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Creating a long term lease  RSS feed

 
Ryan Crafter
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I'm reaching out to find anybody with experience in creating a wackey long term lease with a land owner.

In short, I've been living with a small community on a piece of land in California that is owned by somebody else. The land owner is a radical old school hippy type who did the homestead in the hills thing here for 20 years. Now he lives in a different country and needs people to maintain the place.  We have very little structure in the way of formal agreements.  Some forestry here,  some road work there,  and some fire lines to maintain.  Basically, I've been living the permaculture dream here for the past three years... growing food, raising chickens and goats, milling lumber, building a house, building community and building a relationship with the ecology of this amazing place.  It's perfect.  Yet, I struggle with having a serious multigenerational approach to my life here.  I own land elsewhere.  I lived in that place for nearly 15 years, doing the thing, before deciding to pass the torch in search of community, clean air, and good water.  It was hard to leave my home, my life, my dream... my future behind in search of greener pasture. 

What security I had by owning that land is missing in my newly formed paradise.  I've been communicating these feelings with the land owner and he's all ears.  He claims to be open to the idea of a land trust... we need to build trust in the meantime.  Honestly, I don't know what benefits and pitfalls exist in a land trust.  The trust feels like something to work toward, I need something now.

For the time being, I want to formulate a lease agreement that suits the needs of our permacultural lifestyle.  Creating a framework of accountability.  I need to dispelle the fears I have of somehow loosing (ie. getting forced out, property getting sold, the land owner dieing, etc.) my investment in this place (house, forest garden, my future).  Daunting!  I have found little in the way of reference points.  Yet, I feel I can't be the only one struggling with this!

I'm realizing this is more than just a simple lease agreement.  There's a lot at stake.  And I'm navigating through this process within larger systems (land ownership, feudalism, ridged legal bureaucracy) that have been in place for a very long time.  I feel like the permaculture community is doing a lot to address these issues and that's why I'm turning to you for help.  Who knows,  maybe at the end of this thread we'll have something solid people can use to spread permaculture to places we never dreamed were possible.

Let's stop here and see where we go.

With hope, Ryan
 
Jarret Hynd
Posts: 109
Location: Sask, Canada - Zone 3b
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I've never had a proper lease, as here there is a clause about leases shorter than 3 years not needed to be filed at an office. Since the owner and I have a good enough relationship, it's worked out alright so far, though I'll likely face a similar predicament as you in the next 3 years.

10 to 20 year leases are fairly normal here for conventional farmers, info here, though this works easily for them because they don't alter the land at all. These might not apply to you, but from the possibilities that I've read that pertain to permaculture in my area:

- Any changes to the land must have written approval by the owner.
- If any improvements are made to the land and the agreement is terminated, the person who made the improvements will be given fair market value for that investment by the farmer.
- "Option to Buy" condition where at certain time within the lease agreement you have the option to buy the land. Another option is "Right of Refusal" which means that if the owner ever wanted to sell the land, the guy leasing the land is the first person with the option of buying it.

Assuming it's similar for you, it's not like the owner can allow you to plant 1000 trees and then just cancel the deal while you get nothing for your investment - you should have some security I'd think. Check your local laws to make sure.

Ryan Crafter wrote:Honestly, I don't know what benefits and pitfalls exist in a land trust.  The trust feels like something to work toward, I need something now.

Present a long-term lease to the owner, and if he is still talking about trusts and what not, I'd just save up some money and find somewhere new, as depressing as that sounds. If he isn't interested in selling the land to you or subdividing a portion of it off to you, then from the position you've given it's not worth your time. That looming doubt after each year of "am I gonna be kicked out? am I wasting my time?" is not worth it, at least it wouldn't be for me. A trust, from what I understand, means you still have to manage the land in the way he wants.

Trustees are trusted to make decisions in the beneficiary's best interests and often have a fiduciary responsibility to the trust


People are different and so they have different interests. Since he is technically still the owner in that case, I can't see things working out well for your needs.

Ryan Crafter wrote:Who knows,  maybe at the end of this thread we'll have something solid people can use to spread permaculture to places we never dreamed were possible.


I hope so to. 
 
James Freyr
pollinator
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Location: Middle Tennessee
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Perhaps the landowner might be open to a "lease to own" type agreement. Pay him x amount of money annually, and after a determined number of years or meeting the agreed terms for the value of the land, you take ownership of a predetermined and surveyed parcel of his tract. Maybe offer to pay the "closing costs" of the title company and filing of the new documents with the county etc. so it's as easy as possible for them.

Aside form hiring an attorney to draw up documents, maybe read standard lease agreement documents on the internets, pick and choose paragraphs from the ones you like that contain fancy wording pertinent to your goals, and kinda construct your own legal document. I imagine there's more to it than just this, like getting the survey so there's never any question about exactly what you want to acquire, but it may be some where to start.

Just thoughts from my brain. Hope it helps! :)
 
Ryan Crafter
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Thank you for the input!  The option to buy is not on the table... currently.  Even if it was, in its entirety, the land is currently worth far more than I'd ever want to pay for land.  It's probably worth more than I could make in a few lifetimes.  Maybe once the local economy crashes I'll have a chance... were in a hotspot for the "green rush" and land prices are insane.  James has a good concept that takes the same idea...
Perhaps the landowner might be open to a "lease to own" type agreement. Pay him x amount of money annually, and after a determined number of years or meeting the agreed terms for the value of the land, you take ownership of a predetermined and surveyed parcel of his tract. Maybe offer to pay the "closing costs" of the title company and filing of the new documents with the county etc. so it's as easy as possible for them.
that's worth a shot!  In my case the parcel of land I would be interested in (where my cabin and garden are located) would not have the sweet delicious spring running through it.  Yikes!  That's something I should have considered before building my cabin.  I suppose drilling a well could be an option.


I've definitely seen reference to a lot of the farm lease terms your speaking to Jarret.  I'm particularly interested by
- Any changes to the land must have written approval by the owner.
- If any improvements are made to the land and the agreement is terminated, the person who made the improvements will be given fair market value for that investment by the farmer.
  that's certainly something I need to include in a lease.  Yet, these things do very little to legally bind people to land in the long term.  As I imagine... most permies would see their life's work as being invaluable, something they want their children's children to have access to.  Maybe I'm just on some utopian pipe dream and the only real way to have legal rights to land in a permacurtural/multigenerational way is through ownership.
 
Jarret Hynd
Posts: 109
Location: Sask, Canada - Zone 3b
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Well, I guess we don't actually know how much land you want to have, so maybe some options are being missed. After reading a bit more, it's pretty clear that an Lease to Own is very disadvantageous for the buyer. Assuming you only want 4 acres or something small, could you save up this year + get a loan and afford to buy your parcel next year?

To get down to brass tacks, I'd just ask the owner pointblank next time: "is there any agreement you'd be willing to sign where I would get full ownership of ____ acres in the next ___ year?". If the answer is anything except for a clear Yes, then you have your answer that he has no desire to give up anything and you can proceed accordingly. I had to make that kind of ultimatum this summer, but I got lucky that the deal worked out the way I wanted it to. 

Ryan Crafter wrote: Maybe I'm just on some utopian pipe dream and the only real way to have legal rights to land in a permacurtural/multigenerational way is through ownership.


Nothing wrong with shooting for something better, but yeah, unfortunately in our lifetime individual ownership is gonna matter a lot.

---

If you don't mind me asking, you mentioned about your community. Are they in a similar circumstance as you are in regards to owning a parcel of land in the future?
 
Ryan Crafter
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Really, the more I think about it the less likely subdivision seems like possible solution.  I've thought about a __ year lease that could end in a co-ownership situation.  A kind of buy in process.  But, mostly I've been banking on a short term lease that garontees a land trust being the ultimate goal after 5-? years of establishing a relationship with the owner.  When we've discussed the trust option in the past the land owner has said he would want to create that land trust together.  He is an old school hippie and he's also a radically minded person.  He helped form some really transformative social and ecological justice oriented non-profits in this rural community.  Then... long story short, he got married, had a baby, and moved out of the country.  I get the feling he wanted to find people to fill his shoes on the land and in the larger community.  It seems like he lives vicariously through us living his dream here.  He now has created similar projects and non-profits in South America and it seems like he's going to be there permanently.  He has an ex wife who also lives on this property part time and they have two children that are in college.  The property is 160 acres of fairly steap forested mountain tarain landlocked by national forest.
It's interesting... now that I'm writing it all down and telling strangers about it, I feel crazy for even thinking this could actually happen.  Not that I didn't feel crazy before... it's just a less grounded type of crazy 
This place is not my only option by any means and at the same time, it feels wrong to pass up the opportunity of a lifetime.  I'm willing to ride this verbal agreement out for another year of transition while we create a lease that segways to something more tangible in terms of my/our long term vision with this place.  I'll have to get some protection in the meantime so that I can move forward with my lifestyle that inherently adds value to the property.  I have a large nursery of perennial food trees and shrubs, medicinal herbs, and native plants that need to get in the ground.  Lots of wild crafted native plant seeds to deposit in the seed bank.  I also have a lot of finishing work to do on the cabin and various forestry stuardship goals.  I should mention the land owner has been involved with lot of groundbreaking work that has been done here on this property and in the broader community involving prescribed fire as a land management tool. Indeed there is an ancient relationship involving fire, humans and the earth.  Fire reintroduces a critical missing (suppressed) element back into the ecology.  This is one of the first locations in the country to begin to put public and private land managment back into the hands of the people who know it best... indigenous peoples.  This has helped the people with knowledge and history to step into mentorship roles with government agencies, private firefighters and private firefighting companies.  This year, the California Department of Forestry and Fire Protection were on-site involved with the burns... as students!  Revolutionary stuff.
You asked about others who live here.  We have a small group.  The number is fairly fluid, though there's been about 10 of us here full time for the last three years, and few longer term guests that flow in and out.  We all have varying degrees of commitment to meeting the loose requirements for work trading to stay here.  Like I said,  those agreements are loose and I stress, that doesn't make it easier to create cohesion!  The levels of work we individually put into the property are reflected by varying levels of support from the land owner.  He has offered myself and several others separate 20 year leases.  I shy away from such a long lease. I certainly don't want to get displaced in 20 years, I'd be almost 60.  I want to see something larger take shape within another 5 years here.  I want to see a small community evolve from this.  We as a group definitely all share points of unity regarding ecological and social rehabilitation. I honestly don't think I would want to live this remotely without a small community or group of friends here on the property... we're 4 miles from the closest neighbors and 15 miles from the nearest town.  Talk about cabin fever.
Anyhow,  I am really busy preparing for the first rains... getting all of my ducks in a row.  Which is pretty easy considering I only have two ducks... I guess that means they're always in a row.
 
Ryan Crafter
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Here's a rough draft... the meat of a lease proposal the group drafted a few months back.  Once finished, we planned to have an attorney buddy go over it and submit it to the land owner for review and revision.
In this lease draft we were all imagining leasing farm land as a collective legal entity, such as an LLC.  It was a suggestion that I ran with. For now, just think of it as a person to person lease and replace entity with my name.

WHAT WE"RE TRYING TO ACCOMPLISH WITH A LEASE
   
    -Safety
    -Longterm security

TERMS OF LEASE:

-Duration of Lease:
    -Five Years

-Land Description:
    -Refer to Exhibit A (ZONE MAP)

-Payment
    -$0
    -Work Trade/Maintenance - To be decided by land owner
    -existing structure rental: $300 worth of improvements monthly including labor and supplies.

-General Use:
    -Lessees and Indigenous Communities will have right to engage in agricultural, animal husbandry, social gathering, natural resource gathering and land management activities, etc. within property boundaries
   
-Resources:
    -water
    -lessees are granted access and use of all water sources and water infrastructure in accordance to the priority scheme
       
priority scheme-
            1st -hydration, cooking, bathing, sustenance agriculture, fire protection
            2nd -power, commercial ag
            3rd -non-resident uses
 
-roads/parking
        -equal access/use of all roads and parking on property
       
-structures
        -ability to build or improve and permit structures within community zone.  Structures in community zone will remain in possession of the lessees throughout the term of the lease.
   
-compensation
        -improvements made to land, structures and systems approved by land owner will be compensated at the end of the lease term by land owner.  *Figure out a degradation or increase of value over time system for compensation* ie. Structures become less valuable over time as trees become more.

-Liability
     -Lessees are not liable for activities made by land owner or associated parties on property or otherwise

     ?*-All Parties will be individually responsible, accidental or otherwise, for any damages or losses done to shared infrastructure beyond normal natural degradation and use.

    -Activities and materials deemed unsafe by lessees or threatening to the wellbeing of Lessees will be discontinued or removed upon request of Lessees

-Health and Wellbeing
        -It is the Landowners responsibility to remove any people, practices, machinery or animals that impose significant threat to the wellbeing or safety of ENTITY
        -Property wide Non-Discrimination policy on the bases of race, political leaning, color, gender, national origin, age, religion, creed, disability, veteran's status, sexual orientation, gender identity or gender expression.


-Zoning
     -Shared Use Zones: Informed Consent, X amount of time before parties occupy, make major changes to, or implement land management practices in shared use zones.   Parties agree to share in maintenance responsibilities and have equal rights to land management, harvesting, and recreational activities.  If conflict arises surrounding land use, local ecology is prioritized.

-Entire Land Zone:
    -EASEMENTS: WATER, ROADS, RESOURCES, LAND MANAGMENT

-Ecological Protection
    -All parties responsible for proper use, storage and disposal of any environmental contaminants
    -All parties are responsible for cleaning up and disposing of their own garbage in a timely manner
    -All parties are responsible for keeping toxic contaminants out of watershed generated by their land use
    -All parties are responsible for engaging in practices that will not significantly threaten wildlife populations or habitat
    -All parties are responsible to respect the lives of non-human and human community members

-Communication norms
    -Land Owner and OTHER PARTIES using land or land resources will communicate at regular intervals and before any change to lease conditions/terms
    -Land Owner and OTHER PARTIES will communicate X amount before major changes to land use or activities therein
    -Land Owner and OTHER PARTIES will communicate before any change in occupancy
    -The terms of this lease are amendable only with mutual consent
    -If the Land Owner intends to sell or transfer title of property the land owner will first offer to sell property to ENTITY or other individuals upon consent of ENTITY
    -Land owner and associated parties will agree to respond to any concerns regarding lease or land use issues within X days

-Continued Lease
    -A life time lease/trust will be offered at the end of Lease term providing the conditions of the lease are not broken and unresolved
    -Lease carries over with any transfer of land title

The orientation got wacky in the cut and paste but you get the picture.
 
Jarret Hynd
Posts: 109
Location: Sask, Canada - Zone 3b
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As I mentioned in my first post, I've never had to make such arrangements officially, but this looks pretty good at least as a draft.

I'd be very interested to see what the owner's response will be to these conditions, though that's none of my business. It's just the draft is a complete 180' degree difference from the 20 year lease he was offering.
 
Ryan Crafter
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I had to make that kind of ultimatum this summer, but I got lucky that the deal worked out the way I wanted it to.

Jarret, If you are interested in elaborating on that... I'm interested to hear more about your situation.

As for the 180* difference between leases, your right.  One thing I try to keep in mind is that there's nothing new in my draft lease that I haven't already discussed with the land owner.  It's more of a counter offer.  But, yes it's quite different... it's more of the point blank approach you talked about earlier... with a little more context pertaining to our unique relationship.  I absolutely expect some resistance, as the draft is mostly looking at MY personal needs.  With an expectation that he will fill in the blanks according to his needs.

Another question I have for everyone is a concern the land owner has expressed about liability.  As an absent land owner with people living on his land he needs to be covered legally from any injuries, damages, etc.  My thought has been, this lease and an insurance policy that he would need to get for the property, should do the trick.  As a group, we've talked about hosting workshops and other such public events.  This too would need to be considered.
 
Ryan Crafter
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Quick update.  I recently had a meet up with the land owner.  We discussed a number of options for a "buy in" process.  The timing was ripe for this conversation.  He is interested in pursuing a lease to own option! The land is not subdividable so, we'd have to go all or nothing.  He recognizes that his transition away from California is leaving him with little incentive to retain the property. He wants the land to stay in the hands of people who respect the ecology and hold similar ideals... namely the current residents.  He's willing to negotiate price, understanding that the value is currently over inflated due to the local cannabis industry.  We both agree the over inflated real estate market is already changing drastically with the onset legalization.  During our conversation we discussed a time frame of 5 to 10 years.
So, it looks like we're heading in the right direction.  I'll keep you all updated as things move forward.
 
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