Combines OFF SUBJECT CASH RENTS

[Silver_Shoes]

Mine got jacked this year, its above 120 Ill just say that

 

[pbutler]

Some around here are saying split gross above X. For example split everything above $500, say if yeild is 200 and corn is $3 then pay your normal cash rent plus $50 in that scenario. Key is agreeing NOW on what to base price on-would hate to base it on $3.50 and have harvest price be $2.50. Several methods being used-but just make sure you and landlord both clearly understand the formula. Not sure I would have the guts but depending on landlord then it may be time to propose going back to 50_50IJ Seems like some are wanting cash rent when prices are low and share when high.

 

[IowaDan]

Do you think the landlord would give back $50 an acre if you have a crop failure and you don't raise anythingIJ Just my 2 cents worth. Have a HAPPY NEW YEAR everyone.........Dan

 

[greenstrat]

really hard to get a guy to go to any kind of share arrangement which would mean he will go about a year with no income at all. The cash rent sword is now swinging the other way. gs

 

[deeredriver]

My question is , If it is cash rent why does the landlord think he is entitled to some of the yieldIJ If it is rented cash thats where is should stop.

 

[RAB]

I can't speak too much about cash rent as I share rent over 90% of what I rent. One thing I would caution you about on a deal like this are the FSA ramifications. They are getting VERY picky and may not look favorably on someone getting cash rent plus a bonus (read share) on any crop over a certain amount or using price as a determining factor. You might want to check with them on the legality of this before you let it go too far. like one other poster mentioned I am of the opinion cash rent is just that....payment to farm the ground and bear all the risk. It seems like your landlord who has let you shoulder all the risk in the past now wants to share in the reward when times turn for the good. I know land is harder to come by in the midwest but around here most would drop him like a hot rock.

 

[greenstrat]

that person who owns the land can write up whatever contract he wants. I know of a few around here forcing mandated fertilizer applications too. As long as there are guys hungry enough to bend over this will be the case. gs

 

[RAB]

I understand that the landowner can put whatever stipulations he feels in the contract (ie. fertilize, irrigation, maintenance etc.). When it crosses the line into essentially taking a share of the crop through bonus payments then FSA will look more closely at who is drawing the money and how the crops are divided to make sure they match. This probably won't present a problem but it would be worth checking out before making a mistake that could have dire consequences. I know it would be a reach but this could be construed as a way to get around payment limits or the 3 entity rule if the landowner draws payments from several different farms. I've probably got a little different perspective on this because I deal with a couple different owners who are nearing the payment cap and are looking for legal ways around it.

 

[farmert]

if tehy want too much farm a little less work with your ll's we have to see this great new farming world we might have ldp's next fall who knows anymore