Ag Land Leasing, Budgeting and Management for 2021 - Landlord/Tenant Cash Rent Workshop for Eastern Nebraska 2/25/2021

Department of Agricultural Economics Author

02/26/2021 Added

12 Plays

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Ag Land Leasing, Budgeting and Management for 2021 - Landlord/Tenant Cash Rent Workshop for Panhandle Region 1/7/2021

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[00:00:00.000]Jim Jansen: Cash rental reads.
[00:00:02.970]Jim Jansen: How do you figure out a cash friend considerations for lease arrangements.
[00:00:09.300]Jim Jansen: Second part today we have gone as a clerk who is our budget analyst with the university she spends a lot of time working on.
[00:00:17.190]Jim Jansen: Crop budgets livestock budgets, Glenys and I both work on what is called the customer custom rates report the custom rates report is actually thing that documents, how much does it cost to plant, if you want to hire somebody to plant corn or harvest soybeans or operations on a farm.
[00:00:40.230]Jim Jansen: The third part today we have Alan venality and.
[00:00:45.210]Jim Jansen: Austin or felt their presentation today, when we initially got the grant to provide handouts to people and.
[00:00:54.840]Jim Jansen: You know, some of these things it costs money to send those handouts out and i'll talk more in a few minutes about the handouts today.
[00:01:02.310]Jim Jansen: But the money to get the handouts today was provided by a grant and the motivation of our grant is dealing with disaster now in 2019 when we wrote this grant the disaster that was happening at that time was.
[00:01:18.300]Jim Jansen: With respect to flooding now 2020 the disaster was a little bit different and it caused havoc with things with like prices and some of those things.
[00:01:28.950]Jim Jansen: But rolling into 2021 here, and I know we've gotten along a lot of snowfall on the high 80 corridor that we might call it, but there is concerned, once again about drought.
[00:01:41.130]Jim Jansen: So Austin and alan's presentation is talking about dealing with disaster say you have a windstorm or a tornado go through, and you get a bunch of debris deposited on your ground, how do you deal with that that's kind of the motivation of their presentation today.
[00:01:59.760]Jim Jansen: So I think you'll find that we've had a lot of good comments coming in, and if you got questions as we're going along, you can type them into the chat.
[00:02:09.240]Jim Jansen: You can send us an email, we are more than happy to answer them and i'll have my phone number, as well as the other speakers will have their phone number and contact information.
[00:02:20.670]Jim Jansen: As we're kind of going along here so hopefully everybody can get on that wanted to join us today and.
[00:02:27.870]Jim Jansen: I think we got pretty nice little group had a good number of registered and, hopefully, if you can't take it in live.
[00:02:34.320]Jim Jansen: We were also recording and that's just a reminder to Alan and Ryan, who are helping moderate this today, I think we're recording but this presentation will be recorded.
[00:02:45.390]Jim Jansen: And after our technology as staff member can get this all put together you'll get a email after the meetings over that if you'd like to share this meeting with someone or, if you would like to.
[00:03:01.500]Jim Jansen: Forward it on to someone or go back and watch parts of it you're more than welcome to no no cost or anything like that okay with that, I think.
[00:03:15.570]Jim Jansen: we'll go ahead and.
[00:03:18.690]Jim Jansen: Ryan, do you want to go ahead and mute everybody just make sure we can go ahead and get started, and with that we'll go ahead and start rolling through our slides.
[00:03:28.950]Jim Jansen: So the name of our presentation today is effective budgeting negotiations and management strategies with respect to land management in nebraska our presentation slides if you're just joining.
[00:03:43.350]Jim Jansen: us and we just had a handful of people enter in again.
[00:03:46.170]Jim Jansen: Presentation slides.
[00:03:47.340]Jim Jansen: can be found at the.
[00:03:48.360]Jim Jansen: Farm w and l.edu backslash FAB 2521 the link is also in the chat pane for the meeting so you're more than welcome to join through that means.
[00:04:03.480]Jim Jansen: Our presentation today the materials if we'd be doing this in person, but we're doing it virtually so we did have some expensive mailing the handouts on the materials, it costs about $9 for.
[00:04:16.590]Jim Jansen: All this, all these things, so we asked a you may notice, if you get the handout.
[00:04:22.200]Jim Jansen: We asked if you take the evaluation and take it seriously and let us know your honest opinion on our presentation today, because this is what we have to report back to the people I gave us a grant.
[00:04:32.550]Jim Jansen: If you'd like us to continue doing these in the future, honest assessment good bad anything in between we're always looking for that.
[00:04:42.150]Jim Jansen: My name is Jim jansen I work as an extension economists here for the state of nebraska awesome beer felton on myself we kind of share the eastern.
[00:04:51.360]Jim Jansen: Roughly everything about East of grand island in the state, we kind of work on together, my background is in land economics evaluation of assets, how do you figure out what something's worth.
[00:05:05.220]Jim Jansen: farm management crop production livestock production that kind of thing Austin is a very talented individual with respect to.
[00:05:14.760]Jim Jansen: Farm finances taxation accounting little bit different background, but so we kind of try to work on things together and depending on your question will try to move these.
[00:05:27.060]Jim Jansen: Okay, so a little bit on the real estate serve him yesterday I worked until six o'clock last night entering into 2021 survey.
[00:05:36.660]Jim Jansen: nebraska farm real estate survey was started back in 1978 by Dr RON Hansen and Bruce Johnson each year since then we have continually evaluated.
[00:05:48.780]Jim Jansen: Farm real estate with respect to land values, as well as cash friends, our survey was started in 1978 and we have done it since then we do two things each year.
[00:05:59.730]Jim Jansen: first thing we do is we do a preliminary estimates that are published the second week of March that preliminary estimates document basic changes and land values.
[00:06:11.280]Jim Jansen: And if you're joining our call today whether a landlord or tenant The second thing that they just take a look at is they take a look at caf rental rates cash rental rates for cropland grazing land cow calf barrett's.
[00:06:26.250]Jim Jansen: That information can be found on the brassica prime real estate website which link is given on the bottom of this slide so if you're taking notes.
[00:06:34.110]Jim Jansen: that's kind of a link that you might want to take note of.
[00:06:37.350]Jim Jansen: The full report comes out in June, the full report, we have a few more responses, so the numbers might change a little bit, but they're usually fairly close and the final report also has additional things like what percent of land in nebraska sold me a cash sale something to that nature.
[00:06:58.170]Jim Jansen: The state of nebraska our focus today the meeting was on eastern nebraska but you'll find all of the information we're discussing, we will also provide.
[00:07:07.380]Jim Jansen: numbers for the greater state of nebraska our survey results, what we do is, we take the 93 counties in nebraska.
[00:07:15.330]Jim Jansen: And divide them into key different regions so depending upon if you say your property was in Sherman county your property would be in the Central District.
[00:07:25.440]Jim Jansen: or Lancaster county we're kind of focusing our meeting a little bit on the east district, but that would be the East, the East district right here.
[00:07:34.110]Jim Jansen: North fork is in the northeast o'neill is in the north North platte is in the southwest scott's bluff in Sydney I believe are both in the Northwest.
[00:07:45.630]Jim Jansen: And the actress is in the southeast so that's kind of how we break the state down well you'll find, as I go through my presentation we kind of start at the regional level.
[00:07:56.190]Jim Jansen: We work, down to the county and then towards the end we're going to do some on farm examples, how do we figure out what the cash French should be given where everything's going.
[00:08:06.390]Jim Jansen: I know a lot of people are after the rates and I often run the summary statistics that we're finally starting to get enough in that.
[00:08:14.580]Jim Jansen: We kind of have a feel on where things are going, but we got to analyze those numbers and that's our project for late this week and next week as well.
[00:08:23.880]Jim Jansen: I would ask you, is if you're paying rent or receiving right relative to the rent you're getting how do those Katrin size up against where the 2020 averages were.
[00:08:34.080]Jim Jansen: Think of Catherine has kind of like a trajectory and depending upon where things are headed that's probably going to influence which way catherine's might be heading.
[00:08:45.300]Jim Jansen: you'll find if you're following along in the slides, for the sake of time on Austin illness and I found that this program we had to kind of consolidate some things down because.
[00:08:55.020]Jim Jansen: You know, taking sitting in front of a computer for multiple hours listening to someone talk kind of gets along.
[00:09:01.560]Jim Jansen: But the nebraska average land value there's different types of land values reported in our report.
[00:09:10.320]Jim Jansen: If you take into account all the different types of land you come up with what is called the whole land peg land value.
[00:09:18.360]Jim Jansen: We estimate the market value of land at a point in time remember if you're doing a State work or transition work.
[00:09:26.400]Jim Jansen: Sometimes when it comes to a state you're in a value of that property on the day of someone's passing or maybe the day after.
[00:09:33.780]Jim Jansen: Even if it takes several years for the state to get settled, you have to put a value on something at a point in time.
[00:09:40.170]Jim Jansen: Now that value is different than how we assess value, but the estimated market value in 2020 we noted things had been on a decline and we noticed her up slightly.
[00:09:50.220]Jim Jansen: One area we didn't notice a decline, but on average Eastern part you know 234 or 5% the Western two thirds a little bit different than that but.
[00:10:00.510]Jim Jansen: up slightly Okay, we like to see gradual changes in real estate values we don't like to see huge swings up or down, we like to see gradual changes over time.
[00:10:12.690]Jim Jansen: The average value for the state of nebraska is a little less than a little over 20 $700 an acre and if you took a historical look which that's what the next slide is, if you take a historical look at.
[00:10:26.880]Jim Jansen: land values in nebraska what we see his land values over time have changed in recent history let's see if I can get my laser pointer up for everyone, there we go.
[00:10:40.320]Jim Jansen: we'll see in recent history it rose rapidly it started in 2012 with a drought ethanol created access demand exports and we seen the price of one of the things we raised reach record prices and 1213 and have since come down.
[00:10:58.020]Jim Jansen: land values also increased came down and now they're up slightly, and you know if i'd hedge your bet without even looking at in the numbers i've seen so far.
[00:11:06.720]Jim Jansen: anticipate we might see land values increase them remember assessed values in the state of nebraska with respect to property taxes are based off a three year median ag land value.
[00:11:22.200]Jim Jansen: What is meant by that is.
[00:11:25.410]Jim Jansen: How we assess land, when we look at assessments, they look back over the prior three years was prior three years might be different one than where real estate values are headed there's a little bit of a lag between the two.
[00:11:38.910]Jim Jansen: The other thing when we talk about cash rents, a lot of people right now, or that have expressed to me that they think commodity prices are up by all means, yes commodity prices are higher than what we.
[00:11:53.640]Jim Jansen: had seen say six or seven months ago, but when we talk about cash flow and you're probably trying to take into account that the thing remember on cash rental rates, with respect to commodity prices.
[00:12:07.230]Jim Jansen: If we're looking at the price of corn soybeans wheat whatever six months eight months from now they're not $5 a bushel for corner they're closer to four.
[00:12:19.410]Jim Jansen: Now, have $4 I think you're going to see from genesis presentation that your cost of production is probably going to be covered, it forward.
[00:12:26.970]Jim Jansen: But the thing to note is there's a difference between what we call the old crop the crop that we have in storage right now versus a new crop that we hope to be planning and several months.
[00:12:37.020]Jim Jansen: And you gotta be talking about what is equitable for a cash rental rate give them the value of what we anticipate we're going to have.
[00:12:45.660]Jim Jansen: The other thing right now, one reason that we're seeing land values, possibly go up, and I think we're seeing residential homes and long the it corridor on the hall and can be an island.
[00:12:57.330]Jim Jansen: North platte carnies guys off I would assume as well, interest rates, I put up the 10 year treasury yield rate on the slide just note.
[00:13:07.320]Jim Jansen: Some of the macro economic some of the some of the you know, national or international economic set so we're trying to combat right now with code, one of the things that Federal Reserve has done.
[00:13:19.860]Jim Jansen: They have dropped the.
[00:13:23.310]Jim Jansen: yield they market prevailing interest rates for different things in some of the land loans are seeing right now that have been reported to me and housing loans.
[00:13:33.090]Jim Jansen: You know it's possible to get 30 year mortgage on a house for 3% or less, you can maybe get a land loan right now three and a quarter to three and a half.
[00:13:44.730]Jim Jansen: For 30 years fixed and that's one reason we're seeing you know if land values are increasing, it might be due respect to the fact that if you're in the market by you're thinking Okay, at least if i'm making a land payment I can get it at a very low interest rate right now.
[00:14:03.840]Jim Jansen: One thing I want to point out, and I know a lot of folks are filing their property or excuse me they're filing their state income, as well as federal income tax.
[00:14:12.180]Jim Jansen: One thing that changed, and I know this was very controversial with respect to people have a lot of various views on it and i'm not going to express my view on it i'm just going to stay what the proposal was and what happened.
[00:14:24.120]Jim Jansen: This past summer there was a ballot initiative drive the ballot initiative was successful.
[00:14:30.270]Jim Jansen: With getting it on the ballot in November, in addition to the federal election, we had three I think there were five total things on are valid.
[00:14:39.660]Jim Jansen: But three of those five had to deal with gambling gambling know what they returned as horse race track facilities.
[00:14:47.250]Jim Jansen: And the revenue generated from the gambling, so the taxation funds is kind of a second bullet point right here one of the ballot initiatives was that the earmarks 70% of the roof of the taxation funds generated have to go towards property tax relief.
[00:15:05.400]Jim Jansen: And we'll see on the next slide here what actually happened when the vote wind down.
[00:15:11.310]Jim Jansen: All three of the ballot initiatives that were on the that had to be voted on all three of them passed and we give the summary here of what they were if you want to read more on it, but the thing to note the initiative or 31 that earmarked where 70% of the casino taxes went past.
[00:15:31.980]Jim Jansen: And from that what we're going to be seeing now.
[00:15:36.120]Jim Jansen: Is on your state in nebraska income tax return there's a new credit.
[00:15:42.450]Jim Jansen: This new credit, you have to file a separate form, so an awesome Community comment on this one he doing this slides he wrote a nice article on it.
[00:15:52.050]Jim Jansen: The thing to note is, you have to file a separate form and with this form, you get a small portion of your property taxes that you pay on residential or agricultural.
[00:16:03.630]Jim Jansen: will come back to you as an income tax credit now this credit is projected to grow over time it starts small and it grows over time, as we get taxation revenue coming in.
[00:16:15.420]Jim Jansen: But just if you're doing your personal taxes now take a look around and find information on it or visit with your taxation planning or preparation.
[00:16:26.220]Jim Jansen: The folks that do your taxes just be aware of this.
[00:16:32.250]Jim Jansen: Oh yeah what is influencing land values back in 2020 when we ask this question to the top two or yes, the top in the top four real estate taxes or negatively.
[00:16:48.060]Jim Jansen: influencing land values, according to the folks that took our survey.
[00:16:52.290]Jim Jansen: course when crop prices aren't good there you know it's a negative factor and negative outlook input expenses are always a concern livestock prices, you know they're a little.
[00:17:02.730]Jim Jansen: They were shaky last year for periods of time what are leading to land value increases interest rates are just slightly positive but it back in 2020 the outlook wasn't very bullish.
[00:17:14.910]Jim Jansen: My guess is is when this slide gets updated here for 2021 we're going to see a lot of these things I think crop prices are going to be a very positive force.
[00:17:24.990]Jim Jansen: Property taxes, I think, will continue to remain a concern, but some of these other things like federal form programs.
[00:17:33.300]Jim Jansen: You know, some of these other issues up here I think they will be more positive so we'll have to see what happens.
[00:17:42.960]Jim Jansen: Okay, so we kind of just went through what is happening with respect to land values, what are the big concerns interest rates profitability of farming are definitely two factors that influence real estate values.
[00:17:59.490]Jim Jansen: Property tax credit for the state of nebraska be sure to file the form, if you own any real estate, as long as you file a state of nebraska income tax get out of federal better state helsing a pile of federal.
[00:18:13.860]Jim Jansen: You would be eligible to get that small tax credit and I a gallon and Austin will probably comment, a little bit on that i'm pretty sure Alan did it on his farm that he owns or work through the process, so it can maybe give you a little background on that.
[00:18:27.510]Jim Jansen: All right, on the topic of cash rental rates.
[00:18:32.010]Jim Jansen: We have a breakdown here we'll start with dry land irrigated grazing we're going to start kind of in the region and, finally, another source of where you can actually get katherine's for your farm at the county level and then we're going to talk about some farm level examples.
[00:18:50.730]Jim Jansen: So, remember, I know you're after 2021 but sometimes you got to look back in the rearview mirror and see where men, because if you don't know exactly where you bend it's sometimes hard to.
[00:19:02.850]Jim Jansen: understand where things might be head, what do we see here and 2020 we basically seen catherine's on average across nebraska forward either up slightly or in the case of the southwest, for example, this down slightly overall they were fairly stick.
[00:19:22.440]Jim Jansen: In addition to the average of the regional rate, we also have what we call the high grade in the low green.
[00:19:30.750]Jim Jansen: The high grade represents the average of the high third of cash rent and the low grade represents the low third average a cash rent.
[00:19:41.940]Jim Jansen: Remember, these numbers will be updated in about two weeks, so I got some work to do to get these numbers all going, but with respect to the cash rental rates, we see that.
[00:19:54.930]Jim Jansen: The cash friends by region, we can at least get a feel for how to cash friends very around in region.
[00:20:01.380]Jim Jansen: There are certain counties in the East, Central and West, that you know they might have a higher rate they might be more commonly associated with the high third or the average.
[00:20:12.090]Jim Jansen: There may be other counties are associated with the lower third low third about these are all estimates you got to kind of sort through the information and find your way through these things to figure out what works for your farm.
[00:20:26.820]Jim Jansen: Once again, the rates for the entire state will be updated the second week of March, towards the end of the week.
[00:20:36.180]Jim Jansen: Another source of cash revelry information, I do not personally in or do as anyone at the University of nebraska have anything to do with this survey the surveys conducted by the usda they have a division, called the national agricultural statistics service or nass.
[00:20:57.150]Jim Jansen: It typically do a survey and odd numbered years but, on occasion, they also do it in even numbered years and they usually publish their.
[00:21:06.960]Jim Jansen: survey results towards late summer early fall kinda in the second week of September, their information can be found at this link it's fast that I have listed here.
[00:21:18.540]Jim Jansen: Now, if you do have the handouts, I know there's probably about 20 people out there that did not get them, we will be getting them in the mail when our printing services gets us handouts.
[00:21:30.090]Jim Jansen: If you get your handouts you're going to notice the next slide is very hard to read and you'll have the numbers up in front of me here.
[00:21:38.340]Jim Jansen: If you bookmark where we're at right now in the booklet and fit flip to the back end of the booklet you're going to see that i've actually put in the back of their this slide.
[00:21:49.230]Jim Jansen: And I also provided a link at the bottom of the slide where, if you type that into the computer, you will be able to find it online.
[00:21:58.590]Jim Jansen: And what we're seeing in there is their cash rental rates they produce an average for driving cropland irrigated cropland as well as grazing land on a per acre basis.
[00:22:11.370]Jim Jansen: And we have a breakdown here of the entire state of nebraska you'll notice, if you have any properties, a lot of here in the Ad court or you know up here in the sand hills.
[00:22:22.860]Jim Jansen: Your counties in white either there's not a lot of dry land cropland up in the sand hills, which I would say that should be a fairly true statement.
[00:22:32.760]Jim Jansen: Or, they cannot get enough people to respond that they would disclose the confidentiality of the farmer or operators ranchers that would respond to the survey.
[00:22:44.130]Jim Jansen: other thing I will tell you when you're looking at your numbers, regardless of where you're at panhandle eastern, central.
[00:22:51.600]Jim Jansen: These numbers typically get updated in odd numbered years also when they get updated they're not always every county gets an estimate.
[00:23:02.070]Jim Jansen: But if you're sitting here in the panhandle, for example, or the East, which counties tend to have the higher cash rent which counties tend to be maybe in the lower third you know.
[00:23:13.140]Jim Jansen: This can kind of be an indication that if you're thinking of this as a puzzle so here in the panhandle you can kind of get a feel that there's certain counties.
[00:23:21.510]Jim Jansen: Are up in this area, or maybe down in this area that are associated with the lower third and maybe the average or the upper third earth associated with more in the central area.
[00:23:33.450]Jim Jansen: question that came in, where do I respond to the survey, so the usda conducts their own survey I don't know how they find the people, exactly, my understanding is it's operators respond to it and they respond to it accordingly that way.
[00:23:50.010]Jim Jansen: Okay here's the breakdown on the cash rents, a little bit on the eastern we see that the catherine's are typically a little bit higher kind of hear the Wayne southern Dixon the cedar.
[00:24:01.440]Jim Jansen: Coming county area that's kind of the breakdown that we see on the capture and they're also generally speaking, this isn't always true.
[00:24:10.140]Jim Jansen: Higher cash rents are when you're looking at the district level tend to be more towards the East and in the West, especially on dry land crowd plan by.
[00:24:19.710]Jim Jansen: Every 25 miles Northwest in this state, you lose an injury, so the farther West you go on the dry land, it can go from you know, in the.
[00:24:29.100]Jim Jansen: Low to mid 30s here in Richardson county all the way to you know 12 to 14 inches saying sewer scottsboro off, so you got to plan accordingly and those get vetted into Catherine raids.
[00:24:44.730]Jim Jansen: Alright, switching gears here to irrigated cropland I know people have irrigated catherine's.
[00:24:50.370]Jim Jansen: A few things to know the University of nebraska when we report a rate for gravity or Center pivot here you cropland and I didn't have any questions come in on gravity rates they are in the booklet and they are in the slides that will be sent out.
[00:25:04.830]Jim Jansen: When it comes to the Center pivot irrigated rental rates This assumes that the land, Lord land owner owns the entire irrigation system.
[00:25:16.740]Jim Jansen: Heaven the pump the powering it why because the calf rental rate being paid is compensating the landlord for that entire investment.
[00:25:27.360]Jim Jansen: If you have a tenant providing one of those things you would probably discount the cash rent to account for that obviously few slides for this, the end that will talk briefly on that.
[00:25:39.480]Jim Jansen: irrigated calf around rates by region, the spread that we see on cash rental rates fluctuate significantly across the state by region.
[00:25:48.900]Jim Jansen: You know, in the Northwest it goes anywhere from about 100 275 up in the northeast you have roughly an $80 spread somewhat similar here in the East, as well as the southeast and the central and other areas.
[00:26:03.660]Jim Jansen: What influences cash rental rates for Center pivot quality of the land degrees slope soil type I know it's irrigated but how much is rain in there and.
[00:26:13.890]Jim Jansen: Also, do you have a type of technology on your irrigation system that you can turn on and on, with a smartphone or your computer the ease of management of the system, or do you physically have to go out there and started up all these things influence cash rental rates.
[00:26:33.900]Jim Jansen: The other thing i'll challenge landlords and tenants.
[00:26:38.490]Jim Jansen: who's maintaining the system.
[00:26:41.310]Jim Jansen: If you have someone out there, that is willing to do those kind of services, whether landlord tenant that's worth money in addition to their time.
[00:26:49.440]Jim Jansen: Because if you hire an outfit to go out there and do those types of services as any kind of mechanical work it costs a lot of time, effort skilled talent, to think about gain a vehicle or tractor whatever worked on.
[00:27:05.040]Jim Jansen: Trade professionals, you know 70 to 150 an hour depending on where you're at and what they're doing all influences are rates that we have reported.
[00:27:17.460]Jim Jansen: The irrigated rental rates you'll notice in eastern nebraska there is an area of these counties here, where we don't see as much irrigation.
[00:27:27.420]Jim Jansen: The way the aqua first sits we don't have necessarily as much irrigation their relative to other areas, and also, it does rain more there.
[00:27:35.010]Jim Jansen: And in certain parts of like Richardson county there's land formations area that while you can put a terrorists up I don't think you can necessarily run a pivot over that very well.
[00:27:47.820]Jim Jansen: A few things to note if you're in an area of the state, and this would apply kind of here to the it corridor, where some of the land is fairly flat.
[00:27:56.310]Jim Jansen: We don't see this so much necessarily in the northeast we do have a pocket of it up here in the North as well on the topic of irrigated cash rental raids.
[00:28:07.770]Jim Jansen: The.
[00:28:09.570]Jim Jansen: How should I say this, if you're in an area where there's a lot of flooding or grabbing irrigation.
[00:28:18.240]Jim Jansen: hold on a second they just reminder down or Ryan there's still people that are trying to get into the meeting so keep an eye on that.
[00:28:26.790]Jim Jansen: On the topic of gravity and flood irrigation versus Center pivot if you're in an area of the state here, where we have.
[00:28:36.630]Jim Jansen: Those kind of production practices remember it's kind of like a weighted average they come up with the say, for example in buffalo county if a third of the ground in this county.
[00:28:46.410]Jim Jansen: Is gravity or flood irrigated they come up with kind of a weighted average gravity irrigation tends to rent for somewhere between 30 to $50 a day for less than.
[00:28:58.920]Jim Jansen: What Center pivot does because you don't have the physical structures out there, the chapter maintain and carry insurance on quote as bunch.
[00:29:07.950]Jim Jansen: So that's why we see some differences in the rates and what the usda reports compared to the University of nebraska university nebraska we report we dissect and report to different rates other areas not quite as much.
[00:29:25.200]Jim Jansen: Okay switch over here to the grazing land rental rate will see here in nebraska, this is probably the one rate that we have the most responses for, and there are counties, even where I grew up say up in cedar Dixon thurston area, then clearly there's grazing land there.
[00:29:44.820]Jim Jansen: counties and white that couldn't get enough responses back.
[00:29:49.080]Jim Jansen: For the pasture per acre rental rate in the 2020 season.
[00:29:56.160]Jim Jansen: reporting by the usda we have that displayed on the slide here rate fluctuates quite a bit central Western the stocking rates are definitely influencing the cash rents in the eastern part you'll see here that.
[00:30:13.110]Jim Jansen: in the eastern part of nebraska you know some of the highest per acre rental rates that we have reported.
[00:30:19.920]Jim Jansen: They tend to be in some of these areas where.
[00:30:25.500]Jim Jansen: We have a very low stocking rate, not a lot of grease.
[00:30:30.120]Jim Jansen: Eastern you know you're talking 567 acres down in this area in even more acres to support a cow cow period as part of the West you go into state.
[00:30:43.080]Jim Jansen: Another way set a cash rental rate with respect to cow calf pairs for one cow one calf during the summer grazing season for one month.
[00:30:53.430]Jim Jansen: You can talk about our per pair or in the case of stalkers stalker rental rate on the topic of prepare rental rates, we see let's just pick on the southeast here, the average rate reported was basically $50 a pair.
[00:31:10.530]Jim Jansen: Take $50 a pair of times five five month grazing season it'd be roughly talking about 250 a pair.
[00:31:19.350]Jim Jansen: If you're in the north district, for example, which is about 60 if you take 60 times five that'd be roughly a rate of $300 a pair.
[00:31:28.920]Jim Jansen: What influences cow calf or grazing land rental rates couple things.
[00:31:34.710]Jim Jansen: Quality of the property Okay, you know there's formations in the sand hills so extreme slow, you have to try to run a fence around there is not the easiest thing to do, always so the quality of the land stocking rate weed control who's maintaining the fencing.
[00:31:52.830]Jim Jansen: All these things are negotiable remember if you're renting a property to someone and you're expecting them to take care of that this holes or cedar trees.
[00:32:00.120]Jim Jansen: Are you writing them a property that has extreme issues if you're doing that you probably need to charge a lower cash rental rates incentivize with a person say hey.
[00:32:10.800]Jim Jansen: What do we need to do together remember it's a partnership every contract is a partnership, what do we need to do that we can work towards figuring out a way to better manage the land.
[00:32:21.750]Jim Jansen: If you know you have extreme Russia issues can we put our property and says like three thirds you're going to work on Russian have one third one third one third over time.
[00:32:33.120]Jim Jansen: You know, sometimes when you have big issues kind of carving that out over time.
[00:32:37.890]Jim Jansen: Is it more manageable thing than trying to tackle this you know this monstrosity of an entire section that says covered in the cedar trees can dissect it work on the issue it's easier to maintain into the future than.
[00:32:54.930]Jim Jansen: The range that we see on the cash rental rates would reflect some of those things I just described.
[00:33:00.090]Jim Jansen: It, especially in the north district, we have the average age of the ranchers tends to be a little bit higher than what farmers are.
[00:33:06.900]Jim Jansen: And you know i've had people indicates me and maybe we do their health or age or may not have the greatest back that caffeine, is something that.
[00:33:15.240]Jim Jansen: Maybe they might print out a portion of their property they aren't necessarily taking katelyn but they're willing to do some of those things where they're willing to keep an eye on the cattle and attendance stop there.
[00:33:26.970]Jim Jansen: talked to a gentleman this week for me to nebraska and intakes cattle, all the way up to Valentine.
[00:33:33.720]Jim Jansen: And he goes out checks them they don't necessarily take the cattle in, but he knows when he takes the cattle out there, that he can trust the landlord to do some of these things.
[00:33:46.170]Jim Jansen: Okay final part here's going to be queuing up Austin and alan's presentation, but also a lot of motivation for Glenys is talk talking more about budgeting, how do we think of some of these things.
[00:33:58.650]Jim Jansen: Few different ideas for setting kashrut So if you know march one is kind of the deadline for cash rents and that's why we tend to get a fairly good.
[00:34:07.650]Jim Jansen: fairly good Rita people registered for some of our meetings here in late February.
[00:34:13.410]Jim Jansen: On the topic of cash rents there's three different ideas, and I really like the first two.
[00:34:20.160]Jim Jansen: So I know there's been a lot of information covered, you know, after this talk go tab lunch taking a gluttonous as talk this afternoon, she doesn't very nice job too.
[00:34:30.600]Jim Jansen: But give it a day and then sit down and start looking through the numbers get a calculator scratch paper out and start playing around with things.
[00:34:39.600]Jim Jansen: The first idea to be playing around with on the topic of county level cash rental rates.
[00:34:46.860]Jim Jansen: If some of these numbers, we reviewed today you've got a very good indication of your area and what you think the Catherine might be, you know, also to know happen to know what the average counting cornelius.
[00:34:58.770]Jim Jansen: That link I provided you on the handouts today in the back of your book, you can also take a look at what average county corn or soybean or wheat fields are on the usda website.
[00:35:13.290]Jim Jansen: Take the average county rental rate divided by the average yield for a crowd you get what is called the average county rent per bushel.
[00:35:23.190]Jim Jansen: And this made up example what this says is for every bushel and green sold on rented ground in this county $1 13 and the sales price is going towards what.
[00:35:34.890]Jim Jansen: going towards paying the rent now as $1 13 a lot of money promotional well as past July went my local elevator when they were only paying 286 emotional, that was a lot of money.
[00:35:46.950]Jim Jansen: A little bit different when corn prices when the outlook on corn might be closer to for a little over four.
[00:35:53.400]Jim Jansen: Take the average counting rent promotional side in the upper right hand corner here.
[00:35:57.840]Jim Jansen: Take it times average yield average yield a pH is a historic number associated with your crop insurance policy for a property, you know at the county rent promotional is times average yield you would get one who would get an estimated arm level cash.
[00:36:15.810]Jim Jansen: Okay, we take what we know at the regional level, we step it down to this one way to estimate a catcher and already.
[00:36:27.000]Jim Jansen: Another idea for setting cash rents comes from this thing called cash equivalent from crusher what cash equivalent from crops here says is.
[00:36:36.900]Jim Jansen: otter folks like the idea of a crop chair, but if you're an absentee landowner you know you may not have an interest in doing that because you have to sell the brain or you know just a hands off.
[00:36:47.220]Jim Jansen: approach that you'd like to manage your property, but you understand if you were on a crop share what you make off of that crop shares subject one.
[00:36:58.260]Jim Jansen: Subject to the crowd price in this example, I have here for 2020 is just to demonstrate this point.
[00:37:05.850]Jim Jansen: Say that about a year ago, when you signed your lease the expectation for crop prices was about three and a half roll forward to July Now this is, I think that he's using futures prices here.
[00:37:18.990]Jim Jansen: You know 310 a bushel because of the pandemic we get through until November, you might have said hey I can sell my corn at $4 a bushel i'm going to pull the trigger and do it well, if you pull the trigger intuitive $4.
[00:37:34.890]Jim Jansen: You know there's a lot of difference there but it cash equivalent from crop share the ideas if you're trying to set a cash friend.
[00:37:43.080]Jim Jansen: You would be hopefully willing to offer your landlord roughly what they anticipate they make off that chair, remember that value can take the landlord share the crop hundred and 60 bushel per acre and, if you take that and.
[00:37:59.340]Jim Jansen: hundred and 60 bushel per acre times the average yield they would get half the crap 160 times half is at she have a landlord share in the revenue.
[00:38:10.320]Jim Jansen: minus a landlord share expenses half of the seed fertilizer and chemical and a 5050 split, we can see that the calf rental rate the effective catrin it can vary quite a bit depending upon what your outlook is.
[00:38:26.610]Jim Jansen: And the other idea cash equivalent for patient care, have a lot of people say hey I got you know 20 acres here's something that.
[00:38:33.840]Jim Jansen: kind of an odd shaped piece of ground we just keep it in grass down big enough degrees, so we just want to cut it for hate, how do we set the cat friend on that.
[00:38:42.870]Jim Jansen: Two different examples here, so you can either do a one third two third split or you can do a 5050 split and let's just say this is grass hay is not alfalfa or you get to put established chrome.
[00:38:57.090]Jim Jansen: If you take a third of the crop times that an estimated price per ton we get $80 a ton right here.
[00:39:03.780]Jim Jansen: And you take off the landlord's share the expense in a one to one third two third splitting this example they're not paying the expensive this get a third of the hey.
[00:39:13.530]Jim Jansen: If they get a third of the hand the tenant would say hey i'll just buy out your third of the hey.
[00:39:18.720]Jim Jansen: You know your way what was out there, take a couple bales going away and figure out the math you can get about 66 bucks an acre another example of this property yield a two and a half tons and let's say you go out there and throw on $20 an acre and nitrogen.
[00:39:34.890]Jim Jansen: If that's the case that average tons per acre times the US you get a little bit more revenue, but you'd also have to take out some of the expense.
[00:39:45.390]Jim Jansen: So what is optimal crop share, well, it depends on what you want to do.
[00:39:50.880]Jim Jansen: And this is, I think this is a really good example because people always struggle and setting halen rental rates on grass parcels very basic example ask yourself if I got a third of the hay produced what's that hey worth do the simple math and you can come up with number.
[00:40:11.010]Jim Jansen: And finally return on investment every investment has returned and that return, maybe positive maybe negative.
[00:40:19.350]Jim Jansen: But for anywhere in the stage took the value of the land times rate of return right now it's very close to.
[00:40:27.150]Jim Jansen: You know a little bit more on irrigated a little bit less and dry and there's probably the lowest rate of return those on grazing land, you can get one, yet the effective rental rate per acre.
[00:40:40.950]Jim Jansen: All right, and this is kind of pulling everything together here right we wrapped up here in my section and just a few minutes.
[00:40:47.970]Jim Jansen: who's responsible if you have an irrigation system here in nebraska who's responsible for maintaining that irrigation system that was a survey question we asked.
[00:40:58.380]Jim Jansen: About half the time it's a joint responsibility between a landlord and attendance at the tenant will do the basic operations, but if you have something advanced you know you gotta.
[00:41:07.290]Jim Jansen: gotta pull the pump out of the ground is probably not an activity that an operator, we want to do at 10 it would want to do, maybe a landlord.
[00:41:15.810]Jim Jansen: A third of the time.
[00:41:18.090]Jim Jansen: The tenant just takes care of it and the remainder of the time you the landlord or someone on the landlord's behalf they take care of.
[00:41:28.140]Jim Jansen: How much you discount the cash rent if how much, would you discount the cash when when the tenant owns irrigation system we have the breakdown here, excuse me at the tenant owns a pivot.
[00:41:43.170]Jim Jansen: Not quite two thirds of time you take off somewhere between 26 to 50 bucks an acre So if you know what an aerial cash wrench and me percent or pivot area cropland.
[00:41:55.170]Jim Jansen: How much did you take off that rate if the tenant provides a PID.
[00:41:59.940]Jim Jansen: grammar the pivot just add the physical cost of it, we also have upkeep and a lot of people carry insurance Those are all expenses that if he divided them over the acres landlord wouldn't have to pay.
[00:42:12.450]Jim Jansen: Less than a third of the time, the discounts between 10 to 25 and then about 10% of time we either have more than 51 or you know that zero dollars.
[00:42:28.320]Jim Jansen: How much do you take off the tenant provides a power unit, this would be exactly i'm here good and parcel but the tendon brings like a diesel engine long.
[00:42:36.840]Jim Jansen: break down, we have here that discount is somewhere between one to $9 about you know mid to high 30s to 40s and about 10 to 20 around the 30 I say, generally speaking, if the tenant room is.
[00:42:52.230]Jim Jansen: powering it along, they tend to take off about around 10 1215 bucks an acre is kind of what we have reported based on our call volume that we've been taking.
[00:43:05.340]Jim Jansen: The final thing here to kind of motivates you to be thinking about what does it cost to do something, the focus of blindness is talk those be starting here in a few minutes.
[00:43:15.480]Jim Jansen: And 2019 we had a lot of moisture it was a very, very cold period, and then we just have that sudden warm stamp kind of like we had here in the last week.
[00:43:24.090]Jim Jansen: But it was much, much, much colder for greater extended period we asked a question did you have a provision in your lease to account for flooding damages.
[00:43:35.040]Jim Jansen: overwhelmingly here in nebraska or three four said no 15% said yeah we had some kind of partial provision and just a little over 5% actually had something in that leads to come flooding.
[00:43:51.510]Jim Jansen: For those properties in.
[00:43:54.420]Jim Jansen: That it had extensive prevent plant meaning you couldn't plant that crop in a timely manner, you couldn't play at that crop in a timely manner to allow the crop to mature and grow.
[00:44:09.300]Jim Jansen: By a third of the leases and may know adjustment to the cash run some reducing cash friend and then there was either no rent paid or another feature.
[00:44:18.960]Jim Jansen: Under the no rent paid the property may have been abandoned, meaning if you had six to eight inches of sand deposited across it.
[00:44:26.340]Jim Jansen: landlord dismay of let the tended out at least and said, you know living in a foreign this for a while, maybe it went into crp maybe they had a good big earth moving equipment on a portion I crown push the sand off or figure something else out.
[00:44:42.360]Jim Jansen: And finally here survey responses, did you change your lease going into.
[00:44:51.030]Jim Jansen: And things just not flooding, do you have something in your least to account for Alan will outline this better 90 drought, fire hail.
[00:45:01.080]Jim Jansen: Flooding all these things I don't care what kind of ELISE you have these things all influence catherine's and in 2020 we still had a large portion that did not address.
[00:45:12.840]Jim Jansen: flooding, but we did see some people, you know that quite have either had something or they made some adjustments i'm not saying you have to throw your lease out the window tomorrow start making gradual changes over the years, things that are more appropriate to account poorest.
[00:45:28.950]Jim Jansen: If you do not have a lease in writing.
[00:45:32.130]Jim Jansen: Please take a look at ag least 101 dot org you can get pre fill in the form leases there if you have a verbal lease pay attention to Alan stock he's going to talk about how you terminate that verbal weeks.
[00:45:47.610]Jim Jansen: And finally, this I failed to update this for our group today, if you like, the topic of my presentation Alan Austin glenna says, we have a program is called eglin management quarterly website link is given here on the top of this slide.
[00:46:04.680]Jim Jansen: one hour each business quarter of the year it's usually the second month I think it's either the second or the third Monday of the month.
[00:46:14.010]Jim Jansen: We kind of give an update and these updates fluctuate on all kinds of different topics land better cash rents lease arrangements growing season considerations.
[00:46:24.150]Jim Jansen: kind of what is a hot button issue for that day and we talked about here, I went into a lot more on that property tax credit, so you can actually go to this website and look up this webinar if you want to see some more details on the property tax credit, I was talking about.
[00:46:40.950]Jim Jansen: Oh yeah a few things to know Alan just typed it in their their next one is may 17 for land management quarterly free, open to the public, we don't do it physically anywhere other than from our desk and we asked.
[00:46:56.820]Jim Jansen: Yesterday talks land management quarterly in addition to do today's presentation is being recorded as we speak, and.
[00:47:05.610]Jim Jansen: We will send it it always takes us roughly a day Ryan Evans our technology.
[00:47:11.190]Jim Jansen: staff member he always has to download the recording put it up on the website and sometimes he has to you know, we call for something during the presentation he tries to clean it up a little bit.
[00:47:21.030]Jim Jansen: But with that we're going to go ahead i'm going to seize control from my computer here unless we see another question.
[00:47:30.210]Allan Vyhnalek: One more question, the question was.
[00:47:33.630]Allan Vyhnalek: of mine, and I, as a landowner getting on report respond to land land land rental rate survey.
[00:47:43.020]Jim Jansen: So that usda survey and I talked about this briefly i'll that survey when they asked that question on the county level Catherine maps, those are conducted by the US ski I don't have any input on who they actually survey or not in survey so.
[00:48:00.600]Jim Jansen: If you're an operator's you would get response Okay, and as Ellen noted, we have a whole bunch of these lane management quarterly is already up online, so we fluctuate the topics from season to season, but a lot of the things we talked about.
[00:48:17.370]Jim Jansen: Are kind of.
[00:48:19.080]Jim Jansen: Based on it okay with that.
[00:48:23.970]Jim Jansen: i'm going to stop sharing and do we have gluttonous on a seagull honest Okay, let us introduce yourself and i'll do a sound check for you.
[00:48:34.410]Glennis McClure: Yes, you know.
[00:48:38.100]Glennis McClure: moment i'm going to try to get make sure we've got the right do you see my screen yep no.
[00:48:43.890]Jim Jansen: There you go, I can see slides.
[00:48:46.590]Glennis McClure: Great Thank you alright, so my sound, is it okay.
[00:48:51.330]Jim Jansen: yeah your videos lanes a little bit, but your sound on my end is fine.
[00:48:56.460]Glennis McClure: Okay.
[00:48:57.150]Jim Jansen: All right.
[00:48:57.720]Glennis McClure: And I believe Alan you were planning on probably taking a 510 minute break when i'm done correct.
[00:49:04.290]Allan Vyhnalek: Three to 510.
[00:49:06.150]Glennis McClure: More laughs okay.
[00:49:07.380]Allan Vyhnalek: All right.
[00:49:08.700]Glennis McClure: All right, well welcome everyone, and yes, let me, let me know guys if my audio goes.
[00:49:14.490]Glennis McClure: Strange i've got two different configurations on that and, occasionally, I just have to make the switch I think it has to do with bandwidth and so on, so we'll do our best, I hope you can all hear me and see the slides right now.
[00:49:27.420]Glennis McClure: i'm glynis mclemore i'm an extension educator and firing range management analyst and the Department of ag economics actually Alan is my next door neighbor when we're on campus.
[00:49:38.070]Glennis McClure: You haven't been there as much we've been really busy though i'm able to work from home and do a lot of these webinars and that type of thing, so we.
[00:49:46.170]Glennis McClure: We just happened to all be there yesterday in our pod that was unusual that we're all on campus yesterday, so I enjoyed working with Alan and Austin and thank you, Jim.
[00:49:56.670]Glennis McClure: Jim and I work together on the custom rate survey, and so we talked a lot about that and I appreciate always hearing what he has to talk about with the land values.
[00:50:06.540]Glennis McClure: we're i'm also a farm partner live down south of the actress and we're also we rent out our ground to our nephew and so like to keep up with some of that information, we also have a poultry operation, so my husband keeps busy with that it's a breeding stock main operation so.
[00:50:27.570]Glennis McClure: Always things going on here on the farm and so and i'm willing to help you with budget information all that you want.
[00:50:36.720]Glennis McClure: And you know we get phone calls and I do actually talked to quite a few landlords as well as they're considering looking at.
[00:50:44.700]Glennis McClure: You know least arrangements and honestly I think you know, knowing they want to know the cost of production of for their tenants.
[00:50:52.050]Glennis McClure: and understand what's going on with everything but, again, these are the three main things that I work on through the department and then teach.
[00:51:00.180]Glennis McClure: Farm w and l.edu is the website that our communication specialist Ryan Evan to a probably with the somewhere in the background today.
[00:51:09.240]Glennis McClure: i'm helps to put together, so all the resources that you can imagine, really from the Department of ag economics and the management information that we provide.
[00:51:19.800]Glennis McClure: And really if you go to that website you're going to you're going to find these things, so you can there's a link to the crop badges livestock budgets.
[00:51:27.540]Glennis McClure: And our customers report so that's just kind of a go to place for our information, right now, are very, very.
[00:51:34.920]Glennis McClure: I guess proud of it very happy that we have that, so I really just have a few slides to go through with you and then i'm going to take time this afternoon.
[00:51:43.650]Glennis McClure: At 130 and to help you if you're interested take a look at our new egg budget calculator, so we are moving from eventually from doing our excel.
[00:51:55.980]Glennis McClure: spreadsheets budgets in that format to using what we call the exit to calculates on online program and I really like to show you how that works well, if you know someone if your landlord and you then I would encourage your tenants.
[00:52:12.900]Glennis McClure: operator to take a look at that so so they can put in their information and what the main thing that that program is going to do for us over time is.
[00:52:20.670]Glennis McClure: Is allow folks to really customize their crop production information, eventually, will have a lifestyle component in that so i'm going to work on that I am going to share in the chat right now I don't think I.
[00:52:34.140]Glennis McClure: hit enter on that yet there's a link, so if you're interested in that program and went to register to receive the link to that program I know a few of you have I sent out some links today.
[00:52:47.670]Glennis McClure: Go ahead and register your information, because we're really kind of in a testing phase with that so i'll talk a little bit more about that, but.
[00:52:54.630]Glennis McClure: Why do we want to know our cost of production and really i'd say there's you know there's several reasons that there's probably three main reasons that we would want to know this, but as a landlord you know what's The one thing that you want to be assured of probably.
[00:53:13.320]Glennis McClure: Probably that you want to get paid if you're on a cash basis you want to make sure that your tenants doing Okay, you want to make sure that.
[00:53:20.880]Glennis McClure: You know you're not charging exorbitant amount they can't they can't make it go Okay, you know that they have to meet their obligations and you want to make sure that if you're on a crop share basis.
[00:53:31.890]Glennis McClure: You want to make sure again that they're there you know being efficient with their implants.
[00:53:38.100]Glennis McClure: and growing the best props so that you have the shares that you expect, and that you can sell and have a return on as well as as a landowner.
[00:53:47.700]Glennis McClure: So of course we all want to make sure that our teams are taking care of the ground to.
[00:53:52.890]Glennis McClure: know, are they are they using the right inputs, you know lame conservation those kinds of things are we doing our part to help them, you know, make sure you know, all is going well, so um but obviously understand the cost of production and understanding.
[00:54:10.230]Glennis McClure: That that you know tuned to make some marketing decisions now, particularly in the last few years we've had very, very low margins.
[00:54:19.530]Glennis McClure: As far as what our costs are compared to what we can market, the green for all right, so this year we're starting to see things you know progress in the right direction, so we can see some positive returns again.
[00:54:32.850]Glennis McClure: Particularly in crop production so knowing their costs, I really can help them feel assured and even if you have your on a crusher basis you know.
[00:54:41.940]Glennis McClure: To understand you know where you are with your costs and making some decisions, so I you know to me it's just foundational to understand your cost of production.
[00:54:51.060]Glennis McClure: and, obviously, comparing different enterprises, so does this feel do better with corn generally.
[00:54:58.830]Glennis McClure: You know what other enterprises, you know Should I be planning is it good is it good to have that corn soybean rotation, is that the best use.
[00:55:07.200]Glennis McClure: of my ground and so on, comparing how those different enterprises are doing is really kind of important.
[00:55:13.650]Glennis McClure: And then also making some decisions, we always have some government program decisions this year and the insurance prices haven't come out, yet they usually are we come out.
[00:55:24.390]Glennis McClure: Based off of February information but understanding kind of what my costs are and what kind of level of crop insurance I should.
[00:55:34.680]Glennis McClure: want to make sure my costs are coming if there's a disaster, we never know when those direct code type things are going to happen, like I looked for instance last year, hopefully, those people were insured, you know.
[00:55:45.750]Glennis McClure: And so having that kind of information in relationship to your costs, what do I need to cover what kind of level of insurance, do we need to cover my costs is really an important thing so.
[00:55:57.840]Glennis McClure: So I always say that understand your class on an enterprise basis is really, really very foundational and the university what we provide with our.
[00:56:07.950]Glennis McClure: Budgets is really kind of helps us a guide help folks understand what needs to go into that and it's not that we're doing these budgets to say, this is the.
[00:56:17.820]Glennis McClure: You know, this is the way it has to be everybody has a different cost of production, why our land is different, we might use different inputs, but most particularly.
[00:56:29.280]Glennis McClure: machinery and equipment, I mean some folks can get by with older equipment they may have a lot of repairs, you know what's the best way to look at that so so there's definitely differences there, so I want to mention that, with the rough edges, we have at three different.
[00:56:47.040]Glennis McClure: Budgets that we posted for 2021 that represents 15 different crops, so we have quite a few the most we have our corn get dry land in any irrigated.
[00:56:57.330]Glennis McClure: We have about 10 different sorts we're being budgets that millet we've got sugar beets her out West so that's what we talked about 15 different crops and then we've done those for years, using the excel spreadsheet option.
[00:57:13.830]Glennis McClure: And so folks that have have worked with those know how to go in and work with excel and manipulate those that they better represent what they.
[00:57:21.360]Glennis McClure: What they do, but like I said we're moving to the new ad budget calculator and so that's going to help everyone, I think, be able to customize those budgets little bit more.
[00:57:31.080]Glennis McClure: So again, this is out, we do those are posted on farms at you, and help you cross lines, of course, they want to have those prop budget so we've got those on our COP watch site as well.
[00:57:41.100]Glennis McClure: And then, when you go to that location you'll see the list of budgets, and we have them in a printable format and also the excel format so folks can download those and work with them as they choose OK.
[00:57:53.820]Glennis McClure: So I just put together a few summary slides for you to take a look at on some costs for our 2021 budgets and we let we present cash costs.
[00:58:04.530]Glennis McClure: and economic costs with our budgets and i've just picked a few here on dry land you're getting corn, so if we look at on average.
[00:58:13.260]Glennis McClure: What yields we're using in our statewide budgets we're figuring about 150 push on dry land corn and 238 of your BT corn.
[00:58:21.960]Glennis McClure: And you can see the class differences so cash versus economics and the big question always is what's the difference, why do we call it economic costs well really it's the total costs, including ownership land ownership.
[00:58:36.510]Glennis McClure: As well as machinery and equipment ownership so depreciation and then there's an opportunity costs so there's some non cash costs in the economic side of things.
[00:58:46.110]Glennis McClure: And as a as an economist, in the long run, you want to make sure that you're covering all costs, why we need to replace equipment, we need to make sure you know that.
[00:58:57.120]Glennis McClure: we've got it we've got a return on investment on our land or we're we're making sure that we're paying that cash rent every year, you know so economic costs, you know, need to be covered in the long run, pretty much Okay, so you can see what those figures are for 2021 and.
[00:59:15.360]Glennis McClure: I, I may have it here we're all talking about how we made some changes in that, but anyway, I included for you.
[00:59:22.410]Glennis McClure: And one of our budgets at least one of them, I think there was one or two GM I don't remember in our in our package, I know that quarter number 23 is in there.
[00:59:31.830]Glennis McClure: And this afternoon i'll be demonstrating how we can take that corn budget, which is an excel format and start to look at it, he likes the new the new budget system and and again to help folks customize those budgets.
[00:59:48.330]Glennis McClure: They represent more life with their operation is versus what the university says it might be okay so you've got some examples and I just want to show you.
[00:59:58.950]Glennis McClure: Again sort of how those are broke down and we're kind of using the same approach as we.
[01:00:03.210]Glennis McClure: As we looked after we move things from that format over to the online format so we're really starting to say hey, how do you grow that cross.
[01:00:11.760]Glennis McClure: What are the field operations that you do, what does that order so so this happens to be a no till so 18 budget first thing we do is we do a burn down herbicide.
[01:00:22.170]Glennis McClure: And then we planned, we have some more herbicides and have some spraying, this is a year gated budget so we run the pivot.
[01:00:30.120]Glennis McClure: We combine and we truck the green okay so we've got that information in the field operations and then you notice like spray burn down is the first operation here and then over here operation index number one.
[01:00:44.130]Glennis McClure: shows what went into that what were those herbicides and additives that went into that operation and so we've got the field operations in the materials and services that go into the going to the production.
[01:00:57.090]Glennis McClure: And then the last section of those we add in some interest because there's opportunity interest or we may be paying for not creating loans and what's that costs, going to be.
[01:01:06.900]Glennis McClure: So that's that's figured in here, and then we add in some overhead so all firms and businesses have overhead, we have to pay for our general insurance accounting.
[01:01:17.310]Glennis McClure: You know we've got vehicles to check the fields and so on and so we've got a $25 per acre overhead costs included.
[01:01:25.560]Glennis McClure: And then the opportunity cost of land ownership and real estate taxes and if they were a cash rent operation, we want to put the cash rental figure over into the cash area.
[01:01:37.830]Glennis McClure: But we make an assumption, with all of our budgets right now that our folks are owner operators so, so this is where we end up with the cash costs for 89 and a cost of production or total economically 35 so just to show you how we have those broke down.
[01:01:55.020]Glennis McClure: I think it's good okay now so here, I had done a quick look at the last several years in how things change with prices over time.
[01:02:04.380]Glennis McClure: And really what's probably affected some of our input costs going into 2021 was the fuel price, as we were looking last fall.
[01:02:13.170]Glennis McClure: fuel price was pretty low we know it's taken out by just fill my tank yesterday it's like wow that's really got out the bit that i'm so.
[01:02:21.990]Glennis McClure: You say if the price of fuel, you know they'd want to put in with that price or with anticipate that average price to be over 2021, we can see how he dropped that back in 2020.
[01:02:32.070]Glennis McClure: A Labor we kept the same we did increase that overhead because those costs never seem to go down right, so we didn't use that a little bit this year and then.
[01:02:41.700]Glennis McClure: With the fuel and old oil prices, we were anticipating that mostly and hydrants chemicals and so on, would have been a little bit lower price we don't see see prices changing very often.
[01:02:55.080]Glennis McClure: And then also of course equipment equipment continues to probably get more.
[01:02:59.700]Glennis McClure: pricey and so those costs go up and that has to be figured into your past production on on what your depreciation value and what we need to do to replace our equipment of in overtime.
[01:03:10.680]Glennis McClure: And then we do utilize information is as Jim talked about from the nebraska real estate for it, so we do plug in those numbers, so that we can take a look at what that that cost of land, maybe so.
[01:03:24.240]Glennis McClure: All right, those are just some of the figures I pulled out, to show you how things have changed in our budgets over the last few years.
[01:03:32.430]Glennis McClure: I know this is really a busy chart and it would be included in your handout so I don't expect you to follow this right now, I just wanted to show you I just did a.
[01:03:42.660]Glennis McClure: With a corn budget so i've been budget and we just broke it down in over the last four years to show you how those costs have changed.
[01:03:51.180]Glennis McClure: And so, this is the cash costs area and the economic costs serious I just pulled those numbers from our budgets to show you kind of how things have changed over time alright so.
[01:04:05.010]Glennis McClure: This is one of my favorite pictures we were able to travel in 2019 before.
[01:04:10.170]Glennis McClure: 2020 we didn't go very far right, but we were able to go to Switzerland to visit and exchange students who we had living with us a number of years ago she's got five kids now.
[01:04:20.400]Glennis McClure: Anyway, that we had a wonderful time this is my favorite picture of the cows on the mountain and also developed with the bells on and the cows were used to people being right there by them and I took this picture and I just love it.
[01:04:34.680]Glennis McClure: With a Swiss Alps in the background image, this is your just remind you that we do have also lifestyle sentence, I talked quite a bit, I guess, I I sort of enjoy and not really a lifestyle person so much, I really enjoy.
[01:04:48.060]Glennis McClure: You know the prop budget probably a little bit more than I need on a lot of our experts and folks that are more lifestyle oriented to work with some of the lifestyle so.
[01:04:59.280]Glennis McClure: So then last couple slides here, I just want to mention that again the Ad budget calculator I had included the.
[01:05:08.190]Glennis McClure: The website where you can go in and register and we are the reason we're doing that, again, is we're just trying to track who our users are now.
[01:05:17.280]Glennis McClure: In the program and we encourage anyone to check out the program but we'd like some feedback really we're in that stage where we want to make sure it's user friendly and so as people.
[01:05:28.440]Glennis McClure: get on and start using that we want to know, like what the perks are you know what's working what isn't working, we have a developer.
[01:05:35.910]Glennis McClure: that's working every day to continue to add to that we've got several components we're adding.
[01:05:41.460]Glennis McClure: And you know, and he makes updates, you know just like all programs there's always.
[01:05:46.110]Glennis McClure: there's always things that happened, and we need to make some updates so, so I would encourage you, please, to go and register and i'll send you that link.
[01:05:53.970]Glennis McClure: And if you would do that before our 130 meeting you'll have it, so that you can kind of follow along on your own through a budget.
[01:06:02.010]Glennis McClure: met with a new university calculator we have it set so that folks can just from scratch just start entering information to create their own enterprise budgets.
[01:06:11.700]Glennis McClure: They can then of course come back save it so basically create a password you have your email and your password to get into your account.
[01:06:20.580]Glennis McClure: So you save that information and then you can come back and work on those budgets sort of an ongoing basis.
[01:06:27.150]Glennis McClure: And we will have it, so that you can have it, so that you can view, one of our university budget.
[01:06:33.840]Glennis McClure: And then download those so that can give you a great start So if you like, that that one budget.
[01:06:39.930]Glennis McClure: And happens to be real, similar to what you're doing, and you want to go in and just make some modifications we've added that feature into the Program.
[01:06:48.000]Glennis McClure: And the other nice thing about this is it always takes there's always that learning curve when we're starting something new, so let's say this year you enter several several of your prop enterprises and then come.
[01:06:59.880]Glennis McClure: You say well i'm just making these few changes I really haven't traded anyway equipment i'm just going to you know call up that word veggies I did in 2021 make some changes and save it into my.
[01:07:13.560]Glennis McClure: Account so well you'll be able to do that you're going to copy what you've done and move it over into a new year, so once you've done one or two.
[01:07:21.720]Glennis McClure: that's a great start and.
[01:07:24.390]Glennis McClure: So that's the features that we have anyway um so we're working on different components, as I mentioned they'll be a lifestyle component where we're just now looking at with the whole farm reports are.
[01:07:35.880]Glennis McClure: And that's bringing all your enterprises together and then eventually we'll have a cash flow, which will be really cool because if you take all of your.
[01:07:43.470]Glennis McClure: Enterprises, and you have all of your expenses associated with enterprises, then you have your overhead information and you can say what months you pay.
[01:07:52.290]Glennis McClure: Those things will have a cash flow report eventually so that's a feature that we're going to be working on with that as well, so I hope you can join us this afternoon at 130.
[01:08:03.390]Glennis McClure: Let me know if you have any questions about that and I just want to mention I do some work with our rural wellness team rural wellness.us.edu is our website.
[01:08:13.860]Glennis McClure: it's we've seen some really difficult years really in agriculture and we've got a team together we've been doing programs on helping folks.
[01:08:24.390]Glennis McClure: Understand stress learning how to try to manage your stress when we all get stressed, I mean I have my days for sure where it's like man I don't know.
[01:08:33.900]Glennis McClure: and, especially, I think all of us are tired i'm really tired of the pandemic I think they've talked about how that's really added a lot of stress.
[01:08:41.160]Glennis McClure: On the folks, so it is important to understand how we can help ourselves with that, but also to have an idea of kind of pay attention to those around us, that may be really stressed and to try to.
[01:08:52.830]Glennis McClure: suggest to them, you know, maybe some you know what can they do to help themselves, maybe some counseling would be in order that kind of thing one of the largest.
[01:09:02.340]Glennis McClure: Human sort of the best resources that we have in nebraska nebraska real response hotline and that number is there, they actually will help folks.
[01:09:11.820]Glennis McClure: fight with financial counseling and those kinds of things if they're if they're in that need but also if they have some they're struggling with some mental.
[01:09:21.420]Glennis McClure: wellness and stress, they have they will provide vouchers for folks to be able to get some counseling mental health counseling so again if i'm financially stressed and really.
[01:09:33.660]Glennis McClure: And you know that's really adding to my stress and I think man I don't really want I can't pay for someone to help me know.
[01:09:40.380]Glennis McClure: professionally with that they'll offer they actually have vouchers with folks can.
[01:09:45.240]Glennis McClure: Go ahead and seek that assistance in and not have to pay so that's kind of a good message to keep in mind, so there again there's my contact information.
[01:09:55.290]Glennis McClure: And let us know if you have any questions about any customer production enterprises budgets and those types of things so and I appreciate the team that's allowed me to provide this information to you was there any questions anybody has on anything.
[01:10:15.780]Glennis McClure: Okay, I think we stay pretty well within our time so Al are we good to take about five minutes.
[01:10:22.860]Allan Vyhnalek: yeah so I have 1009 right now let's make sure we started by 1030 or 1014 just before 1015 please.
[01:10:30.900]Allan Vyhnalek: I was going to put us on i'll put up our first lucky, and let us you'll have to tell me if this show you stop your singleness for a second.
[01:10:39.300]Glennis McClure: I will okay.
[01:10:41.400]Allan Vyhnalek: And he put up our first slide.
[01:10:47.340]Glennis McClure: Okay, so come back everyone and listen to al and Austin finish the program this morning.
[01:10:52.980]Allan Vyhnalek: This is that showing up on your end.
[01:10:54.690]Allan Vyhnalek: Is that okay when you're in.
[01:10:56.310]Glennis McClure: A yes, no.
[01:10:58.800]Allan Vyhnalek: Do you got my slide or no.
[01:11:00.900]Glennis McClure: And no I don't.
[01:11:02.100]Allan Vyhnalek: share a slide yeah hang on my my share screen just a minute.
[01:11:07.740]Glennis McClure: ago go ahead, everyone and take break and come back.
[01:11:10.890]Glennis McClure: yeah that's what.
[01:11:11.610]Allan Vyhnalek: I do yeah.
[01:11:14.310]Glennis McClure: Okay, see you.
[01:11:15.270]Allan Vyhnalek: There you go.
[01:11:16.200]Allan Vyhnalek: There you go Thank you.
[01:11:17.970]Allan Vyhnalek: All right, well.
[01:11:20.100]Glennis McClure: i'm gonna take a break to.
[01:11:21.180]Allan Vyhnalek: will come back get started.
[01:14:16.980]Allan Vyhnalek: Okay, we can get away with a shorter break on something like this if you don't need to stand more and you're welcome to do that, while you're listening to us bit.
[01:14:25.560]Allan Vyhnalek: shorter breaker because there's you know essentially 50 restrooms out there versus having one or two in a in a meeting hall so.
[01:14:34.020]Allan Vyhnalek: The restroom breaks, will go a lot faster this way because we all have one all right we'll get started i'm out but I like to diversity.
[01:14:43.200]Allan Vyhnalek: Is extension educator for farm succession and transition and part of my talk today will actually be on farm succession transition and so that's why i'm part of this team.
[01:14:51.360]Allan Vyhnalek: But i've also worked for about 15 or 18 years on land lease.
[01:14:55.650]Allan Vyhnalek: provisions and information and how to make a good time to put together the good Lisa so that's why i'm also part of this thing because I kind of helped start that effort.
[01:15:03.600]Allan Vyhnalek: Quite a few years ago now, so there's my contact information when i'm in the office and affiliate hall.
[01:15:10.380]Allan Vyhnalek: On East campus that's my phone number on the office, but please leave a message, even if i'm not in because it comes to me it comes to me verse via.
[01:15:21.150]Allan Vyhnalek: comes to me via email your message to come to the email someone wherever you're working from home or wherever I will get that message I can read, I can reply to you just.
[01:15:30.570]Allan Vyhnalek: understand it myself on still kind of tied to my Columbus Columbus number so that looks a little strange but it's fine we're really good.
[01:15:38.820]Allan Vyhnalek: Okay austin's Informations there to be found to fall city area, he had no se nebraska that agricultural context so there's that information and um yeah we'll just go on.
[01:15:53.760]Allan Vyhnalek: Your thing okay there we go i'm going to talk about these communication, a little bit on XX succession and transition also going to cost talk about negotiation adjusting leases food James Brown and I will finish up with least provision management will be done by 1150.
[01:16:11.220]Allan Vyhnalek: and be done by them.
[01:16:13.650]Allan Vyhnalek: Okay, a little bit on communication when I work with families and and or individuals on leases or farm succession doesn't matter.
[01:16:23.790]Allan Vyhnalek: And I there's something wrong something went haywire some didn't work right i'm just here to tell you that a whole bunch of time it's about bad communication or no communication.
[01:16:37.770]Allan Vyhnalek: If you're with your family that's really a bad idea to not have any communication or have that communication because it's your family for crying out loud, so you have to always ask yourself, is my goal to have a family or not healthy that's that's something that so.
[01:16:54.600]Allan Vyhnalek: If i'm going to have a family.
[01:16:57.330]Allan Vyhnalek: Then I have to maybe treat them differently tonight to treat somebody it's a business partner so just keep that.
[01:17:02.700]Allan Vyhnalek: or somebody that I do business with I guess.
[01:17:05.820]Allan Vyhnalek: and make sure you're including family members that need to be involved, and so, when I think it's Father Father wife.
[01:17:13.650]Allan Vyhnalek: husband wife matriarch or patriarch husband are brothers brothers, that are the main owners of the operation.
[01:17:22.110]Allan Vyhnalek: I think that they ought to make sure their children are involved in some of the conversations we know kind of what's going on, because.
[01:17:29.400]Allan Vyhnalek: i'm just telling you after lots of years this when the next generation has to take over the next generation he's questioning what's going on it's because their parents haven't told them what's happening to me.
[01:17:44.190]Allan Vyhnalek: what's next.
[01:17:46.110]Allan Vyhnalek: So the best way to communication, the best way to make sure that communication is happening properly is to listen.
[01:17:54.300]Allan Vyhnalek: Not about talking it's not about making noise it's about listening seek first to understand, then to be understood that's most important concept i'm going to work with you on.
[01:18:03.570]Allan Vyhnalek: Ever you know that's that's it that's the most common most biggest thing I could talk to you about seek first to understand, then to be understood so.
[01:18:13.110]Allan Vyhnalek: What I have to talk about there is that something you have to ask them clarifying questions about what they're saying, because sometimes people say something mean something different.
[01:18:22.740]Allan Vyhnalek: You have to prove to the other party that you've heard what they're saying Okay, you have to prove that prove to them each year.
[01:18:29.970]Allan Vyhnalek: And because we repeat it back to them what they've said, that means that they feel appreciated they feel like they've been listened to.
[01:18:38.070]Allan Vyhnalek: And I can't communicate with you until you think that i'm listening to you and you can't communicate with me until I think that you were listening to me, so please just keep that in mind some really important to think about.
[01:18:51.750]Allan Vyhnalek: So active listening includes things like paying attention to that person don't be looking at your cell phone or doing something else, look at who's talking.
[01:18:59.520]Allan Vyhnalek: don't talk yourself just listen ask questions clarify what they're saying or did I understand you just say that that is.
[01:19:08.100]Allan Vyhnalek: If you don't like what somebody says don't turn over to many of us old white guys in nebraska they're farmers and ranchers if we don't like when somebody says we just turn around and walk away.
[01:19:19.500]Allan Vyhnalek: No, we don't like to somebody says, be a stop ask clarifying questions, what did you mean by saying that woody woody what's what's your point or were you coming from.
[01:19:29.010]Allan Vyhnalek: what's going on, because sometimes they say one thing, but they mean something totally different they haven't thought through what the what that means so be sure to ask some questions first.
[01:19:39.660]Allan Vyhnalek: Follow the directions that are given to you, especially if you're supposed to be following directions and you need to visualize what they're saying visualizing what they're saying that means you're listening more carefully.
[01:19:48.810]Allan Vyhnalek: All active listening is important okay now in terms of leases the landlords intense need to communicate with each other right, so what is a tenant what does a farmer tell the landlord.
[01:20:01.110]Allan Vyhnalek: Well, they need to talk to the landlord more than once a year, when you said to release rate or more than twice a year, when you give them the payment sentence, please.
[01:20:11.010]Allan Vyhnalek: Make sure that you give them information, even on cash lisa's more than the once a year thing force yourself to share that information.
[01:20:20.700]Allan Vyhnalek: In the summertime just give them a month by month I think monthly is really good update on what's happening with moisture conditions and what happened with the standard you did good stand what's our standard rate what happened with disease inspector or or.
[01:20:35.790]Allan Vyhnalek: We depression and if you can, or if the if the landlord can accept it, or has ability to accept it send them a text to send them an email with picture attachments.
[01:20:47.100]Allan Vyhnalek: Either way, because that's a picture's worth 1000 words I know one landlord that had their tenant say hey there was a terrible hail storm here.
[01:20:58.560]Allan Vyhnalek: in Atlanta or it's spreading over what happened to his field well the tenant took the time to take a picture.
[01:21:04.320]Allan Vyhnalek: Of that cornfield and send it back to the landlord and land or tells me about folders and lines where it says that was worth everything.
[01:21:11.400]Allan Vyhnalek: And so, while I can see the corn stripped up and had actually did get hailed it was not to the point that it was.
[01:21:18.480]Allan Vyhnalek: needed to replant it or it's going to be too damaged or there's anything wrong with so that was that was again picture's worth 1000 words if you're able to do that that's a great way to handle it.
[01:21:28.290]Allan Vyhnalek: So tenants communicate stuff land or this important more than just once a year, when it's time to renegotiate to lose.
[01:21:36.990]Allan Vyhnalek: landlords you need to communicate with the tenant you need to you need to let them know what your visions goals and objectives for that farmar.
[01:21:44.520]Allan Vyhnalek: Listen landlords this isn't about getting the highest rent and walking away this shouldn't be about understanding and we have to be that farming as good or better condition and then, when we received it.
[01:21:56.820]Allan Vyhnalek: The point is, I don't get to take my farm with me when i'm gone I on the farm i'm a landlord but I don't get to put anything in the casket my casket doesn't have dirt in my task it doesn't have my favorite trucking doesn't have any of these things.
[01:22:12.240]Allan Vyhnalek: So what are we what's our objective or objective should be to make that that piece of ground for one were gone so it's still productive to feed the world.
[01:22:19.800]Allan Vyhnalek: We have to do that what's our goals here good weed control, maybe good the rosy cheeks maybe maybe how we handle those non crop bakers, like the the cedar trees used to nebraska want to do an Eastern nebraska cash right meeting we got to talk about solutions that's a problem.
[01:22:34.860]Allan Vyhnalek: Where they're they're using the pharmacy wasn't the expectation for me.
[01:22:38.310]Allan Vyhnalek: don't and attendance and landlords just understand me yeah I feel like this in the lower left hand corner of the screen full weeds.
[01:22:45.330]Allan Vyhnalek: or in the lower right hand corner, we have disease pressure or or a nutrient deficiency on its let me plan i'm not sure what it is doesn't matter it's still looks bad.
[01:22:54.990]Allan Vyhnalek: Are we communicating that we don't want that to happen in attendance communicated that has happened we're trying to rectify, we have to make sure those those things clear, so those things will cause confusion.
[01:23:06.330]Allan Vyhnalek: When I run into you once in a while is just power over business landlord says the 10 says, all the power to go to the least, and when I SAS landlords, why do you feel that way and you'll say because the tenant.
[01:23:20.070]Allan Vyhnalek: knows what's good ground out there and was bad ground out there, and he knows with all with all producers and they just are out there all the time they see it in the form that ground that they just know everything there is to know about that ground and so.
[01:23:30.870]Allan Vyhnalek: The tenants have all the power over this least because they know my ground that are the night.
[01:23:35.700]Allan Vyhnalek: And the landlord and the tenant and tenants will say the landlords have all over the power of the police, because we have a cash least landlord wants $10 $10 an acre this year.
[01:23:46.470]Allan Vyhnalek: If you don't give it to him by where attention with you, if you don't give it to him by 11 o'clock this morning he's going to go to a coffee shop assuming assuming no code.
[01:23:53.790]Allan Vyhnalek: And he's going to tell the tale of his coffee shop, but he say I asked him bucks in this guy's barking at me guess what he's going to have by five o'clock that night.
[01:24:02.370]Allan Vyhnalek: At least three more bids, at least that higher higher i'm not saying that that's the right way to go, i'm just saying the tenants feel like they're over a barrel, because if they don't pay exactly what's being asked the landlord go find somebody else by the end of the day.
[01:24:16.830]Allan Vyhnalek: i'm just pointing out things i'm not saying it has to be I say quick I say you have big communications back and forth then there's no feeling of power one power has more power over the other just have to make sure you communicate well back to her.
[01:24:30.900]Allan Vyhnalek: And maybe the first communication, you have about the lease should not be about the rental rate, maybe the first.
[01:24:37.380]Allan Vyhnalek: Prepare prepare prepare does matter or with prompts.
[01:24:42.150]Allan Vyhnalek: Maybe it's the conversation about what is the landlord expect for that ground from a management standpoint and what can what can attend, provided that ground from Tennessee and.
[01:24:51.810]Allan Vyhnalek: Maybe that needs to be the first conversation, if you agree on all that then the rest of this stuff comes easy.
[01:24:59.070]Allan Vyhnalek: Okay, just my comments, but communication now we're going to want a few comments about farm and ranch succession and transition and understand that this is about 10 or 15 minutes I don't tend to keep us out of a two and a half hour talks i'm really hitting some very.
[01:25:15.210]Allan Vyhnalek: Very high highlights anybody playing your tire well we look at this survey that I did when I started this position, three years ago, four years ago.
[01:25:28.620]Allan Vyhnalek: I don't know what to do about.
[01:25:31.890]Allan Vyhnalek: It can't leave it up to occur if they're going to ask me if I have an emergency Okay, so I apologize so 35% 20 plus 15 are saying.
[01:25:41.400]Allan Vyhnalek: um I don't I plan to have something some plans to retire before that i'm not saying to eat, you are not i'm just saying it's good for them, and the other 54% 24 plus 21 plus 950 4% don't ever plan to fully retire.
[01:25:57.750]Allan Vyhnalek: So over half don't ever plan to retire from farming, if you look at the island number to see even more startling 31% never retire 47% semi retire the 78% never fully plan to retire from farming.
[01:26:14.670]Allan Vyhnalek: The I can't talk right now please call back.
[01:26:20.910]Okay.
[01:26:22.380]Allan Vyhnalek: So 78% sensitive never fully planning to retire from form.
[01:26:28.500]Allan Vyhnalek: i'm not trying to embarrass anybody was the wiring they retire well because they, why are we retiring later or don't want to retire at all well because we are 70% 70 75% they have difficult to controls, an issue chose a huge issue.
[01:26:43.020]Allan Vyhnalek: So almost 70% the modern farm equipment GPS during an auto steering Nice and like I was going to be an attractive cat blogger, and it to be true, a nice cab with good seats and all that sort of thing it's way better.
[01:26:54.930]Allan Vyhnalek: 66% don't think about retirement retire because they that means they're going to be dead soon and they don't think about fatality.
[01:27:01.980]Allan Vyhnalek: 62% the sad news because they can't afford to retire don't think they do that for your time and then 60% healthier longer life that's the good news.
[01:27:09.870]Allan Vyhnalek: And then 55% don't have a successor and 54% though don't know what else they do, and to be true they're farmers that didn't take on woodworking or did take on.
[01:27:20.220]Allan Vyhnalek: Any other craft or hobby and they don't necessarily want to go to the bar and play cards all day and drink beer or whatever, I mean.
[01:27:28.770]Allan Vyhnalek: You can understand that, and so they don't know what else to do so, as long as I get up in the cab long to get that tractor.
[01:27:34.440]Allan Vyhnalek: I might as well just keep farm so there's there's reasons why they don't want to retire i'm not trying to embarrass you think that you need to retire, you can retire knock yourself out farm as long as you want to please keep going.
[01:27:45.840]Allan Vyhnalek: However, the thing we have not been able to avoid is the device we all will meet the maker someday we haven't been able to figure out how to delay that or put it off when it's time when it's our time it's our time so here's the point.
[01:28:02.940]Allan Vyhnalek: I think you know the next slide to show.
[01:28:06.060]yeah.
[01:28:07.980]Allan Vyhnalek: More often than not planning tends to be deferred until some critical life event with courage which forces the family, to address the matter.
[01:28:17.190]Allan Vyhnalek: me farm families experience difficulty and discussing the future of the family farm so they just put it off, they don't do it.
[01:28:24.450]Allan Vyhnalek: And now you've got somebody passes away or somebody getting pretty sick or something in a nursing home or somebody.
[01:28:30.930]Allan Vyhnalek: hooked up to machines can't answer for themselves, and you have to deal with us and you're going.
[01:28:37.710]Allan Vyhnalek: Alright, so now we deal with it as a family and guess what what do we what atmosphere, do we have we have stress because he's passed away or so he's.
[01:28:46.380]Allan Vyhnalek: Definitely Oh, whatever stress and can we make the decisions when we're having all the stress I submit maybe not, I think we do better if we would you take care of this before we had those catastrophic events per so get a plan in place, please do okay.
[01:29:03.690]Allan Vyhnalek: get a plan in place before you have that critical life of that which forces you to do it, because then you're not going to make your decisions in life.
[01:29:12.600]Allan Vyhnalek: And we don't plan, because we assume it's complicated it's mental work and true it gets to be complicated with mental work because.
[01:29:24.570]Allan Vyhnalek: you're using words and terminology and talking to a lawyer you're not used to their lawyer East or law or English.
[01:29:31.050]Allan Vyhnalek: i'm not sure I call it English but anyway it's the things like probate and and wills and trusts and llc is and how that all goes together a gift tax.
[01:29:39.480]Allan Vyhnalek: and inheritance tax and estate tax, and how does that all work together and we'd start confusing terms and we start stop start confusing what they're telling us and we just just give up.
[01:29:50.250]Allan Vyhnalek: We want to think about death Hillary talked about that if we're afraid to do something that will be wrong at some point in the future and guess what.
[01:29:59.040]Allan Vyhnalek: If you do something today, it will be wrong, five or six seven years from now, yes, we will, but I submit that if we have a plan in place today and at some point in time in the future, we need to change that plan change it.
[01:30:13.080]Allan Vyhnalek: The cost of changing the plan is hundreds of dollars versus the cost of not having a plan can be 10s of thousands or hundreds of thousands of dollars you'd buy your own insurance on that I say, have a plan and then change it.
[01:30:27.630]Allan Vyhnalek: So near the end of the at the end of your life, there are three types of playing, you need to hurry, I think that most people don't think about two hours.
[01:30:38.910]Allan Vyhnalek: that's the challenge i'd like to leave you with.
[01:30:42.030]Allan Vyhnalek: A second.
[01:30:43.650]Allan Vyhnalek: First of all, and your life documents plans and documents end of life i'm not dead, yet, but I can't answer for myself, I mean capacity.
[01:30:52.650]Allan Vyhnalek: Who takes care of my business that's a durable power of attorney we're going to designate for that.
[01:30:57.780]Allan Vyhnalek: Who takes care of my health care decisions that's my health care power of attorney who am I designating for that sometimes the same person, sometimes it isn't.
[01:31:05.400]Allan Vyhnalek: And the third part, is what is my health care directive and I told the hospital doctor's office people that I work with for medical standpoint how I want to be.
[01:31:13.770]Allan Vyhnalek: treated with my health care Directive and the health care directive document and my medical power of attorney make those decisions for me when I can no longer respond to myself Those are all the end of life, things that you need.
[01:31:26.250]Allan Vyhnalek: and have in place once you reach 18 years old once you're 18 you have to have those because, even if you have a 20 year old son or daughter they get into critical car accident and they're in bad shape.
[01:31:38.700]Allan Vyhnalek: You can't just parents go talk to the hospital about that, without going into the Court first and be designated as the as the.
[01:31:48.060]Allan Vyhnalek: Power of attorney for health care, so you even though it's so once you're at need have those done.
[01:31:55.320]Allan Vyhnalek: The State plans, the second part, lower left hand server that you will trust llc or other structures, you want to use whatever you want to use there.
[01:32:02.520]Allan Vyhnalek: And those are the those are the documents to say what happens to my stuff when i'm gone we don't want to happen to my.
[01:32:09.210]Allan Vyhnalek: where's my land go where's my favorite track to go what to do, and all that, so what happens the cash, if I have a farm sale, what happens all this stuff where's bill.
[01:32:17.850]Allan Vyhnalek: hey that's a statement, but the third part of it, I don't think we talked about very much.
[01:32:22.740]Allan Vyhnalek: And that is if we're lucky enough to have somebody come the operation with us if we're lucky enough to have somebody it's going to take over the farm or if we get assigned to find two or whatever.
[01:32:31.110]Allan Vyhnalek: How are we going to do the business succession plan, and it was how we gonna get the business on to that next generation how big a big with the business on to whoever needs to go to those are things like.
[01:32:44.790]Allan Vyhnalek: First right of refusal for purchase first right to long term lease agreements, a long term land contract.
[01:32:54.660]Allan Vyhnalek: Giving data on foreign kid to the farm ground but giving the off farm kids to cash or whatever else you have in terms of equities.
[01:33:03.720]Allan Vyhnalek: there's a variety of structures that you can put in place to make sure that you keep the on foreign person farming and not throw them out of business because the price of price of farm grounds got so high right now.
[01:33:17.520]Allan Vyhnalek: If we just simply say got three kids for kids i'm going to give it all equally to all four kids, but I have one kid on the farm.
[01:33:25.170]Allan Vyhnalek: And that's how the kids three kids want to be bought out and you get like we just put them all on this nobody's gonna find because.
[01:33:33.210]Allan Vyhnalek: You can't get alone with 25% equity, this is not gonna work I don't care what age, you are once you have a bunch of cash to go with it you're not gonna get along.
[01:33:41.850]Allan Vyhnalek: So make sure you have the business succession plan in place first if it's your objective to keep that farm is its own business.
[01:33:48.930]Allan Vyhnalek: With the next with the next person, whoever, that is, whatever that looks like, then you make sure that you get those those documents place and procedures in place so that can happen.
[01:33:59.850]Allan Vyhnalek: elsewhere.
[01:34:01.530]Allan Vyhnalek: What too many people do is they get into simple than action they live date number one I should have a plan everybody can kind of understand that everybody gets that right.
[01:34:09.480]Allan Vyhnalek: I see good old meeting me Lord good good do it just outstanding three complicated give me a headache is all these terms I don't understand I gotta think about this more is so you just go to number four I take no action at this time.
[01:34:21.630]Allan Vyhnalek: and taking no action at this time, the last three months to three years.
[01:34:26.460]Allan Vyhnalek: How do I know this because it happened to me too I needed update my will.
[01:34:31.740]Allan Vyhnalek: And I put it off for five years before I did so, I know that I was in a circle of an action i've talked to lawyers about this today agree that people are in a circle and actually.
[01:34:39.810]Allan Vyhnalek: They don't know exactly what to do, they take no action I say you have to be sequential I think you have to think about that I have a plan go to meet with lawyer.
[01:34:48.930]Allan Vyhnalek: get some on figure out matt get the family together talk about what the options are pick some options again succession plans, so I need to go, you need to send three days now, they get a plan together in three weeks.
[01:34:59.160]Allan Vyhnalek: No, but you can share get it done in three to six months, so if you worked on it today, you can have done by plan to give you really worked on, but I.
[01:35:08.310]Allan Vyhnalek: Sure, have done that fourth of July, for sure.
[01:35:12.480]Allan Vyhnalek: So parents make several assumptions and and I want to talk about these because parents are making them for the right reason they think that everything's good but they don't turn out well that's my experiences I talked with families about these issues.
[01:35:26.370]Allan Vyhnalek: One number one my kids get along great Now I know continue that will continue, even after my death.
[01:35:34.590]Allan Vyhnalek: That I wouldn't sometimes the parents of the blue, the whole family together when parents are gone, then the rebel child whoever, that is.
[01:35:41.730]Allan Vyhnalek: being critical there's just the one that's kind of sticks out the little things a little differently they'll want to do something different, and fitness them up, no, no.
[01:35:50.310]Allan Vyhnalek: I know that my children want to keep this asset in the family, even when we're gone.
[01:35:54.540]Allan Vyhnalek: And I can tell you that that's that is a noble idea noble thought and most of your kids will will abide by that, but not all, not always so.
[01:36:05.850]Allan Vyhnalek: I know my children keep this acid families are gone don't assume that if you want to keep the assets to stay in the family, maybe you have to put things in place to make sure that happens i'm not saying have to i'm not saying you should i'm just saying it's a consideration.
[01:36:20.580]Allan Vyhnalek: Because I have to figure out how to divide i'll be gone I don't care what happens if you want to start World War three with your family just go ahead and go with that assumption.
[01:36:27.510]Allan Vyhnalek: you're going to be gone you don't care don't put a plan in place man that's a bad idea, especially if you have somebody might keep on the farm farm think about that.
[01:36:36.870]Allan Vyhnalek: Since it is for children, my assets, have to be divided equally so a fair way to do it 25% each.
[01:36:44.310]Allan Vyhnalek: And i'm here to tell you that that that's as I described me to go that's a sure way to make sure that that on farm child own farm said son or daughter.
[01:36:53.340]Allan Vyhnalek: It will not keep the farm because soon as you start doing something like that the other one of the other three or one out and they'll force the sale of Earth.
[01:37:01.110]Allan Vyhnalek: Just be careful about that don't make that assumption, and in the last statement is Sunday son or daughter this love yours someday this will all be yours boy.
[01:37:11.250]Allan Vyhnalek: Be careful about that unless that statement is Notre eyes and held up in a court of law, I would assume that that's a lie don't assume that's correct at all.
[01:37:20.910]Allan Vyhnalek: there's far too many people they have told her kids someday this law of yours and it's not to get a fourth of everything, because of the statement before that just.
[01:37:30.060]Allan Vyhnalek: So, in some cases, these assumptions work they work out great however don't make those assumptions without having some documentation in place to make sure through through rights.
[01:37:40.050]Allan Vyhnalek: Some other things couple of things.
[01:37:42.720]Allan Vyhnalek: First conversations on a State plan are you still going to have family don't talk about what happens to the lander don't talk about what happens to the antique tractor talk about how we still have a family will be doing this.
[01:37:52.200]Allan Vyhnalek: don't make that assumption is that commandment don't make that assumption get that come in.
[01:37:59.100]Allan Vyhnalek: I know family, where a daughter in law said, I am not going to clean the House out taking it down to the auction barn have an auction of the House to send me my check.
[01:38:11.370]Allan Vyhnalek: She didn't care she the part of the family or not my view would that kind of statement, so therefore.
[01:38:17.340]Allan Vyhnalek: that's fine, we know that was let's go on let's go on with this who's involved who wants to be that we're not expecting something if somebody signed and.
[01:38:27.570]Allan Vyhnalek: Secondly, our mom and dad or grandpa and grandma on the same page the matriarch or patriarch and operation people that have the gold people with the golden rule here.
[01:38:37.110]Allan Vyhnalek: If they're gonna be on the same page for us because they go to their children, my dad goes grandpa goes to the one son says this so at this wedding good.
[01:38:44.820]Allan Vyhnalek: And grandma goes to the daughter over here, it says, I think this will be out of you, and now we've created two generations of war.
[01:38:50.790]Allan Vyhnalek: Because the son and daughter against each other grandpa grandma would be so there, so they grandma grandpa mom dad the matriarch or patriarch need to be absolutely on the same page versus I want to proceed.
[01:39:00.600]Allan Vyhnalek: That happens, then you have chance, otherwise don't even start the conversation and tell that's taken care of because, otherwise, you have no chance because you still have a war civil civil disobedience.
[01:39:12.810]Allan Vyhnalek: So be ready for that catastrophic event hope it doesn't happen that way that's sort of an action have great communication with your family.
[01:39:19.710]Allan Vyhnalek: and avoid those assumptions that aren't always correct in my webpage is egg kinda you know that you use succession, and that has all the rest of my stuff on it, the other two hours and 20 Minutes that you didn't hear.
[01:39:32.670]Allan Vyhnalek: Some reading stuff that I put up there, and again the rest of my staff is, in short, video clips eight to 1012 minute long video clips and so you don't have to watch them all at once.
[01:39:42.480]Allan Vyhnalek: pick pick and choose it works out great so any questions about that throw it in the chat otherwise I think i'm going to turn it over to Austin I have one more thing talk about.
[01:39:56.070]Allan Vyhnalek: In two weeks, three weeks ago now, three weeks into this thing.
[01:40:01.380]Allan Vyhnalek: We started something called the land.
[01:40:04.080]Allan Vyhnalek: The egg laying an egg line length or landline program started to reach go and we're working on two problems for young people that are interested in agriculture, they don't have access to land we're trying to create a way to have them communicated get by getting assets access to it.
[01:40:20.400]Allan Vyhnalek: For the older producers, the landowners, with no parent errors, they want their operations team is their operation.
[01:40:27.000]Allan Vyhnalek: we're trying to give them an avenue to get hooked up with some of these younger people, so we created the land and it's a database for both parties to Mr service.
[01:40:36.810]Allan Vyhnalek: In the bottom line is i'm not going to publish any either the database online i'm just keeping it myself.
[01:40:43.230]Allan Vyhnalek: And then, when I went so i'm getting a land out these translators having them quiet and i've got over 30 applications already.
[01:40:50.940]Allan Vyhnalek: I got applications for landowners for them to applied lister land I don't have one so we're working.
[01:40:57.810]Allan Vyhnalek: Applications reviewed and possible matches with seekers and central angle this review we possibilities no words i'm going to send the seeker application to the landowners where it fits with matches.
[01:41:08.760]Allan Vyhnalek: With trying to match interests if somebody says, I want to raise hogs know the land owner has his cattle i'm not going to make that push that across you know.
[01:41:17.580]Allan Vyhnalek: Or if they only want to do crops, but this guy's got livestock I can't push that across to make sure we have something kind of matches and the land owners will review this seeker applications over and decide who they want to talk to, if they want to talk to.
[01:41:33.600]Allan Vyhnalek: And did I put down the website for that Okay, the website for that I didn't put it on there is farm that ul.edu i'll type.
[01:41:45.360]Allan Vyhnalek: arm.ul.edu land one one word.
[01:41:51.690]Allan Vyhnalek: that's the oh man land link.
[01:42:01.980]Allan Vyhnalek: Okay, there you go that's the better one, the second one so don't don't do the person so that's how you get into that thing.
[01:42:10.740]Allan Vyhnalek: Where we are now ready let Austin take over and he's going to do some stuff on negotiation i'm going to mute and stop my video and let Lawson controls for me.
[01:42:20.880]Austin Duerfeldt: yep, so I hope everybody's doing all right with what i'm going to talk about now in terms of negotiations.
[01:42:30.240]Austin Duerfeldt: If I get there, we go.
[01:42:33.000]Austin Duerfeldt: I i'm wanting to try and break you from the pure cash negotiation.
[01:42:38.160]Austin Duerfeldt: I know a lot of you probably logged on to this this webinar and your hope is you're trying to get an idea of what you can charge for cash or in dollar wise.
[01:42:47.550]Austin Duerfeldt: And my hope is when you get done with this is that maybe you've got a couple of other things that you want to either tack into a lease agreement.
[01:42:56.940]Austin Duerfeldt: Or at least look at some different options as to how you want to approach this and the first thing that I want to just throw out there is.
[01:43:05.280]Austin Duerfeldt: Most of you are probably familiar with the hack old method of negotiation, this is your typical car dealership you're walking in you're sitting down across the table from somebody.
[01:43:15.810]Austin Duerfeldt: And there is a car on the lot that you want to buy they want $70,000 for it, you said that's not worth a penny more than 30 and you start going back and forth until at some point in time you're going to basically split the difference.
[01:43:31.920]Austin Duerfeldt: If that's the kind of negotiation you're going to do the entire conversation you're having.
[01:43:38.310]Austin Duerfeldt: has nothing to do with if we switch back talking with land, it has nothing to do with the land has nothing to do with the values of how you want it kept up and how you want to maintain.
[01:43:49.020]Austin Duerfeldt: The only thing you're talking about if that's how you open up your negotiation is how you're going to split that $30 difference between their opening and your opening price that's all you're talking about.
[01:44:02.760]Austin Duerfeldt: you're just trying to split that difference, and so what i'm trying to do is i'm trying to get you to go away from that.
[01:44:10.470]Austin Duerfeldt: to switch.
[01:44:12.690]Austin Duerfeldt: And we're moving a little slow so bear with me.
[01:44:20.700]Austin Duerfeldt: And i'm trying to get you into a new realm of what might be possible with what you're getting for your cash ran what you're getting in terms of what your overall contract looks like.
[01:44:32.310]Austin Duerfeldt: And so, as I was trying to find a way to visualize this and show exactly what i'm trying to pitch I drew up this short little graph and what we're using when we're looking at this graph on the left hand side on that y axis you've got your satisfaction with the agreement.
[01:44:50.970]Austin Duerfeldt: And on the bottom you've got my satisfaction, if I was trying to rent ground from you, the bottom line would that X axis would be mine y axis is yours.
[01:45:00.180]Austin Duerfeldt: And we're looking at the dollar value and so anytime that we've got a situation where your satisfaction is really high because you're getting a lot of money.
[01:45:09.420]Austin Duerfeldt: my satisfaction is pissed for to the point where I might not want to catch rent or right in agreement with you in the future.
[01:45:17.490]Austin Duerfeldt: If we do that haggling method where we're going back and forth trying to find a way to split what you're going to find is is we're going to end up in that bottom left hand box.
[01:45:28.590]Austin Duerfeldt: Where i'm not happy and you're not happy, but we got something hammered out and we got something signed.
[01:45:36.090]Austin Duerfeldt: You will never get off of that line if all you're going to do is use the haggling method, when you start negotiating just start right off with talking about how much cash rent you want.
[01:45:48.870]Austin Duerfeldt: You can get off of that line and get out into the baseball diamond shaped area potential wasted value if we start looking at some other things.
[01:46:02.160]Austin Duerfeldt: On the knowledge and myself got the opportunity if we went out to Harvard University in Cambridge in Harvard houses, the.
[01:46:10.620]Austin Duerfeldt: Negotiation is to.
[01:46:13.710]Austin Duerfeldt: win I went there is about, I think, maybe about 70 classmates from about 60 different countries.
[01:46:21.990]Austin Duerfeldt: they're bringing in people around the world, learn about how to do this and learn about what they're pitching.
[01:46:27.450]Austin Duerfeldt: And what we're using is just as i'll got done talking to you that communication relationship.
[01:46:34.620]Austin Duerfeldt: we're using those two things to find out what the interests are for both parties, what the options are to meet those and what the criteria is going to be and how we measure this.
[01:46:45.450]Austin Duerfeldt: And then we boil it down to one or two things one is a commitment of both sides agree to the contract will go ahead and sign him in will be will be better off for it.
[01:46:55.320]Austin Duerfeldt: The other one law, the jargon terms that they've got set up is called Batna which is best alternative negotiated agreement basically just think of as your walk away.
[01:47:06.390]Austin Duerfeldt: If I don't want to sign the agreement what am I going to do instead of that.
[01:47:12.960]Austin Duerfeldt: So trying to understand how i'm creating value there's five main areas I want you to focus on here's a resources and capabilities relative valuations forecast risk preferences and time preferences.
[01:47:33.480]Austin Duerfeldt: In your handouts you'll probably have this slide and I tried to create some examples that i've run into as i've been going around doing this.
[01:47:41.310]Austin Duerfeldt: and probably bar none the one that's easiest for me to pitch that both sides can start understanding what i'm trying to get him to to grasp and understand his time preference.
[01:47:53.310]Austin Duerfeldt: A lot of cash rent nebraska is starting to become more and more fully do before spring planting if you want to capture at the ground, I need the money up front and then you can go and do whatever you want.
[01:48:08.070]Austin Duerfeldt: If i'm the tenant more than likely if i've got to come up with that much cash right away, I want to have to take out more in my operating loan which means I want to have more interest i've got to pay to the bank.
[01:48:23.280]Austin Duerfeldt: Now, if I can convince the landowner to allow me to pay after harvest whether that'd be the full or maybe it's just be partial.
[01:48:32.430]Austin Duerfeldt: That means I don't have to take out so much operating loan which means i'm saving money that I was paying interest to the bank that potentially I could be paying to the landlord in order to increase my bid.
[01:48:46.710]Austin Duerfeldt: Another one that i've run into is relative valuation.
[01:48:50.790]Austin Duerfeldt: Here in eastern nebraska hunting rights are big deal if you've got land that's got some timber or some water on it more than likely you've got something there that can produce its own income stream.
[01:49:03.720]Austin Duerfeldt: And if you're somebody that doesn't necessarily like to hunt, or you don't go out there and utilize it.
[01:49:10.140]Austin Duerfeldt: that's something that I would recommend either you can withhold it from the lease in rent it out yourself, or if you've got the right tenant coming along that needs someplace to take their kid to go hunting.
[01:49:22.050]Austin Duerfeldt: They will probably bit a premium price to get that property, just so they secure that place that they've been looking for.
[01:49:30.330]Austin Duerfeldt: The last one that i'll pitch is resources and capabilities if you've got some old green beans on the property say that you've got an old homestead.
[01:49:39.480]Austin Duerfeldt: And you've got 30,000 bushels storage farm only produces maybe 15 to 20,000 bushel so you've got 10,000 extra bushel of storage on that property.
[01:49:52.170]Austin Duerfeldt: If it was me and i'm a tenant looking for property and i'm paying storage at a commercial elevator five cents, a month.
[01:50:01.290]Austin Duerfeldt: I would much rather pay you that five cents, a month to secure that property and I would pay the elevator because i'm not only story migraine trying to price it better.
[01:50:12.630]Austin Duerfeldt: bombs carrying more land which allows me to produce more and so bids that were maybe 198 nacre if i'm in 10,000 bushel of storage, on top of it, I was paying at the commercial elevator I might bump my bit up to 35.
[01:50:31.350]Austin Duerfeldt: And so there's ways that we can create value and start playing around with this and trying to get further than where we were before if we were just talking purely about cash.
[01:50:42.510]Austin Duerfeldt: And that's, not to say another one that i'll just throw out there, these don't have to necessarily be farm related I had one situation where there was a.
[01:50:53.070]Austin Duerfeldt: elderly woman that was moving to town, she was just going to start cashing it ran out the property.
[01:50:58.470]Austin Duerfeldt: But maintaining the farmstead was a high priority, she wants the lawn mowed every week, she wanted string trend she wanted the fences painted.
[01:51:07.230]Austin Duerfeldt: And she wanted maintain, just as the day that she was out there and so that's something that can be built into the contract it's not necessarily something that deals with row crops or cattle.
[01:51:18.990]Austin Duerfeldt: But it's going to be hard to find a landscaping firm to go out into the country and do that type of work, but a farmer that's one during ground might.
[01:51:30.900]Austin Duerfeldt: So we covered what a bad note was the other key jargon term that they throw out there is open and that's the zona possible agreement.
[01:51:39.840]Austin Duerfeldt: And the main point that I want to get across with this is going back to that haggling method, if the most I was willing to offer you was $200 an acre for your ground and you bare minimum needed 210.
[01:51:57.300]Austin Duerfeldt: I might as well, not even walk in the door.
[01:52:00.570]Austin Duerfeldt: Because there's a $10 an acre difference there that we're just not going to match up, and so we do not have a zone of possible agreement that situation.
[01:52:10.440]Austin Duerfeldt: But if you start looking for what the interests are in your sure starting to try and create value, you can bridge that gap, but it's not something that's obvious that people are just going to be able to walk in the door and fine you've got to be asking questions.
[01:52:25.050]Austin Duerfeldt: Which kind of leads me to two things, the first thing is understand what a good outcome is I think i'll probably mentioned, if not the coffee shop conversations do do nothing for.
[01:52:41.310]Austin Duerfeldt: understanding what a good agreement is if I walk in the door and somebody spouting that they got $250 an acre cash rent for the dry land crop and what a good, you know negotiator, am I.
[01:52:53.490]Austin Duerfeldt: i'm probably sitting there thinking i'm not quite so sure i'd be too happy about that contract, because I don't know what exactly is going on.
[01:53:01.770]Austin Duerfeldt: If you've got a good outcome from a signed contract you're going to have the best of many options you're going to sat down and talk this through and figure it out what exactly it is you're interested in having done you're going to have criteria that supported which came up with.
[01:53:20.580]Austin Duerfeldt: I would almost argue, to the point where, if you brought your contract to Alan and myself and held out what the value was in terms of what then number is.
[01:53:30.180]Austin Duerfeldt: me and Alan should be able to go through what the criteria is in come up with a pretty close number, we should be able to follow through based on the criteria and understand where things are going and what end up being.
[01:53:42.600]Austin Duerfeldt: And also, you need to have clear communication built into it, I know a lot of guys when they start Catherine they're pretty hard on you know these are my numbers and I don't share him with anybody.
[01:53:56.430]Austin Duerfeldt: But as we're getting more and more into production and volatility you've got to be communicating about what's going on and be fair, with how you're handling the situation how you're handling the information based on that ground.
[01:54:14.730]Austin Duerfeldt: So What this boils down to is.
[01:54:18.480]Austin Duerfeldt: If if you're going in and negotiate and this goes look.
[01:54:26.700]Austin Duerfeldt: I think Alan just moved me, let me try.
[01:54:29.400]Allan Vyhnalek: I apologize that's my fault go back.
[01:54:34.710]Austin Duerfeldt: Can you take me back one slide.
[01:54:39.390]Austin Duerfeldt: There we go.
[01:54:41.970]Austin Duerfeldt: To be an investigative negotiator, you need to be asking what not why.
[01:54:49.170]Austin Duerfeldt: or opposite way around you need to be asking why not, what if you've got somebody walking in the door, asking what's it going to take to cash rent this ground.
[01:54:59.550]Austin Duerfeldt: I don't know if I want to be deal with that person.
[01:55:03.150]Austin Duerfeldt: They need to be asking me why.
[01:55:05.850]Austin Duerfeldt: Why do you want to start capturing ground what it is what it, what are your main concerns what's going on, tell me about the situation, because what you need to be focused on is you're not trying to reconcile the man's you need to be reconciled anxious.
[01:55:23.160]Austin Duerfeldt: I did get the opportunity in December I sat down with a landlord that wanted me to be present when they were opening seal bids.
[01:55:32.070]Austin Duerfeldt: And I did start to see some of this value creation stuff and some of the contracts, I was seeing coming through the door, the one thing if you're a tenant trying to bid on ground that I need to add on these slides I don't have right now is you also need to be able to paint a picture.
[01:55:49.350]Austin Duerfeldt: it's great if you want to tell the story of a FLEX lease into your bid trying to make it more appealing.
[01:55:56.850]Austin Duerfeldt: But if you don't paint the picture as to why is more appealing than a straight fixed cash ran agreement.
[01:56:03.240]Austin Duerfeldt: it's not going to go anywhere, and that was kind of what the problem was when some of those contracts were coming through.
[01:56:09.240]Austin Duerfeldt: Some of the contracts that were doing the value added stuff we're actually pretty appealing, in my opinion.
[01:56:16.830]Austin Duerfeldt: But they weren't painting the picture as to what the value was and I wasn't going to get involved and try and dictate where the landowner was going I was just there to provide assistance in terms of they had questions on something specific.
[01:56:32.190]Austin Duerfeldt: And I also want to bring up Do you understand the difference between selling and negotiating if you're going to woodhouse and you're trading in a vehicle and buying something.
[01:56:43.380]Austin Duerfeldt: That is selling.
[01:56:45.330]Austin Duerfeldt: you're going to go in there you're going to meet somebody that you're never want to run into again more than likely, and if you want to haggle and be ruthless about it go right ahead.
[01:56:55.830]Austin Duerfeldt: But if you're planning on keeping this ground long term and you're wanting to cash rented out you're going to be dealing with these people a couple of times a year, year after year.
[01:57:07.080]Austin Duerfeldt: And so we want to make sure that we've got some sort of a relationship that's positive that we can actually work with each other and move things forward in a productive manner and try and improve the value of the ground when we're all sitting.
[01:57:30.390]Austin Duerfeldt: In terms of what I expect as a commitment, if you intend to sit down with a potential tenant.
[01:57:38.430]Austin Duerfeldt: And sign an agreement, all in one meeting.
[01:57:43.050]Austin Duerfeldt: I would tell you probably didn't do it right.
[01:57:46.500]Austin Duerfeldt: My expectations for a first meeting with a tenant that you seriously intend to run with.
[01:57:52.890]Austin Duerfeldt: Is you're sitting down cover those interests and options and then you're assigning tasks we need to find out criteria, about how we're going to set X or how we're going to set why.
[01:58:03.090]Austin Duerfeldt: And so I need you to go out and maybe the tenant needs to pull up to the cash rental rates from the usda and talk with one of the regional ag economists about the you know land report.
[01:58:14.250]Austin Duerfeldt: And i'm going to go talk to my banker and talk to him about my cash flow and what exactly I need in order to meet X y&z for my vacation plans.
[01:58:23.640]Austin Duerfeldt: or going down to see the kids more often and we're going to meet next Tuesday at noon and we're going to go over our findings and we'll figure out what final decision is.
[01:58:36.420]Austin Duerfeldt: I fully expect these meetings, probably need to be two if not three meetings long.
[01:58:42.420]Austin Duerfeldt: If you're going to get a contract now again this isn't something if you're getting a good contract and you've got a good relationship going.
[01:58:49.200]Austin Duerfeldt: This is probably going to be something that last you a few years it's not something you're going to have to do, year after year if you're doing the Hadley method.
[01:58:56.370]Austin Duerfeldt: you're trying to hardball the best number that you can possibly get you're probably going to have to sit down with tenants, year after year, but if you're actually getting one of these agreements where you're talking through through and you've got the relationship going.
[01:59:10.170]Austin Duerfeldt: I would fully imagine you are probably going to get quite a few years out of it.
[01:59:19.170]Austin Duerfeldt: The second part that I want to cover adjusting leases for damages ground, specifically when we were starting to build this we were looking at the flood that happened a couple of years ago.
[01:59:30.330]Austin Duerfeldt: When we were trying to break down the work we broke it down into heavy work and hard work.
[01:59:37.740]Austin Duerfeldt: When I talk about hard work i'm talking about I need to put some leather gloves on and go out with the ATV in a saw.
[01:59:45.660]Austin Duerfeldt: And maybe there's some tree limbs, I need to cut up and move maybe some corn stocks got caught up in a windstorm and now there's some great big wads out in the field that i've got an issue with.
[01:59:56.790]Austin Duerfeldt: But there's obstacles out in the field that are relatively minor that can be handled pretty quickly.
[02:00:03.030]Austin Duerfeldt: that's what we consider what hard work is that is a landlord responsibility.
[02:00:10.290]Austin Duerfeldt: From my experience I would tell you that most landlords don't ever have to do this type of work.
[02:00:16.920]Austin Duerfeldt: Most of the time, the tenants because they need to keep the operation moving will go out and handle this on behalf the landlord.
[02:00:27.390]Austin Duerfeldt: In terms of hard work or not hard on terms of heavy work what i'm talking about is bulldozers and scrapers.
[02:00:34.770]Austin Duerfeldt: Again, looking at that flood if you had a bunch of sand that you had to move or maybe you had a heavy rain, you had a bunch of goalies and ditches and the terraces broke over.
[02:00:46.170]Austin Duerfeldt: that's going to be again heavy heavy work of a landlord expense or you're going to have some major expenses that need to be covered.
[02:00:57.420]Austin Duerfeldt: To specifically talk about sand, to make sure we cover our bases, if you do have an issue with sand, you have three options option one is you can push it back into the river, but you need a permit to do that, and you can contact the US army corps of engineers find that permit.
[02:01:15.090]Austin Duerfeldt: If the sand is contaminated you're going to have to bring in a dump truck in front end loader and all that off.
[02:01:24.870]Austin Duerfeldt: If the sand is not contaminated you do have a potential asset there to where you can sell it to some of the road crews, whether that'd be linkedin or some of the construction companies in omaha.
[02:01:37.140]Austin Duerfeldt: will pay for that type of sand.
[02:01:40.890]Austin Duerfeldt: But you're going to have one big issue and that's with your tenant.
[02:01:46.860]Austin Duerfeldt: If you intend to hold that sand and sell it under general contractual law.
[02:01:55.170]Austin Duerfeldt: You have to provide the rented property and usable state for the entire growing season, so if i'm holding that sand on there, and I say don't go out there and planet or disc or anything because i'm going to sell that sand.
[02:02:06.810]Austin Duerfeldt: Attendance probably going to have a case for vacating in the premise of not making lease payments, because they weren't able to.
[02:02:15.780]Austin Duerfeldt: fulfill the contract based on as it was written or as it was verbally agreed to.
[02:02:22.020]Austin Duerfeldt: In terms of adjusting the lease if you expect full payment definitely look at.
[02:02:30.060]Austin Duerfeldt: What exactly the growing season and usable stages of the ground if you're doing cash rent.
[02:02:35.700]Austin Duerfeldt: If you're doing crop share I tell you, you don't have to worry about this that much because you've already decided 5050 6040 7030 you've decided some sort of a share agreement as to what the expense, is going to be broken up as and how it's going to be handled.
[02:02:53.760]Austin Duerfeldt: When when these types of damages do happen there are.
[02:02:59.610]Austin Duerfeldt: programs and insurance policies for the tenant or the farmer through prevent plan and equip and emerging conservation programs.
[02:03:09.390]Austin Duerfeldt: But most of these programs are set up to try and cover the input costs that farmer and cured and lost due to what the damages are and so it's not necessarily a policy that's replacing the revenue it's a policy replacing what the expenses are.
[02:03:29.070]Austin Duerfeldt: If you do have damages and you need assistance in terms of trying to pay to fix something.
[02:03:35.730]Austin Duerfeldt: There are costs of senses programs through the usda whether you use natural resource conservation service or if you use the more local natural resource district in our bodies.
[02:03:46.740]Austin Duerfeldt: They do have cost share programs and partners and easement programs out there to help do some of these projects, and they have both row crop type programs and livestock programs.
[02:03:59.160]Austin Duerfeldt: If you're interested in trying to learn more about some of those programs, I do have is about an hour and a half long video where I had.
[02:04:07.470]Austin Duerfeldt: brad from in rcs who's the program specialist sit down with me and we went through and talked about some of the different programs and how they work and what the requirements are and that can be found at the link on the side.
[02:04:23.280]Austin Duerfeldt: The reason that I bring up the cost share and part of what I want to get into is if you're brand new to owning farm ground.
[02:04:32.100]Austin Duerfeldt: At some point in time, a disaster is going to happen, whether that's a five inch rain and 30 minutes or if it's flooded ground something's going to happen at some point time you're probably going to have damages.
[02:04:44.400]Austin Duerfeldt: Those damages can be surprising when you start getting the bill to how much it's going to take to fix it.
[02:04:51.570]Austin Duerfeldt: Just to give you a couple around about numbers.
[02:04:55.140]Austin Duerfeldt: For heavy machinery work and i'm talking to users and escalators you're looking somewhere in the ballpark of $160 per hour.
[02:05:03.480]Austin Duerfeldt: And that does not cover any of the material costs and for it so for instances with us and Eastern nebraska you got tile lines and terraces and some culverts that's all going to be in addition.
[02:05:18.750]Austin Duerfeldt: To that hundred and $60 per hour.
[02:05:23.490]Austin Duerfeldt: To try and give you an idea of what may be an expectation might be.
[02:05:29.220]Austin Duerfeldt: Our family does conservation work here in southeast nebraska if we're looking at a job and this isn't a solid number, this is me just trying to throw something out to give you an idea.
[02:05:40.620]Austin Duerfeldt: If you need tile and terrorists work done on a farm say maybe you've got some old toddler some.
[02:05:47.490]Austin Duerfeldt: Old terraces and waterways and you're wanting to switch Thailand terrace take how many acres you got time 700 and that's probably going to give you a ballpark number, how much money we're actually talking about.
[02:05:59.760]Austin Duerfeldt: And so, if there's a storm that actually wiped something out, you know we might be talking about 60 $70,000 else that needs to be come up with in order to get this back into usable state.
[02:06:13.170]Austin Duerfeldt: And so what I would.
[02:06:18.600]Austin Duerfeldt: pitches when you're looking at this.
[02:06:22.350]Austin Duerfeldt: Something that I would build into your expectations of a cash flow from a cash rental agreement is you need to be setting aside a little bit of money.
[02:06:32.850]Austin Duerfeldt: To go towards some sort of event like this it's hard to come up with $70,000 all in one year, but if i've been expecting something to happen and i've been putting maybe four or five grand away every year.
[02:06:47.040]Austin Duerfeldt: that's going to help alleviate some of that strain coming up with that money.
[02:06:53.160]Austin Duerfeldt: One key thing that did come up this last summer was there was a gentleman that was signed up to do a cost year agreement.
[02:07:02.280]Austin Duerfeldt: To do some Thailand terrorists work on their farm and based on those contracts, most of them come do in terms of when the product has to be completed by.
[02:07:14.340]Austin Duerfeldt: Those come do in July late July early August.
[02:07:18.840]Austin Duerfeldt: If you're an Eastern nebraska most of us do corn soybean rotation.
[02:07:23.970]Austin Duerfeldt: In order to fulfill that contract of getting the work done when it was supposed to be done that's going to require the tenant to change that rotation and do a year of wheat, instead of whether it would have been corn, or whether it been soybeans.
[02:07:39.870]Austin Duerfeldt: And so the question was does ELISE need to be adjusted.
[02:07:44.400]Austin Duerfeldt: More than likely if you've written up a contract the contracts, unless you specifically say it, otherwise the tenant has the right to plant, the commodity that they choose, unless you stated, otherwise in the contract, they can choose what commodity they plant.
[02:07:59.400]Austin Duerfeldt: And so to tell them that you can't plant that you have to play a weed you're probably going to have to have some sort of adjustment so as we were trying to come through this, the first thing we looked at is.
[02:08:11.250]Austin Duerfeldt: You know what kind of damage might there, possibly be in terms of attendance revenue, and so we have what the traditional rotation was versus what the requested was going to be and we threw in some prices.
[02:08:23.130]Austin Duerfeldt: And we did say yeah it looks like there's probably going to be, you know somewhere in the ballpark of $180 an acre revenue loss if you're switching from soybeans to wheat and a three year rotation.
[02:08:38.010]Austin Duerfeldt: And so, as we were trying to come up with a way to approach this and have a conversation again, none of this is set in stone, this is sitting down having a hard conversation with somebody trying to figure out how we're going to handle is.
[02:08:50.670]Austin Duerfeldt: What we ended up looking at was cash rent typically runs around 26 to 30% projected farm revenue, it could be a little bit more, but so if I was looking at a 230 bushel an acre corn property at 390.
[02:09:09.120]Austin Duerfeldt: For bushel that would be $197 per acre revenue times that by 28% somewhere in the ballpark of $250 cash rent rounded down would be an expectation of where that cash rate might end up at.
[02:09:26.010]Austin Duerfeldt: And so, if you're looking at that projected revenue, we can apply that to corn and soybeans and come up with an idea of what the potential change by need to be in terms of changing the ren So what we suggested was making a table kind of similar what we've got down below.
[02:09:43.920]Austin Duerfeldt: we've got projected revenue based on soybean expectations, based on weed expectations again, this is a conversation of.
[02:09:51.900]Austin Duerfeldt: You know, sitting down with that tendency and i'm thinking we're probably going to be around 540 where do you think it's going to be at I was looking at usda but.
[02:10:00.690]Austin Duerfeldt: You talk about the numbers you come up with that projected revenue and then you've got a couple of options down the line.
[02:10:07.110]Austin Duerfeldt: Where maybe if you're thinking is 27% of revenue you've got 176 verses 117 I might need to adjust the rent for that year that i'm changing it to wheat, maybe I need to adjust it lower by $59 an acre in order to.
[02:10:26.010]Austin Duerfeldt: accommodate the tenant switching or replacing that soybean rotation was a week rotation.
[02:10:33.120]Austin Duerfeldt: And again, this is just a conversation point it was something that we pitched to getting started.
[02:10:40.680]Austin Duerfeldt: In terms of adapting leases one thing that i'm starting to see more of if you're wanting to try and tie in some payments to production wrist and take a little bit more advantage of.
[02:10:53.850]Austin Duerfeldt: If you think we're running into another 2012 or we're going to see $13 soybeans and $7 corn flexible cash leases can do that for you.
[02:11:04.890]Austin Duerfeldt: there's a couple of different ways, you can set them and if you're wanting to learn more about flexible cash leases there's a publication link there that you can read about them.
[02:11:13.590]Austin Duerfeldt: But as i'm starting to talk to more and more producers and more and more landowners i'm starting to see people pitch more and more this flexible cash ran agreement type idea.
[02:11:23.460]Austin Duerfeldt: The other thing that I would highly recommend, and this is what we do with our agreements down here in the area that we farm at.
[02:11:30.720]Austin Duerfeldt: Is add into the agreement who's responsible for correcting some sort of damage.
[02:11:37.230]Austin Duerfeldt: Generally, what we do is we just set $1 limit to it if it's you know say $400 to fix it and corrected we're just going to take care of it for you.
[02:11:48.000]Austin Duerfeldt: And so we'll go out there and we'll track our time and stuff will take pictures will notify you and will basically say hey there was an ice storm some of the trees fell down in the fence row.
[02:11:59.280]Austin Duerfeldt: We went up we cleaned it up and took care of it, you don't owe us anything, it wasn't that expensive it didn't take a whole lot of time we just want to let you know about it again that clear communication, making sure people know about what's going on.
[02:12:13.470]Austin Duerfeldt: If it's a bigger problem like that you know, five or six inch rain and 30 minutes.
[02:12:18.750]Austin Duerfeldt: Then, probably what we'll do is we'll give you a call and we'll ask you to you know pick a date and we'll we'll take you out and we'll look at the farm.
[02:12:27.210]Austin Duerfeldt: or go through the the issues that need to be corrected, whether that's fixing some of the terraces or or fixing some goalies and ditches for water wash off.
[02:12:39.420]Austin Duerfeldt: But will will walk you through what needs to be done, will give you an estimate, based on what we think it's going to take for us to fix it.
[02:12:47.790]Austin Duerfeldt: And we'll give you a couple of contacts, for if you're wanting to get an outside contractor to bid or to actually do the job will give you that, but then it's up to you to decide how you want to handle it.
[02:12:59.670]Austin Duerfeldt: And so again if you've got something like that built in, and just kind of streamlines the process, so you don't have to have an awkward conversation every time some little wind storm or something pops up is clear cut and handled.
[02:13:13.710]Austin Duerfeldt: And with that I think we'll probably switch over to how again to close it out and he's going to cover some additional least provision ideas that we've got that we suggest trying to add into your leases.
[02:13:26.430]Allan Vyhnalek: Okay, thanks Austin trying to guess on home, so now, if you have the handout in that packet with the handout there was an evaluation.
[02:13:36.360]Allan Vyhnalek: Your costume attending this program is to fill out the evaluation and mail it back to.
[02:13:42.090]Allan Vyhnalek: The program is free, but we, because we have a grant to do the program We really need to have the evaluation done that helps us know what to do next time.
[02:13:50.490]Allan Vyhnalek: And tells us how we do this program so please fill out that evaluation that's your tuition today if you get if you get the packet in the mail in the next few days i'm three will those be evaluation there's is filled out as best you remember about this program.
[02:14:06.000]Allan Vyhnalek: Alright finish up here in a few minutes, so I will get done by love 15 that should be done by low 20s.
[02:14:12.030]Allan Vyhnalek: um so gabby releases in writing, Jim Murray talked about this every total told you about the site at least one or one dot O rg to get your get a kind of a PDF copy of a blank Lucy.
[02:14:26.220]Allan Vyhnalek: If you have an old verbal lease handshake agreement know that you have to the dead did a brassica Supreme Court says it performed Monday starting September 1.
[02:14:36.360]Allan Vyhnalek: seasoning for foreign land they started on march 1 next Monday, you have a handshake a verbal agreement off the farmland starts march 1 next Monday.
[02:14:45.090]Allan Vyhnalek: In order to terminate the lease for 2021 you had to get noticed by September 1 of 2026 months ago, so just know that and then there's publications out there on our.
[02:14:57.840]Allan Vyhnalek: website and real estate website, excuse me real estate they talked about how the termination thing goes and it said that.
[02:15:05.160]Allan Vyhnalek: it's not the same for pasture because the past releases simple before May 1 October 1 from June 1 to November 1 it's a five month lease.
[02:15:15.390]Allan Vyhnalek: So therefore the pastor descended your lender last November ended last October.
[02:15:21.330]Allan Vyhnalek: So you need to re up those leases every year, unless you have at least it says it's going to be for some years.
[02:15:26.850]Allan Vyhnalek: But it's a five month lease so just understand that so there's no there's no termination notice needs wherever needed for passion for farmland, because to 365 days, so you have to be that traditional.
[02:15:38.820]Allan Vyhnalek: Okay.
[02:15:40.740]Allan Vyhnalek: Starting and ending date of leases make sure you have that in your lease length at least make sure it's terminated that's that's clear.
[02:15:47.580]Allan Vyhnalek: How are you going to how are you going to hold over how are you going to continue and Lisa make sure that's clear how much notice if you're going to terminate a written least how much notice, you have to add make sure that's within the least one camp, with the nose up.
[02:15:59.250]Allan Vyhnalek: When will the least be negotiated, make sure that's noted and least when you negotiate this, because what I find is when prices are going up landlords wants to negotiate least now right before March 1 when prices are going down.
[02:16:13.980]Allan Vyhnalek: tense wanted in landlords want to negotiate back and by September antennas wants to go negotiate now because prices are going down so just make sure it's always the same time for both parties, so that you're being somewhat equitable.
[02:16:29.700]Allan Vyhnalek: fertility notes couple of fragility things think about it scares me with some of these highly since I heard one lease and one part of Eastern nebraska it was supposed to be up supposedly over $400 a week or just this week just this week for 2021.
[02:16:43.380]Allan Vyhnalek: or $400 an acre.
[02:16:45.930]Allan Vyhnalek: If you if you end up with prices going back down corn and soybean prices going back down guess what the guys going to make this one at our lease payment so how's it going to do that he might skip on for life.
[02:16:57.840]Allan Vyhnalek: So maybe one thing to consider is putting up her vision leads to talks about you can't mind a leaf boss or side of my ground, you have to leave it is certain minimum level.
[02:17:08.220]Allan Vyhnalek: or for the tenant if you put sponsors out there.
[02:17:12.480]Allan Vyhnalek: chances are they're putting enough on their last 234 years and still kick them off after one year did they get to use all their fosters probably not so.
[02:17:20.700]Allan Vyhnalek: You have it set up to they could get we could have competition both ways to to manage that risk for manage that expense.
[02:17:27.960]Allan Vyhnalek: line should be a landlord expense I don't understand why people can't figure that out because long term lease city it's gonna be a long term expense and Eastern nebraska lives assumed the last 10 to 15 years, maybe longer for your pH drops and points you have to reapply.
[02:17:44.910]Allan Vyhnalek: So it should be a landlord thing, because it should be tied to the land it's just like an expensive excavating are making the rebuilding terrorists is that sort of thing, but in some cases, the tenants have started to put Lima.
[02:17:58.080]Allan Vyhnalek: find the day if they have a 10 year investment in line and kick them off after two or three or you disrupt the lease after 235 years, then they should get part of that prorated back to just understand this data clouds and least covers that.
[02:18:12.120]Allan Vyhnalek: shouldn't be a clouds and least because the landlord to pay for the first place.
[02:18:17.010]Allan Vyhnalek: i'm.
[02:18:19.200]Allan Vyhnalek: Fixing excessive erosion last talked about that quite a basically landlords expense non cash crop acres in control to see the trees and knocks noxious weeds that is a landlord expense, however, the tenant might do it.
[02:18:31.710]Allan Vyhnalek: But the landlord should be willing to ride the tenure, with the chemicals to do it if they're doing that or whatever.
[02:18:36.810]Allan Vyhnalek: This land arctic's responsibility care cedar trees and packers it's a chance responsibility to take care of annually leads and patches like this that's tennis job.
[02:18:46.830]Allan Vyhnalek: With the landlord job takers so know that they'll that that has to be cleared they had made go to have the APP that conversation that's what.
[02:18:55.470]Allan Vyhnalek: If you if the landlord expects to lead your know to considerations that should be noted that ELISE if they if they have a specific request that way organic versus non organic.
[02:19:05.130]Allan Vyhnalek: Again nabokov communication about that and think about what that looks like the bottom line is you can't have no chill and organic.
[02:19:15.840]Allan Vyhnalek: At the same time, usually because organics set up on that idea to do cultivation to control the weeds.
[02:19:24.300]Allan Vyhnalek: And know tail except that you use chemicals control the weeds which would be network brag or gang So be careful about that.
[02:19:32.340]Allan Vyhnalek: GMO versus non GMO the dead horse out the gate 97% soybeans and 95% of the corn is all GMO production so now you're not going to find see there wouldn't be necessarily that that that's a done deal it's healthy it's fine to all the research shows it's gonna be okay.
[02:19:48.120]Allan Vyhnalek: And their crop residue grazing stock for sale bailing stocks, if I got out their cars out there for 30 to 60 days like they should be.
[02:19:56.550]Allan Vyhnalek: Do I care if the stocks get grazed know as matter fact I like it when the socks be praised.
[02:20:02.670]Allan Vyhnalek: Because it's one up getting up getting up the Court and they might have left in the field might have fell off because of wind storm or something like that, and then you have too much volunteer.
[02:20:13.080]Allan Vyhnalek: corn control as a weed now, and so I be cropped next year I not do anything I get concerned about here is that if you're rolling are bailing stocks.
[02:20:24.450]Allan Vyhnalek: And you're doing a clear idea I rake our aggressive rate you taking almost all the material off the ground and putting it into round bales and harvesting off that field after harvest.
[02:20:35.760]Allan Vyhnalek: I wouldn't want as a landlord I wouldn't want that to happen more than once every four six years I wouldn't want to tap and every time I have foreign field is to our own organic matter it's too hard and and phosphorus so just be careful about that.
[02:20:49.530]Allan Vyhnalek: And this down unless it provisions held out investors have different provisions least if it's a cashless the tenant gets us to stocks you for gracing orphan bailing zoom just have be clear on the communication.
[02:21:04.320]Allan Vyhnalek: What else we got here one other thing pastor or Austin kind of alluded to this briefly and he said basically this he said.
[02:21:13.200]Allan Vyhnalek: We have to make sure we account on our pastor least for the big three fire dragon tail that's one thing we're kind of missing right now, especially especially it came up back to the drought to 2012 people would be calling me up late in that season going hey.
[02:21:27.390]Allan Vyhnalek: calories on the pasture and there's nothing left to eat and there's a landlord i'm not sure I like that, and if I was a landlord or past year, I would like to you.
[02:21:36.420]Allan Vyhnalek: How are you going to handle the lease I don't have a textbook honest I don't have a research, study on this i'm just saying, have a conversation figure out you to do.
[02:21:44.850]Allan Vyhnalek: You have a conversation the landlord tenant how are you going to handle the big three fire draft hail and how's that least going to get adjusted.
[02:21:51.210]Allan Vyhnalek: And then the last thing here on this slide is honey rights crop ground pasture it's different on crop ground running right one to the tenant unless they're held out.
[02:22:00.600]Allan Vyhnalek: on pasture because of pasture is a five month lease and it ends before hunting season starts, then the hunting rights belong to the landlord.
[02:22:08.910]Allan Vyhnalek: Now the big thing I want to talk about here as a four or five years ago we teach the brassica recreational use law or for recreational use of agricultural land and that says it for hunting, it could be for off road bicycling either with bicycle or motorcycle it could be for.
[02:22:28.680]Allan Vyhnalek: trail rides horseback riding could be for snowmobiling any recreational use low farm Okay, as we don't charge the people to be there and we allow them to have recreational or form for free.
[02:22:41.400]Allan Vyhnalek: If they fall into a hole and twist an ankle or something that's not our fault or landowners cannot be sued or the depth of the law schools to protect us from this.
[02:22:51.390]Allan Vyhnalek: Powerful charge them a nominal some kind of fee to be there, then, make sure you have.
[02:22:56.970]Allan Vyhnalek: That specified and figured out and make sure you have your your negligence covered in terms of holes and things like that, because we have trouble.
[02:23:05.220]Allan Vyhnalek: either case, make sure you have a nice umbrella umbrella liability policy for your farm that you own farmland shown.
[02:23:12.870]Allan Vyhnalek: And I, like, for instance I I own farm ground, and I have my liability umbrella policy under my home Homeowners insurance just it's possible 100 hundred and 50 bucks a year so much effort million dollars with.
[02:23:24.750]Allan Vyhnalek: With some of you know somebody out there they're not supposed to be the ball in the hole I at least have some coverage if they think that i'm negligent.
[02:23:31.110]Allan Vyhnalek: For them trespassing you know who knows a lot people always go back to the deepest pockets so that's why you need to have the liability insurance.
[02:23:38.490]Allan Vyhnalek: that's the end of our presentation I almost made to 1122 projects.
[02:23:44.940]Allan Vyhnalek: Again that's how you get Ahold of us again thanks for participating today.
[02:23:49.530]Allan Vyhnalek: we're going to leave the window open glynis is going to be the host now and she'll take over again at 130 so you're going to listen to her budget thing and 130 to stay in this window, if you want to, or you can jump off and jump back on with the same link and.
[02:24:03.750]Allan Vyhnalek: let's see.
[02:24:05.640]Allan Vyhnalek: If you have an evaluation, please fill it out send it back, and if you get an evaluation, please fill it out send it back I don't see any.
[02:24:11.610]questions in the chat.
[02:24:14.010]Glennis McClure: On.
[02:24:16.080]Glennis McClure: landlord.
[02:24:19.170]Allan Vyhnalek: who's responsible for soil testing well.
[02:24:23.010]Allan Vyhnalek: Once you want to have happen, I mean if it's just normal years years Old Testament can easily get that taken care of.
[02:24:28.830]Allan Vyhnalek: If it's a soul testing at the end of the lease where you're trying to check for phosphorus and make sure that tenant is left certain amounts of fossils there and I would submit the landlord policies cover that test again.
[02:24:39.600]Allan Vyhnalek: Communication will determine I know that i've had my lease and my brother for quite a long time now, over three years and.
[02:24:49.020]Allan Vyhnalek: my brother farms my ground, and I know that when we had a sharecropper weise I did cover my share her of the soul testing as part of the part of all, we wanted to have happen.
[02:24:58.110]Allan Vyhnalek: So, but we were in a cashless he covers it because it's just a part of us do, or at least provision slides in the book there was mailed to us, yes, they will be.
[02:25:11.250]Allan Vyhnalek: Other questions.
[02:25:17.820]Allan Vyhnalek: So i'll just in landlord is data is data wise I think it's for a year to year, I think the tenant will cover that.
[02:25:23.190]Allan Vyhnalek: And if it's before checking about we're talking about we're talking about the actual you know, going from one thing to another lease on that, I think that that that can be a landlord expense, obviously.
[02:25:37.680]Allan Vyhnalek: This, I said that wrong, I say that wrong Austin.
[02:25:42.960]Austin Duerfeldt: I think you said it right okay.
[02:25:46.110]Allan Vyhnalek: I mean that's that's my perception here's what i've learned from for 18 or 20 years whatever it's been 1518 years is that every every neighborhood in the state has to do things differently and and what I just represent was what what happens in most not all but most.
[02:26:03.930]Allan Vyhnalek: there's a neighborhood right across the road we're Austin lives in Northwest Missouri that things that the things that the land or just paid attention to harvest corn for the harvest as a part of the loose.
[02:26:20.010]Allan Vyhnalek: So now, I could explain that in more detail, you want to know someday but send me an email i'll be right back.
[02:26:28.890]Allan Vyhnalek: Okay, thanks again thanks we're good real leave it open and we'll start this thing back up at 130.
[02:26:38.490]Allan Vyhnalek: Thanks everyone, you can jump off free to stay on glynis I think you're the host now is that correct.
[02:26:46.410]Glennis McClure: I think so.
[02:26:47.400]Allan Vyhnalek: yeah you are the host you are the host okay don't think i'm going to have to do in about 10 minutes so i'm gonna have to take this slide down and put my mother presentation up for the noon hour so.
[02:26:57.660]Allan Vyhnalek: i'll get i'll be jumping off here in about 10 or 15 minutes, so you may want to you may want to create something that looks like this and talk about the.
[02:27:05.940]Allan Vyhnalek: Budgeting workshop again 130 minutes your first slide and you can put yours up here in a few minutes tell me when you're ready we'll put it up.
[02:27:12.870]Glennis McClure: yeah I can go ahead and do that, so you what you need to do thank.
[02:27:16.620]Allan Vyhnalek: You Thank you yeah no I mean they just closed it down then okay i'm a close off and get off here alright thanks everybody i'm going to get imma jump off.

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Ag Land Leasing, Budgeting and Management for 2021 - Landlord/Tenant Cash Rent Workshop for Eastern Nebraska 2/25/2021

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