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Contributor

CRP Troubles

I just bought my first piece of property that Im going to start a hobby farm on, I knew going in that it was under a crp, so I contacted the FSA and they gave me a figure of 8k to get it out of the crp. SHould I risk it and wait on the 2012 farm bill that might get rid of the penalties or try and scrape up the money to get out of it? I am 38, dont know squat about farming, we just want to raise a few cows and animals, the property is 17 acres, 9.7 under the crp. The thing is Im not willing to leave it in because it doesnt expire until 2016 and my kids are 13, 12, 11, and 10 and I want them to learn with me about farming.

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27 Replies
Honored Advisor

Re: CRP Troubles

Well, it`s kind of a math problem, basically is it worth paying about $850/acre up front to rent it for 4 yrs or about $212 per acre?   Since it`s CRP and you`d that a yield hit the first yr of farming and lose the 4  years of CRP payments, I really doubt it.  Plus maybe there will be a penalty-free CRP out in the next yr or two. Maybe try to rent another piece of ground?  If you already have the $8,000 laying around you could maybe rent the tillable ground off someone`s 40.  Good luck. 

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Contributor

Re: CRP Troubles

well I dont have any area around me to rent, this land is attached to the back of my house so my plan was just to move onto it and start doing my own thing. I never signed the crp, it was never brought up between me the bank and the seller, so technically I could just go hog wild on it and the people who signed the contract would be liable, but I cant morally do that because it was an older couple who sold it to me and they couldnt afford the penalty. Im really just shopping for opinions on whether I should wait for the farm bill or cough up the money and forget it. I dont have the 8 grand to spare right now though.

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Veteran Advisor

Re: CRP Troubles

I wonder if you talked to the people at the FSA office?  Is there anyghing at all you can do with it now?
In some areas, such as around here, it is dry enough to cut hay off it, with no penalties, other than the loss or partial loss of one year's CRP payment.  Of course, there are guidelines as to when you can cut it, and you may need to leave strips of vegetation for wildlife, but it is something to consider.  It may be possible to hay it for a year, and see what the new farm bill brings. 

Another thing, I have no idea how the ground lays.  In the Nebraska Sandhills, there are old fields that are in CRP, because the land is unsuitable for farming.  About all it is good for is grass, as the sol is thin, and erodes easily.  The CRP gives the farmer a payment, in return for seeding it back to grass, controlling weeds, and giving the grass a few years to establish itself.  I would hate for you to tear up grass, and have only unproductive soil underneath.  Maybe a soil test is in order, before you decide what to do for sure?


I don't know your situation, so I kind of just threw some ideas out there, to see if anything looks like it may help.

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Honored Advisor

Re: CRP Troubles

Wow, they didn`t sign over the payments to you or at least get you to agree in writing to the CRP terms when you bought the place?  Since it qualified for CRP is it worth $220ish an acre for "rent"?

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Contributor

Re: CRP Troubles

Nope, they didnt sign over the payments or have anything in writing at all about the crp agreement.

Kind of complicated but here goes.

 

An elderly couple farmed it for years then signed it into a crp, they then donated the land to a church, the church left them in the crp so they would receive the payments, then the church decided to sell it, I bought it. The elderly couple live in the old farm house on the property, I have to let them stay until they pass on. A weird deal I know but I wanted this property in a bad way..

 

The field was farmed for years, corn, beans, then they gave up a put it into a crp, the soil has to be decent, once again I am a big time rookie, so I wouldnt know for sure, but Im only wanting to raise a fe animals and have some vegetables to teach my kids how to do it.

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Contributor

Re: CRP Troubles

I called the FSA this morning and the lady on the line was trying everything under the sun to get me in there to sign papers and get the payments transeferred but I told her I would need to do some research. She was really pushy thats why i came here for advice.

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Veteran Advisor

Re: CRP Troubles

 
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Honored Advisor

Re: CRP Troubles

Around these parts you have to "certify your acres" by June 30th every year to be elgible for CRP payments and in that certifing process you are asked if you sold or bought land, it sounds like the FSA office dropped the ball, so no wonder they`d like you to come in and sign stuff.  I`m not a lawyer but I think you`ll have to live up to the CRP agreement one way or another, think of it as you bought a car that had a "mechanics lien" on it.  This is why both a buyer and seller of a property should have a attorney to represent them.

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Contributor

Re: CRP Troubles

I was aware of the crp, but the crp contract was never disclosed at the closing or in any of the title work

The older couple retained a life estate for the house, i had the lot separated off and they have a life estate to that lot.

The older couple has received the payments even when it was technically owned by the church.

The CRP goes for 5 more years.

My banker has no knowledge of this whatsoever. I never brought it up and it never came up.

 

Its been a nightmare just to buy the property, i closed on it December 22.

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