Elizabeth Marshall said she doesn't know if she could put into words the responsibility she feels about maintaining the Southern Humboldt ranch that has been in her family for more than a century.
”It's such an emotional subject,” said Marshall of Marshall Ranch. “When you go back to over a century of blood, sweat and tears being poured into this land, the sense of responsibility I feel toward it is indescribable. I want to honor the position I'm in by doing good things with the land, and having the land intact enables me to do that.”
Demographics show the nation is on the brink of the largest transfer of working lands from one generation to next, said Yana Valachovic, University of California Cooperative Extension's forest advisor and Humboldt and Del Norte counties director. She said the transition can be a very tricky process, and there's no cookie cutter approach.
”Dealing with family farm succession is a real issue for people in our community, absolutely,” Valachovic said. “We are seeing parcels break up because people haven't figured out either their estate planning or succession planning, which means our county is going to look different in some ways, as ownership transfers and parcel sizes change.”
Marshall said the entire county benefits when succession is planned and private land owners keep their property intact.
”You hear people talk about watershed, but very few people talk about heritage shed, which is a new term I just made up,” Marshall said.
Marshall said once a family's generations-long tie to the land is broken, it can never really be restored.
”The land may go to another person or entity not related to the family,” Marshall said, “and they won't ever value the land as much as the family itself.”
Marshall said she is fighting a daily battle to keep her land financially solvent.
”When my grandma passed away in 2005, there was an enormous estate tax,” Marshall said, “and I'm still under that weight, which illustrates what a huge problem it could be if you don't have a plan for succession.”
Valachovic said she thinks most people are afraid of having the conversation.
”Most people don't want to talk about when they won't be there anymore, the dividing of assets,” Valachovic said. “The workshops the extension offers are moving away from just estate planning, which involves sitting down with an attorney and deciding who gets what assets, toward succession planning, which not only involves the physical transfer of owner to owner, but the passing of the business.”
Planning for succession is normally a lengthy process, said Deborah Giraud, the extension's farm, community and economic development advisor.
”Ideally, there are around 10 years involved, even when there is a clear heir, so they have time to buy the business,” Giraud said. “We say a lot here that 'fair isn't always equal.'”
Valachovic used the example of three children with different levels of experience, whom their parents love equally and want to have equal shares of the family farm.
”If a sibling can't buy out all the others, another sibling can go to court and foresale their parcel,” Valachovic said. “This is generally not what the family wanted. A really hard discussion to have are those that are not equal but fair. We recommend families don't take all their assets and divide it equally three ways. Maybe one sibling gets the life insurance and another kid gets another distinct asset.”
Valachovic said just hoping the details will all be worked out later rarely ends well for the continuation of a family farm or ranch.
”It's one thing to say, 'My kids will inherit my land,'” Valachovic said, “and another thing to say, 'My kids will inherit my land and continue the business, the legacy, the passion.'”
Marshall said she looks to her children, nieces and nephews and doesn't want them to go through the struggles she's gone through.
”I want to honor the memories of the people before me, their stories of hardships and their resilience,” Marshall said. “The property serves as a monument to their memories.”
A successful succession: How to plan
The UC Cooperative Extension is a partnership among Humboldt County, the University of California and the United States Department of Agriculture, which puts together programming addressing issues in the community including how to go about passing on agricultural land.
The extension's next workshop regarding succession planning will be in two parts on March 18 and 25.
For more information on these workshops, call the University of California Cooperative Extension Humboldt and Del Norte at 445-7351.
Jillian Singh can be reached at 441-0509 or firstname.lastname@example.org