Who’s Buying Nebraska? Corporations, Investors Grabbing Giant Chunks of Nebraska Farmland
There’s never a Black Friday discount when a piece of Nebraska farmland hits the market in 2023, be it a fertile field in the Platte River Valley or a vast swath of Sandhills pastureland.
The market’s hot. And corporate farms, both in-state and out, are dipping into their deep pockets to claim the increasingly pricey agricultural land they desire.
The nine buyers who spent the most money on Nebraska farmland in the past five years are all corporate farming operations, real estate developers or investment firms, an analysis by the Flatwater Free Press found.
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Most Foreign Investment in Iowa Farmland Is for Wind Leases
More than 90 percent of Iowa’s agricultural land with foreign investment is in long-term leases for wind projects. Federal law requires multinational firms with a majority interest in another country to disclose investment in ag land. Foreign investors — firms or individuals — must report leases of 10 years or more.
Nationally, about 30 percent of foreign land investment is in leases.
Dickinson County had the largest number of acres of ag land in Iowa with foreign investment — 50,216 acres as of Dec. 31, 2021. All of those acres were leased for three wind projects, but the largest, the Red Rock Energy Center, a 79-turbine development near East Lake Okoboji, was denied a permit in October, Iowa Public Radio reported.
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Unhappy Times For Syndicated Conservation Easements
Just in time for the annual end-of-year tax shelter season, the Internal Revenue Service has issued proposed regulations to deal with so-called syndicated conservation easement transactions. This follows the IRS's failure of its previous proposed regulations, Notice 2017-10, for failure to comply with the Administrative Procedures Act (APA). This new set of proposed regulations, which will presumably be enacted in proper accordance with the APA this time, follows the Secure 2.0 Act of 2022 that disallows a deduction for a qualified conservation easement contribution made by an entity taxed either as an S-corporation or partnership (the latter including an LLC taxed as a partnership), if the amount of the contribution exceeds the member's tax basis in the entity by 250%. The regulations also impose new reporting requirements for the members of the entity who are seeking a deduction based on the entity's conservation easement transaction.
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What Will Land Values Look Like in 2024?
Record-breaking highs for farmland sales in the Midwest, continued high demand and a rallying cattle market are all things that are affecting land values across the region. Knowing these facts likely brings questions to the minds of farmers and ranchers.
Where do new producers start? Should you wait to buy that cropland at auction? Have land prices finally peaked in 2023? Read on to answer these questions and more with Eric Ehlis, assistant vice president of Farm Credit Services of Mandan, N.D.
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Farm Lobby Pushes for New Farm Bill in Early 2024
Farm groups called for Congress on Thursday to overcome a months-long impasse and enact a new farm bill early next year. President Biden was expected to sign legislation that extends current farm law until next Sept. 30 but the farm groups want to keep the pressure on for prompt action.
The extension was included in a short-term government funding bill and will avert the so-called dairy cliff on Jan. 1, when the government-guaranteed price for fresh milk would more than double under a 1949 agricultural statute, with ripple effects possible at the grocery store. The 1949 permanent law comes into effect when a farm bill lapses.
“While an extension is necessary, they’re running out of time to write a new bill,” said Zippy Duvall, president of the American Farm Bureau Federation. “We need a new farm bill in early 2024.”
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ASFMRA Government Relations Update
Congress Passes CR, President Signs Avoids Shutdown, Farm Bill Extended
Congress passed the “two-step” Continuing Resolution (CR) last week as initially proposed by Speaker Johnson (R-LA). The Senate voted 87- 11 to pass the CR after the House passed it 336-95. Both votes were bipartisan. The President signed the CR into law to avoid a government shutdown. The CR contains no emergency supplemental spending, neither domestic nor international. Four of the 12 appropriations bills are funded at FY 2023 levels through January 19, 2024, while the remaining 8 are funded through February 2, 2024.
The House vote on the CR was eerily similar to the previous CR vote in September that resulted in then Speaker McCarthy (R-CA) losing his Speakership. In both cases 209 Democrats voted with 127 (Johnson) or 126 (McCarthy) Republicans for passage while 93 Republicans (Johnson) or 90 (McCarthy) voted against passage with 1 or 2 Democrats. Conservative Republicans are not happy with their new leadership and felt an opportunity was missed to cut spending or to push for legislative riders to counter Biden Administration policy. Any honeymoon period Speaker Johnson had is now ended.
Speaker Johnson has said he will not support any further CRs. Much work must then occur on the 12 FY 2024 appropriations bills between now and January of next year, although that seems unlikely with the holiday schedule and congressional inability to pass individual appropriations bills. It has been 26 years since Congress passed all 12 appropriations bills via regular order. While a large omnibus bill just before Christmas has been avoided, the problems inherent in the appropriations process have only been postponed, not resolved.
The CR language does include language extending the 2018 farm bill authority for programs with expired authority (notably the commodity title) through fiscal year 2024. It also provides authority extension and some funding for “orphan” programs – those programs with expired authority and expired funding – through the end of the fiscal year. The additional spending is offset with a $177.35 million rescission to the Biorefinery Loan Program. The four leaders of the House and Senate Agriculture Committees released a statement after the draft CR language was released about the extension. “As negotiations on funding the government progress, we were able to come together to avoid a lapse in funding for critical agricultural programs and provide certainty to producers. This extension is in no way a substitute for passing a 5-year Farm Bill and we remain committed to working together to get it done next year.”
Senator Hoeven, Representative Harris Question USDA ERP Provisions
Senator Hoeven (R-ND), Ranking Member of the Senate Agriculture Appropriations Subcommittee and Congressman Harris (R-MD) Chair of the House Agriculture Appropriations Subcommittee sent a letter to Secretary Vilsack last week urging him to reconsider how USDA has implemented crop year 2022 ad hoc disaster payments. Specifically, the legislators say USDA has not followed Congressional intent with its progressive payment reduction factor and how USDA is treating the reimbursement of crop insurance premiums. Absent something stronger than a letter, USDA is unlikely to change its program administration.
2022 Crop Year Disaster Payment Calculations Explained
Many of you have noticed that the “track 1” Emergency Relief Program (ERP) payments recently released for crop year 2022 are significantly curtailed from expectations. The American Farm Bureau Federation released a post that explains in detail the new factoring formula contained in the Farm Service Agency’s 2022 crop year ERP. Note ERP payments for NAP crops are not as nearly limited as those for insured crops.
Welcome New Members
Help us welcome our newest members to ASFMRA! We are thrilled that you have chosen ASFMRA as the organization to be affiliated with. Because of you, ASFMRA continues to grow and support rural property professionals across the nation!
We are recognizing new members of the Society on a monthly basis. You may recognize your colleagues in the following list and we encourage you to welcome them into ASFMRA!
New Members
Richard Brown in Morgantown, KY (Kentucky Chapter)
Syanord Carter in Carbondale, IL (Illinois Chapter)
Rabail Chandio in Ames, IA (Iowa Chapter)
Faith Correll with Agri Affiliates, Inc. in North Platte, NE (Nebraska Chapter)
Hailey Eads in Trenton, MO (Missouri Chapter)
Kelsey Egresi with Farm Credit East, ACA in Hornell, NY (Northeast Chapter)
Aaron Estrada with Kidder Mathews in San Diego, CA (California Chapter)
Ernest Flechsig with US DOI in Portland, OR (Washington Chapter)
Gregory Hill with Tiverton in Shoreline, WA (Washington Chapter)
Eric Lazear with CBRE in Howard, OH (Ohio Chapter)
Donald Lunkwitz with Agri Affiliates, Inc. in North Platte, NE (Nebraska Chapter)
Courtney Lyssy with Texas A&M University in Falls City, TX (Texas Chapter)
Jefferson Manning with LandFund Partners in Nashville, TN (Mid-South Chapter)
Jethro Mantel in Sutherlin, OR (Oregon Chapter)
Shaun Melarvie with BMO Harris Bank in Winter, WI (Wisconsin Chapter)
Olivia Schmidt with AgWest Farm Credit in Santa Maria, CA (California Chapter)
Dalene Stewart in San Jose, CA (California Chapter)
Bryce Uebel in Lakeville, MN (Minnesota Chapter)
Chloe Van Etten in Cedar Falls, IA (Iowa Chapter)
Amy Velazquez in Portland, OR (Oregon Chapter)
Kinser Wargel with Field Level Agriculture, Inc. in Springfield, IL (Illinois Chapter)
Jennifer Wharton with Hertz Appraisal Services in Washington, IA (Iowa Chapter)
Serenity Wilcox with Agricultural Operations Management Club in Georgetown, FL (CA and FL Chapters)
Sonora Zaugg in Rexburg, ID (Idaho-Utah Chapter)
Share Your Experience - Make a Referral
You know first-hand what a great organization ASFMRA is and what it means to you both professionally and personally. We thank you for spreading the word, you are the driving force behind our continued growth! Talk to those you know who would benefit from ASFMRA’s educational offerings, networking, and meetings. Let them know your experiences of being involved in this great association and some of the business contacts you have made along with lasting friendships. Your peers listed below have done just that! They spoke to individuals about ASFMRA and those individuals have now become members of ASFMRA!
Mark Akers, ARA
Daniel Ceilley, ARA
Tony Eggleston, ARA
Rick Gullickson, AFM
Cavin Joesting
Terry Kestner, ARA, RPRA
D. Matt Marschall, ARA
Katie McDowell
Richard Mercier, ARA
Christian Minard
Sydni Nicolici
Skye Root, AFM, AAC
Traci Schermerhorn
JoAnn Wall, ARA
Thomas Wargel, AFM
Wendong Zhang
Thank you to all who have referred someone and in some cases, more than one, to join ASFMRA.