Maine Farms for the Future Case Studies

Four case studies outlining the benefits Maine farms derived from participation the the Maine Farms for the Future program.

The Maine Farms for the Future program provides grants to farmers for developing farm business plans. Phase I grants provide services and expertise to develop a farm specific plan. Eligibility is limited to farmers who own five acres of land in production and under development pressure. Phase II grants provide funds to implement changes called for in the business plan.

Over the summer of 2006, Katie Benson visited with a number of farms that received Farms for the Future grants and documented some of the benefits those farms derived through participation in the Farms for the Future Process. Some of those case studies are below:

O’Donnell’s Farm John O’Donnell 445 South Monmouth Rd Monmouth, ME 04259

Farm Description O’Donnell’s Farm is an organic, grass-fed beef farm owned and operated by John O’Donnell in Monmouth, Maine. His 270 acres, barn and farmhouse were once used for a dairy operation before he purchased them in 1999. He spent his first few years on the farm researching ways in which he could use it as a profitable means to preserve the land. Noticing the demand for organic meat, John purchased his first Black Angus beef cows in 2001 to reach this growing niche market. Since then, he has built his herd to over 20 animals, reaching a customer base of 50 people in direct-to-consumer sales.

Farm Mission and Goals By 2003, John was looking to boost his production and sales. To do this, he planned to expand his production from seasonal to year round and to improve the genetics of his herd. He applied to Phase One of Farms for the Future in 2003 and was assigned to a seven-person advisory team to help him draft a business plan and explore his options for expansion.

Phase One of FFF: Exploring the Goals During Phase One business planning, John learned the implications of moving forward with his ideas. His part time job running his own computer-consulting firm leaves him less time for farm work, so expanding production would increase his labor costs. At that point, he was still using profit from his other business to offset the cost of farming, so an expansion might not have been the best means for reaching economical sustainability. The Phase One planning allowed John to refocus these objectives. Instead of concentrating on means of expansion, John began exploring ways to improve his already existing facility.

First, he analyzed the ratio of cows to acres, and concluded that by expanding the perimeter fencing around the pastures, he would have more flexibility for rotational grazing during the summer months. He also knew that he would need this extra space for future herd growth.

The next step was soil testing. With help from a team member, Ron Desrosiers, John found the areas on his land where the soil was ideal for harvesting hay and serving as pasture space. John would now be able to plan his grazing patterns by using a map that shows the areas where cows or heavy equipment would be damaging to the ground during wet months. This discovery, among the others brought up during his discussion with team members, lead to the need for a shelter.

Knowing that winter feeding is the most labor-intensive part of operating his farm, John concluded that a winter shelter would be needed if the farm would ever be able to sustain an expansion. It would also keep the cows off the wet ground during the winter and spring, which would maintain the soil’s prime condition for grazing months. A dry pack would keep the cows warm in the winter, and the manure would collect in one place, which would facilitate recycling. The concrete slab in front of the shelter would make it simple for John to feed out his round bales during the morning and afternoon.

Putting these new ideas into practice would better prepare John for a expansion in the future. He and his team went on to tailor plans for genetic improvements by developing the concept of herd performance testing. This introduced the idea of purchasing digital scales. By weighing his cows, John would be able to see which of them gained the most weight during a given period of time. He would use this information to keep his best animals for breeding.

Phase Two of FFF: Implementing Changes John applied for and received a Phase Two grant for $20,000, covering 25 percent of his $80,000 project. The bulk of his matching funds came from beef and hay sales, which allowed him to complete the project without borrowing money. He also entered into a farmland protection agreement with the Maine Department of Agriculture promising not to take his land out of agricultural use for five years.

John began executing these plans by expanding his perimeter fence to encompass an additional 30 acres to the original 100. He also fenced in two lanes between the pastures to ease the rotation process.

Before receiving the Phase Two grant, John’s shelter construction was already underway. He used the grant money to paint, install water and electric service, lay concrete and build an area to work on the animals. He also purchased digital scales, and is in the process of installing them.

Reaping the Benefits of FFF With the additional space in the pasture, John was able to expand his herd from 15 to 20 animals. Now, he plans his grazing patterns around the soil types, which enables him to preserve the land during the wet season. During this time, he keeps the herd in the winter shelter, which saves him from extensive labor and has a lasting impact on the land. Now, instead of struggling to place a round bale in front of unconstrained cows, it is easy for him to roll it out on the concrete slab in front of the shelter. The housing keeps the animals off the wet ground and it saves the tractor from running over the pasture to bring food to them. The dry pack keeps them warm and clean, and by spring, John will move the manure to a compost pad for recycling.

Taking the steps through the Farms for the Future program helped John make valuable decisions for the well-being of his farm. His business planning assistance gave him direction and helped him outline appropriate objectives, while the Phase Two funding helped him complete an important project that would make the farm sustainable for future growth.

Nezinscot Farm Gregg and Gloria Varney 284 Turner Center Rd Turner, ME 04282

Farm Description Gregg and Gloria Varney purchased their 330-acre farm in Turner from Gregg’s parents in 1987. Both raised on farms, the Varneys used their know-how to expand the once small dairy farm to a diversified operation that became one of the first in the state to be certified organic. Their herd now comprises 350 dairy and beef cows. Between 1990 and 1998, the Varney’s also acquired a flock of 12 sheep, meat birds (such as ducks and turkey), and pigs. In addition to the bulk dairy, they produce fiber and fiber products, eggs, poultry products, pork, veal, and chevon (goat meat).

For years, Gloria had practiced making cheese in a small pan in her kitchen and had completed internships in cheese making. The Varneys added a cheese room in 1994.

Each of their farm products are sold through their on-farm store, which began on the lower floor of the family farmhouse and was moved to a remodeled barn in 1995 in order to offer a wider variety of products. It boasts a kitchen for preparing fresh baked goods, a small café with a sitting area, and retail items such as meat, milk, cheese, eggs, jams, jellies, fiber products, and several other organic products made right on the farm.

Farm Mission and Goals: With a growing demand for her cheese, Gloria decided to focus the farm’s growth on the high-end artisanal cheese sector. Her goal was to replace her 30-gallon combination vat and pasteurizer with a combination 50-gallon vat and pasteurizer. This change would allow her to increase cheese production, but she would also need to increase her dairy production to do it. This meant expanding her existing 12-goat herd to 36. Another goal was to “make the fiber shop pay for itself”, and Gloria decided to boost fiber production and sales. A purchase of 24 sheep would increase her herd size to 44. With these objectives in mind, Gloria planned that the farm’s profit margin would increase by 50 percent.

Phase One of FFF: Exploring the Goals Upon entering Phase One in September 2004, Gloria received business planning assistance from her advisory team. “Because we run such a diverse farm, we never had a true cost per pound,” she said, explaining that the team helped with the logistics of business planning and budgeting.

One of Gloria’s team members also introduced her to Josep Cuixart, a Spanish cheese maker. She learned through him that European cheese makers are seeking to trademark their brands. With this in mind, she started to come up with her own brand names so that she would be better prepared for this change. They worked together to perfect her cheese, giving it a flavor that would be distinct to Nezinscot Farm

As she researched cheese-making equipment, Gloria discovered that a larger machine would still allow her to make small batches, thereby giving her more flexibility in the timing, type, and amount of cheese making she could schedule. Additionally, a larger cheese vat could be converted to also pasteurize milk. A 100-gallon combination vat and pasteurizer would make her production double from what she initially planned. Gloria also decided to convert it in a way that would enable it to automatically stir the cheese during pasteurization, which would free her to invest that time in other farm enterprises.

Phase Two of FFF: Implementing Change: In April 2005, the Varney’s received a $25,000 Farms for the Future grant. They used $83,500 of their own funds from CSA shares, owner and vendor financing, and a $10,000 loan to cover over 75 percent of their costs. They also entered into a farmland protection agreement with the Maine Department of Agriculture promising not to take the land out of agricultural use before the year 2010.

With this money, Gloria purchased the new equipment for her cheese room. She also bought six goats and expanded her 20-sheep herd to 60. Their own investments of time and money have been (and will be) used to expand the cheese room itself, streamlining the process and allowing more room for storage.

Reaping the Benefits: The Varney’s have replaced their smaller combination vat and pasteurizer and are working on converting the new 100-gallon vat to one that also pasteurizes and stirs the cheese. Their cost is not affected by this change. While a rainy season prevented the Varneys from launching the cheese room expansion, they have been able to improvise by converting a root cellar to a summer kitchen, allowing room for cheese packaging. They also got an outdoor furnace up and running which helped provide consistent temperatures throughout the farm store and cheese room – a critical factor in cheese making. As of spring 2006, Gloria is building her inventory of “Nezinscot” cheese. She has been contacted by a new wine store in New York City interested in an exclusive relationship with her, and by Associated Buyers, who are ready to distribute to a wide range of markets.

With the six extra goats, Gloria has been able to invest much more goat milk into her cheese, and plans to start using a larger portion of the organic cow milk for cheese production.

The sheep herd expansion has added to the Varneys meat and fiber sales. She sells her own natural and dyed yarn and wool, and offers courses in spinning, weaving and felt making. A new crossbreed of sheep gives her the softness of Merino wool but without the extra lanolin, which significantly reduces processing costs. Gloria is also dyeing wool, which adds significant value to each skein sold.

The Varney’s are looking forward to the upcoming season when they can continue moving forward to become more economically sustainable.

Spring Fever Farm West Gardiner Beef Todd Pierce 143 Hinkley Rd West Gardiner, ME 04345

Farm Description Todd Pierce is the owner of two farm-based businesses in West Gardiner, Maine. Todd started Spring Fever Farm in 1995, after purchasing 35 acres of land adjoining his property. At that point, he also owned over half of West Gardiner Beef, a family owned butcher shop that has been in business for over 25 years. At Spring Fever Farm, Todd raises between 15 and 20 beef cows seasonally. He processes freezer beef, small feeder pigs, freezer hogs, roasting pigs and chickens at West Gardiner Beef. He provides both custom and state inspected services, which include: slaughtering, cutting, wrapping, freezing and old fashioned hickory smoking. After purchasing the remaining portion of the business, Todd is now the sole owner of both Spring Fever Farm and West Gardiner Beef.

Farm Mission and Goals After running the farm for ten years, Todd was looking to expand his herd in order to increase production. Not only was the demand for his products increasing, but Todd also knew that raising his own animals would give him more control over when he processes. At that point, he was relying solely on animals from other farms to run his butcher shop. Todd was also looking for ways to increase efficiency in the slaughterhouse, which would reduce labor costs. Becoming more efficient would give Todd time off from work, and would make the business more viable for the future transition to his son’s ownership.

Phase One of FFF: Exploring the Goals Todd was granted Phase One business planning assistance in the fall of 2004. He enrolled in “Tilling of the Soil,” a 12-session course on business planning. His son, to whom Todd hopes to pass on the business, also took the class. With this help, Todd was able to draft an organized business plan that would help him determine the practicality of his goals. One of the primary benefits of raising his own beef and swine is being able to control the timing and the quality of his finished product. When Todd can arrange his processing schedule around his own animals, he can ensure that each animal is processed quickly, aged for the correct amount of time, and out the door at the right time. Currently there are back-ups in scheduling and space at the busiest times of year, and while quality and safety come first, the cost of maintaining quality is high. If Todd could raise more of his own animals, he could rely on cash flow from processing during the less busy times of year.

The dairy barn on his property is not suitable for raising beef, so, in order to house more cattle, he would need to construct a shelter. He needed materials, excavation work, electrical work, and a labor force to complete the project.

He also wanted to purchase a Cry-O-Vac, which is a vacuum operated packaging machine. This would ease the packaging process in the butcher shop, requiring less manual labor. It would also meet a growing customer demand for airtight packaging, which will preserve the meat longer than the traditional white paper packages can. Todd applied to Phase One with these ideas already in mind. His extensive experience with the production and marketing aspects of his business meant that most of his team-based work centered on financial organization. His final three goals were: to expand his beef herd at Spring Fever Farm to 30, to build a 42x75 square foot barn in which to house them, and to purchase the Cry-O-Vac for West Gardiner Beef.

Phase Two of FFF: Implementing Changes In 2005, Todd entered into a farmland protection agreement with the Maine Department of Agriculture promising not to take the land out of agricultural use for five years. In exchange, he received a $15,000 Phase Two grant, which he matched 3:1 with farm income, farmer investments and a portion of a home equity loan that was taken out prior to beginning Phase One. He had intended to take out an additional $25,000 loan, but was able to cover the rest of his costs with personal savings.

He used a portion this money to purchase a $15,000 Cry-O-Vac. It was more expensive than the smaller machine he had intended to buy, but will seal ten packages at a time.

The rest of the money will go toward purchasing additional animals and financing the barn, which is projected to be completed by summer, 2006.

Reaping the benefits of FFF As of spring 2006, Todd is still in the process of building. The barn is mostly finished and is already housing his beef cattle. This spring, he will complete the roof and add an addition at the end of the barn to serve as a space to work on the animals. Once it is finished, he will be able to complete his herd expansion. His decision to start Spring Fever Farm transformed a piece of farmland that would have otherwise become residential property.

Todd has been using his Cry-O-Vac for a few months. Purchasing the Cry-O-Vac was necessary for Todd to meet the needs of his current customers, who are all satisfied with the new packaging. He has picked up a few additional customers who were specifically attracted to the new packaging. It also helped him to meet his labor efficiency goal. Now, instead of hand wrapping each product, one person can use the machine to wrap ten packages at a time.

The Farms for the Future project was necessary for Todd to improve efficiency of his two businesses. While he is not currently looking to attract a larger clientele, it remains paramount that he satisfies his existing customers. Purchasing the Cry-O-Vac not only met this need, but it is also helping him to save labor costs. This will make it easier to increase production when his new barn is complete. He will also see costs saved from raising his own animals to sell at retail prices instead of relying on other farms in order to run the butcher shop.

These changes are facilitating a growing interdependency between the two businesses, which is ultimately making each of them more viable.

Snafu Acres Ivan and Nancy Smith 259 Tillson Road Monmouth, ME 04259-7220

Farm Description Ivan Smith, a seventh generation farmer, and his wife, Nancy, a member of the Maine House of Representatives, are the owners of Snafu Acres Dairy Farm in Monmouth. Growing up working on his uncle’s dairy farm and helping his own family raise hay, corn, and beef, Ivan started his own farm on a rented milking facility over 15 years ago. Today, after completing their business plan and undergoing on-site construction, the Smith’s raise dairy, poultry, swine, veal and beef on their 21 acres of land. Ivan and his siblings own additional farmland through an LLC of which Ivan uses 120 acres for pastures and hayfields. They sell their locally processed meat, poultry and free-range eggs out of a freezer building next to their farmhouse and at a local farmers’ market.

Farm Mission and Goals In the late nineties, Nancy and Ivan were considering ways to make their dairy farm more viable. Nancy was interested in transitioning to organic and diversified farming, but the farm could barely bring in the revenue to cover their existing costs. With the milking facility two miles off property, and the pastures lacking adequate watering systems, labor was the primary limiting factor on the farm. Before the Smiths could anticipate an expansion of any kind, they would need to increase efficiency. The only hired help is several family members who fill in as needed. Nancy and Ivan do most of the production, marketing, and sales work themselves.

Phase One: Exploring the Goals Snafu Acres became one of the first farms to go through Phase One of Farms for the Future after submitting its application in 2001. The Smith’s met with their business planning team three to four times during Phase One to discuss ways to reduce labor and increase value on both farm sites.

One of the largest problems was efficiently getting water to the animals in the pasture once they were broken into smaller paddocks. At that point, Nancy was carrying five gallon buckets of water from the house to the poultry pasture daily. With an automatic watering system, she would save both time and energy, which would allow them to run the farm more efficiently.

As part of their desired expansion, the Smiths wanted to increase meat bird production. They researched the market for natural meats and found that the demand for their product not only existed, but was growing. They identified possible competitors, like local supermarkets, and explored ideas for their own retail space. Before this expansion could take place, the Smith’s decided that they would need to build additional portable housing to protect their flocks.

In addition to raising their own replacement heifers for the dairy herd, they wanted to raise bull calves for beef and veal. This would mean keeping the calves at birth instead of selling them, but to do so, they would need a place to house them.

Ivan and Nancy completed their business plan with the following goals for their farm: to build a heifer barn with water and electricity next to the farmhouse, to install watering systems for the pastures, and to build poultry housing. On their 35 acres of leased farmland, they would pave the driveway and extend the roof of the milking barn to reduce runoff. They would also expand rotational pasture and watering systems there. This would allow the Smiths to expand the rotational pastures, to get better use of the land. Note: the paving and roof overhang did not occur due to time constraints on the KCSWD program, so the money was re-allocated to another farm.

Phase Two: Implementing Change In 2002, Ivan and Nancy received a $25,000 Farms for the Future grant. With personal labor and additional investments, they matched a portion of the grant and used a grant from the Kennebec County Soil & Water District to cover the remaining expenses. The total match from the Smiths and KCSWD was 4:1 over the FFF grant. In exchange for the Farms for the Future grant, they entered into a farmland protection agreement with the Maine Department of Agriculture promising not to take the land out of agricultural use for ten years.

At the farm, Nancy contracted with the local high school vocational program to construct a building that would serve as a meat storage facility and small farm-stand. There wasn’t enough room inside the farmhouse to hold the four freezers she planned to use for storage. Through this agreement for the project, she was only required to pay for the building material and an additional 20 percent of its cost.

The Smith’s also saved money when they built the heifer barn. They bought a “hoop barn” kit for $20,000. Full construction costs were substantially less than for stick-built construction or a metal building. Shortly after the barn was completed, illness led Ivan to the decision to move his herd off the leased property and onto his own land. He and Nancy felt it would be easier to care for the animals if they were right next to the house. They would lose 35 acres of land, but they would also save $600 a month in rent. Instead of making renovations to the rented barn, they chose to build a milking facility on their own property, partially within the new heifer barn.

The Smith’s divided the land behind their farmhouse into seven pastures for rotational grazing and installed an automatic watering system. They built three portable chicken houses and increased their chicken and turkey flock size from 40 to 400.

Reaping the Benefits: With all of the animals on-site at the home farm, the Smiths save on land and barn rent and make labor more efficient. Now, they don’t have to travel to take care of the animals, and have downsized their dairy herd to fit the somewhat smaller landbase. Five years after starting the Farms for the Future program, they are ready to make the transition to an organic farm by having their milk certified as organic: a move that Ivan says will substantially increase farm viability.

This year, Nancy and Ivan will raise 800 to 1,000 meat birds. They will raise free-range turkeys for Morning Glory Natural Foods of Maine, as well as their own free-range chickens and turkeys to sell out of their farm stand. In addition, they are raising 30 hens for free-range eggs. Because of increasing demand, they made a $.50 price increase last year and now sell eggs for $3.00 per dozen.

They also started raising hogs. They take unwanted produce from a supermarket in Augusta, for feed supplementing with natural grains. The hogs are processed in Topsham and sold to local consumers. This year, instead of raising the new piglets to maturity, they will sell them to save space and feed costs.

Ivan’s one concern with the program is the rule change that occurred after the second round of applications. By decreasing the conservation easement obligation from ten years to five, the participating farmers are allowed to take a step back from the original commitment to the long term sustainability of farming in Maine.

For the Smiths, Farms for the Future has made all the difference. “Through the business planning process and the grant for 20 percent of the cost of required improvements, our farm is on much more solid footing. Because of FFF, we will continue to farm Ivan’s family’s land in a way that is financially and environmentally sustainable.”

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Maine Farms for the Future Case Studies

Four case studies outlining the benefits Maine farms derived from participation the the Maine Farms for the Future program.