Frequently Asked Questions

The Growing New Farmers Project has an excellent list of of farming questions and answers - visit these for addtional food for thought and resources! Also, many of the responses below are extracted from the Guide to Farming in NY: What Every Ag Entrepreneur Needs to Know, which you can download in its entirety as a PDF for free.

What's the step-by-step process to starting a farm?
How do I get a grant to start my farm?
How do I finance my farm start-up?
How can I get access to land?
What can I raise profitably?
How do I match my land to a particular enterprise?
Where can I market what I produce?
Where can I find sample budgets for the enterprises I'm interested in?
What's involved in being organically certified?
How can I gain production experience? Where can I apprentice or find a mentor?
What are the tax benefits to farming?
What regulations apply to me?
Where can I get help?

What's the step-by-step process to starting a farm?

Because every farm is unique, there is no formula to follow! Your start-up process will depend on your current situation: your primary goal (full-time farm? part-time? hobby?), level of farming experience, financing, access to land, and time available. Starting a farm is overwhelming - so many decisions to make! The best advice is to start small and grow as you experience success.

The Lessons on this website offer you a framework for planning, and the opportunity to put your plans into writing as you go through each unit (via online worksheets). Even if you don't need a loan to get started, it's a good idea to put some kind of a plan in writing, to help yourself get organized and make sure that you have thought through all the major aspects of your farm operation. Such a plan, whether it's a formal business plan or not, will help you take one step at a time and lay the foundation for your success.

How do I get a grant to start my farm?

Grants are almost never available to start a farm and are not a reliable strategy for growing your business. Grants may enable you to expand a particular aspect of your business to make your operation more viable or provide funding to try a new practice on your farm. But don't take it from us - see what farmers say about grants in our Voices of Experience video series.

Grants are highly competitive so apply only if the project you are proposing clearly meets the grantor’s objectives. Always find out what kinds of projects were funded in the past to determine if your project is in line with what has been funded.

It takes significant time and effort to write a winning grant proposal. Instructions must be followed precisely. Grants often require a cash or in-kind match that must be documented in the budget you propose. Grants will not be considered if they arrive after the application deadline. Deadlines for application submission and instructions are generally announced once a year. Most grants are not available on an ongoing basis.

Once you submit a grant, it may take 3 to 6 months to find out if your application was selected for funding. If funded, it also takes time to finalize the contract. Generally you will not be reimbursed for money spent prior receiving the signed contract. Grant contracts require that you write a report of the results and provide an accounting of how the money was spent; therefore, you must keep accurate records. Grants are also considered income for tax purposes.

For a comprehensive list of grants available to farmers in NY, download Fact Sheet #31, Grant Opportunities for Farmers from the Guide to Farming in NY.

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How do I finance my farm start-up?

If you’re a new farmer, your chances for success will be greater if you can avoid going into debt to finance your farm operation, since your initial profits can be reinvested in the farm rather than paying the bank. Credit cards, with their extraordinarily high interest rates, are a particularly dangerous way to finance your new enterprise. Think carefully and creatively about your options, and resist temptations to buy more and better equipment than you really need. Too many promising operations have been sunk by overcapitalization. Of course, some operations will benefit from a loan, especially if they have a solid business plan that exhibits a realistic strategy for paying it off.

The farmers in our Voices of Experience video series offer great advice about start-up.

Here are a few options for borrowing money:

Farm Service Agency Beginning Farmer and Rancher Program - 315-477-6300
The Farm Service Agency (FSA) provides direct and guaranteed loans to beginning farmers and ranchers who are unable to obtain financing from commercial credit sources. A beginning farmer or rancher is an individual or entity who: (1) has not operated a farm or ranch for more than 10 years; (2) meets the loan eligibility requirements of the program to which he/she is applying; (3) substantially participates in the operation; and, (4) for farm ownership loan purposes, does not own a farm greater than 30 percent of the average size farm in the county. All applicants for direct farm ownership loans must have participated in business operation of a farm for at least 3 years. If the applicant is an entity, all members must be related by blood or marriage, and all stockholders in a corporation must be eligible beginning farmers.

Commercial Banks
Most banks have a commercial lending department to handle business loans, but few banks have an agricultural lending department prepared to work with agricultural business. Check with your bank to see if they write agricultural loans (most will if you have a Farm Service Agency or Small Business Administration guarantee). Following is a partial list of NY banks with known agricultural lending departments:
Farm Credit - click on NY; NY listings include: First Pioneer (860-741-4380)
and Farm Credit WNY (585-815-1900)
M&T - 800-724-2440
NBT Bank - 800-NBT-BANK

Micro-Enterprise Loan Funds or Revolving Loans Funds for Small Business
Some county governments have micro-enterprise loan funds with attractive interest rates and repayment terms that can be used to finance farm operations. Check with your county Planning and Economic Development Agency/Dept. to find out if they have micro-enterprise loans funds that you might qualify for. The Carrot Project is piloting a few such programs for small farmers in New England, with plans to expand to serve farmers in NY if their programs are successful.

Residential Finance or Using Your Own Equity
While many banks are unwilling to lend money to an individual to purchase a herd of goats, for example, almost all banks offer home equity loans and/or other personal loans that you could use for your agricultural business. Home equity and personal loans may carry higher interest rates than business or farm loans available through the above sources. Be sure to check rates and terms. Never finance a business using credit cards as interest rates are enormous and, if payments are not made, can quickly spiral out of control. If purchasing equipment or supplies (machinery dealers, a farmer selling animals, etc.) ask the vendor about their credit options and terms, as they may be more liberal than a commercial bank because they can easily seize and make use of the asset if payment is not made. Again, be sure you know the interest rates and terms.
Custom Hiring
Instead of purchasing machinery or specialized buildings, beginning farmers should evaluate options for local custom hire opportunities. It is better to hire someone to provide a service than to buy expensive equipment. For example, would a neighboring farmer be willing to work your fields? This would avoid the time and expense of purchasing and maintaining machinery. Is there a commercial kitchen available for processing? This would avoid the expense and regulation of building a commercial kitchen.

Farm Credit’s FarmStart Program
First Pioneer Farm Credit has launched a program called FarmStart – visit
www.firstpioneer.com/finance/L3/getting_started.htm and click on FarmStart. FarmStart is a new venture with a mission to provide investments of working capital in farm businesses and farmer cooperatives that show sound promise for business success. The program can make loans to beginning farmers who wouldn't meet Farm Credit’s internal credit standards. It requires no down payment or equity for five-year loans up to $50,000, as long as the business cash flows and seems to have a good chance of succeeding.

New York Beginning Farmer Loan Program
www.nysefc.org - click on Program and scroll down to NY Environmental Facilities Beginning Farmer Loan Program. Call 800-200-2200 to speak to the Beginning Farmer Project Manager at the Environmental Facilities Corporation (EFC). The New York Beginning Farmer Loan Program (NYBFLP) provides low-cost financial assistance to Beginning Farmers in New York State (NYS) for the purchase of agricultural property and equipment to help start a farming business or to facilitate inter-generational transfer of a farm business.

In order to take advantage of this program, the Beginning Farmer works with their Lender (who is willing and able to purchase EFC’s Aggie Bond to fund the Beginning Farmer’s loan) to arrange the terms of a loan. Loan terms include the farmer’s credit evaluation, security, collateral and length of loan, interest rate, etc. The loan will ultimately be the Beginning Farmer’s obligation to the Lender, as in a normal loan. After the terms are set, both the Beginning Farmer and the Lender jointly apply to the NYBFLP. While the NYBFLP loan maximum is $250,000, there is no minimum NYBFLP loan amount.

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How can I get access to land?

With land prices as high as they are, there is no easy answer to this question.

Leasing a Farm
Owning farmland can be expensive and can make it more difficult to develop a profitable enterprise. Leasing is one of many creative options. Many people own idle farmland and would be happy to see it used productively. Great care should be taken when establishing a lease, as there are many issues to address in writing between landowner and farmer, such as lease tenure, infrastructure development, restrictions, and permitted uses.

Here is a lease template and list of considerations to include if you develop your own lease (from Fact Sheet #1 in the Guide to Farming in NY)

Many of the Regional Organizations listed in the Connections section of this website are launching programs in their counties to help match aspiring farmers with landowners. Contact the one nearest you to inquire.

The Equity Trust offers a model land lease that may be useful: www.equitytrust.org/ModelDocs06.htm. The book No-Risk Ranching by Greg Judy (available from many libraries and most book retailers), while based on a model using beef cattle, also offers details and advice on approaching landowners and establishing successful leases.

NY FarmLink
800-547-3276 - This is a program of NY FarmNet. FarmLink tries to link retiring or exiting farmers with individuals interested in getting started in farming. They also offer counseling to guide the process, whether the farm is going to be sold from one party to another, leased, operated as a partnership, or organized as a management opportunity for the new farmer to gain experience and equity.

Cornell Cooperative Extension
Agricultural Educators in county extension offices may also be able to direct you to farms for sale or farm realtors. Call or email the Beginning Farmer contact in your county Cornell Cooperative Extension office.

Farm Newspapers with Listing Farm Properties for Sale
Grassroots – The Voice of New York Farm Bureau – www.nyfb.org; 800-342-4143
Country Folks – Lee Publications - www.countryfolks.com; 800-218-5586

Farm Real Estate Brokers*
While conventional real estate brokers list farms for sale, most active farms are considered commercial property and are listed by real estate agents specializing in farm transactions.
• MLS Residential Search - The largest multiple listing service for residential real estate. Often contains small and medium farms.
• First Pioneer Farm Credit and Farm Credit of WNY - Agricultural lender with an appraisal services, they would know of farms for sale
• Farm Service Agency Real Estate for Sale - Listing of homes and farms for sale by the Farm Service Agency, many available with low interest financing
• Landandfarm.com - Rural property listing service
• Landdirectory.com - Rural property listing service
• United County Real Estate - Rural real estate brokerage
• Come Farm with Us – farm real estate listings in Northern and Central NY


*This listing of realtors is not intended to be complete, and listing does not imply endorsement by
Cornell Cooperative Extension. Check with folks located in the area near where you hope to farm to find realtors who specialize in farm property.

 

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What can I raise profitably?

This is an important and complex question that can be answered through good research and business planning. Identify what you want to raise, investigate the costs and potential returns, and then decide if it meets your goals on paper, before you invest real money. If you work through the Lessons on this site, you will be well on your way to thinking through all the elements that make up this question.

Listen to what the farmers in our Voices of Experience videos have to say about Profitability.

If you'd like personalized help answering this question, check out the next offering of our online course, or see if there is a face-to-face training near you. If you don't see one on our events calendar, contact your local Cornell Cooperative Extension office and ask about their upcoming programming.

 

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How do I match my land to a particular enterprise (and vice versa)?

If you already have land, it is important to learn as much as you can about it before committing to a particular enterprise. Your soil type, drainage, micro- and macro-climate will all influence what grows well on your property. Your existing or available infrastructure (buildings, fencing, electricity) will influence this too. Visit Unit 3 - Evaluating Land and Facilities for Your Enterprise to learn more about this.

If you do not yet have land, learn the requirements of the enterprises that interest you, and be sure that any piece of land you consider buying or leasing will meet your needs. Research soil, climate, forest and infrastructure resources. Buying the right property and the right amount of land is critical to the success of farming.

Download Fact Sheets #1, #2, #3, #8, #9, and #11 in the Guide to Farming in NY for much more information.

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Where can I market what I produce?

This is really the first question you should consider, and might better be phrased, "What can I grow that people will buy?" What is your product and who wants it, and where are those people? Don't just assume that "if you grow it, they will come!" It's important to know your customer.

And there are so many market outlets! Farmers markets, farm stands, internet, wholesale, restaurants, retail stores... Most beginning farmers think about direct marketing as the place to start but this takes time, so consider what amount of time you have to invest in marketing and project potential returns by market channel.

To hear from farmers who have answered this question successfully for their farms, check out our Voices of Experience video on Marketing.

Check out Unit 2: Marketing What You Produce, and for more information, read Fact Sheets # 23-30 from the Guide to Farming in NY.

 

Where can I find sample budgets for the enterprises I'm interested in?

There are several sources of enterprise budgets available. Be aware of the assumptions behind the numbers in the budget though, and make adjustments to fit your scale, production techniques, and unique farm conditions. See Unit 4: Chapter 4: Make Financial Sense? for links to these resources. There are also a few examples of full business plans with budgets available for download at the bottom of the Planning page of this site.

What's involved in being organically certified?

Becoming Certified
Organic production offers many advantages for small farmers including ecologically friendly production methods, strong consumer demand for organic products, and higher prices. If you have farm sales of more than $5,000/year you cannot legally sell your products as organic unless your farm has been officially certified. If you sell less than $5,000/year farm products, you can legally call yourself organic without certification, but you still must use organic practices. You can download this


You can find the list of all certifying agencies by going to the USDA’s National Organic Program website. You can use any agency listed. The two located in New York are NOFA-NY and Natural Food Certifiers.

Fees and Costs
Certifying agencies generally charge a fixed fee to cover the initial certification costs and then an annual fee to cover the continued documentation and verification costs. Costs vary so you may want to investigate your certification options.

The NYS Department of Agriculture & Markets offers grants to new farmers to help cover the initial certification costs. They set aside a certain amount of money each year to cover 75% of the initial cost up to $500. This money is allocated on a first come first served basis.
For a grant application: Ag & Markets - 800-554-4501 or 518-457-2195; www.ams.usda.gov/nop - National Organic Program information; Forms can be downloaded from:
www.agmkt.state.ny.us/AP/agservices/OrganicApp.pdf

General Overview of Regulations
Organic regulations are complex and ever-changing, which is why it is important to work with your certifying agency on everything that you do to assure compliance. In general, you cannot use synthetic pesticides, antibiotics, or petroleum-based fertilizers. To certify a field as
organic it must not have had pesticides or petroleum fertilizers applied for the past three years. To certify animals as organic, there are various transition requirements depending upon the animal species: dairy, beef, pork, poultry, etc. Great attention is paid to nurturing the soil by the use of composts, cover crops, rock minerals and natural fertilizers. Plant disease and pests are controlled through the use of crop rotations, resistant varieties, cultivation, biological and botanical pest control. Animal health is maintained with wholesome food, adequate shelter, access to the outdoors, and preventive health plans. Documentation of field maps, adjoining fields, complaints, crop inputs used, yields, sales, feeds purchased, medications used, and equipment-cleaning logs must be kept to maintain your certification.

Developing Your Organic Farm Plan
The Rodale Institute in PA has researched and demonstrated organic techniques for decades. They have an online tool that walks farmers through the synthesis of all the documentation they will need in order to apply for certification. You can find their Organic System Planning tool and many other organic resources at www.rodaleinstitute.org.

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How can I gain production experience? Where can I apprentice or find a mentor?

If you did not grow up on a farm and do not already have farming experience, this is a critical aspect to your preparation for start-up. Finding someone who is successfully doing what you want to do and working side-by-side with them is the single best way to learn the skills and unique challenges to producing and marketing the product you have chosen. No matter how much you have read about farming, and no matter how successful you have been in any other professional capacity, it is essential to have some real experience in your chosen enterprise before you invest a lot of capital into it. How you do this depends on your situation:

  1. Work full-time on a farm as apprentice or employee - If you have the ability to spend a season or a whole year working on a farm, you can get a solid feel for day-to-day farm life. Some resources where you can find these opportunities:
  2. Volunteer with a nearby farmer as your schedule allows - If you work full-time, have a family or other commitments, it is much more difficult to gain hands-on experience. But if you are creative and persistent, you can use the resources listed for #1 above and locate a nearby farmer who is willing to allow you to volunteer part-time on their farm.*

  3. Get started on a micro-scale - Maybe you can’t get away to work on another farm due to your current work and family obligations. But if you have any outdoor space around your home, you can get started on a micro-scale and gain a lot of direct experience in your chosen enterprise. Mistakes are so much less painful at this scale! Use sheets like those listed in the 4-H resources below to keep track of your expenses, how much time you spend, and how much you harvest. This will help you get a better sense when you plan the finances of a business. As you learn, and as your confidence increases, you can grow your business.
        • NYS 4-H Resource Directory - because these resources are written for kids in 4-H, they offer a very basic introduction, mostly to livestock. Peruse the list to find information relevant to your chosen enterprise. Often you can download a recordkeeping book to help you track your time and expenses
*Keep in mind that farmers are very busy people - if you establish your own mentoring relationship, be respectful of the farmer's time, and offer to pay them or work on their farm in exchange for the help they provide you.

 

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What are the tax benefits to farming?

Farmers are exempt from paying sales tax on purchases of supplies used in farming. Some farm buildings are wholly or partially exempt from property taxes, and once a farm generates over $10,000 in sales, the land can also receive a property tax exemption. Additional tax exemptions apply once farm income becomes 2/3 of total income.

Read Fact Sheets # 17, 20, 21, 22 in the Guide to Farming in NY to learn more details about Ag Assessment, Farmers School Tax Credit, and Sales Tax Exemption.

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What are the regulations that apply to me?

This depends, of course, on what type of farm operation you have (or plan to have).

Read Fact Sheets #8, 9, 10, 27, and 28 in the Guide to Farming in NY to learn more about Zoning, Environmental, Marketing, and Small-scale Food Processor regulations.

Where can I get help?

The Connections section of this site offers contact information for various agencies that exist to help farmers with specific aspects of their planning or production. It also offers some assistance in demystifying which agency or organization to approach with which type of question.

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