions Workshops Help Producers Pass Farms Down More EffectivelyFri, 04 Apr 2014 16:07:46 CDT
Planning for a passing a farm from one generation to the next often occurs in the context of estate planning. Oklahoma State University’s Dr. Shannon Ferrell says such a transition is not a very effective way to ensure the survivability of that farm. Ferrell is an attorney and is a faculty member in the Department of Agriculture Economics. He is conducting a series of workshops across the state to help farmers and ranchers transition their operations to the next generation in a more effective manner. Ferrell talked recently with Radio Oklahoma Network Farm Director Ron Hays. (You can listen to their conversation by clicking on the LISTEN BAR at the bottom of this story.)
“Research shows that about 30 percent of the farms and small agribusinesses that get transferred at death, only 30 percent of them make it to that next generation,” Ferrell said. “And, so, nearly two-thirds of them aren’t. And the reason for that is that we don’t have a really good sense of communication between the generations about what their goals and objectives are. And then, secondly, you’re sort of thrusting that next generation into a management role when they really haven’t had a chance to grow into it.”
He said the farms that have a succession plan in which management and ownership shift over time drastically increases the odds of that those businesses will survive far into the future.
“And, so, at these transition workshops we’re focusing on creating long-term plan so that, over time, you can have a comfortable retirement as a farm family while you’re still providing opportunities for that next generation to grow into the operation and give them the best chance for success.”
Ferrell says that communications between family members is the key to establishing viable transition plans. He says that is a major focus of their workshops.
Amazingly, he says, 73 percent of farmers and ranchers say they have never considered retirement. And, equally amazingly, very few have had conversations with the younger generation about what their specific goals are and if they even want to come back to the farm.
“I think when we start talking about those questions people are surprised by the answers, but in a good way. They are learning things about the next generation that they previously didn’t know and that’s opening up a lot of possibilities that they hadn’t considered in planning the long-run operations on their farm.”
Ferrell says workshop attendees learn how to broach the topic of transition with the different generations and then discuss specific retirement and estate planning strategies and legal mechanisms which can allow those transitions to occur.
Additional meetings are April 7th at the High Plains Tech Center in Woodward, in Ardmore on April 14th and the final workshop will be held at OSU in Stillwater on May 2nd.
The workshop series is hosted by Oklahoma Cooperative Extension Service with funding from the USDA Risk Management Agency through the Southern Risk Management Education Center. The workshops are also sponsored by Farm Credit Associations of Oklahoma and the Samuel Roberts Noble Foundation. The cost for attendees is $25 for a family of four and includes a lunch, refreshments and two farm transitions workbooks. Additional registrations are $10 per person. To register, contact Kareta Casey at 405-744-9836 or via email to firstname.lastname@example.org.
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