Perth forges ahead with debate on surplus farmhouse severances

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The farm organizations have to follow the Farm Business Registration Act. Their mandate is to provide a 'service' to eligible farm BUSINESSES. The farm orgs. DO NOT have the legislative ability to speak on any other matter outside farm businesses.

Farm severances are matters of property rights. Every member of the OFA should read their governing Act when they sit on the board so they are informed of their boundaries.

My parents severed a farmhouse just 1/2 mile from Perth years ago.
Perth dragging their feet on this commanded a premium for said property.

Raube Beuerman

As someone said recently, it's all about the MONEY and given the downloading of the provincial gov't Perth county needs the property tax and severance money! Furthermore and unfortunately, the rules as proposed may prevent (discriminate) against some farmers who don't live adjacent to said surplus house therefore won't have the same ability to severe. Unless they change that rule it will mean discrimination in that some farmers will have the ability to out bid others for the same farm based on the fact of severability of the surplus house. Then again, farmers were never in it all together at any time in history.

In my travels around Huron County, I see oodles of empty farmhouses that were, not that many years ago, in good condition and which housed families whose children went to local schools, and which housed parents who worked in local hospitals, stores and industries. Furthermore, there seems to be a rule-of-thumb that once a house stays empty for ten years, it's going to be demolished, and many have been.

We, in agriculture, are at substantial risk of "hollowing-out" local communities because of our opposition to rural severances. In particular, Huron County's population has been gradually declining for many years and allowing more rural severances would serve as a positive step in the other direction.

Stephen Thompson, Clinton ON

North Perth population is on the incline, l would think that for every farm house that has been torn down in the rural countryside 10 have been built within the the town limit of Listowel.Wether it's the same elsewhere in the county l'm not sure but it's why we all look at the severance question differently.

With the prices of farms today, it is better to tear down houses and take the capital loss than to go through the expensive process of severing a surplus house.

Far more cost effective even if the house is relatively new. The farmer will be further ahead in the long run.

The left wing of society has long complained about a real or imagined lack of corporate social responsibility.

Positioning any discussion of rural severances in a framework in which the objective is - "the farmer will be further ahead in the long run" completely avoids any consideration of the farm community's social responsibility to help create and nurture a vibrant and diversified rural community.

Thinking about what will be best for farmers and not thinking about what will be best for everyone else, isn't something about which agriculture can be, or should be, proud.

Stephen Thompson, Clinton ON

Rural communities are evolving at a rapid pace because of a number of global, social and governmental factors. The mid 1960's saw over 260,000 active farmers in Ontario. Those farmers and their families played a strategical role in the 'vibrant and diversified rural community'. They were the backbone of their church, school and community and generously gave of themselves as they had a vested interest in the betterment of those around them. For the most part, the farm schedule allowed for the flexibility of farm members being active in community support groups. These farm families were an invaluable asset but their volunteer hours were never publicly recorded anywhere. There are no complete stats to recite the farmers contributions to their communities.

There are less than 30,000 active farmers today. The majority of rural communities are suffering because the new breed of farmers are working more land, more animals, more everything and have little to no time to volunteer even if they live in the community.

Society, and more importantly, our government, does not give two hoots about farmers and rural communities. Society demands more for less from agriculture. 80% of our food is imported now for a reason.

So, get off your idealistic rose-colored high horse and let farmers do what every other person is allowed to do. Protect themselves using what ever legal tool is available and try to earn a decent living.

The above pontifical (and completely-crap) argument is effectively the same thing as arguing that we needed to have kept slavery or else everyone in Mississippi would be poor.

More to the point, the argument that farmers deserve more than equal protection, or, more bluntly "protect farmers, to Hell with everyone else", is what has long-since driven supply management and does little more than argue for the enhancing of what is already a rural aristocracy - it's an elitist attitude that should make everyone ashamed to be a farmer.

As for my "idealistic rose-colored (sic) glasses", the "new breed" of farmers has no time to volunteer for anything because they are working 90 hours per week at two jobs in order to keep up with their supply managed, at one time high-school classmates who can, and often do, have cottages at which they luxuriate in order to avoid seeing the toil of their hard-working rural neighbours.

Stephen Thompson, Clinton ON

Finally some one with some common sense

Yes Raube, as you complained about with other farm subsidies, its a no brainer that surplus house severance policy also acts as a subsidy to further inflate overall farm property values.

This poster is correct that the ability to buy a farm, and then severance the house will result in the potential farmer(s) paying more for that farm.
However, there is no subsidy anywhere to be found in this argument.

Raube Beuerman

Be honest.

A legislated regulation that allows a severance for some farmers essentially gets bid into the price of the overall price of the farm by those same few eligible farmers.
Since it is a legislated entitlement then it is no different than lavish legislated quota income that Stephen claims is being used essentially as a subsidy in inflating the price of land.
However, on balance (depending on the details), I believe that severances are good for the tax base of community.

Regardless of whether or not the house and buildings can be severanced does not change the price per workable acre.
Therefore, since the price per workable is the same in the end, then your argument that this increases the price of land holds no water.

Raube Beuerman

A couple of postings ago you indicated the overall $$$value of the farm would increase if the severance was permitted. A beginning farmer would most likely not be able to claim the house was "surplus " even if he owned other bare land therefore he would not comply with the severance rules. So how is he supposed to bid with the big established boys who do comply with the rules? Discrimination?

Editor: This comment has been modified.

Everyone (being presumptuous here) knows that land is valued by the workable acre but when there is a residence on that farm parcel, the residence is not valued at the same rate as if the residence is severed. Therefore, when a person buys a farm with a residence, the building is devalued at point of sale.

When the residence is severed, the severed property has an increased value and the workable acres have been deemed subsidized by the severance. The severance reduces the total cost of the entire farm.

Therefore a farm with no residence has the value of the workable acres but a farm with a separable residence can and does reduce the total cost of the remaining workable acres.

Your argument is backwards.

The only time the above anonymous poster's theory might be correct is when severances aren't allowed.

If severances are available , and if the intention is to sever the house and sell it, nothing will be devalued at the point of sale - the property/properties will be valued by competing buyers at the sum-total of what they would be worth as individual units, in exactly the same way developers value farm land in terms of building lots rather than as farm land.

Therefore, while allowing severances might appear to penalize young farmers who want to buy and live in "devalued" farm houses, young farmers are already so-screwed by having to compete with the hydra-headed monster of supply management that the severance issue (and the real or imagined "devaluation" of farm houses) is immaterial and irrelevant.

Stephen Thompson, Clinton ON

So, there you have it folks, effectively we have an admission that both SM and the surplus house severance regs are indeed both deemed subsidies.

Purists and pedants would argue that supply management is not a subsidy because only governments pay subsidies - that supply management is a subsidy legislated by government but paid by consumers seems to be concept supply management supporters are, judging from the howling coming from them whenever someone claims supply management is a subsidy, completely-unable to understand.

As for any suggestion that severances are a subsidy to anyone is patently absurd. In the absence of any restrictions on severances, market forces would establish the price at the sum total of what a farm would be worth, plus what a house on it would be worth.

As pointed out before, the entire severance issue is a "red-herring" clouding (probably deliberately) the truth that supply managed farmers have the clout to buy, no matter what severance legislation might be in place, additional farms on which they don't need or want the house, but individual non-supply managed farmers who want to buy the same farm and live in the house, cannot afford to bid against the supply management monster.

The point anonymous posters on this site seem to be falling all over themselves to ignore and/or deny is that if we got rid of the land-grabbing ability supply managed farmers have been given through 200% tariff barriers, the severance issue would largely go away all on its own.

Therefore, the concept espoused by the above poster is that eliminating, or at least substantially reducing restrictions on severances is somehow a subsidy is nonsense.

Finally, another facet of the problem is that current capital gains legislation makes it too-easy for farmers to sell, thereby adding fuel to an already raging fire of supply management consolidation and, therefore, the demand for severances. When, as in one example this winter, a $1.5 million sale of bare farm land attracted capital gains taxes at under 10% of the sale price - if the vendor had been married, there would have been no taxes at all.

Stephen Thompson, Clinton ON

Again, you limit your "logic". So a farmer paid just under 10% on a $1.5M sale. The average house in Toronto is now worth $1M and when the owners sell, they pay 0% on the sale.
Rural people always pay more but you carry on that farmers are the problem.

It's only some farmers who are the problem, particularly dairy and poultry farmers who, thanks to legislation favouring them alone, have the ability to out-bid other farmers.

That purchasing power, plus the extremely-low marginal taxes paid by sellers of qualified farm property, makes farmland values look like the Fort McMurray fire is a camp-fire.

Stephen Thompson, Clinton ON

Hogwash. By your definition any form of ag subsidy including supply management inflate land values. Therefore, by your admission since surplus house severances also inflate overall farm and land values they are indeed effectively a legislated subsidy. Nothing really wrong with surplus house severances but they are indeed a subsidy that tends to inflate land values somewhat and probably less than SM does.

The ability to sever and sell surplus farm hoses DOS NOT inflate overall farm and land values. Farm land values are over-inflated because, thanks to supply management, dairy and poultry farmers have the INCOME to over-inflate farm values, regardless of the ability to sever or not sever a surplus house on any given farm.

Severances have almost nothing to do with farm land values, supply management does.

Why do farmers constantly focus on the trivial and/or the irrelevancies, but ignore the real issues? It's like concentrating on a broken fingernail instead of admitting that the patient has cancer.

Stephen Thompson, Clinton ON

Over 5 years ago a young family bought a house that had been severed from the 50 acre farm it is surrounded by a few decades ago. Last year the owners of the farm decided to sell, and the young couple purchased the farm also.
So the question becomes, if the farm had not been separated from the house would the couple have been willing to pay the price they paid for the farm, added on top of the price they paid for the house?
Of course they would have, because, the fact is they did.

Raube Beuerman

Editor: comment will be published if name and telephone number are supplied. Telephone number will not be published but is needed to verify identity.

My parents sold quota and surplus housing. I just want to be able to farm in Huron County, but they won't give me the money. So Will!

Perhaps allowing limited numbers of livestock on a severed farmstead lot would be a smart idea! This would preserve some buildings, and you are far more likely to attract understanding country type buyers who would be accepting and wanting the country lifestyle. Forcing a severance to be a residential lot only brings non sympathetic buyers into the community and they'd probably prefer living in a livestock free zone !

These people need to get their heads out of the sand . There are smells with agriculture . There are also amendments and practices that can be used to mitigate the smell .
The County of Perth proposed rules are not workable . Further the Perth Federation of Ag and OFA all need to wake up and get with the times . Maybe the County of Perth needs to be the next Green Belt . That worked really well for Ag didn't it !

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