Leader: A Lasting Legacy

s

Farm Credit Lending support to all of agricultureÂŽ

leader

Check out our 2018 calendar winners on page 14!

Volume 22 | ISSUE 4 | $3.95

A Lasting Legacy

s MidAtlantic Farm Credit, ACA

In This Issue

Thomas H. Truitt, Jr., CEO

FARM AND LAND

MidAtlantic Farm Credit Board of Directors Paul Baumgardner Chairman Jennifer L. Rhodes Vice Chairman Brian L. Boyd Gary L. Grossnickle Laura M. Heilinger Dale R. Hershey Walter C. Hopkins

4 RDaryl aising Cows and Kids Stoltzfus of Gap, Pennsylvania

has been working with his parents to transition their family’s dairy farm to he and his wife, Kim.

6 PFollowing reserving Family Traditions the tragic loss of her father, Taylor Huffman and her husband, Brandon, were determined to keep her father’s business in Thurmont, Maryland alive.

Anthony M. Ill T. Jeffery Jennings M. Wayne Lambertson Fred R. Moore Dale J. Ockels Ralph L. Robertson, Jr. Alan N. Siegfried Douglas D. Scott Joseph D. Snapp Fred N. West

facebook.com/MidAtlanticFarmCredit @midatfarmcredit mafc.com/blog

8 LDavid eading The Way 10 The Growing Through Generations Denny of Queen Anne’s County, French family has been on their Maryland is the third generation to lead his family’s grain farm, but his five year old son, Beckett, is following right behind him.

land in Woodstock, Virginia for generations. Today, they farm 300 acres and the middle child, Hubbel, is keeping it all in the family.

+MafcMidAtFarmCredit MidAtFarmCredit @midatfarmcredit

OUR ASSOCIATION

12 The Future of Your Farm 13 2018 Annual Meeting Dates 14 Calendar Contest Winners 15 Know Your Tax Facts COMMUNITY

16 Properties for Sale

questions or ideas If you have any questions or ideas for the editorial staff of the Leader, contact Jenny Kreisher at 888.339.3334, e-mail her at jkreisher@mafc.com or write her at MidAtlantic Farm Credit | 700 Corporate Center Court | Suite L | Westminster, MD 21157.

This publication is for you, our reader. We’d love to hear from you!

The Leader is published quarterly for stockholders, friends and business associates. If you wish to no longer receive this publication, please email: unsubscribe@mafc.com. Use “Unsubscribe Leader” in the subject.

The Farm Credit Administration does not require the association to distribute its quarterly financial reports to shareholders. However, copies of its complete report are available upon request or see quarterly updates online at mafc.com. The shareholders’ investment in the association is materially affected by the financial condition and results of operations of AgFirst Farm Credit Bank and copies of its quarterly financial report are available upon request by writing: Susanne Caughman | AgFirst Farm Credit Bank | P.O. Box 1499 | Columbia, SC 29202-1499 Address changes, questions or requests for the association’s quarterly financial report should be directed to: MidAtlantic Farm Credit, ACA by calling 800.333.7950 or writing: MidAtlantic Farm Credit | 45 Aileron Court | Westminster, MD 21157

2

| VOLUME 22 | ISSUE 3 | mafc.com

s president’s message

Planning for Succession

s events | deadlines

DEC

event

place

3-5 Maryland Farm Bureau Convention Ocean City, MD 12-13 Growing PA’s Organic Farm Conference Harrisburg, PA 25-26 Christmas Offices Closed Jan 2018 event

place

1 New Year’s Day Offices Closed

1-8 Delaware Ag Week Harrington, DE

9-11 Keystone Farm Show York, PA 11-13 Future Harvest’s Cultivate the Chesapeake Conference College Park, MD

15 Martin Luther King, Jr. Day Offices Closed 19-21 Maryland Horse Expo Timonium, MD 24-25 Eastern Shore Agricultural Conference Melfa, VA 30-Feb 1 Mid-Atlantic Fruit and Vegetable Convention Hershey, PA

FEB event

place

7-10 PASA Farming for the Future Conference State College, PA

8-9 MidAtlantic Women in Ag Conference Dover, DE

19 President’s Day Offices Closed

There comes a time in any business owner’s life when they start to think about what’s next for them, their business, and their family.

Farmers are no exception. Whether it’s prompted by changes in the market, family dynamics, or simply being ready to work a little less, the discussion of what to do with the farm is inevitable. It’s often not a conversation that happens until it needs to, but with the average age of today’s farmer being 58, it’s a hot topic both in- and outside of the agriculture community.

The four customers featured in this issue of the Leader have either worked through a succession plan, or have one on place. Each of them has a very different story, but one thing we can learn from them is that even though succession planning is an easy topic to put off, you never know what the future holds. The earlier you can start the conversation, the better position you’ll be in when the time comes to make a move.

Daryl Stoltzfus of Gap, Pennsylvania knew when the time came to talk about the next steps for his family’s dairy operation, he and his wife, Kim, would be there to help his parents make that transition.

They now raise their four children on the same land his parents farmed, and they all work together, making it a real family business.

A family tragedy in 2013 resulted in 24 year old Taylor Huffman and her husband, Brandon, transitioning her father’s agritourism business in Thurmont, Maryland over to them. Neither of them had any business experience, but Taylor’s love of the farm and passion for keeping her family’s legacy alive fueled them to make it work.

After years of a 50/50 partnership with his father, David Denny worked with his parents to fully transition their farm on the Eastern Shore of Maryland over to him and his wife, Jessica. David credits his father with passing down knowledge he never would have received from anyone else, and continues to work with both of his parents on a daily basis.

Lastly, we feature the French family of Woodstock, Virginia. The family’s land dates back to 1861, and when Doug and Shirley were ready to take a step back, their middle child, Hubbel, was there to ensure the family’s tradition remained intact.

This issue also features an article by Dr. Alex White, a succession planning expert, on why this conversation is important to have.

You can read his thoughts on page 12. We also announce our 2018 calendar winners, and the dates for our annual stockholder meetings, taking place in early April.

Reflecting back on this issue, each story illustrates new beginnings, which is something we, too, have experienced at Farm Credit over the past few years, with retirements and new faces joining the team. As we look forward to another year full of opportunities and growth, I wish you and your family a happy and healthy 2018.

Happy Holidays,

For a full list of events, please visit mafc.com VOLUME 22 | ISSUE 4 | mafc.com | 3

FARM AND LAND

Raising Cows and Kids on the family farm Story and photos by Sally Scholle

| Being raised on a farm doesn’t always mean ending up on that farm as an adult, but

for Daryl Stoltzfus, the farm of his childhood is becoming a reality for his family. “My parents Abe and Anna Mae lived here before we did, and they had farmed it all my life,” says Daryl. “It was a dairy farm, and we raised crops and broilers.”

The Stoltzfus family takes a break from working together on their family dairy farm in Gap, Pennsylvania. From left: Abby, Nolan, Daryl, Shania, Chloe, Kim, and Deena.

Daryl recalls always being interested in farming, and helping with both the dairy and broiler operations as a youngster growing up on the farm. The first ag project he undertook on his own was a broiler house he built when he was 18. Although he worked part-time off the farm, Daryl knew he wanted to continue dairy farming.

About 13 years ago, the Stoltzfus family began the transition from Abe and Anna Mae to Daryl and his wife Kim. The transition began with the formation of an LLC. “I bought half the 4

| VOLUME 22 | ISSUE 4 | mafc.com

herd and half of the equipment,” explains Daryl. “We put a cash flow together and worked numbers until they made sense.”

Daryl added that his father may have been somewhat resistant to transitioning the operation when they first started talking, but has been very supportive and easy to work with throughout the formal process.

“I bought him out completely last spring,” says Daryl. “We did it in two chunks—last year wasn’t a good dairy year, so we did half in April (the cows) and the rest in January (the equipment).”

The herd is comprised of Holsteins, some of which are registered. “We breed for a good cow,” says Daryl. “Feet and legs are the main priorities. The udder matters, but if you can keep feet under them, that’s the most important thing.”

Dairy facilities can become outdated quickly, and the Stoltzfus family has kept up with technology and made improvements as necessary. Daryl says that when his father purchased the farm, cows were milked in the original tie stall barn. “Dad built the double six parlor in 1996,” says

Daryl. “In 2001, he built the other barn on top of that. It was a freestall barn, but we transitioned it to a bedded pack. We were milking about 110 cows when I bought in, and we’re milking 150 now.”

The main reason Daryl and his father decided to transition to a bedded pack barn was to maintain good feet and legs.

“We tore the freestalls out and added a wing about five years ago to accommodate more cows,” says Daryl, adding that a bedded pack accommodates fewer cows.

“There’s a drive-by feed area with a rail.”

When the cows aren’t eating a balanced TMR (total mixed ration) that’s kept in front of them throughout the day, they move to the bedded pack area to rest.

The pack is bedded with shavings weekly, which keeps cows clean and comfortable.

Daryl says that the pack encourages cows to walk about freely, making it easy to detect when an animal is in heat.

“With the bedded pack, feet and legs have improved and our cull rate has dropped,” notes Daryl. “Reproduction rates are good because it’s easier to catch heats when cows have better footing.”

Daryl acts as herd manager and observes the cows closely throughout the day. Kim milks every morning and fills in during evenings when necessary. The two oldest Stoltzfus girls, Abby, 15, and Deena, 13, milk several nights a week, and parttime employees fill out the schedule.

Kim and Daryl manage newborn calves and make sure they’re off to a good start, then the children take over daily calf care until calves are about four months old. Daryl says that switching from raising calves in the old bank barn to hutches has made a big difference in improved calf health. Shania (age 11) and Nolan (age nine) care for calves every morning and most evenings, and the other children fill in as needed. Kim says that the children are familiar with good calf health and recognize the early signs of calves that might be sick. Replacement heifers are raised on the farm.

Abe is an integral part of the farm when it comes to cropping, and Daryl says that his willingness to help with field work is a valuable asset. “This season’s weather will yield possibly the best crops the farm

has ever harvested,” says Daryl. “The last couple of years, we’ve had amazing beans, then it got dry in August and the final yield wasn’t so amazing.”

Depending on harvest timing, Daryl plants cover crops on as much ground as possible. Last year, with early harvest, he established cover crops on all crop ground.

This year, he might not be able to establish cover crops in time due to a delay in harvest because of wet ground.

Daryl says that everyone in the family has remained open-minded throughout the transition process, with each person working to understand the others’ points of view. “It was his business and his home,” he says, describing his father’s close ties to the farm. “It isn’t easy, but he wanted to see me farm, so we made it work. We didn’t agree on everything, but I wouldn’t be here if it wasn’t for him.”

Although Kim and Daryl haven’t purchased the farm property yet, that’s coming in the future. “Our goal is the same: I want to farm and my dad wants me to have the farm,” says Daryl. “Eventually, we’ll figure it all out.” l

s

s

s

(top): All of the Stoltzfus children help on the farm. (bottom): Daryl pushes feed to the cows during the day ensuring the herd always has plenty to eat.

(top): With good crop management, fertile Lancaster County soil and ample rain this season, Daryl says that 2017 is probably the best crop year they’ve had. (bottom): The bedded pack barn, which was converted from a freestall barn, gives cows plenty of lounging room and provides good footing. Good ventilation year-round helps maintain cow health.

Farm Credit loan officer Andrew Stutzman, on left, discusses the current crop year with Daryl. They are standing in a structure that was built to store poultry litter from the farm’s broiler barns until it can be land-applied.

VOLUME 22 | ISSUE 4 | mafc.com | 5

FARM AND LAND

Within the 30 acre maze, there are dozens of checkpoints for people to search for as they make their way through the miles of trails.

Preserving family traditions at Lawyer’s Winterbrook Farm | Taylor Huffman has always loved life on her father Jan Lawyer’s Winterbrook Farm in Thurmont, Maryland, which has been in the family for 95 years. But she never expected that she and her husband, Brandon, would be fully responsible for keeping the farm running at the ages of 24 and 25, respectively. Taylor and Brandon took over the ownership and operation of the farm after her father passed away in 2013 from brain cancer, an unexpected and difficult transition for the young couple.

Story by susan walker and Photos by susan walker and Taylor Huffman

“It was a total surprise when my dad was diagnosed with a brain tumor,” explains Taylor. “He was young and I didn’t anticipate losing him. The biggest challenge related to transitioning the farm was doing it without my dad. When he passed away, we didn’t know what to do. But, we decided we still wanted to farm, so we picked ourselves up and continued. It was a big life decision for both of us and it was scary looking at those numbers on the papers when we refinanced the farm into our names, but I don’t regret it at all. This is what we love to do and we wanted to keep the farm going, especially in memory of my 6

| VOLUME 22 | ISSUE 4 | mafc.com

dad, so we made the jump.”

Taylor and Brandon say that working with Farm Credit made their tough transition a bit easier. “We were very fortunate, because Farm Credit stuck with us and supported us through two very difficult years,” Taylor says. “I can’t tell you how much of a relief it was to know that as long as we kept going and working, they would work with us. Everything here on the farm is everything I’ve ever known and I am very grateful for the opportunity to keep the farm in our family.”

Adds Brandon, “Farm Credit has always been there for us and has been

supportive. They made everything super easy, unlike other banks where there are a bunch of hoops you have to jump through. It feels like a small bank. When we walked into the office, everyone knew us and asked how they could help us. It’s not like a big financial institution where you’re just a number.”

“I grew up with Farm Credit,” continues Taylor. “They were always supportive of my parents and our loan officer John Stump became a good friend. He encouraged us and kept us positive as we went through the transition. I’m very thankful that Farm Credit helped us continue to

s Among the many new attractions at the farm this year are miniature donkeys, Thelma and Louise, and mini ziplines.

pursue our dreams.”

The family’s 327 acre farm is made up of three properties, including Lawyer’s Winterbrook Farm, where Taylor and Brandon farm thousands of bales of hay for local horse farms. In addition to the hay operation, the Huffmans also continue Taylor’s father’s Fall Festival and agritourism operation, which he started 18 years ago with a pumpkin patch and a corn maze he hand-cut with a skid loader. Taylor started helping out with the agritourism operation when she was 16.

“Since my dad started the Fall Festival, we’ve had the biggest corn maze in Maryland,” says Taylor. “It covers 35 acres, has 6.3 miles of trails, and it’s a big draw for the farm. This year, we’ve added 15 new attractions for families, including mountain slides, mini zip lines, a farm animal area, and apple cannons. We’ve also added fun activities for the youngest kids in our barn, including a bouncy ball pit, a corn pit kids

s s Visitors can try their luck with the new apple There are several new additions to the Huffman family. In addition to pygmy goats, Tom and Jerry, Taylor and Brandon are expecting their first child.

can dig in, farm-themed swings, and duck races. And, there’s a nine acre pumpkin patch and free hay ride. We enjoy sharing the farm experience with the families who visit, many of whom come from as far away as Baltimore and Virginia. Our true passion is farming the land, but in today’s world it’s hard to make ends meet by farming alone.

You have to be creative and get into a niche market and that’s what the Fall Festival helps us do.”

Taylor and Brandon are also planning to expand their operation in the coming years, adding a you-pick operation on one of the family’s other farms to build income that will help carry them winterbrookfarmsmd.com facebook.com/LawyersFarm @winterbrookfarm @winterbrookfarms

cannons or scramble up the tractor tire mountain Brandon built.

from spring to summer. For now, however, they’re focusing their time and efforts on building the agritourism business and reinvesting in the farm.

“During the transition, when things got tough and I would think about giving up, I’d flash back to memories of growing up on the farm,” Taylor says. “I’d think about raising kittens, riding my dirt bike, the hay forts my dad built for us. I got to do so many things that other people just don’t get the chance to experience. We want to keep the farm thriving and growing for our kids. It’s important to us that they grow up here and appreciate the land and develop the strong work ethic you get when you grow up on a farm. It’s a lot of work running a farm and it can be very stressful.

Sometimes Brandon and I ask ourselves, ‘What were we thinking when we decided to farm?’ We could have had a ‘normal life’ and not worked crazy hours, but we love this and that’s why we do it.” l VOLUME 22 | ISSUE 4 | mafc.com | 7

FARM AND LAND

Continuing Tradition: David Denny leads the way while the next generation awaits its turn | Beckett Denny, the five year old son, grandson and great-grandson of Eastern Shore farmers, runs up and down the fields with his arms outstretched and his hands flapping. “People think he’s playing airplane,” his grandmother Ellen explains, “but he says he’s spraying his fields. He flaps his hands like the ends of the spray arms bouncing up and down.”

Story by Nancy L. Smith | Photos by Nancy L. Smith and courtesy of Ellen Denny

It will be some years before Beckett takes over the family farm, but his father, David, has assumed control of the family grain operation from his father Walter Jr., who years ago assumed it from his father Walter Sr. David farms corn, wheat and soybeans on 5,000 acres across Talbot, Dorchester and Queen Anne’s Counties.

Ellen and Walter Denny with Jessica and David Denny, and their two children, Beckett and Bei. David“has been a farm boy since the day he was born,” Ellen says.

8

| VOLUME 22 | ISSUE 4 | mafc.com

He lives in Queen Anne’s County with wife Jessica, a physical therapist, Beckett, and seven year old daughter Bei. Reflecting on the passage of a farm to the next generation, Farm Credit loan officer Wayne Richard says, “Every farmer probably works longer than he thought that he would.”

“Retirement is tricky,” Wayne adds,

“when there is no clear succession plan.

Usually, in those situations, the farmer will try to find somebody who is a good person to help them out, who wants to get into farming,” he says.

That is how David began acquiring farms. “I bought a tractor one week after I graduated [from high school] and started doing custom farming for other

farmers,” says David.

Foreshadowing Beckett’s early interest in the details of farming, David recalls, “When I was 10 years old, I had a brown book, and every single room of the house was labeled with what “crop” was there. I waited until Dad started picking corn, then I started picking corn in the house. I ran my little operation just like we always ran the big operation.”

David gave Beckett toy versions of every piece of his farm equipment which the boy has deployed throughout the house with detailed “plantings”.

“If he planted the living room, you have better not walk through the corn crop,” says Ellen. She remembers she once moved a toy and later Beckett came into the room and demanded, “Who moved the planter?”

David got early lessons in farm finance. When he was seven or eight, his mother recalls, Walter ran over David’s toy Massey-Ferguson tractor. “His dad took him down to the Massey-Ferguson dealer and said, ‘There’s the man to talk to.’” David placed his ruined toy on the counter and said he needed to trade it in.

s David’s grandfather Walter Sr., left, farmed with

mules and a two-row planter in the late 1940s and early 1950s. In contrast, David uses a thoroughly modern 16-row planter (top photo).

His father recalls the dealer gave David a contract for a new toy tractor— his mother still has the document.

With the trade-in, the new tractor cost nothing. “I guess that’s why I am going to let you take over here. I’m going to let you make all the deals,” Walter tells his son. Though David runs the operation now, Ellen will continue handling payroll and bookkeeping.

“My father really did pass along a lot of knowledge—and a good work ethic, too. I remember when I was a teenager, that was when I learned my work ethic and I’ve had it ever since and I do appreciate it. You’ve got to get that from generation to generation, too, not just the know-how,” says David.

After years in a 50/50 partnership with his father, David plans no big changes, saying, “We had a pretty good operation.”

Walter says he decided to transfer responsibility just last year. “I thought I might go until I was 70, but I decided at 66…I just thought it was time to get out,” he says. Ellen adds, “I think David’s been making a lot of the decisions for at least four or five years. He’s got the technology

s Corn is loaded out of David’s farm. His

parents credit David’s knowledge of technology and marketing for the ease of the transition in the farm’s management.

[knowledge]. He is up on the markets.”

Walter has no separation anxiety about the transfer. “I sleep good at night.

I don’t think about anything. People don’t realize how much stress it is to farm,” he says, relieved to be free of the pressure.

Walter muses on the inevitable transfer of responsibilities. “Older farmers are pretty hard to change. I’ve seen that through my father and me, for instance.

You’ve got to listen to these young people. They’ve got good ideas. I just hope that he listens to me just a little bit now that I’m retired,” he says.

David says Walter has retired from the stress of decision making, but he still works just as hard. “For a lot less money,” Walter jokes.

While David is now responsible for the entire operation, he says in some ways, it will be simpler. “I always handled all the bills, all the decisions we made as far as what we were putting out in the field. Now I don’t have to guess anymore what their bills are going to be, how much corn we have to sell. To be honest with you, it’s easier,” he says. l

s s David with five-year-old David, loan officer and regional manager Wayne Richard, and Walter. Although he has passed the farming responsibilities to David, Walter Jr. says he still works hard.

son Beckett.

VOLUME 22 | ISSUE 4 | mafc.com | 9

FARM AND LAND

Growing Through the generations | In 1904, the Ryman family settled on a farm back in the woods of Shenandoah County, in a bend where the Shenandoah River runs wide and shallow. Forty years later, Doug French’s grandparents purchased the adjoining farm. A lot of history has passed since then, resulting in not only the farms merging, but the families, too.

Story by maggie wolff peterson and photos by Maggie wolf peterson and Allie French Coffey

Following the family’s genealogy leads to decades of joyful marriage announcements and lengthy obituaries, and a tangle of established Shenandoah County family names. Through the years, pieces of the property have been ceded to one family member or another, to use for their homes and farms. The French’s cabin is now the site of bi-weekly family gatherings, at which cousins, aunts and uncles congregate for a meal that individual branches of the family take turns preparing.

Through all this time, the one constant has been the land.

Today, the family’s 300 acres is passing to the next generation. Shirley and Doug French, having raised their family there, are ready to step back. Their middle child, Hubbel, has begun making improvements to the farm, investing in equipment to streamline the operation and investigating new crops, including wine grapes, that may open additional revenue streams.

“I keep it diversified,” Hubbel says.

The hilly, wooded land is fine for cows and generations ago, dairy operations began what is now a portfolio of land uses. Today, the dairy cows are gone, the fields are occupied by beef cattle and field crops, and the farm is even marketing to tourists. A lodge, a smaller home, and a second-story efficiency take advantage of the rural location and river access to be used as rental units that are available by the week or weekend. Doug has his rentals listed on a popular rental site, and keeps his phone by his side to accept inquiries from potential lodgers.

He was born into farming 63 years ago, and for a while, tried to leave it entirely, thinking he was done with the early mornings and long days. “I didn’t want any part of it when I was growing up,” he says.

Attracted to the idea of becoming an airline pilot, Doug enrolled in college in Florida. But the idea soured before

he had tuition paid for his second year.

“I knew I had made a mistake,” he says. “I was homesick the whole eight months and two weeks.”

Doug returned to the farm. “I grew up in a family where land was important,” he says. “It’s a strange addiction.”

As one of nine children, Doug understands how land is parceled and passed from one generation to the next.

Shirley, Doug’s wife, says the mission now is to make sure their three children share equally as the farm is passed to them.

While only Hubbel is a full-time farmer, Allie French Coffey and Trip French work as needed while maintaining off-farm careers. After earning a college degree in hospitality at James Madison University, Allie returned to the area and today, manages the books for a strip mall the family owns in New Market.

She said she especially remembers family time on the farm that she enjoyed as a child, and now, as an adult, loves “the

s

s

s

Strategic investment in the farm has included development of this complex of buildings, to house calves and equipment.

Two generations of the French family. From left to right, Dorothy Ryman, Doug French, Shirley French, and Marian French.

The French family raises beef cattle on their farm, as well. The calves are kept in a barn on the family’s 300 acre farm.

10

| VOLUME 22 | ISSUE 4 | mafc.com

The next generation of farmers. From left to right: Brentley Coffey, son of Allie French Coffey and Brandon Coffey; Asher French, son of Trip and Jenna French; Jackson French, son of Hubbel and Jessica French; and Kellen French son of Trip and Jenna French.

peacefulness of the Shenandoah Valley and its gorgeous views, too.”

Through the years, the French family has put portions of their acreage into conservation easements to ensure it will remain protected for generations to come.

“This will always be farmland,” Shirley says. “It cannot be anything else.”

Additionally, through strategic acquisitions funded through Farm Credit, the family has expanded the farm to include more woodland and pasture, as well as river bottom. Much of the energy behind this growth has come from Doug and Shirley’s children.

“To pass it on, they wanted more land,” Doug says. “They believe in farming.”

And Hubbel has substantially increased the family’s stock in equipment and buildings that today includes a complex of recently-completed structures that enable a more robust revenue stream. One new building houses three

Bale Barons, parked in front of thousands of bales of hay. In a year, between the farm and custom-hired work, over 100,000 bales are handled. Another barn houses equipment and a feeding facility for beef calves. “Some of these calves were born on the farm, and those will go to Wegmans and Whole Foods,” Doug says.

“Four years ago today, none of these buildings were here,” he adds. “This farm was farmed with horses by Shirley’s dad, up until the mid-1980s. We pitched the hay on a wagon. In two generations, we have progressed to the equipment we have now.”

The family works together to ensure the farm succeeds. Doug notes his children are “reinvested in the farm.

We cannot do all of this without the togetherness of everybody.”

Doug and Shirley’s grandchildren are the current generation to experience childhood on the farm. Today, they’re the ones enjoying the open space and

fresh air, riding on four-wheelers, tubing on the Shenandoah River, and selling freshpicked corn from baskets at Walton and Smoot Pharmacy in Woodstock, another third-generation French family business, purchased by Doug’s uncle, Milson, in 1952.

The French’s daughter, Allie, said her kids are learning about “the good, the bad and the ugly” that comes with a farming lifestyle.

The good, she says, is “normal operations, great weather, crop prices up, and equipment running great.”

The bad: “When a tractor breaks down, having too much or not enough rain, or losing an animal.”

And the ugly: “Looking at the checkbook and bills! Or when new group of heifers has trouble calving during a snowstorm,” she says.

Nevertheless, she says, the family farm endures through memories, hard work and continued improvements. “No matter what, we’re going to stay invested.” l VOLUME 22 | ISSUE 4 | mafc.com | 11

OUR ASSOCIATION

The Future of Your Farm— are you planning for it?

by Dr. Alex White, Virginia Tech Dairy Science

I speak to a lot of groups about a lot of topics. These days, the most common topic that agricultural groups ask me to address is transition planning—how can/should they bring the next generation into the farm business? Transition planning is a process for determining how to transfer ownership of assets and management responsibilities to the next generation. It’s one of those topics that most families know is crucial for the future of the family, but they just never get around to doing it. I don’t need to remind you of the reasons why, but I will.

Most of us get serious about transition planning when someone in the community passes away. We all see the negative impacts on that person’s family and/or business, and we say, “I won’t let that happen to my family.” We promise ourselves that we’ll start planning for our future. Heck, we even go to an Extension office to learn how to make the transition more successful. Then we get home to find out that cow #7 is in the wrong pen or the skidloader is leaking hydraulic oil, and that takes immediate precedence over transition planning. Next thing you know, transition planning is out of sight, out of mind, again. Because, you know, in the big picture, moving a cow is much more important than taking time to talk with your family about the future…

Hopefully, that sarcastic comment struck a nerve with you. Hopefully, it gets you to think about starting the transition planning process. Then your mind starts to cloud over with thoughts of lawyers and accountants and LLCs and estate taxes. “My

12

| volume 22 | issue 4 | mafc.com

gosh, this is too complicated. I can’t stand the thought of wading through that rat’s nest. Maybe I’ll just hire someone to develop a transition plan for us.” Guess what? All of these legal and tax issues are the easy part of transition planning. The complicated part is sitting down with your family and having open, honest discussions about everyone’s goals and concerns. Family communication (or the lack of) is by far and away the biggest stumbling block in transition planning.

“What do you mean by that? We’re family.

There’s nothing wrong with our communication. We all know what everyone wants.”

Like I said, the lack of family communication is the biggest hurdle.

You know the rest of the story.

Someone in the family finally works up the courage to say, “Let’s have a family meeting to discuss our future.” In the awkward silence

that follows, someone says, “I have more important things to do right now” —those things typically include vaccinating calves, fixing the tractor, or talking to the lender.

Granted, those things are important and need to be done, but are they more important than developing a plan that will help your farm and family grow and prosper into the future? Might it be worth a few hours per month to work on a plan that will help your family business continue to be successful for years to come?

Then comes the familiar statement, “Well, we don’t have to do it this minute. We have plenty of time to develop a plan.”That’s what the father of one of my students said, about two months before he passed away, unexpectedly. That’s what the grandfather of one of my students said for about three years—just long enough for my student to get frustrated and get a full-time job away from the farm. That’s what five siblings said after they inherited the family farm from their mother—and then three of the siblings decided they were going to sell their acreage (which happened to be in the middle of the farm) because they needed cash—all of a sudden the remaining two siblings who

“Only 30 percent of family businesses successfully

make the transition from the first generation to the second generation.”

wanted to farm couldn’t. And, worse yet, all of these families were torn apart because at least one party thought there was plenty of time to start the planning process.

According to the Family Business Institute, only 30 percent of family businesses successfully make the transition from the first generation to the second generation; roughly 12 percent make it to the third generation; 4 percent make it to the fourth generation. And, in most cases, the failure is voluntary. The conscious (or subconscious) choice to not develop your transition plans and share them with your family is the main problem. Most family businesses can have a good chance of succeeding into the future if they would just take time to develop plans for the transition.

I know what you’re thinking: “Alright, Mr. Know It All, how do we start?” The simple answer is start the conversation about the future of your family farm today.

Start small and don’t think you can address all of the issues in one day. It’s like my father used to say, “You want to know how to eat an elephant? Simple: do it one bite at a time.”

If you’re ready to start the discussion of planning for your farm’s transition, Farm Credit can help. Give us a call at 888.339.3334 and we’ll help you prepare to take that first bite.

Dr. Alex White has taught a wide variety of college courses at Ohio State, NC State, Ferrum College, and Virginia Tech for the past 25 years. The courses he has taught include ag financial management, farm management, small business management, and several courses in personal financial management. He has served as an extension agent and an extension specialist (personal/ farm financial management) for Virginia Cooperative Extension and has worked with Farm Credit in a variety of ways for the past nine years. He is also a Farm Credit customer.

ooo

Save the dates: 2018 Annual Stockholder Meetings Make plans to join us at the location nearest you in April for our annual stockholder meeting! You don’t want to miss the opportunity to mingle with your community members and Farm Credit staff, and learn about what your association has planned for the year ahead. Oh, and did we mention the food is pretty good, too?

Tuesday

April 3 Thurmont Event Complex | Thurmont, Maryland *

Wednesday April 4 Modern Maturity Center | Dover, Delaware Thursday

April 5 Yoder’s Restaurant | New Holland, Pennsylvania

More information will come soon, so stay tuned. In the meantime, you can visit mafc.com/info/annual-meetings for additional details. * This is a new location for 2018! Come out to see the brand new facility at 13716 Strafford Drive.

Visit thurmonteventcomplex.com for more information about this new venue.

volume 22 | issue 4 | mafc.com | 13

Contest Winners 2018 Calendar

OUR ASSOCIATION

14

Thank you to everyone who submitted a photo into our 2018 calendar contest! We received a lot of pictures capturing life on the farm or in the country, and it was a tough selection process. If yours didn’t make it into the calendar—don’t worry! It may appear in a future Leader issue, our annual report, or on social media.

Stop by the office nearest you today to pick up your calendar!

Cover Photo: Robbin Campbell, Elizabethtown, PA

January t Zelda Rowley, Lancaster, PA Patti Cooper, Marydel, MD

July t Deanna Dunning, Hartly, DE BreAnn Fields, Keymar, MD

February t Susan Younker, Fleetwood, PA Denise Ziegler, New Windsor, MD

August t Robbin Campbell, Elizabethtown, PA BreAnn Fields, Keymar, MD

March t Robbin Campbell, Elizabethtown, PA Robbin Campbell, Elizabethtown, PA

September t Valerie Robbins, Milford, DE Charles Wright, V, Mardela Springs, MD

April t Robbin Campbell, Elizabethtown, PA Eric Wilson, Street, MD

October t BreAnn Fields, Keymar, MD Valerie Robbins, Milford, DE

May

November

t Morgan Winkler, Lyon Station, PA

t Robbin Campbell, Elizabethtown, PA

Lindsay Kelland, Hanover, PA

Hannah Gaylor, Hagerstown, MD

June

December

t Tyler Rahmer, Woodsboro, MD

t Morgan Winkler, Lyon Station, PA

Denise Ziegler, New Windsor, MD

Patti Cooper, Marydel, MD

Have a photo you want to submit for our 2019 calendar? Visit mafc.com/info/calendar-photocontest to submit it! The deadline is August 10, 2018.

| volume 22 | ISSUE 4 | mafc.com

Self-Employed and Looking to Purchase?

Know your tax facts!

By Andrew Hood, Farm Credit mortgage loan originator

When applying for a mortgage, lenders determine if you can afford your new monthly payment by comparing it to your gross monthly income. This number can easily be calculated for salary and hourly employees, but what about the nearly 15 million Americans who are considered self-employed*?

To be considered self-employed, you must own at least 25 percent of a business and/or receive more than 25 percent of your income in non-salaried pay (commissions, bonuses or contract work). In order to use self-employed income, lenders must verify that there is at least a two year income history and that the income is likely to continue for the foreseeable future.

To verify this, lenders will request financial documents, such as two years of personal tax returns with all schedules (including C, D, E, or F), two years of business tax returns with all schedules (including K-1, 1120, or 1120S forms), and a year-to-date profit and loss statement showing your year-to-date income.

There are many perks to being your own boss, like setting your own schedule and having the ability to write off certain expenses. Write-offs can be an important tax planning tool to lower your taxable income, but keep in mind that lenders will use that same net income figure to determine your gross monthly income.

For example, if your business makes $80,000 annually, but you write off $50,000 in expenses, the lender will only be able to use $30,000 for annual income. Some items may be added back in, increasing your net income figure, such as depreciation.

When applying for a loan, think about your needs and future goals, and what steps should be put in place to help you achieve them. By partnering with an expert from the beginning, you will increase the likelihood of your loan getting approved quickly and efficiently. Give us a call at 888.339.3334 if you have any questions. We’re happy to help you prepare for your next home purchase! *Per the U.S. Bureau of Labor Statistics.

888.339.3334 | mafc.com

COMMUNITY

16

Harrington, Delaware

Newark, Delaware

18.3 acres with approved site evaluation for sand mound. Property holds abundant wildlife and has 1.5 acre food plot in the back left of the property. Property line is to the middle of the tax ditch allowing for easy access around the perimeter of the property. Adjacent parcels also available. $125,000.

48 +/- acres located just west of Newark and Glasgow, and north of Route 40. The tract is fully wooded with mature trees and rolling topography. This is an opportunity to own a rarely available large piece of ground in this New Castle County location. There are recorded restrictions against development. $240,000.

Contact Wes Cromer, Masten Realty, 302.448.1032.

Contact Jamie Masten, Masten Realty, 302.422.1850.

Crapo, Maryland

Asquith Island Farm with 4,000+ square foot modern log home that accommodates 16 guests comfortably. 100 acres are managed floodable cropland, woods, marsh, and miles of shoreline on the Hongo River near the Bay. Wildlife abounds. $3,995,000.

Contact David Leager, Sassafrass River Realty, Ltd., 410.778.0238 or 410.708.0891.

Chestertown, Maryland

Denton, Maryland

Elkton, Maryland

Magnificent 113 acre waterfront farm with a three-bay, two-story brick Colonial built in 1810 near historic Chestertown. 97.9 acres tillable, 13.9 acres in Conservation Reserve Program, and one acre Wildlife Habitat Incentives Program - Impoundment. One deep water pond. $1,895,000.

Over 16 acres with a custom-built home. Fourfive bedrooms over 3,000 square feet and a full walk-out basement. This home has many custom details and upgrades throughout, including a gourmet kitchen and in-ground pool with beautiful tile. Great property for horses or a home-based business. Easy commute to Delaware or the Bay Bridge. $635,000.

73+ acres of level land on Elk River. 1,500’+ of waterfront – 80’ bulkhead and 105’ pier.

Access to C&D Canal and the Chesapeake Bay. Renovated in 1991. Classic center hall Colonial plus in-law suite/office over attached four car garage. 6,000 square feet of finished living area.

Seven bedrooms and three and a half baths. $1,900,000.

Contact Clint Evans, Cross Street Realtors, 410.778.3779.

Contact Terri Murray, RE/MAX Executive, 443.540.6209.

Contact Aimee O’Neill, O’Neill Enterprise Realty, 410.838.6980.

Hagerstown, Maryland

Hampstead, Maryland

Keedysville, Maryland

Three acre lot with conventional perc. Situated in woods for privacy. Very convenient location to I-70, Meritus Hospital and medical complex, community college, shopping, and restaurants. $69,900.

109 acre farm. First time offered, same owner since 1954. Picturesque gentleman’s farm, approximately a half mile blacktop road for access to nicely situated farmhouse and outbuildings. Has a one acre reserved building lot. Subject to farm land preservation easement. $1,250,000.

Ten acres of wooded pastureland that can be subdivided. Historic remodeled 1861 barn and remodeled 1861 log home conjoined to a 2006 modern residence. Bright white kitchen, granite countertops, open floor plan, and stunning views. $800,000.

Contact Florence Wise, Coldwell Banker Innovations, 240.527.0349.

Contact Larry E. Haines, Haines Realty, 410.876.1616.

Contact Eric McLellan, Keller Williams Real Estate Centre, 240.490.4289.

| volume 22 | issue 4 | mafc.com

Perryville, Maryland

Preston, Maryland

Turn-key horse farm. Newly renovated brick rancher with in-ground pool and full in-law suite on 5.31 acres. Morton building, (indoor 60’ x 90’, 30’ x 40’ office with second floor), seven stall center isle barn with enclosed feed room, water and electric, four paddocks, two run-ins, 24’ x 36’ block building. $795,000.

Beautiful 58 acre horse farm overlooking the Susquehanna River with horse trails. Recently renovated 2,267 square foot home. Outbuildings include a multi-car garage, eight-stall barn, indoor arena, riding ring, fenced pastures, and run-ins. Total of four lots; three could be built or sold. $1,200,000.

Recently renovated country Cape has new windows, baths, carpets, and refinished wood floors. Large living room with gas fireplace leads to dining area overlooking farmland and protected forest, with an open kitchen. Master suite with sitting room/library is complemented by two first floor bedrooms. $238,000.

Contact Marvine Jenkins, Long and Foster Real Estate, 410.596.4756.

Contact Stephen Ferrandi, Maryland Land Advisors, 866.910.5263.

Contact Tim Miller, Benson & Mangold, 410.310.3553.

Rock Hall, Maryland

Thurmont, Maryland

Sudlersville, Maryland

Eastern shore home, circa 1890, with 54 acres has a beautiful rural setting and large stocked pond. Updated in 2004, the vinyl-clad home offers pastoral views and original wood detail creating an inviting ambiance. The Kent County farm is ideal for hunting, with 28 acres tillable and 10 acres of woods. $840,000.

Lovely ranch home on over an acre of land with privacy. Hardwood floors throughout except the kitchen, detached garage, no HOA, low taxes, convenient to Route 15, so it’s a commuter’s dream! Newer vinyl tilt-in windows, new roof and down spouting, basement waterproofing has lifetime warranty. $234,900.

A unique opportunity to purchase historic Sledmore, one of the most intriguing houses in Tidewater Maryland, circa1713. This property has not been offered out of the Sudler family for generations. The interior design remains original with hall-parlor plan and architectural elements. $425,000.

Contact Richard Budden, Coldwell Banker Chesapeake Real Estate, 443.480.1181.

Contact Chris Reeder, Long & Foster Real Estate, Inc., 301.606.8611.

Contact Lori Willis, Century 21 New Millennium, 410.266.9005.

Taneytown, Maryland

Worton, Maryland

Properties for sale

New Windsor, Maryland

Need financing for any of these properties?

Call Farm Credit at 888.339.3334.

EQUAL HOUSING EQUAL HOUSING Turn-key farm for sale with amazing views from OPPORTUNITY itsOPPORTUNITY recently-renovated federal-style farmhouse that sits back off the road. The farmland is just spectacular. Some uses include livestock, winery, farming, nursery, etc. The pastures are fenced with auto water tanks in every field.

Large bank barn, too. $580,000.

Industrial zoning adjacent to rail line. 62 tillable acres, leased for CY2016. Eight acre pond. $850,000.

Contact Karen E. Hecht, Heritage Realty, OPPORTUNITY OPPORTUNITY 443.277.9780.

Contact Joe Hickman, Cross Street Realtors, 410.778.3779.

REALTOR

®

EQUAL HOUSING

EQUAL HOUSING

volume 22 | issue 4 | mafc.com | 17 EQUAL HOUSING

REALTOR

®

OPPORTUNITY

EQUAL HOUSING

OPPORTUNITY

COMMUNITY Auburn, Pennsylvania

Bernville, Pennsylvania

Breiningsville, Pennsylvania

You can own a piece of Pennsylvania history: The John & Catherine Fisher Stone Grist Mill, built in 1821. Property includes a three bedroom home and 48’ x 44’ stone mill. The main features of this spectacular property are the picturesque mill pond, mill race, and Bear Creek, a PA stocked trout stream. $475,000.

Circa 1750 five bedroom farmhouse on seven acres near Blue Marsh Lake in northern Berks County is perfect for horses. Original planked wood flooring, fire places, and wide window sills. Modern kitchen, bathrooms, and heating system. In-ground pool and historic smoke house. Huge separate four car garage and in-law apartment. $625,000.

This 74 plus acre working farm offers 64 tillable acres and 10 wooded acres in the Parkland Schools in Upper Macungie Township, Lehigh County. This three bedroom, one bath circa 1800 farmhouse offers 2,160 square feet, detached oversized one car garage/workshop. $999,000.

Contact Deborah A. Coles, New Pennsylvania Realty, 570.386.5000.

Contact Randy Weeber, RE/MAX of Reading, 610.858.4134.

Contact Ed Spayd, RE/MAX of Reading, 610.587.4762.

Gilbertsville, Pennsylvania

Landenberg, Pennsylvania

Lehigh County, Pennsylvania

Phox Phalian Farm - horse breeding facility on 95 acres in Montgomery County, PA. 16 stall barn with attached indoor arena with feed and tack room, office, viewing room, and large attached run-in. Outdoor arena, fenced pastures, and several outbuildings. Four bedroom, two bath brick farmhouse. Preserved farmland. $1,275,000.

Location! 17.50+/- acre gentleman’s farm located within minutes of Fair Hill. Block barn with four stalls, wash area, tack room, equipment storage, attached run-in, and multiple paddocks. Solid brick home with wonderful views, pool, pond, and separate living quarters above the detached garage. $729,999.

Exceptional 350 acre farm in Lynn and Albany Townships. Large center hall stone farmhouse, five bedroom frame farmhouse, and two bank barns. It has rolling fertile farm land, beautiful views, lush pastures, woodland, and an ever-flowing trout stream, as well as a two acre pond. One of the prettiest farms in PA. $3,500,000.

Contact Cindy Stys, Cindy Stys Equestrian & Country Properties, Ltd., 610.849.1790.

Contact Karen Kunda and A. John Price, Patterson Price Real Estate, 443.466.5375.

Contact Perry Long, New Pennsylvania Real Estate, 610.398.2559.

Need financing for any of these properties?

Lehighton, Pennsylvania

Kintnersville, Pennsylvania

Call Farm Credit at 888.339.3334.

Beautiful five acre hilltop farm. Customdesigned three bedroom home with many upgrades. Well-designed 30’ x 48’ horse barn with three stalls, hot and cold water, tack room, and wash stall. 60’ x 90’ outdoor arena and pastures. Just minutes to Routes 309, 443, 100, mountain resorts, the Poconos, and historic Jim Thorpe. $399,000.

Contact Jonathon Coles, New Pennsylvania Realty, 570.449.8197.

18

EQUAL HOUSING Fabulous circa 1789 Bucks County stone farmOPPORTUNITY house, large totally restored bank barn, five stall stable. Total of 16 acres with eight acres fenced, large pond, summer kitchen, office, in-ground pool, heated greenhouse, and turn-out sheds.

Lovely grounds with specimen plantings, very private setting. $1,290,000.

REALTOR

®

Contact Chip Williams, Long and Foster Real OPPORTUNITY Estate, 610.442.6559.

EQUAL HOUSING

| volume 22 | issue 4 | mafc.com EQUAL HOUSING

REALTOR

®

OPPORTUNITY

West Penn Township, Pennsylvania

61+/- acres. Approximately half open and half wooded. Great home sites to choose from— private or with views. Subject to an ag preservation easement. Many possibilities. Crops are excluded from the sale. This is a combination of three parcels. $799,000.

Magnificent 432 acre country estate. Stone manor house with five bedrooms, custom kitchen, great room, home theater, pool, and large garage. Caretaker’s house. Multiple barns and workshops. Frontage on Little Schuylkill River. This entire property bespeaks of quality, elegance, and upscale country charm. $3,750,000.

7.24 +/- acres of open land currently being farmed. Located at the southern end of the Eastern Shore of Virginia, surrounded by farm land with plenty of wildlife. Just south of the town of Cape Charles. Bring your horses. $49,000.

Contact Christ W. Taylor, Beiler-Campbell Realtors, 717.786.8000.

Contact Gary L. Coles, New Pennsylvania Realty, 570.386.5000.

Contact Dutch Schwab, Ralph W. Dodd & Associates, LLC., 757.678.5377.

Berkeley Springs, West Virginia

Inwood, West Virginia

Shepherdstown, West Virginia

Subdivision was approved for 13 lots, but would need updated with Morgan County Health Department and Planning Commission.

Five current septic permits are in place to allow development of the 39 acres by using the exemption process, avoiding the lengthy S/D process. With large pond, stream, and mountain woodlands. $399,000.

Great location. Close to I-81, local, and coming businesses. 12.98 unrestricted acres.

Commercial/residential. Public water/sewer.

Home with two car garage with electric and generator hook-up. Workshop with electric.

Barn, pig pen, lofting shed, wood shed, and more. Unique wood burner and new oil burner.

Must see to appreciate! $799,900.

Talk about location! Close to 13 acres of unrestricted land that is less than five minutes from Shepherd University, Marc train, and close to Hollywood Casino. This peaceful park-like setting offers pastoral views and tranquility along with privacy. Picture-perfect for your dream home or private estate. $269,000.

Contact Valerie O’Roke, Century 21 Sterling Realty, 304.839.4408.

Contact Eric Butler, Century 21 Sterling Realty, 304.261.8255.

Contact Teresa Seville, Coldwell Banker Premier, Steve DuBrueler, Broker, 304.671.3515.

SING

Cape Charles, Virginia

Properties for sale

Nottingham, Pennsylvania

EQUAL HOUSING

NITY

OPPORTUNITY

What puts the life in your lifestyle?

If you have a dream to add more life to your lifestyle—whether it’s a pond for your kids to enjoy, fencing to keep your puppy safe and close to home, or even a brand new farm that would give everyone a little more room—call your local Farm Credit office. We want to be your lender for life.

EQUAL HOUSING

OPPORTUNITY

REALTOR

®

REALTOR

®

EQUAL HOUSING

OPPORTUNITY

888.339.3334 | mafc.com

PRSRT STD U.S. POSTAGE PAID BALTIMORE, MD PERMIT NO. 7175

45 Aileron Court Westminster MD 21157

Stay connected to Farm Credit

facebook.com/MidAtlanticFarmCredit @midatfarmcredit

Our customers have their hands in everything these days—from farm markets and fairs to vineyards and dairy operations. With agriculture constantly evolving, we like to keep up by covering industry news and hot topics that are important to you. Stay in the know by signing up to receive our blog posts directly to your inbox. Visit mafc.com/blog today!

mafc.com/blog +MafcMidAtFarmCredit MidAtFarmCredit

And don’ t forget to follow us on our other social networks! @midatfarmcredit

Lending support to agriculture, one generation at a time Since 1916, Farm Credit has supported farming families with loans to help them grow their businesses. We’ve been there through droughts and floods, we’ve seen new technologies emerge, and we’ve helped the next generation become the farmers of today.

A lot has changed over 100 years, but one thing that’s constant is Farm Credit’s dedication to giving America’s farmers and their families access to consistent and reliable credit. No matter what the next century holds, we’ll be here to help them feed and clothe our nation.

888.339.3334 | mafc.com |