Farm for Sale, But Buyer Must Use it For Sustainable Farming

Erin Grace reported this week at the Omaha World-Herald Online that, “Want to buy an Iowa farm?

“The nonprofit owner of a 53-acre Loess Hills farm for sale east of Omaha is looking for prospective buyers who would do three things: put up a reasonable financial offer; pledge to farm the land in a sustainable way; tell a great story.

“The Des Moines-based Sustainable Iowa Land Trust is holding an open house Tuesday at the property, next to 19195 Cougar Ave. in Honey Creek, Iowa. Suzan Erem, the group’s executive director, will be on hand to answer questions. She said the group plans to use a two-step process. Step One is requesting letters from potential buyers saying how they’d farm the land and listing a price they think is fair. Step Two: Land trust board members will review the proposals and invite chosen buyers to submit sealed bids.”

The article noted that, “The group will place an agricultural conservation easement on the property, requiring sustainable food production by future owners, a move that limits the pool and reduces the cost.”

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Nonprofit Combines Urban Farming and Jobs for Ex-Offenders

New York Times writer Patricia Leigh Brown reported earlier this month that, “Even by the standards of the Bay Area, where sourcing local, organic chicken feed is seen as something of a political act, the spectacle of 30,000 fruit and nut trees being tended by formerly incarcerated orchardists is novel.

“The green thumbs are there because of Planting Justice, a nine-year-old nonprofit that combines urban farming with environmental education and jobs for ex-offenders. From its headquarters in a pair of salvaged shipping containers on a dead-end street in East Oakland, Calif., Planting Justice has forged a trail in which revenue-generating businesses help subsidize the group’s core mission: hiring former inmates, many from nearby San Quentin State Prison, and giving them a ‘family sustaining’ wage, along with health benefits and a month of paid leave annually. About half the total staff of 30 have served time in prison.

“Two years ago, the group’s founders — Gavin Raders, 35, and Haleh Zandi, 34 — established an orchard on a weedy, vacant lot in this area of stubborn poverty, where the pruning is serenaded not by birds but droning trucks from the adjacent freeway. Planting Justice’s Rolling River Nursery now sells and ships some 1,100 varieties of potted trees and plants — among them, 65 different kinds of pomegranates, 60 varieties of figs, and loads of harder-to-find species such as jujubes (Chinese dates), Japanese ume plums and rue, an aromatic herb used in Ethiopian coffee. Signs warn visitors that they have entered a pesticide- and soda-free zone.”

The Times article stated, “Though still young, the organic orchard generates roughly $250,000 of Planting Justice’s yearly $2 million operating budget. Another $250,000 comes from an edible landscaping business, in which roving horticulturalists hired by well-off clients install beehives, fruit trees, chicken coops, massive barrels for harvesting rain water and “laundry to landscaping” systems that funnel used washing machine water into the garden. The money helps subsidize pro bono edible landscapes in low-income neighborhoods.”

Ms. Brown added, “Planting Justice has also had success with crowdsourced funding. When offered the chance to buy 30,000 trees from a nursery that was closing, Ms. Zandi and Mr. Raders raised $100,000 through Kickstarter and secured additional funding. Then there was issue of where to put 30,000 trees: The Northern California Community Loan Fund came through with a $600,000 loan to help finance the acquisition of the East Oakland land.”

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Hog Industry Faces Historic Legal Challenge in North Carolina

Wall Street Journal writer Valerie Bauerlein reported yesterday that, “The linchpin of 500 legal complaints against Chinese-owned pork giant Smithfield Foods Inc. headed to federal court Tuesday, part of a historic challenge to North Carolina’s $2.9 billion hog industry.

“A Raleigh-based jury will determine whether a 4,700-hog farm run by a Smithfield contractor, with open pools of manure, emits enough odor and sprayed liquid waste to be considered a nuisance to a neighboring couple.

“Lawyers representing Beulaville residents Elvis and Vonnie Williams said in court filings that Smithfield is ‘a large enterprise with the ability to reduce and end the nuisance.’ They said the smell has hurt the couple’s ‘ability to enjoy family gatherings, barbecues, outdoor chores, playing with children outside, and doing yardwork.'”

The Journal article stated that, “Smithfield, a Smithfield, Va., unit of Chinese pork producer WH Group Ltd., said its farm complies with local, state and federal environmental regulations. Chief Executive Ken Sullivan said it is wrong to penalize owners for things like noise and smell, which go hand in hand with running a farm.

“‘Today, it’s hog farms. What about chicken farms? The turkey guys? Grain farmers?’ Mr. Sullivan said in an interview. ‘We’ve got to decide as a society how food is produced.'”

Yesterday’s article added, “The Williamses’ case is one of a handful of bellwether trials that will help determine how hundreds of other complaints against Smithfield will be handled.

“In the first trial last month, a Raleigh jury in U.S. District Court awarded $50 million to 10 families living near a Smithfield contract farm in neighboring Bladen County. The judge subsequently lowered the settlement to $3 million, to comply with a state statute capping punitive damages.”

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Supreme Court Ruling Gives Teeth to Employment Contracts Drawn to Minimize Corporate Exposure to Public Trials and Class Actions

Jess Bravin reported last week at The Wall Street Journal Online that, “A divided Supreme Court on Monday gave businesses the power to block employees from joining together to file claims for wage theft and other work-related violations, upholding employer-written rules requiring that each case be limited to a single employee.

“The decision, which overturns the position of the National Labor Relations Board and resolves a split among federal appeals courts, gives teeth to employment contracts drawn to minimize corporate exposure to public trials and class actions filed by their own employees.

“Tens of millions of employees currently work under contracts limiting redress to claims filed before a private arbitrator on an individualized basis. With the issue clarified, employers are expected to impose such limits on millions more.”

The Journal article noted that, “Business groups have championed individualized arbitration as an efficient means to resolve disputes and deter frivolous claims that would live longer and cost more if brought in open court. Consumer and labor organizations contend the private, often confidential system is stacked against individuals and can hide from public scrutiny systemic misconduct by a company or industry.”

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Organic Trade Association Kicks Off Pilot Project to Deter Organic Fraud

An update last week from the Organic Trade Association (OTA) indicated that, “The [OTA] on Thursday [May 24th] announced the kick-off of a groundbreaking pilot project by the organic industry to prevent and detect fraud in the global organic system.

“The far-reaching three-month pilot project was initiated by the Global Organic Supply Chain Integrity (GOSCI) Task Force of the Organic Trade Association. This group of 48 members of the trade group was formed last year to develop a fraud prevention program designed specifically for the organic industry that organic companies will be able to voluntarily enroll in. As the first step toward this program, a comprehensive ‘best practices’ guide was created by the task force to facilitate the industry-wide implementation of systems and measures to preserve the integrity of organic, both inside and outside of the United States.”

Last week’s update noted that, “‘Organic now operates in a global market. Fraud is one of the biggest threats to that market, and it cannot be tolerated in the organic system,’ said Laura Batcha, CEO and Executive Director of the Organic Trade Association, in announcing the initiative at the association’s Annual Policy Conference in Washington.’Everyone has a role and responsibility to detect and deter fraud. I commend the Organic Trade Association members participating in the pilot for the commitment to doing everything in their power to address the problem and taking the lead in finding constructive and workable solutions.’

“Participating in the pilot project are 11 members of the GOSCI Task Force, representing the entire organic supply chain, from farm to retailer and a diverse range of products, services and commodities including fresh produce, grain, spices, dairy, eggs, meat, beverages, packaged and prepared foods, importers and consulting services. Pilot participants are:

— Clarkson Grain Company, Inc. (handler/processor/feed grains/oilseeds)

— Egg Innovations, LLC (producer/handler/eggs, livestock feed)

— Global Organics Ltd. (handler/importer)

— Grain Millers, Inc. (handler/processor/grains)

— I Was Thinking (importer/handler/co-packer, grains, seeds, legumes, sweeteners)

— MOM’s Organic Market (retailer)

— Organically Grown Company (distributor/produce)

— Organic Valley CROPP Cooperative (producer/handler/livestock/dairy/meat)

— Pipeline Foods, LLC (handler/supply chain solutions/feed grains/oilseeds)

— J.M. Smucker Company (processor/multi-ingredient)

— True Organic Products, Inc. (manufacturer/fertilizer)

“The pilot will run from June to September. It is designed to be an intensive-focused exercise in which participants will ‘test drive‘ in their specific businesses the fraud prevention and detection strategies developed by the GOSCI Task Force.”
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Existing Home Sales Fell in April

Laura Kusisto and Sarah Chaney reported last week at The Wall Street Journal Online that, “Sales of previously owned U.S. homes declined in April, as inventory shortages and rising prices weigh on the market and higher mortgage rates begin to pose a threat to demand for the first time in years.

“Existing-home sales fell 2.5% in April from the prior month to a seasonally adjusted annual rate of 5.46 million, the National Association of Realtors said Thursday. Compared with a year earlier, sales in April were down 1.4%—the second consecutive month sales declined on an annual basis.

“Thus far the critical spring selling season—when some 40% of U.S. home sales occur each year—is off to a slow start despite a robust economy. That reflects increasing pressure on buyers, as home prices rise at about twice the rate of incomes and borrowing costs climb.”

The Journal writers explained that, “The median sale price for an existing home in April was $257,900, up 5.3% from one year ago.

“The rate for a 30-year mortgage rose to 4.66% this week from 3.99% at the end of last year, mortgage company Freddie Mac said Thursday. Mortgage rates rose in 15 of the 21 weeks of the year so far—the highest share since Freddie began tracking the data in 1972.

“The latest sales numbers reflect purchases that were closed in April, based on contracts signed in February and March. Rate increases were still modest when the contracts were signed and economists said the impact of higher rates will be felt more strongly in the coming months.”

Posted in Real Estate Law | Comments closed

National Home Values on the Rise

Bloomberg writer Alexandre Tanzi reported this week that, “National home values have increased 8.7 percent since last April to a median value of $215,600, according to Zillow.

“Newly released data from the Federal Housing Finance Agency confirm the widespread gains seen by Zillow as home prices rose in all 50 states and the District of Columbia in the first quarter of 2018 compared to a year earlier. The FHFA report shows first-quarter home prices rose 6.9 percent from a year earlier. Annual appreciation surpassed 10 percent in Nevada (13.7 percent), Washington (13.1 percent), Idaho (11.1 percent), Colorado (10.6 percent).

“The rise in home prices has allowed more people to take cash-out of the homes when they refinance. Refinancing, where the home owner took additional cash out, rose to 61 percent in the first quarter — the highest rate seen since the third quarter of 2008, according to FHFA data.”

The Bloomberg article added that, “The pace of appreciation seen by Zillow is the fastest since June 2006, when home values were rising nine percent annually.”

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U.S. Beekeepers Lose Four of Every 10 Managed Colonies in 2017-18

Bloomberg writer Alan Bjerga reported yesterday that, “Beekeepers in the U.S. reported an increase in honeybee deaths over the last year, possibly the result of erratic weather patterns brought on by a changing climate, according to the scientist leading an annual survey on the insects.

“U.S. beekeepers said 40 percent of their hives, also called colonies, died unexpectedly during the year that ended March 31, according to a survey released Wednesday by researchers from Auburn University and the University of Maryland. That’s up from 33 percent a year earlier.

“Elevated bee-loss rates have been an agricultural concern for the past decade, since a mysterious malady called Colony Collapse Disorder coincided with a doubling of honeybee death rates and spurred greater attention and research on commercial and wild bees. Higher death rates make pollination more expensive for beekeepers and farmers.”

Mr. Bjerga added that, “An autumn that began with hurricanes in southern states, followed by abnormal temperature patterns and frequent winter storms, may have disrupted bee feeding patterns and increased their vulnerability to other maladies, said survey coordinator Geoffrey Williams, an assistant professor at Auburn in Alabama.

“‘Changes in climate and weather affect food and forage for bees,’ he said. ‘It’s pretty obvious that if you have bees already on the edge and you have a radical, quick weather shift, they aren’t going to do as well.'”

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For Veterans, a Positive Outlet on the Farm

Nick Babcock and Carl Bednarski indicated recently in an opinion column posted at Michigan Farm News Online that, “When soldiers who’ve fought for their country return to the Land of Opportunity, too often they find uncertainty. New legislation introduced by Senators Debbie Stabenow and Pat Roberts will give them a better chance to continue serving their country on the farm.

“Make no mistake. These returning veterans want and need ways to continue serving their country. One of the best ways they can do that is to farm, driving their heart for service down a country road that leads to peace and contentment, even if they don’t become wealthy doing it.

“In an age where the American Dream seems undefined or blurry, these veterans bring it all back into focus.”

The column added that, “Too often, we as a nation forget about the sacrifices it takes to enter a war zone. Some people also forget about the long, sometimes frustrating days getting a crop in the ground and caring for livestock…That’s among the reasons Michigan Farm Bureau and many other organizations support The Farmer Veteran Opportunity Act of 2018, which makes all new veterans eligible for support from the U.S. Department of Agriculture (USDA).

“The bill also improves access for Michigan farmer veterans across eight existing initiatives to make risk management tools more affordable, expand access to land and capital, and prioritize training for veterans.

“The bill, if passed by Congress, would expand support to all new veterans who may have existing careers in agriculture. Currently, the USDA’s veteran’s initiatives are designed to support those who are starting a career in agriculture for the first time.”

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Fewer, But Bigger Fundraisings in Tech Startups

Wall Street Journal writer Jacky Wong reported late last week that, “Masayoshi Son is at it again: Not content with one $100 billion tech fund, the SoftBank founder this week said it’s ‘just a matter of time’ before he launches another.

“If and when that happens, it’s likely to widen the gap between the haves and have-nots in the tech sector.

“The Japanese company’s $97 billion Vision Fund, launched last year, has already had a deep effect on how venture-capital firms finance tech startups. The vast sum it’s deploying has tempted companies into bigger financing deals: Globally, the number of private equity-backed fundraisings of over $100 million, known as mega-rounds, jumped 62% last year to 258, according to data from PricewaterhouseCoopers and CB Insights.”

The Journal article noted that, “The Vision Fund’s emergence has exacerbated the trend of recent years toward fewer but bigger fundraisings in tech. Partly, that reflects the ‘winner-take-all’ nature of the internet economy, in which companies like Facebook or Google have become so dominant. Venture-capital firms, seeking surer bets, are favoring late-stage unicorns—private companies worth over $1 billion—that already have big user bases. Uber and Didi are good examples.

“But with tech unicorns sucking up so much of the available cash and entrenching their market-leader positions, what’s left for early-stage startups? As big fundraising deals soared last year, the number for seed-stage companies slumped by 29% globally, according to consulting firm Delta Partners.

“Another consequence is ever larger valuations for some of the bigger unicorns. A warming IPO market has added fuel, as investors pile into later-stage names in hopes of quick profit from new-listing pops. This has been a key factor in the ever-escalating valuations of pre-IPO Chinese companies like Ant Financial and Xiaomi over the past year or so.”

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