Ep. 101 Securing the Future Of Farming with the Ohio Farm Transition Network
In this episode of AgCredit Said It, host Libby Wixtead discusses the Ohio Farm Transition Network with David Marrison from the Ohio State University Farm Office. The program is a collaborative effort among various agricultural organizations to assist Ohio farm families with transition planning. The discussion covers the inspiration behind the network, which aims to address the risks associated with farm transition and estate planning by uniting ag service providers and building professional capacity. The episode highlights the importance of communication in transition planning and share dates of upcoming Zoom webinars and in-person workshops to aid farm families. The Ohio Farm Transition Network's goals include increasing the number of farms with formal transition plans and providing resources and training for professionals involved in the process.
Learn more: farmoffice.osu.edu/farm-transition
- Transcription
Speaker 1 (00:08):Welcome to AgCredit Said It, your go-to podcast for insights on farm finance and maximizing your return on investment. Join us as we talk to industry leaders, financial experts, and area farmers, bringing you skillful advice and strategies to grow your farm's financial future AG credit setting where farm finance goes beyond the balance sheet.
Libby Wixtead (00:38):Welcome back to another episode of AgCredit Said It where we take you beyond the balance sheet of Farm finance. I'm Libby Wixtead, your host today, and we are talking with David Marrison of The Ohio State University Farm Office to learn about a new program that just launched into Ohio to aid farmers with transition planning on their farm. Welcome David. We're happy to have you today.
David Marrison (01:01):My pleasure to be here, Libby. Thanks for having me on.
Libby Wixtead (01:04):Yeah, so the program we're going to talk about today is the Ohio Farm Transition Network. Can you start by telling us what this new program is?
David Marrison (01:14):Sure. We're pretty excited about this new program called the Ohio Farm Transition Network, and this is basically, it's a collaboration. So this is a bunch of ag organizations coming together to help improve our abilities to help farm families with farm transition planning. So we have over 76,000 farms across the state of Ohio. So the Transition Network is bringing together ag service providers, say folks from Ag Credit, it could be extension folks from OSU extension, our industry partners from Ohio Corn Wheat, Ohio Soybean Association, the Ohio Farm Bureau and other organizations. And basically just to build capacity so that we can help farm families complete and have a formal farm transition plant.
Libby Wixtead (02:09):That is a big topic here and our local territory that we service, and I know it's such a big topic that we get into conversations with farmers throughout the state of Ohio. So there definitely is a need. I think even within our own farm families here as employees at AgCredit, that conversation comes up and we sit there with each other of how do we do this? So can you share with us what inspired the development of the Ohio Farm Transition Network?
David Marrison (02:41):This inspiration, and I'll say it first. I think there has been this common theme between all of us who help provide services to Ohio farmers knowing that this is a huge risk area of transition and estate planning and that we all, whether it's ag credit, whether it's Ohio Farm Bureau, whether it's OSU extension, we have been doing transition planning workshops each in our own shops throughout the year,
(03:13):And we all see the risk. We know there's a risk, but we would probably tip our hat credit needs to go to Tim Hicks at the Ohio Farm Bureau. He was really the spark for this really simplistic idea. The fact that we all see that transition and estate planning is a huge issue. Why don't we as ag organizations come together and work as one voice for farmers in this space? So that started probably a year and a half ago. We had first a coffee meeting between a couple of us just talking about this, Hey, can we check our egos? Can we check our turf all at the door? Can we all come together and just talk about farm transition and have some goals in mind? So some of the early people at the table of course was Ohio State extension. Of course ag Credit because we're sitting here talking with ag credit on this podcast, but also Nationwide was part of that.
(04:13):Ohio Corn and Wheat Growers, the Ohio Soybean Association, and I said Farm Bureau already and Farm Credit MidAmerica. And then most recently some folks from the Farm Service Agency as well as the Ohio Ag Law Bar Association have been coming together to have these conversations on how if we could do this together, how could we start a network that could be here to help farmers? And that's what this announcement here just this month has been about is hey, we have secured some funding and we're ready to roll and put the Ohio Farm Transition Network and out. It's in this infancy, right? It's starting, but to start this organization to help farm families and transition and estate planning.
Libby Wixtead (05:06):Yeah, I know that we have been doing these, I think you and I were talking off air, you came to AgCredit 10 years ago and I know Tim Hicks was actually our OD probably about that same time there. There you go, Larry. Yeah, and I know that he was very passionate about it and I think this is just showing the passion that all of our organizations have for Ohio agriculture to continue that and really trying to help farm families transition well rather than the horror stories that we've seen. And I know we've had some horror stories, so can you share the process of how this would help a farm family maybe walk through the journey or the resources that are offered for farm families?
David Marrison (05:57):I think how this is going to help farm families is that as part of our goals, so one of our big initial goals is that we develop a training and a support mechanism for attorneys, accountants, tax professionals, lenders, extension folks, farm bureau folks so that we can train them so that their professional capacities to help a farm family and transition planning increases so that we all can surround from each of our, that could be a certified crop advisor that comes onto the farm and is talking about fertilizers, talking about seed varieties, but all they can also talk and lend a voice into the process with transition. So part of that is to build capacity of our professionals. Second is we all use different languages in our different organizations. So part of our process, how do we standardize the terminology and the best practices so that we're all helping farmers in the same process?
(06:56):And ultimately we want to have a statewide clearing house of resources that is there for farms to go to as well as qualified service providers that they can go and see and say, okay, there are some people in my part of the state that can help me. And then ultimately that trickle down is that we're going to have the resources as well as the people to be able to help farm families to have these discussions. You look at the statistics, most of the statistics will say less than 30% of all of our farms across the country have a formal transition plan. Libby, you and I were talking before that, or maybe it was even Kayla, that sometimes the transition plan is in our head as the senior generation, we know what we want, but we never formalize that process about getting the ownership as well as the management to the next generation. So getting it from our head, from our brain into paper to where we have a plan that is pretty methodical, that is our end goal when this is all said and done for just to be able to help every farm family in their journey because we know the journey for each farm family is going to be different
Libby Wixtead (08:12):And with the economic stress that a lot of our farmers are facing right now, I know that that conversation has come up here in some of my year end meanings of just going over financials with my customers and just we're trying to have that conversation of, okay, what do you have coming down the pipeline? And they're like, well, mom and dad are getting older and I'm just not sure what's going to happen. I'm not sure how to plan. And so I feel like we wear all these different kinds of hats and agriculture and all of our different roles of, okay, we have our profession, me as a lender, but then I feel like I'm being a therapist. Then it's coming into borderline accountant lawyer, which again, lenders cannot do that. We are not certified in those areas, but it's just we're trying to wear all these hats and help our farmers out because they looking so they're wanting those answers and how to get those conversations started. So what things that you guys having coming up here that are planned to come here in maybe February and March that some farm families can attend or get online and get some direction?
David Marrison (09:30):I appreciate that most of our organizations are still doing some of the outreach and educational programs that all of us have been doing, whether it's Ohio State Farm Bureau AgCredit, but I can tell you specifically from our seat at Ohio State, we have a couple opportunities that folks can take part of one is we have, since COVID, we've done a live Zoom webinar and that's over Monday evenings, four consecutive Monday evenings now every year. Up until this year we held that in February, but this year we pushed it to March, so on March 2nd, ninth, 16th, and the 23rd, and these are evening programs from six to eight o'clock. The best part of this is folks can join the Zoom webinar and there's one feed $99 per family, which means that as many family members that want to join, so maybe grandma and grandpa are in Florida during March, that's okay, they can jump on a Zoom from Florida. Maybe there's a brother or sister that will have a voice in the process that may live three or four states away, they can jump on. We've had as many up to 15 people from a farm family and
(10:47):That family that couldn't attend. The best thing is the resources are all there. They can download the workbooks of that and then they can just have those discussions because a lot of times we'll send one person to the in-person meeting or maybe
(11:03):Two people go to the in-person meeting and then you're trying to remember everything to share with your siblings, your mom and dad or vice versa. So this chance is that folks can do that all by themselves. Now we also do in-person workshops. Most of them this year, unfortunately, for your AgCredit listeners, the northwest part of our state, we have concentrated to the southern half of the state. So probably the closest one is going to be in Morrow County on March 18th and 26th. That's a long wait, but some people do like to drive for those. So probably the Zoom live webinar is going to be the perfect opportunity for folks during March, but let's say I can't squeeze that in March, were we just unveiled at Farm Science Review this past September. We have an online course that people can do anytime, any place, anywhere that they want to do.
(12:02):So let's say you want to do this on your own. Robert Moore, who's one of our attorneys in the OSU Ag and Resource Law program and myself, we put this course together so that enrollment's there and people can check that out. So if you just go to farmoffice.osu.edu, I'll say that again, slower farm office.osu.edu and look for the farm transition information. You can find out how, if you want to enroll in either of those programs, you can do that. So some more winter like weather that we have, it looks like it's going to stay around. What better to do during the month of February waiting for the groundhog to tell us is spring going to be near that you were able to get this done and have some of these discussions why the weather is not so pleasant for us?
Libby Wixtead (12:54):Yeah, you guys have I think done a fantastic job to really make this accessible in many different ways of how people want to, I guess take in that information. Just having it in person. Mom and dad probably want to go to in person. You've got some younger folks that want the zoom, but I really like that you guys have that Zoom option because of the farm family members, like you said, that are out of state or, and everybody, I think this is important, I think you would agree is everybody's hearing the same information.
Speaker 4 (13:31):Correct.
Libby Wixtead (13:31):And it's not only the information maybe that one farm family member wants to hear or could be interpreted that way
David Marrison (13:38):Or wants to share.
Libby Wixtead (13:40):Yes,
David Marrison (13:41):We speak some hard truths and at times some of the conversation does become uncomfortable, but the end goal of where you're going makes that process where you might feel uncomfortable worth it in the end to have some uncomfortable conversations that you might just not want to have. But we're going to give you some tools during those workshops to be able to better empower yourself to have good crucial conversations with one another.
Libby Wixtead (14:11):Yeah. So can we dig in a little bit to maybe what they're going to hear or in that course maybe what they're going to find out? Could there be some misconceptions that are going to be addressed in any of those webinars or courses or in-person meetings that you can talk about?
David Marrison (14:35):Sure. For us, we look at it in two different lenses. The first is the transition side. So that is how do I put a plan together for the transition of ownership and management and the key on there, the management of the farm in the future, whether that is from an owner operator sense or maybe it's from an owner landlord, because we know in some farm instances there might not be the next farming generation. That's okay,
(15:05):But there can be the next generation of being a really, really good landlord and to really take care of the land that was entrusted to you and how to do that. So on the first two evenings of the Zoom for instance, it's primarily about transition. So we talk about transition, we talk about analyzing businesses. So a lot of the things we've been preaching through the years about SWOT analysis, having goals, thinking about your desires for the future, and then we go into some communication skills about that, how to have tough conversations and understanding some of the psychology of how we communicate as individuals on the farm. And then we will look at what we would call the elephants in the barn. What are the things that are going to hold us back from getting this done? Those are some times or hurts, habits, hangups. It could be generational issues, it could be a lot of different things about how to unpack those elephants in the barn so that you can make that part of the planning process.
(16:08):So those are our first two sessions. And then in our final two sessions, this is where people, their ears perk up. It's like, how do I do my estate plan? Number one, we don't want the federal government to get any of our money, and the big beautiful bill has made it easier for us to transition our assets without paying any federal state tax or our Ohio estate tax. So that's about the mechanisms. What are the different ways that we can use the things that we can use, whether that's trusts, it could be like a business organization like LLCs. It could be a combination of using some financial products such as life insurance or it's maybe using transferable on death or designation on death designations could include a little bit of gifting. So there are so many ways to get our physical financial assets, our assets to our heirs.
(17:04):And what we try to do is give you the information about what are the different avenues so that when you go talk to your professional, your attorney, you kind of understand as they help you put your plans together. But bottom line, it's getting your head wrapped around of what are my goals for the future? And then allow your professionals to get you to that goal using the mechanisms that are available that fit your farm. We would always say, don't ever go into a professional that says, well, this is all I do and this is the plan that you're going to use because your farm is different than just the farm right next to you. So part of what we try to do is here's the information, let's let's learn about it, and then you may or may not use that piece because your puzzle looks different than my puzzle.
Libby Wixtead (17:57):So let me ask you this. Do people, when they think of estate planning or transition planning, they just jump right to that mechanical part where having the hard conversation is maybe more the more difficult piece of the puzzle here. That gets overlooked a lot.
David Marrison (18:18):Libby, I couldn't say that any better. That's what people will come to programs in the old days, back in the 2008, 2009, I say that they're old, but they're not. But the federal exemption was at a million dollar Back
David Marrison (18:34):Then. So people are really interested in how to keep their assets from being taxed and that's why people come. But Libby, you said it right. What really holds us back, it's communication. It may be something that happened on our farm 15 years ago, an event that happened 15 years ago that was never reconciled, and because it was never reconciled, that's going to hold one of the generations back from being very proactive in their planning because that past hurt is still there. It's lingering behind the scenes. So the communication that has to happen is what we would say number one has to happen is the communication, learning how to communicate about tough subjects.
Libby Wixtead (19:26):I get a lot of questions asked by the farming generation, having that conversation with their parents or grandparents. Do you guys talk about that two way conversation of the farming generation talking to maybe the landlords or the owners and then also the owners down to the ones that are maybe doing the farming? You hear what I'm saying? Trying to say with that? Yeah,
David Marrison (19:55):Absolutely. That communication and transition planning can't be one way. Communication from the senior generation to the following generations. That communication about the goals, desires, frustrations, all those things have to be a two-way communication where everybody in the operation, regardless of the generation that they may be sitting in, have the ability to be able to express it lots of time. However, we know what happens is one way of that communication, there's either a fear that their ideas or their feelings won't be heard effectively
(20:34):And then they will shut down as part of that process. So just helping people understand that communication is not easy. If communication was easy, we would have no dysfunctionality in our workplace or in our family businesses, but it is, communication is tough, and if you just start from that point, knowing that communication is tough, then that helps you start to say, well, we can do this, but we have to be willing to do that together as a family. We have to be willing to do it. And if somebody's not, then that's where we can, maybe for instance, we have the Ohio Farm Resolution Services. When there's conversations that are really tough or they can't be had together as a family, maybe you bring in somebody from our Farm Resolution services that's able to sit and help and work alongside that farm family to help guide the conversation, to keep the conversation healthy.
Libby Wixtead (21:32):I appreciate you offering that little bit there. With the Ohio resolution, what was that organization? The Ohio resolution?
David Marrison (21:38):The Ohio Farm Resolution Services that offers as we love acronyms at Ohio State. So offers is the farm resolution. We received funding two years ago from the USDA to offer. We were one of only eight states in the United States that did not have a formal farm mediation program, which goes back to the eighties so farmers can remember the eighties.
(22:02):So we now have a farm mediation program. There's five of us through Ohio State University that are qualified mediators through the Ohio Supreme Court. We're able to mediate, but our approach has been we would like to be proactive with farms to help them navigate through tough discussions before they get so contentious that you would think formal mediation would need to happen. So a new program, but again, it's part of this Ohio form transition network that we're able as professionals to know, oh, if you're really struggling with communication and having some of these tough conversations, oh know that Ohio State has this new program called the Ohio Farm Resolution Services that you can have come out and work with your farm family. So that that's the genesis of the Farm Transition Network that there are professionals, farmers work with so many professionals, whether it's their lender, whether it's their extension educator, whether it is somebody from Farm Bureau, whether it's someone from Nationwide, all the professionals. If we're all working around this farm family, we can help them succeed if we all are willing, and that's what most of us who are in the service profession, we're here to help.
(23:22):Whether they're sitting down, the best form transition meetings in my mind happen when you have the accountant and you have their tax professional, you have their attorney and you have a good facilitator that's able to sit there and you're able to just to talk around the table together as a farm family. That's the whole goal of this Farm Transition network.
Libby Wixtead (23:44):Yeah, I will agree with you on that because that has been one of the coolest conversations that I've had the ability to sit down and listen to when we've been working through transition with some of my farm families, and I appreciate you guys are doing so much for Ohio and for our farmers. And where do you see the Ohio Farm Transition Network heading here in the next few years? Because it seems like you guys have put so much work into connecting all of the dots and trying to get all of the farmers, their professionals, all on board to help them through this.
David Marrison (24:23):We have some big goals. We want to have more people in our state that what we would call farm succession coordinators, people that can go sit and help farms have these conversations to build the capacity of people that are trained, that are available on a list that farmers can go to. Other goals are to continue programming, providing programming for agri professionals like yourself, Libby, to just keep building your skills in this area and then as a group, as a team, as a network, build the resources that are needed by farmers to be able to more methodically and more effectively and efficiently move through the transition processing. So it could be like a spreadsheet that we have put together to help farm families. It could be some guides on how to have a better farm business meeting. So we're trying to think about those resources that we can offer for farm families. Maybe it's even workshops that
(25:30):Farm families can go to that tool system. So our big goal is to flip that number of where only 30% of our farms in the state of Ohio have a transition plan to 70 to 80% have a written transition plan. To completely flip it to where Ohio producers as part of their whole management cycle is that every farm family has been thinking about that transition plan going forward, and they're constantly improving it from year to year to year. Just like we would improve our field operations, our livestock operations from year to year to year, looking at production efficiencies, maybe the management efficiency of good transition planning. Estate planning is something that we need to put a little higher on our management sphere of tasks that we do in the farm.
Libby Wixtead (26:24):Yeah, businesses, a lot of businesses do that, and we are farm businesses now and we need to take a look at that management piece of it. You guys have such exciting things happening, and I appreciate you being on here with us, and I appreciate Ohio State and all that they have done, especially with, I mean the Farm office website. If our customers have not been on there and they need to go on there because there are so many resources, and then adding the Ohio Farm Transition Network on there, we will put all of those dates that you talked about David and the website. We'll make sure that is in our show notes, so anybody, if you're driving, just know that you can click on our links and we'll have all of the information for us. Thank you so much again, David, we really appreciate having you on here.
David Marrison (27:15):My pleasure. I really appreciate what AgCredit does for our farmers. Thank you.
Libby Wixtead (27:21):Thank you and everyone go visit that website and we thank you so much for tuning into another episode of AgCredit Said It and we will talk to you guys next time.
Speaker 1 (27:37):Thank you for listening to AgCredit Said it. Be sure to subscribe in your favorite podcast app or join us through our website at AgCredit.net so you never miss an episode.