The Kentucky Farmland Transition Initiative gets major boost with passage of state legislation and the introduction of a federal act.

One year ago, the Kentucky Farmland Transition Initiative (KFTI) was launched by the Kentucky Farm Bureau (KFB) to address the loss of the state’s farmland.

Specifically, KFTI is helping farm families access resources related to farmland transition and learn their options; connecting providers of services to transitioning farmers to one another and to people who need their services; determining how existing state and federal policy is working; and figuring out what policy changes may be necessary to increase the amount of farmland going to active farmers.

Throughout the last year, the initiative has gained momentum and support throughout the state from other ag organizations, commodity groups, and lawmakers.

“In the Kentucky General Assembly, HB 703 was introduced by Representative Myron Dossett to make changes to the Kentucky Selling Farmer Tax Credit making the credit work for more farmers and provide greater certainty for sellers. Provisions of this bill were included in HB 775, which received final passage and became law.

 Nationally the recent introduction of legislation by Kentucky U.S. Senator Mitch McConnell, the Protecting American Farmlands Act (PAFA), will take farmland transition to a new level.

 “American farmers, especially those in Kentucky, are grappling with a steady decline in available farmland,” McConnell said. “Now more than ever, we must preserve our agricultural land and keep it in production for the next generation of producers. The Protecting American Farmland Act reduces the tax burden on selling farmland, making it easier for retiring farmers to keep their land in the hands of those who will continue to cultivate it. This legislation, which I was proud to partner with the Kentucky Farm Bureau on, is a big win for farmers across the country, and one that will help plant the seeds of farming generations to come.”

KFB President Eddie Melton said the organization is proud to stand alongside Senator McConnell once again in championing legislation that strengthens the future of American agriculture.

“The Protecting American Farmlands Act is the outgrowth of important work started last year by the Kentucky Farm Bureau Farmland Transition Initiative,” he said. “This legislation not only helps ensure that our nation’s farmland remains in the hands of active farmers, but it also provides retiring farmers with a viable pathway to transition their operations to the next generation. We deeply appreciate Senator McConnell’s leadership in addressing this issue, and we look forward to the lasting impact this legislation will have on farming communities here in Kentucky and across the country.”

The Protecting American Farmlands Act would allow landowners who sell to active farmers to defer taxes on the proceeds of the sale if they sell their land to those who will keep it in agricultural production for a minimum of ten years. The profit from the sale is invested in a retirement savings account. As a result, landholders can sell to other farmers, while also investing in their future with more liquid assets in retirement.

This measure gives retiring farmers more control over their financial future while helping keep farmland in production. By reducing financial barriers for farm transitions, this bill gives retiring farmers an option to sell their land without losing significant portions of their proceeds to taxes. It also provides a more flexible retirement strategy, addressing the common challenge of farmers being "asset-rich and cash-poor" in their later years.

Agricultural Leaders Across Kentucky Endorse the Protecting American Farmlands Act, Urge Congressional Support

KFTI has gained support from several other state organizations from the very beginning of the initiative and the same is true for the PAFA.  The coalition of these agricultural organizations and institutions that have committed to preserving farmland for active farmers, has officially endorsed this national legislation. As Kentucky continues to lose farmland at an alarming rate, over 20 organizations in the network are calling on Congress to pass this critical legislation to ensure farm families have the tools they need to transition their land to the next generation of farmers.

“The farms we know and love as Kentuckians are at risk,” Melton said. “At the current rate of farmland loss, the number of Kentucky farmers will be cut in half over the next 60 years. We can’t solve this problem alone, and fortunately, we don’t have to. With the support of Senator McConnell and so many influential leaders in agriculture, we have an opportunity to make real progress in preserving our farmland. The passage of the Protecting American Farmlands Act is an essential step in this effort.”

Senator McConnell has been a member of the Agriculture Committee since his first day in the Senate and currently is the Chairman of the Subcommittee on Food and Nutrition, Specialty Crops, Organics and Research.

During a recent press conference held at the University of Kentucky Martin-Gatton College of Agriculture, Food, and Environment (UKMGCAFE), McConnell along with Assistant Kentucky Commissioner of Agriculture Warren Beeler, UKMGCAFE Dean Laura Stephenson, Melton and Hardin County Farmer Matt Adams met with members of the press to discuss the new legislation. 

Melton told the gathering the one thing in agriculture that means more to farmers, than anything, aside from their families, is their land.

“Whether you're a row crop farmer, or you raise livestock, you have to have that land to be able to do what we do,” he said. “What we're working on is to try to help those beginning and young farmers, and active farmers be able to retain that land, so they can grow their operations. If you own that land, you're more profitable than if you rent or lease that land and I think we need to focus on trying to find a way that we can make farming more profitable.”

Adams, along with his wife Molly were named the 2023 KFB Young Farm Family of the Year. He shared their unique story of how they came to own their farm and why farmland transition is so important.

“We had a unique opportunity to partner with an older farmer that I worked with and slowly start to buy him out,” he said. “We didn't have anything formally set up like we've talked about with the farmland transition initiative, but upon his passing, his family knew his wishes (to keep the farm intact) and his heirs honored those wishes, working with us and selling that home farm to us (in a way) where we could afford it as young farmers. That's not the case with every operation out there, and that's what we're looking at addressing with this initiative.”

Adams added that while they feel they now have established themselves and their farming operation, initiatives like KFTI and PAFA are important for future generations.

“This is important to us just because as in any business, including agriculture, if you're not growing, you're falling behind,” he said. “We have two young daughters, three and six that are coming up and just live, eat, sleep, and breathe farming just like we do. And if there's going to be a place for them in the future, then we have to be looking at that now. All we were asking in the beginning was an opportunity and I think these initiatives will provide opportunities.”

KFTI summary for the year

Since its inception, Aleta Botts has served as the project coordinator for the farmland transition program. She said the Initiative puts Kentucky farmers at the center of the discussion for how best to keep our farmland in the hands of active producers.

“The best outcomes of the past year have been hearing from farm families who have ideas for keeping land in production and who have also been prompted by the Initiative to reach out to determine the best path forward to keep their land going as a farm long into the future,” Botts said.

She also recognized the support KFTI has received through a vast network of state agriculture organizations.

“This work would not be possible without the support of the members of the KFTI Network who hosted educational sessions, shared information with their members, and offered their suggestions for ways we can do more on the issue,” Botts said.

While the program is marking its year anniversary, she noted that there is still work to do.

“This year in addition to building support for the federal legislation we will be developing more resources in response to the needs we have heard about and continuing to spread the word to ensure that farm families know what tools they have available to them to make the transition of their own farmland successful.”

KFTI milestones

•       Reached over 4,422 individuals through the website (kyfarmlandtransition.com), for over 9,800 page views.

•       Presented to over 3,000 people through extension workshops, Kentucky Farm Bureau events, and other meetings.

•       Built a network of 27 organizations united in promoting farmland retention.

Developed legislation based on the work of KFTI.

For more information on the Kentucky Farmland Transition Initiative Network, visit kyfarmlandtransition.com/about.

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KFTI Network Members supporting the efforts of farmland transition include:

Agribusiness Association of Kentucky

Ag Credit

Community Farm Alliance

Farm Credit Mid-America

Kentucky Agricultural Council

Kentucky Agriculture and Environment in the Classroom, Inc.

Kentucky Association of Conservation Districts

Kentucky Association of Meat Processors

Kentucky Burley and Dark Tobacco Producers Association

Kentucky Cattlemen’s Association

Kentucky Center for Agriculture and Rural Development

Kentucky Corn Growers Association

Kentucky Dairy Development Council

Kentucky Department of Agriculture

Kentucky Horse Council

Kentucky Forage and Grassland Council

Kentucky Horticulture Council

Kentucky Pork Producers Association

Kentucky Poultry Federation

Kentucky Sheep and Goat Development Office

Kentucky Small Grain Growers Association

Kentucky Soybean Association

Kentucky State University

Kentucky Thoroughbred Association

Kentucky Woodland Owners Association

The Dairy Alliance

University of Kentucky Martin-Gatton College of Agriculture food and Environment

WAVE Ag Initiative