Leelanau's State Of The Farmland
By Emily Tyra | April 14, 2021
Leelanau Conservancy is coming off a banner year, according to Kim Hayes, its farmland and easement programs director: “We closed on 13 acquisition projects in 2020, a record for us in a calendar year.” These were a mix of conservation easements (which prohibit certain development rights on what remain privately owned lands), plus natural area lands (that the conservancy now owns), for a total of 954 acres across the county.
Of that: 498 acres were farmland, working with five Leelanau families.
That momentum hasn’t let up, says Hayes. “We plan to close four farmland conservancy easements — for a total of 525 acres — by late summer or early fall 2021.”
Meanwhile, the pressure is increasing to convert land from farming into housing, and large agricultural parcels are now hitting the market, often with the potential to develop. The Leelanau Ticker takes a look at what’s in play, what’s at stake, and what’s possible with these one-of-a-kind Leelanau farmlands.
Hayes explains that the conservancy currently “conserves” Leelanau family farms by working with funds available through the federal Farm Bill’s Regional Conservation Partnership Program, administered by the USDA Natural Resources Conservation Service (NRCS). A conservation easement is, in essence, the purchase of specific development rights. Once in a blue moon, Leelanau farmers have donated conservation easements outright to the conservancy, but most often farmers' financial position requires some compensation for the easement.
The NRCS funds cover 50 percent of the conservation easement fair market value; then the landowner and the conservancy contribute the remaining 50 percent, creating a three-way partnership.
Leelanau Conservancy Executive Director Tom Nelson says, “We’re grateful that more Leelanau’s farm families than ever are interested in collaborating in this program.”
Among them: Michael Ulrich, who started a native nursery in Empire and is increasing biodiversity by incorporating native plants including species of milkweed to support a returning monarch population. Ulrich started his career in restoration ecology as an intern, restoring an abandoned sand farm in Wisconsin. “Now full circle, I am afforded this opportunity,” he says. “Making that a mortgage-paying venture is another matter.”
He adds with real estate sales booming it would be easy to parcel up the property and sell a few to pay down the remainder. “However, I feel deeply committed to keeping it as a single parcel dedicated to agriculture. The farmland preservation easement with the conservancy is making that possible.”
For Ulrich, a total of 76 acres are going into easement with the Leelanau Conservancy.
Hayes says they will be chipping away at grant money funded through NRCS’s Regional Conservation Partnership Program until approximately 2025, and are looking for other ways to support farmland protection, because at this point there is a waiting list: “The need is more than we can cover now, based on landowner inquiries to work with us,” she says.
Jim Nugent, currently chairman of the board at the conservancy, and a fruit farmer along with wife Toddy Rieger at Sunblossom Orchards in Bingham Township, says protecting large agricultural parcels in Leelanau is important because of its rare role of having “some of the best sites for fruit production in the country.”
Nugent was the Leelanau County MSU Extension Director starting in 1976, then served as coordinator of the NW Michigan Horticultural Research Station until 2007. He says the thing we do well is fruit: because of Lake Michigan's climate-moderating effects, the rolling hills that allow spring frosts to flow into low areas, and the deeply well-drained soil.
“If you take any of those three away,” he says, “We may as well as be South Dakota and we would grow same amount of fruit they do.”
Nugent says historically, the county’s residential development was “mostly in villages and around the lakes” but has now headed for the hills — literally. He says the limited “‘good-view sites’ are exactly the kind of land we need for fruit production,” noting that there is a “decoupling” of land value from its potential to generate income from agriculture.
But what’s at stake if farmland is broken into smaller parcels, with some sold for development? Simply put, says Nugent, it becomes uneconomical to farm. He says there are ways to make a living from smaller acreage, “using greenhouses and a CSA model, for example, but overall, it’s difficult to find a viable agricultural use for smaller acreages.”
He adds that there are challenges with proper buffers when creating housing developments in a rural area. “The reality is in the fruit industry we do have to control insects and diseases and have to spray — a job that’s easier done if the orchard isn’t surrounded by housing.”
Of course, there are large tracts of farmland on the market right now in the county — including the historic 217-acre Hohnke farm, which is already protected by a conservancy easement.
And an interest to buy.
Carolyn Telgard of Coldwell Banker Schmidt Realtors tells the Leelanau Ticker: “There are definitely buyers out there looking for agricultural properties, with parcels between 10 and 40 acres attracting the most attention.”
Says Ann Marie Mitchell, also of Coldwell Banker Schmidt, “From the seller side, there is by no means a dumping of property; in many cases there is a generational aspect to it and a bit of a shift going on.”
Mitchell notes that of the more than 1,000 agricultural acres she has traded thus far in her time as a real estate agent in the county, “They were all traded exactly the way they were. They were farmed and not purchased for divisions.”
Telgard and Mitchell have co-listed a working fruit farm near Omena: a 76-acre agricultural parcel with multiple view sites of Grand Traverse Bay and Old Mission. Approximately 40 acres are planted with fruit trees.
Telgard says, “While a potential buyer could divide this property, most folks seem most interested in it for a homesite, and to continue farming it.”
Both Mitchell and Telgard say in agriculture real estate transactions, they also act as a matchmaker of sorts. Telgard explains, “Some orchards are already under lease or maintained by a local farmer. One of the number one questions we get is ‘can we reach out to that person?’”
“In our world, we can partner a current local grower who needs or wants the fruit with a buyer who wants to continue to see the land farmed,” says Mitchell.
What’s more, Mitchell says that a buyer who wishes to preserve the agricultural character of the area and continue the farming operation can reap significant financial benefits. “First there is a Qualified Agricultural Exemption — the property would be taxed at the homestead millage rate. And they can potentially depreciate the fruit trees, whether or not they actually planted those trees.”
Telgard and Mitchell also recently listed a 184-acre parcel in Suttons Bay — home to an actively maintained orchard with over 7,300 cherry trees. In 2009, Bingham Township approved a site condominium plan for this large parcel called “Leelanau Estates” — a project with 78 residential units, at 2+ acres each. Since that time, the township has adopted a clustered development plan so other configurations with larger parcels sizes and fewer roads are also viable.
As these properties hit the market, often with an option to develop, there is the undercurrent of another need: available housing in the county.
Nelson acknowledges the need, specifically workforce housing, and advocates for smart-growth solutions. He views the best places for these opportunities as “in or close to our existing villages, particularly at distances that are walkable to places of employment as well as community services and amenities like schools, and shops.”
He says, “Fragmenting family farms for residences and non-farm commercial uses is the prime reason farming communities fade away. We can’t let that happen. We firmly believe there are solutions that solve our workforce housing challenges without losing our family farms. And it takes the whole community to make it happen. I’m optimistic Leelanau will find a way.”
Mitchell adds: “Leelanau would not be Leelanau if we did not have our agriculture.”Comment
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