If you don't know them, it's easy to think that Les and Evan are father and son. They farm together, and nearly 30 years separate their birthdays. So, it's a logical assumption.
But, the two Jackson, NE, farmers are partners, not because they're family, but because Les Albrecht was willing to give Evan Uthof a chance to farm. It's proved to be a win-win situation.
Albrecht already had a successful farm business when Uthof started to work for him as a high school student. That relationship continued when Uthof enrolled in nearby Northeast Community College, Norfolk, NE.
His head was in the books, but his heart was at the farm as he earned a degree in auto mechanics. “I never spent a weekend at college,” Uthof says. “Sometimes I'd come back and help with harvest after class. I finally realized that auto mechanics wasn't for me.”
Uthof returned to Albrecht's operation in 2003 as a full-time hourly employee. It didn't take long for Albrecht to realize he had a decision to make. “I was at a point I knew I wanted to expand. But I knew if Evan was going to stay, I was going to have to share,” Albrecht says.
So, he made the decision that so many farmers can't bring themselves to, even with family. He accepted Uthof as a partner. Albrecht admits Uthof had some leverage in the deal. “He had other options and I didn't want to lose him,” Albrecht says. “Evan had a lot of ambition and was always mature for his age.”
It's a decision that Dave Baker, farm transition specialist at Iowa State University's Beginning Farmer Center, wishes more established farmers would make. “The older-generation farmers need to understand that deals like this are doable and commendable,” he says. “It's too easy to just cash-rent out land when you're ready to get out of farming. But when you bring a young farmer into your operation, it's important to the community. You can't keep renting ground to bigger farmers and then wonder why there are no kids in the local school.
“We're short of young farmers coming back to the farm,” he says. “We need more older farmers willing to work with young farmers.”
Baker's job at the Beginning Farmer Center is to match older established farmers with younger generations who are looking for a way to get started in farming. You can check out opportunities for both at the group's Web site, www.extension.iastate.edu/bfc/.
THE PARTNERSHIP PLAN of Albrecht and Uthof is a good model for success, according to Baker. “Probably the biggest factor in making a partnership like this work is communication. Both parties have to be willing to communicate openly without hidden agendas,” he says. “You have to build trust based on both sides committed to keeping the operation going and willing to share obligations of the future.”
The chances for success increase as you write down more details, according to Baker. “You need everything written down in specifics, including dollar figures. It helps to have an independent third party look at both sides of the suggested partnership. When everybody agrees on the conditions, you write it up,” he says. “Off-the-cuff conversation isn't enough. And, any plan needs to include an exit strategy. It needs to be understood what conditions could trigger the exit plan if the partnership doesn't work.”
Written agreements are a process that Albrecht and Uthof have just begun. Early on, most of their agreements were verbal. But as the acres and dollars involved have gotten bigger, the partners have started to put more of their agreements on paper. “We're starting to write up more stuff to protect each other,” Uthof says. “Also, any new equipment we buy on a 50/50 basis.”
It's not just about money, though. “In situations where a young couple moves to a new location, they leave their friends, their schools and their church behind,” Baker says. “It's important for the older-generation farmers to help them become part of their new community. You need to help them fill that void.”
That wasn't an issue for the Nebraska partnership. Today, Albrecht farms close to 3,000 acres; Uthof farms 1,800. They farm 900 of those acres together.
As partners, the two share equipment and labor, but put a dollar figure on everything they do. “I started out by buying a sprayer and seed tender. Les owns the corn planter and the combine, but I own the bean drill,” Uthof says. “So, I pay him $25/acre to use his combine to harvest my crops and he pays me an hourly wage when I combine his.”
UTHOF STARTED HIS own farm operation by cash-renting 400 acres in 2004 while he was still Albrecht's hourly employee. Without a banker willing to finance a beginning farmer, Uthof might still be an employee today.
With plenty of ambition and little debt, Uthof was able to finance a production loan on the 400 acres at the Bank of Dixon County, Ponca, NE. Senior Vice President Richard Dohma helped Uthof put together the paperwork to get a Farm Service Agency (FSA) Beginning Farmers and Ranchers guaranteed note through the bank.
Uthof's reputation for hard work and demeanor factored into his getting that first loan. “Evan was pretty well known in the community. He'd proven himself with a lot of little things over the years,” Dohma says. “And, Les is well established in the community. He's really a great guy, and he and Evan had worked out a deal for Les to rent the equipment for Evan to farm with.”
Uthof built cash flow during his first years farming with a custom-spraying business and a Golden Harvest seed dealership. At the same time, he was able to cash-rent land from farmers he worked for as a teenager.
“Evan relates well to people older than himself,” says Albrecht. “He's aggressive and he's not afraid to sell. He's got a gift to talk to people.”
He's also got a sense of history that has him in a conservative mode right now. “I've heard about the 1980s and I don't want to go through it. I don't care to know what that's like,” Uthof admits.
SO, AS OTHER farmers advertise in local newspapers what they're willing to pay for cash rent, Uthof is ready to stay on the sidelines for awhile. “I'm willing to sit and wait a bit and be happy with where we're at right now,” he says. “Rather than rent expensive land, I'll focus on doing better with what I already have.”
Older and with deeper pockets, Albrecht has a more aggressive attitude toward expansion. “This is all I know,” Albrecht says. “I still have to be aggressive.”
The partnership allows each farmer to make independent decisions. Albrecht is free to expand. Uthof can stay in a holding pattern. Or, they might rent more land together. But, when either partner makes a decision, they talk through what it means to them individually, and as partners.
And, it's not always mutually beneficial. A wet fall in 2007 made Uthof nervous enough he wanted to hire some custom-harvest work done to make sure his crops got out on time. The decision meant some of the income Albrecht counted on from his combine wasn't realized.
They're used to talking through those decisions. “We decide on a farm to farm basis how we'll manage the crop,” Uthof says.