Conservation in Your Estate Planning

Over the years, Clark Porter and his family have worked hard to increase conservation – including planting cover crops, expanding grassed waterways, incorporating buffer strips, and experimenting with rotations of oats — on the Grundy County land the family has owned since 1873.

“I grew up riding my pony behind my grandfather on our land, and spent summers throughout high school and college working for various farmers,” Clark says. “My great-great grandfather farmed this land – and I want my great-great grandchildren to be as rooted as I am in this soil. That means I have to take care of that soil. For me, it is a living entity.”

How can Clark make it more likely his heirs will follow his conservation ethic? As he worked with an attorney on estate planning, Clark learned he could put some language in his trust document that would assure the farm is managed sustainably. “I knew my children would take care of this if possible,” he said, “but I could not be sure they will be anywhere in the area.”

Clark Porter with his father in front of his great-great grandfather’s barn. Clark’s sons will be the sixth generation to be involved with their farm.

The attorney hadn’t had a request like this before, but developed the following language for the trust document:

“During the Trustor’s lifetime he has consistently worked to conserve the land and improve the fertility of the soil in his management of the family farming operation; he directs the Trustee to continue these best conservation and soil fertility practices.”

Clark initially liked the language, but as time passed he decided he needed to provide more guidance to his heirs and whomever else might be overseeing farming operations on the land. He contacted Practical Farmers members looking for more advice. We contacted attorney (and former farm girl) Rachel Dahl of Hellmuth and Johnson, who confirmed Clark’s concerns:

“Language like this is too ambiguous. The intent is not clear,” Rachel reports. “This says: ‘Hopefully someone carries on my conservation wishes.’ Does this refer to the entire farm? A particular part of the farm? Do certain areas need to stay out of production?

“You need more specificity. And if you want something specific, then it should be recorded with the land, and the trust document should include the specifics as well. In today’s terms, what is conservation farming? What methods are you using? Your idea of conservation may not be what others think of.”

The Sustainable Agriculture and Land Tenure Initiative (http://sustainablefarmlease.org/) is helpful for those farmland owners wishing to hone in on their conservation priorities. For example, is soil conservation your top concern? Do you always want livestock integrated into your system? Habitat provided for wildlife? A wetland kept as wetland?

Predicting the future

Clark’s trust will last for 21 years after the death of his latest living beneficiary, Rachel points out, so this trust may continue for 100 years. Clark needs to balance his desire for more specificity in the trust document with the wish to allow his heirs the flexibility to manage the farm. Trying to predict the farming system this piece of the earth may need in 50 years, let alone 100 years, is impossible. Will the land be too wet for row crops? Too dry and hot to grow corn and soybeans? Will the best conservation – and profitable — use of the land be a permaculture system?

A question: Is conservation the most important, even if it results in no income to his heirs? Is the farm income to heirs most important, even if conservation is compromised? Does Clark want to indicate a range (say up the 10 percent?) of farm income should be spent on conservation over a five year period?

Another question: Is there government money helping to pay for that conservation (such as the Conservation Stewardship Program) that may not exist in the future, making it harder for your heirs to justify the conservation expense?*

Clark wants to keep the farmland in the family, so isn’t likely to consider an outright donation to a conservation group.  He could consider, however, an agricultural conservation easement. Agricultural conservation easements are designed to keep land available for farming. They are designed to limit subdivision, non-farm development and other uses that are inconsistent with commercial agriculture. In Iowa, Iowa Natural Heritage Foundation (inhf.org) and Sustainable Iowa Land Trust (silt.org) accept conservation easements.

And, finally, if you want your heirs or another family to continue to farm your land in a manner that protects the environment, setting an example is as important as any legal document. Document your farm history, goals and values for the farmland and what you did to leave the land better than how you found it. Be as specific as possible! Your heirs will appreciate knowing more about your conservation values and how you put those values into place.

Note: This article is for information purposes only. Always contact an attorney when you take on estate planning.

Resources

Join the new Farm Transitions Discussion Group to share with others: http://www.renewingthecountryside.org/farm_transitions or contact eli@rtcinfo.org

Invaluable resource for farmland owners who have conservation as a top goal: iowalandoptions.org

This website hones in on conservation practices you might want to include in your leases or even in a sale of farmland: http://sustainablefarmlease.org/

This is a complete toolkit for conservation-minded farmland owners facing transfer issues: http://farmtransitions.org/tool-kit/

See Clark Porter’s blog on “The Essential Conversation Between Landowners and Farmers Over Sustainable Farming www.practicalfarmers.org/blog and search for “Clark Porter”

Attorney Rachel Dahl is licensed to practice in Iowa and is available at: Hellmuth & Johnson, rdahl@hjlawfirm.com or 952/746-2155.

*Rachel Dahl points out that there are ways that trusts can be changed, despite the Trustor’s original intent. Under the Uniform Trust Code (which has been adopted in Minnesota but not yet Iowa), anyone with an interest in the trust can get a non-judicial settlement to change the terms. This Code helps heirs deal with “dinosaur trusts” that are simply unworkable given changing conditions. If the Uniform Trust Code is adopted in Iowa, Clark may want to add a provision to his trust document indicating that the trust cannot be changed, if his commitment to conservation is that strong.