Terra Cultura and the Great Land Search

Terra Cultura and the Great Land Search

This is the first of a multi-part series about Terra Cultura’s experience searching for a place to call home. You’ll be hearing from Travis and Rachel in the coming weeks about the next phases in our epic quest for land.

When we sat down to write Terra Cultura’s business plan nearly two years ago, we knew finding the right piece of land would be key to the organization’s success. In those early days of planning, our biggest concern was location, and we spent many a weekend exploring every county within a two hour drive of the Bay Area. We took note of the communities, the landscapes, the water, and climate. After that initial tour, we delved into market research, looking at demographics and socio-economics, the availability of arts programming, interest in sustainable agriculture, and a host of other categories directly, and not so directly, related to our mission. We narrowed in on a few communities in the central coast region, and continued on to write the remainder of the plan.

In early 2017, the nebulous ideas described in the business plan were just beginning to take shape. We had formed our Board of Directors, our application to become a 501c3 had been submitted to the IRS, and Rachel, Travis and I had all cut back our hours or left our jobs to focus more of our attention on nurturing the seeds of Terra Cultura. Our goal was to have land by October, and we had been warned that this could be a long, complicated and arduous process. So, in late January, we embarked on the first of what would be many expeditions to find Terra Cultura a home.

Going into our land search, we thought financially we were in pretty good shape. The previous year, Rachel and I had received an inheritance from our wonderful and generous Auntie Mollie which, while not a huge amount, was enough to put towards a solid down payment.  So, equipped with our savings accounts, which, although meager, were bigger than they had ever been before, an inheritance, and a healthy dose of naivete, we weren’t very concerned about our ability to purchase land. We were under the impression that the process would be similar to buying a house, with comparable down payments and mortgage rates. Over the next few months, we quickly realized how wrong we were.

According to the National Young Farmer’s Coalition, access to land is one of the most significant challenges facing new farmers. Land prices have more than doubled since 2004, and student loan debt prevents younger farmers from accessing the capital they need to be able to afford it. Even if farmers do manage to figure out the financing, it’s often still prohibitively expensive for a young farmer’s budget, given the average profits made on a small farm. The USDA and organizations like California Farmlink are working to address the issue, but the resources they offer remain limited. Over the next few months, we’d experience many of these challenges first hand.

Our first conversation with a real estate agent ended with strong encouragement to get our financing figured out first thing, so we began calling lenders. The first few lenders  we spoke to were completely confused about why we would want to buy land without a house on it, and referred us to other lenders who specialized in raw land. The next few lenders we talked to refused to work with a start up, especially a non-profit start-up, and suggested we try talking to a regular mortgage broker as individuals to see what we could get. We took their advice, but were told our student loans were prohibitively high, even though our pay as you earn repayment plans kept our monthly payments at a reasonable and affordable level. It was a common problem, they told us, and happened all the time these days, especially to millennials with student loans, like Rachel and I, or the majority of young farmers. The best they could do was meet us halfway– and that was of course only if the property had a house on it.

Searching for home

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Discouraged that banks didn’t see any value in raw land, and feeling the weight of our student loans, we shifted our focus. We spoke to California Farmlink, a nonprofit who works specifically with new farmers on overcoming the challenge of land access, and are open to such unconventional arrangements like taking your first crop of kale as collateral. They were lovely, but had never worked with a nonprofit before, and informed us that our unusual structure disqualified us from the assistance they offered. We learned we were in the same situation with the USDA’s land access resources. Farmlink could however recommend a number of other organizations we could reach out to. We went through their list one by one, crossing them off for many of the same reasons we had run into with the more conventional banks. The last organization on the list sent us an email introduction to Farmlink, thinking they’d be the best match for us. We felt like a dejected hot potato, but decided to see the conversation through. Maybe Farmlink would have some additional ideas for us. To our surprise, the situation had changed since we last spoke to them. They had just received news that allowed them to work with nonprofits, and they wanted to have a conversation. It felt like a huge breakthrough, and we spent weeks working through the loan application, only to hear that we should come back after we had three solid years of financials to show them. Projections were just too risky.

We were discouraged, but unwilling to let these setbacks stop us. And, fortuitously, at around the same time CA Farmlink’s loan department had told us they weren’t going to be able to offer us a loan, their land match department had begun conversations about 11.5 acres just outside of Hollister, that they thought might be a good match for Terra Cultura. Farmlink had already shared our case statement with the owners, and they were excited about our mission. They were more interested in a lease, but were open to the possibility of negotiating a purchase down the line. Although it wasn’t exactly what we had imagined, this would give us some time to establish ourselves in the community, and get a few years of solid financials on the books. Theoretically, by the time the owners were ready to sell, we would be able to get a loan. We thought this might just be the land breakthrough we had been needing.

 

…or is it this?

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Our first visit to the 11.5 acre plot was in late October, just a couple weeks after we got the news that we would not be able to procure a loan. The land was located in a valley just outside of Hollister, in an area that had been earmarked by the county for agritourism development, since many of the local wineries were located nearby. We pulled into a long driveway, past about 4 acres of fallow land that had once been row crops, and into a round dirt patch with a pile of equipment in the middle, making it into a kind of roundabout. A large white barn stood behind us, and a makeshift chicken coop had been constructed next to the dirt patch we had parked in. There were a handful of people standing beside pick up trucks, and they looked a bit confused when we approached them. When we asked to speak with the owner they gestured to another truck at the end of the lot and told us a woman had pulled in not long ago, it might be her. They were right, but we were all a bit curious about what the situation was. Why would they be working the land but have no idea who owned it? The owner turned out to be a woman we’ll call Daisy*, and we liked her immediately.

We walked through the paddocks she had built with her husband, and looked out at the seasonal stream that ran along the back portion of the property, as she pointed out the pear tree her husband had planted to shade the kitchen window in the summer. We watched her shake her head at the piles of garbage that had accumulated since she and her husband had left the land, and it became clear to us just how much she loved the property. She expressed a deep sadness about the way the current tenants were treating it. The soil had been neglected, the barn, which had been built to be half residence and half workshop, had been completely abandoned, and the land was strewn with old 7-11 cups, plastic bottles, and other trash. On top of all of that, we found out, the current tenants weren’t paying rent, or even covering their water costs. There was a verbal agreement years ago that a friend of Daisy’s husband could use the land, but Daisy seemed to feel like things had gotten out of hand. Structures had been built out of piles of old planks of wood that Daisy didn’t know anything about, and she was surprised to see a herd of goats grazing behind the chicken coop. She wanted someone on the land who would truly appreciate it for all its potential, and who wouldn’t mind handling the clean up in exchange for rent. She was excited about Terra Cultura’s mission, and we were excited about the possibilities this land held. It would take a lot of work, but we weren’t afraid to get our hands dirty. She had brought the proper notices with her to evict the current tenants, and told us they would have to be off the land within 60 days. We parted ways agreeing to move forward with negotiations to figure out a lease with an option to purchase, with the help of Farmlink, and to schedule a meeting in a few weeks to present a plan for the land.

Future farm?

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Over the next month, we worked diligently to develop our plan for the land and adjust our budget to fit this particular plot. We passed numerous lease drafts back and forth. We also began diving deeper into some of our concerns. A real estate agent we had been working with was able to pull up the title for the property, and told us Daisy wasn’t actually on it. That meant that it was her husband, and not her, who would need to sign the lease agreement if it was going to have any legal weight. We knew Daisy had planned to show our case statement to her husband, and work to get him on board with the lease, but we hadn’t realized how crucial his approval was. And, if it was necessary to get him to sign off on the lease, why hadn’t he been at the meeting? The issue of the tenants also began to bother us. If they had been on the land for so long, and had managed to resist Daisy’s requests to at least cover their own utilities for years, why would they respect the eviction notice? Plus, we were beginning to feel uneasy about the eviction of long time tenants preceding our entrance into the community, even if they had been mistreating the land.

Just after Thanksgiving, we presented our detailed plan for the land to Daisy and her real estate agent. They were excited and enthusiastic about it, but the timeline made Daisy uneasy. We had hoped to be on the land in the first few weeks of January, since the current tenants were set to be gone by late December. But Daisy was concerned about the eviction. The tenants had told her they didn’t want to leave, and that 60 days would not be enough. She would have to get the sheriff involved, and that made her nervous. It also sounded like she hadn’t talked to her husband yet. She was concerned that if he went down to the tenants to talk to them about leaving, they’d manage to convince him that he should let them stay. We suggested that perhaps we could meet with Daisy’s husband ourselves, and help her in convincing him that Terra Cultura would take much better care of the land than the current tenants, and Daisy agreed that would be a good idea. Over the next few weeks, though, that plan began to unravel. Daisy and her husband had to move, and moving is stressful. The new house needed a lot of work, and they had storage units they wanted to clear out, and the timing just wasn’t right. As our meeting with Daisy’s husband got pushed back again and again, our doubts grew. The final blow came in an email in mid-January. Daisy was working to get power of attorney over her husband, a process that could take many months, and she asks that we be patient. We began to accept what we had been avoiding saying out loud for weeks: we needed to reopen our land search. The realization hit us hard, despite the fact that we had all seen it coming. I was struck by the extent of the sense of loss I could feel over something that had never been ours to begin with. But, you have to put a lot of heart into planning how you’d use the land, and there’s a lot of emotion that goes with imagining a new home for yourselves and your dreams. We knew going to into this that there would be setbacks, though, and mountains to climb and bumps in the road, so all we had left to do was keep searching.

*Name changed for the sake of privacy