Land, Enterprise and Ownership Transfer
by Troy Smith for Angus Productions Inc.
MITCHELL, Neb. (Nov. 30, 2011) — During Range Beef Cow Symposium XXII, in Mitchell, Neb., a panel of three producers discussed their personal experiences and offered advice regarding successful transfer of family farm and ranch businesses to succeeding generations.
Lucy MeyringLeading off, Lucy Meyring, of North Park, Colo., described the multi-generational ranching operation built by the family of her husband, Danny. Directing comments to "senior" members of the audience, Meyring urged preparation of a formal succession plan that allows transfer of an operation as a viable business.
“I encourage you to take this seriously,” warned Meyring. “Have things set up so you have some income coming in for the rest of your life. Your young people need to realize this is necessary. Few parents can afford to just hand it all over to their children and just hope they will take care of you in your old age.
“There are ways to do it, such as gifting some assets, like cattle or equipment, to children, but keeping the land and leasing it to them,” she explained.
Ed Blair After sharing the history of his family’s ranch, near Vale, S.D., Ed Blair told how he and his brother purchased half of their parents’ business on a long-term contract. Their father also set up trust accounts for the brothers, their off-ranch sister and their mother. Over time, said Blair, the transition worked as planned.
Both Blair and his brother have sons that are now involved in the operation. They have started planning for the next transition, starting with gifting the money needed for the younger men to purchase land and start building equity. Ownership of cattle and equipment is now under a limited liability company (LLC).
“My advice,” said Blair, “is to start early, because it takes time, and seek the advice of professionals to develop a transfer plan.”
Tom Marcy Tom Marcy, Hay Springs, Neb., said his parents started the transfer by shifting from their role as managers to advisors and supplemental labor. They also gifted a parcel of land, including the headquarters site, to the younger Marcy and his wife. The younger couple also purchased cattle and equipment, on a long-term contract, and began leasing the remainder of the ranch.
“I think you have to have business goals and personal goals, and state them clearly. All parties have to communicate to make it work,” stated Marcy. “Have your banker, attorney and accountant involved. Most importantly, get a plan and act on it.”
The biennial Range Beef Cow Symposium was hosted Nov. 29-Dec. 1 at the Mitchell Events Center, Mitchell, Neb., by the cooperative extension and animal science departments of the University of Nebraska-Lincoln, South Dakota State University, Colorado State University and the University of Wyoming. Comprehensive coverage of the event is provided online at www.rangebeefcow.com, an event coverage site provided by Angus Productions Inc. (API), publisher of the Angus Journal and the Angus Beef Bulletin.
Editor’s Note: API's coverage of the event is made available for distribution to all media via an agreement with the Range Beef Cow Symposium Committee and API. Headquartered in Saint Joseph, Mo., API publishes the Angus Journal, the Angus Beef Bulletin, the Angus Beef Bulletin EXTRA, and the Angus e-List, as well as providing online coverage of events and topics pertinent to cattlemen through the API Virtual Library. For questions about this site, or to notifiy us of broken links, click here.