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BE PREPARED: COVID-19 is spreading quickly, and most farmers are at high risk for developing complications from the virus. It’s good to have a contingency plan on the farm in place just in case something bad happens.

Stay healthy, but know who takes over if you get sick

Have a contingency plan in place and investigate legal options such as power of attorney or a living trust.

You may think that living in the country, far away from the epicenters of COVID-19, might shield most farmers from getting this potentially deadly disease. But data show that most farmers are very much in the “high risk” category of people who could develop a serious bout of the virus.

Farmers are older — 57.5 years old on average, according to the 2017 Ag Census — and 34% are over the age of 65, which is one of the highest-risk COVID-19 groups, according to the Centers for Disease Control and Prevention. Underlying conditions such as high blood pressure, cancer, diabetes and obesity can make anyone’s risk factor for getting serious illness go up.

One way to ensure the farm continues operating in case you get sick is having a written contingency plan in place.

Mike Hosterman, a business consultant for AgChoice Farm Credit, says it all starts with trust.  

“You have to make sure anyone is taking over, a neighbor or family member, they know the management protocols,” he says.

That includes having contact lists for important people, proper insurance information and knowing farm-specific protocols. For example, if it’s a dairy farm, make sure the next in line knows where the milk is being shipped, the names of the milk inspectors, and contact numbers for the veterinarian, nutritionist and other key people.

When the owner is also the employee, finding someone to take over can be tricky. Having worked with dairies as small as 50 head, Hosterman tells farmers to always think of scenarios where someone — a family member or a neighbor — would have to take over for a short period of time, such as a short trip, family emergency or serious illness. Again, it’s all about trust.

The Pennsylvania Center for Dairy Excellence is linking farmers with industry professionals to create contingency plans for COVID-19.

Farmers are linked remotely with an industry professional to address farm management questions, including:  

  • Strategies for practicing social distancing and communicating with farm staff
  • Steps to protect employees and providing resources, such as travel letters for potential “shelter in place” restrictions
  • Procedures for farm visits and deliveries to mitigate the spread of coronavirus and ensure farm safety
  • Preparations for maintaining dairy and medical supplies and plans for how to operate if they become in short supply
  • Strategies to mitigate any potential losses in product sales associated with COVID-19
  • Financial calculations to determine how the business can continue to operate given any potential loss in product sales

Legal protections

Curt Ferguson, president of The Estate Planning Center in Salem, Ill., says there are legal ways to protect your farm if you get sick.

He says to start by asking this simple question: “Who would you trust to make the kind of decision your currently have to make? It's one thing to get someone to do the physical work, but who do you want to be the brain? Sometimes that's obvious, sometimes it's not.”

A power of attorney document or establishing a living trust are two tools that can help a farmer plan for the unexpected and set up an orderly transfer of the farm’s management and, if needed, the assets, he says.

A power of attorney document appoints a person or organization to manage the farm, and a farmer’s financial or medical affairs if they become unable to do so. It’s a simple way of making someone legally responsible for the business in case a farmer becomes seriously ill or disabled.   

But they are also risky, he says. Quite often, power of attorney documents must be publicly recorded, especially if a farmer assigns the power of attorney to handle a land transaction.

Assigning someone as power of attorney also gives that person broad power over a farm’s operation and affairs, and it can create problems for farmers if they aren’t careful with how it’s written or who they assign as power of attorney.

A living trust is like a power of attorney in that a “trustee” is assigned to handle the affairs, but they are much more specific as to assigning roles on the farm and how assets are to be divided.

They also don’t have to be recorded for the public record, he says, so there is an enhanced level of privacy. Living trusts can also avoid having living family members go through the probate process of dividing assets should a farmer or landowner die.

“In the area of disability planning, this is one of the great places to flesh out details of how you want your property managed,” Ferguson says.  

If something like COVID-19 forces a farmer to think about a power of attorney or a living trust, then it also makes sense to think about how the farm will pass down to the next generation, he says, and get those plans in order all at once.

After all, no farmer is immortal.

Farmers can learn more by visiting the Center for Dairy Excellence, the Estate Planning Center and the Cornell Agricultural Workforce Development program.

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