Photo by byzantiumbooks

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Community Farmland Trusts

While the overwhelming majority of the more than 250 community land trusts (CLTs) in the United States currently focus on preserving affordable housing, the roots of the CLT movement spring from agriculture and civil rights struggles of Black farming families dispossessed of their land in the 1950s and 1960s who purchased and collectively managed farmland as a survival tool in the face of racial discrimination and violence. Today, one of the biggest barriers to the equitable ownership of farmland is the increase in land values as a result of the financialization of land as an economic asset. CLTs effectively address this barrier by removing the speculative pressures from farmland when they acquire it. The CLT holds land for the benefit of the community and enters into long-term leases to provide farmers with secure tenure and the autonomy we generally associate with ownership. The CLT can also partner with another entity to sell a conservation easement, which drastically reduces the value of the land, making it that much more affordable for the farmer and preserving the agricultural character of the land forever. As nonprofit organizations, CLTs also legally bind the farmland to the charitable purposes for which the CLT was incorporated, essentially ensuring that the farmland it owns will be put to uses that will benefit the public in perpetuity.

Importantly, CLTs also structure their Board of Directors, the ultimate decision-making body for most nonprofits, to localize decisionmaking power. CLT boards include representation from professionals, tenants (in this case, farmers), and immediate community members to ensure that the CLT is acting in the best interests of those impacted by its activities. At the Law Center, we are working with Agrarian Trust to further develop the CLT model into a decentralized and democratic community institution by piloting the model of worker-self direction within the land trust itself.

Other examples of farmland CLTs include South of the Sound Community Farmland Trust and Sustainable Iowa Land Trust.

Worker-Owned Farms

REITs exemplify a dominant feature of farmland in the United States, absentee ownership. This “out of sight, out of mind” approach leaves open a gap in land management that agribusiness has been all too eager to fill with its overuse of chemicals, export-driven cropping practices, and worker exploitation. It is one reason why communities in the Central Valley of California, mostly people of color, experience some of the highest rates of food insecurity and environmentally-influenced diseases in the state, even though they live in the heart of the richest agricultural economy.

Worker-owned farms, on the other hand, are by definition locally-owned. And local ownership matters. Placing farmland ownership in the hands of the people who work the land, live in nearby communities, and raise their children there leads to a seismic shift in decision making over land management. Empowered is this way, would farm worker-owners choose to spray chemicals in the fields where they work? Would they choose to grow crops without considering whether they will be able to feed themselves? Would they contaminate groundwater with nitrates from overusing fossil-fuel based fertilizers? We think the answers are no, no, and no.

At the Law Center, we are leveraging our expertise with worker cooperatives to put together a series of resources for farmers and farmworkers interested in developing worker-owned farm enterprises. While the cooperative model has a long history of supporting self-sufficiency in agriculture (see Federation of Southern Cooperatives), worker-ownership has not been a key feature. Recently, several examples of worker-owned farms have developed, including Our Table Cooperative, Solidarity Farm, and Our Harvest Cooperative. Swanton Berry Farm, while not set up as a cooperative, does include features of worker-ownership through an Employee Stock Ownership Program and a unionized workforce.

Community Financing for Farmland

There is no question that one of the biggest challenges to implementing a just transition in farmland ownership is identifying sources of financing. In traditional real estate transactions, financing tends to greatly influence the ownership structure. A common principle is that the person who invests the most money gets to own most of the land and make most of the decisions. While this may appeal to the investor in each of us, such a model perpetuates the myth that because wealth is generated based solely on merit, those with wealth ought to be in control. It also erases the history of unjust enrichment of White people in the United States at the expense of Native Peoples, Black farmers, and waves of immigrants of color.

If we are to truly develop an equitable food system, then we must envision a new relationship between money, land, and ownership.

Nonprofit lenders focused on supporting farmers already exist, and have been providing low-interest operating loans to farms for decades. California Farmlink and Northern California Community Loan Fund are great examples of the role nonprofit lenders can play in extending beyond operational support to finance equitable farmland acquisition. Both are Community Development Financial Institutions, or CDFIs, which allows them to access a larger pool of federal funding that they redirect to supporting economic development in low-income communities. As nonprofits, they may also have an easier path to aggregating investment capital because of exemptions from federal securities laws for charitable organizations.

There is also the example of a cooperative twist on REITs, called a Real Estate Investment Cooperative (REIC). REICs sell membership shares to community members, specifically targeting non-accredited investors (those who are not very wealthy), to aggregate capital to finance projects that benefit specific communities. Examples of this model include the Northeast Investment Cooperative and NYC Real Estate Investment Cooperative. Black Land Matters is using the REIC model to finance, among other things, farmland acquisition to rebuild Black land ownership in the United States.

At the Law Center, we are interested in supporting these models as well as exploring other less developed, yet potentially impactful, financing strategies to secure an equitable future in farmland ownership. These include unlocking people’s retirement incomes (like an IRA or 401k) from Wall Street and allowing people to self-direct their investments into local farm enterprises and farmland ownership. This could directly counter the current use of similar funds by pension fund managers that promote domestic land grabs. We also see potential in expanding crowdfunding laws to promote broad-based community investment in local agricultural enterprises, including supporting farmers in acquiring land. Or, how about creating pathways for advanced investment in cemetery plots to fund pasture land preservation and promote green burials?

Our guiding principle in exploring these possibilities is that the democratization of land ownership requires the democratization of capital. To reach this goal, it’s likely that all of the strategies discussed above – community control of land, worker ownership, and non-extractive finance – will need to work together in order to ensure an equitable and sustainable future for farmland.

By Neil Thapar, Food and Farmland Attorney / republished from the Sustainable Economies Law Center blog

The post The Future of Farmland (Part 2): Grabbing the Land Back appeared first on P2P Foundation.

Land grabs, the controversial acquisition of large parcels of land by governments or corporations, are nothing new in the United States. Beginning with settler colonialism and the Dawes Act, continuing through the Civil Rights era, all the way through to today’s large-scale corporate and institutional investment portfolios, the United States has a long history of land grabbing, particularly from Native communities and communities of color. What is new is the increasing involvement of individual investors in these land grabs through their participation in Real Estate Investment Trusts, or REITs. Previously focused on housing tracts, apartment complexes, and shopping malls, REITs are increasingly being created to facilitate the transfer of large amounts of wealth directly into centralized farmland ownership to do one thing: make money. You may never have heard of a REIT before, but everyone interested in creating a just and equitable food system should become familiar with these troubling investment tools. Here are three reasons why.

Farmland REITs put profit over principle. As an investment tool, the primary goal of a REIT is to generate a profit for its investors. This means that all other considerations, including the needs of farmworkers, farmers, soil health, surrounding community, and watersheds are secondary to the profitability of the asset, if they are considered at all. Farmland REIT managers see themselves as participants in a global food economy, which also means that they are likely to shift cropping practices and employment practices based on global market demands instead of responding to local needs.

Farmland REITs treat land as an asset in a portfolio instead of a natural resource in an ecosystem. As terrestrial beings, we have an inherent connection to land that, through place-based ownership or stewardship, can foster the growth and expression of our highest and best selves. When that connection to the land is taken away, as it has been forcibly done to Native peoples through settler colonialism, to Black people through enslavement and Jim Crow, and to many peasant farming communities in Central America, Southeast Asia, and Africa through international trade agreements – the social, economic, and ecological consequences are devastating. REITs are legal entities that are the real-world results of an economic and legal system that not only allows, but incentivizes, the commodification of land as a financial asset. One REIT manager put it this way, “the idea for the [American Farmland] Company was based on noting that U.S. farmland property values have generally been increasing over the long term….”

Farmland REITs recreate feudal relationships between landowners and land stewards. REITs acquire land, often from active farmers, then re-lease the land back to the farmer as a tenant on short-term leases, averaging 2-3 years for row crops and 5-8 years for orchards. If you were a farmer, would you invest in equipment, soil health, or water quality and conservation if you might be evicted in a few years? The result for farmers is that they have no incentive, let alone control, to invest in sustainable practices like crop rotation, cover cropping, no-till cultivation, native hedgerows, or other long-term cultivation practices that enhance soil quality, water retention capacity, and pollinator habitat. The result for the community is the loss of healthy local food production, exploitation of local human and agricultural resources, and wealth extraction by absentee landlords.

“There’s a reason I’m a landlord and not a farmer.” – Paul Pittman, CEO, Farmland Partners, Inc.

Farmland REITS know this, and in fact, are betting on it as a profitable strategy. The CEOs of these REITs, by their own words, understand and take pride in their status as landlords. Paul Pittman, CEO or Farmland Partners, Inc., a REIT with over 150,000 acres in its portfolio, says “there’s a reason I’m a landlord and not a farmer.” One reason might be that most REITs require their tenants to pay the entire year’s rent up front, in cash, before spring planting. So, at the same time that farmers need cash to purchase inputs and hire workers and before they’ve even sown a crop, let alone sold anything, they are expected to pay the entire year’s rent. Or, as David Gladstone, CEO of Gladstone Land Corporation, a REIT with nearly 34,000 acres in its portfolio, puts it, “[Y]eah, well the farmer takes on most of the risk, obviously.”

This exploitation of land and labor that investor-based land ownership deploys is why farmland REITs are so dangerous to the future of our food system, rural economies, and the land commons. Farmland REITs are essentially betting on a formula of increasing global food demand and shrinking availability of farmland to generate profits for their primarily wealthy investors. While most REIT investors are wealthy individuals, some REITs are also publicly traded, which means that ordinary people’s investment and retirement accounts may also be invested in a farmland REIT as part of a portfolio. Many of us wouldn’t know if this was the case unless we very carefully scrutinized each investment we made – something that is very important but not very easy to do.

Farmland REITs, public and private, continue to grow. According to Pittman, “this can be a multi-billion-dollar business, and that is our goal.”

Well, we have a different goal. Tune back in next week to read the second part of this blog. We’ll focus on existing and emerging principles and legal tools for community-based land acquisition and management models around the country. From community land trusts to real estate investment cooperatives to worker-ownership, these are the mechanisms that will help us start to grab the land back.

By Neil Thapar, Food and Farmland Attorney / republished from the Sustainable Economies Law Center blog

Photo by DaraDPhotography

The post The Future of Farmland (Part 1): The New Land Grab appeared first on P2P Foundation.

A feeling of joy and achievement runs through the group of ten people gathered in Robert’s kitchen. After three years of planning, they have come to celebrate: Ingrid and Fabien will soon be able to settle down and develop their farming business. The farm is theirs!

In this small, pastoral village of the French Pre-Alps, establishing young farmers is an act of will. Everywhere, small mountain farms are closing down; work is hard and the business not deemed profitable enough. When aging farmers retire, they do not find a successor. The best land is sometimes sold off to one of the few more or less industrialized farms that remain. Overall, villages are progressively abandoned or become havens of secondary residences.

In Saint Dizier, a small village of thirty-five inhabitants, local people have decided differently. Municipality members, local residents and farmers have decided to preserve agriculture as a component of local economic activity and lifestyle. They also view farmers as young, permanent residents for the village. So they keep an eye on land put for sale, and have contacted farmers and landowners to learn their plans for the future. The municipal council has sought public subsidies to acquire farmland and rent it to young farmers, but with no success.

In 2006, villagers started to work with Terre de Liens, a recently established civil society organization focused on securing land access for agroecological farmers. Everywhere in France, high land prices and intense competition for farmland and buildings have become a major obstacle for young farmers. Obstacles are even higher for those doing organic agriculture, direct sales or other “alternative” forms of agriculture, which usually are not deemed profitable enough by banks or worthy of public policy support.

So when a farm goes for sale in Saint Dizier, everyone is ready. In just a few months, the small group approaches the owners and all relevant institutions with a stake in the transaction. Above all, they start raising money among local residents, family and friends. And it works. Through word-of-mouth, public events and fairs, they soon manage to raise 50,000 euros locally. Then, Terre de Liens, through its national network of supporters, raises another 100,000 euros. People choose to invest in the project because they want to promote organic agriculture, to preserve mountain farming, to protect the environment, or to give young farmers a chance. Soon, Ingrid and Fabian start to graze a herd of 160 ewe and to produce cheese; they also develop a microbrewery, work on an agrotourism project and lease part of the land to a fruit grower.

The group continues to meet regularly. They discuss the terms of the lease and the protection of the environmental assets of the farm; they plan for the repair work needed on farm buildings; they support Ìngrid and Fabian in developing direct sales; and they facilitate exchange of equipment and services between local farmers. When another farm goes for sale, they repeat the operation and, after two more years of mobilization, they are met with success. In just over five years, this small village of thirty-five inhabitants has gained three new farm businesses. Four new families with children have settled permanently.

Throughout France, Terre de Liens fosters similar dynamics for preserving agricultural land and supporting a new generation of farmers. Participants are driven by the conviction that agriculture is everybody’s business. They recognize that the way land is used and distributed is key to improving the quality of local food production, not to mention ecological forms of farming and livelier rural areas.

The fundamental premise of Terre de Liens is that the value of farmland lies in its contribution to food production, lasting ecosystems and human life. So when people invest in the group’s farmland, they choose not to make a profit. Technically, they are shareholders of a private company, but practically, they know that the land will not be sold back as long as Terre de Liens continues to exist.

Terre de Liens in numbers

• 12,000 citizens mobilized
• 120 farms acquired
• 2400 hectares in organic, peasant farming
• 200 future farmers supported every year
• 1 ethical company, 1 foundation, 19 regional and 1 national association
• 35 million euros in ethical investment and 5 million euros in donations
• Share = 103 euros
• Tens of partnerships with local authorities

In any case, they will receive no financial dividends. At best, they may have an inflation-based re-evaluation of the value of their shares at some point, and may qualify for income tax rebate, on a limited scale. The benefits that investors seek are nonfinancial ones: direct connection to a farm, good local food, fertile soils and biodiversity, preservation of a local activity and a sense of belonging. They also enjoy partaking in new forms of experimentation and social bonding around food and agriculture.

Terre de Liens is still a recent movement facing many challenges: improving the monitoring and management of farms and buildings, reaching beyond its first circle of supporters, consolidating its financial resources, etc. To date, it has saved 120 farms, recruited 12,000 supporters and forged tens of partnerships with local authorities. These achievements, while modest in the larger context of French agriculture, are a strong sign that, if given a chance, large numbers of citizens want to promote more intelligent land planning, agro­ecological forms of farming and more robust rural areas.

Terre de Liens is advancing this agenda by liberating land from the commodity system.¹ For the moment, it is done via “capitalist” instruments such as private property and finance. But the organization and its supporters believe that developing a “solidarity-based economy” can nourish the idea of treating farmland as a commons, with eventual support by law.

Today, there is an urge to grow and connect the Terre de Liens initiative with similar alternatives elsewhere in Europe and in the world. The decline of smallholder farming is a fact of contemporary life. So are the disastrous consequences of conventional farming for the environment and public health, and the desertification of rural areas. There is resistance, however, especially among a new, emerging generation of farmers who are eager to integrate farming with its social surrounding, and to produce food for local and regional markets. In this sense, Terre de Liens is part of a much broader transition aimed at restoring living, community-connected ways of farming and rural life.

Véronique Rioufol (France) is Terre de Liens’ European Relations Coordinator. She has a background in international relations and political studies and has worked in human rights organizations. She joined Terre de Liens in 2010 because she views it as a successful experiment for social change. She has contributed to setting up the European Network on Access to Land, of which Terre de Liens is a member.

Sjoerd Wartena (France) worked at the Amsterdam University library and moved to France in 1973 to become a goat farmer. He was active in the organic agriculture movement and in 2003 cofounded the Terre de Liens association and was president for its first ten years. He considers this organization the logical consequence of his adaption to the traditional way of farming he discovered in France, which he believes to be a healthy and “modern” alternative to destructive large-scale farming.

Lead image by Terredeliens.org

The post Patterns of Commoning: Terre de Liens: Experiencing and Managing Farmland as Commons appeared first on P2P Foundation.