Farmland preservation through the purchase of conservation easements is not a new idea. However, a southeast Michigan township has carried the concept beyond holding the easement to also seeking a specific buyer of the conserved property to meet identified needs and wants of the community.

Conservation easements place permanent deed restrictions on the use of a property, mostly prohibiting any kind of residential or commercial development, while keeping the property natural or available for agriculture. Land trusts and public agencies buy and hold these easements, which are priced at the difference between its value as farmland and its potential development value.

Commonly, the easement holder’s job is limited to buying and enforcing the easement, and the landowner is then free to retain the property or sell it with the easement attached. However, Scio Township’s Land Preservation Program not only purchased the easement, but it also secured a purchase agreement for the land, allowing it to pick the perfect land buyer.

“We were looking for a buyer in local food production with good conservation practices,” says Barry Lonik, consultant for the Scio Land Preservation Program and president of Treemore Ecology and Land Services.

The property, located just outside of the city limits of bustling Ann Arbor, is known as the Renz farm. It had been in that family for 100 years in 2020, which was the same year Harold "Dick" Renz died and the estate applied for conservation. 

Scio reached an agreement with the estate for an overall purchase price of $3.5 million for the 110-acre farm, but it was later scaled back to 101 acres after it was discovered that 9 acres of the farm had been identified in a decades-old master plan as the ideal location for a township fire station.

Purchase price for the easement was just shy of $3 million, as the property was zoned agricultural, but master-planned for 1-acre housing sites, which hugely boosted its development value.

Prime property to protect

With the property bordering protected land to the south and west, Lonik says it was ideal to protect. Scio bought the easement with the help of four other funding sources — the Ann Arbor Greenbelt Program, the Washtenaw County Natural Area Preservation Program, the State of Michigan Agricultural Preservation Fund and the federal Agricultural Conservation Easement Program. It’s the first time five funding sources have been tapped for a land preservation project.

Originally, the farmer who had been leasing the land showed interest in buying the property, but then later declined and retired. The Renz family wanted to sell the conservation easement and the property at the same time, so Scio signed purchasing agreements for both, knowing it could not simultaneously own the property and hold the easement. It was a short-term solution to keep the process moving.

“But we knew we had to find a buyer and were worried about the timing and getting a buyer before the owners wanted to close,” Lonik says. “So, we contacted American Farmland Trust about buying it, in the interim, if necessary.”

Brian Bourdages, AFT Midwest farmland and national agricultural land consultant, says, “Our land protection committee and, ultimately, our board stepped forward and said we’re willing to go ahead and buy that restricted land and work with the township to get it resold to another farmer if it becomes necessary. And that allowed them to proceed.”

Ultimately, Scio Township secured a buyer before the closing, but the framework and process for implementing a “buy-protect-sell” strategy in farmland preservation was established.

“It’s a tool land trusts and units of government are starting to utilize more frequently,” Bourdages says. “Scio Township is the first local program in Michigan with a dedicated funding source to formally adopt a process for buy, protect, sell. Twenty years ago, it wasn’t much considered, but it’s proving to be a useful tool in some areas to address the issues of succession.”

Scio Township developed a public and transparent process and standards for putting out a request for proposals for interested land buyers. A total of seven proposals were eventually whittled down to three and then to one — Mike Vestergaard of Vestergaard Farms LLC, a local livestock producer who practices rotational grazing and has plans to host a community garden and educational activities on food production at the property.

“We fixed the price of the conserved land at $320,000,” Lonik says. “It wasn’t a bidding process, where whoever had the most money won. By setting the price, it was our hope to open it up for more buyers, including small, young or beginning farmers. It’s the first time such a process has been implemented.”

Scio Township’s dedicated land preservation tax of a half mill was approved by voters in 2004 and renewed in 2012 (two years ahead of time), both by large margins. With this project, the township program has been involved in protecting 1,709 acres, with more projects set to close in the coming months. A half mill generates about $600,000 a year on average.

The buyer

Mike Vestergaard is an immigrant from Denmark, who started a hobby farm on 10 acres while growing his business of building children’s playgrounds all over the country.

His full-time job allowed him to sell that original farm, and 13 years ago, he bought a 112-acre conserved farm a little more than 2 miles from the Renz farm. “Conventional farming on this acreage is not really possible — corn, soybeans and wheat rotating. It requires some out-of-box thinking,” he says.

Being only 2 miles outside of the city of Ann Arbor — home of the University of Michigan — Vestergaard began to retail his products direct to consumers.

“With my sons, Max and Carsten, we raise pork, beef and chicken, and about two and a half years ago we opened the retail store on the farm — it has done really, really well,” he says.

The store also features an array of products, many locally sourced, that you’d find in most grocery stores.

Vestergaard raises about 60 steers, 200 hogs and 3,000 chickens annually. He’s cutting back on the chickens because competing, price-wise, with conventionally raised chickens at the retail level has been somewhat challenging. However, his beef business is booming.

“We are looking at a large contract for ground beef, but there was no way we could fulfill it on the land I currently had,” he says. “So, when I learned about the Renz property coming up for sale, I saw a great opportunity to expand our beef business.”

His beef is all grass-fed with rotational grazing, and while he does put up hay for feeding December through April, he’s not tied to the price of corn.

The Renz farm has 80 acres of hay, with the remainder in woods, tree lines and a farmstead. Vestergaard is working to erect fencing and plans to build a livestock building in the near future. The property offers several soil types, including a sandy and gravel mix.

“It doesn’t produce huge yields, but I can get cattle out there without sinking in, and it will be so beneficial because we can use them in different times of the year,” he says.

Vestergaard already welcomes visitors to the farm with a gardening program through the nonprofit Willow Run Acres. He plans to expand that community outreach to engage and educate others in agriculture by creating a road through the Renz farm, allowing people to see and enjoy a working farm. “We also would like to have a summer camp,” he says.

Vestergaard has been in contact with a local nonprofit called Project Grow, which has community garden spaces around the area. He plans to provide plots for people to grow their own vegetables.

Another idea is to allow a beginning farmer an acre or two at no cost to grow commodities on the farm, which then could be sold wholesale back to the farm market for retail sale. “I want to inspire the younger generation,” he adds.

In working with the township to pick a buyer, Lonik says, “We wanted to support a local, existing business, which was sustainably using the land and contributing to the local food economy. But we also saw real value in Mike’s desire to engage the community and to offer educational programs. With a nature preserve and other conserved lands nearby, this was a good fit.”

The seller

Harold "Dick" Renz, who took over the farm his parents bought in 1920, had no intention of letting the farm go, even during the worst of times and when developers were knocking all the time, says his daughter Pamela Martin, who became the executor of his estate.

“There was just never any question in his mind it would remain a farm until the day he died; he was very attached to it,” Martin says.

With his wife, Virginia, Renz built the farm while also serving 23 years as an Ann Arbor fireman. The land was rented out in the early 2000s, when Renz could no longer farm. He died June 13, 2020, and left the future of the farm to Martin, who consulted with her cousins on its fate — especially Kathy Esper.

“She helped considerably, and we worked together on this goal of keeping the property undeveloped,” Martin says. “We felt very strongly that we wanted to conserve the land rather than sell to a developer who would put up another subdivision.”

When Renz died, a number of developers made offers above the appraised value, but Martin says leaving a legacy trumped their proposals.

Ultimately, the sale with a conservation easement benefited a nearby grower with affordable land to expand, the community with local foods and a connection to its production, and Martin, who will divide the proceeds between eight other family members.

She adds, “It had been a farm for 100 years, and even though Dad didn’t specifically dictate what he wanted done with the farm, I think he would be proud to see it continue to be farmed.”

Building community support

Sometimes you have to go through failure to reach success. Such was the case for southeast Michigan’s Washtenaw County, which leads the state with five dedicated millages for land preservation.

Washtenaw County put a countywide proposal on the ballot in 1998 — only the second one in the state and the first countywide one. In a public campaign, the original proposal included farmland preservation, natural area preservation, brownfield redevelopment and planning assistance to rural townships.

It had too many components, was confusing for many and voters turned it down, says Barry Lonik, consultant for the Scio Land Preservation Program and president of Treemore Ecology and Land Services. 

“The homebuilders and realtors vehemently opposed it, threw a lot of money at it and ran a very effective opposition campaign,” he says. “There were newspaper stories, and television and radio ads that sparked a lot of community discussion.”

Riding on that heightened awareness of the issue, a new ballot proposal — which included just natural area preservation — was drafted and endorsed by the homebuilders and realtors. The Washtenaw County Natural Area Preservation Program passed in 2000 with 64% of the vote. It was renewed, with the inclusion of farmland, in 2010 (58%) and again in 2020 (72%).

Overlapping the county program, in 2003 Ann Arbor Township passed a 20-year, 0.7-mill proposal with 77% support, and the city of Ann Arbor’s 30-year half mill Greenbelt proposal passed with 67% in favor. Scio Township passed a half mill in 2004 (75%), and Webster Township followed with a half mill in 2005 (70%) — both of which have been renewed by large margins.

Lonik says voters understand that open space (some open for public use) and private farmland are investments in the community.

“Sure, residential developments generate more taxes, but they also require more services — roads, utilities, schools, and police and fire protection,” he explains. “Many ‘cost of community services’ studies have proven that everybody’s taxes go up, essentially subsidizing development at the loss of many community attributes. Instead, by buying a conservation easement on that property, it will cost a little bit of money in the short term, but we can match it with other sources, and then you never have to pay to support development.

“Plus, those conserved properties provide all kinds of natural benefits [groundwater recharge, wildlife habitat, scenic views, carbon storage and more], and many of the conserved farms are now producing edible foods grown by a younger generation of farmers. It’s a winning situation for all.”

In total, all of Washtenaw County’s conservation programs have invested more than $200 million into easements and preserve acquisitions.