Meet the Farmers in the Dell

July 1, 2010 03:20 PM
 

The farmer takes a wife. The wife takes a child… The nursery rhyme is tailor-made for the farmers in the Dell family. Four generations currently depend on the Westminster, Md., family farm that is, believe it or not, located in a dell about 30 miles west of Baltimore.

The family’s 2,300 acres of rolling farmland spills over into a 160-cow dairy located in a dip of a valley that is as picturesque as it is historic. An occasional Civil War relic still turns up in the soil here.

Now this family is engaged in an attempt to make sure their own farming history continues. The Dell family applied and was selected to be included in the Farm Journal Legacy Project, embarking on an effort that is part therapy, part analysis and ultimately all about planning and implementing a farm transition plan that spans six separate families.

Kevin Spafford, Farm Journal succession planning expert, met with the entire Dell clan in summer 2009 to begin a customized process of transition and succession. Since then, FARM JOURNAL magazine has been reporting on the progress made as the Dells explore the visions and goals for their farm and families.

"Every farm family has their own story, but the Dells’ complex family makeup is not unlike many farm Gary and Crystal Dell Tommy Dell, Greg Dell, Kevin Spafford and Roger Dell families that are great at going to work each day. They’ve been terrific at transferring the love of farming to multiple family members, but, as often happens, they found themselves faltering when planning for what comes next," Spafford says. "The thing that impressed me is how united they are in their willingness to tackle this chore. That is a huge first step."

MEET THE FAMILY. Greg Dell’s application letter to FARM JOURNAL tells the tale: "My brother and I are the owners of the business corporation, but my father and mother are still part of an older corporation that owns the home farm. I have three sons involved in the operation that are not owners yet.

"We have talked to lawyers and financial experts, trying to come up with a succession plan. We have never gotten any concrete directions. They always seem to just stall out."

Donald (age 85) and Leona (age 81) Dell are the farm founders. Leona serves as secretary/treasurer of the business. They would like to pass on their shares, but they still need income to live comfortably.

Their sons are Roger (age 61) and Greg (age 59) Dell. Both of their wives are supportive but are not active in the daily management of the farm.

Greg would like to take over the operation and come up with a plan for his sons to become more financially involved. Roger wants to retire and sell his business assets to Greg. Roger’s two sons have no active interest in the farm. Donald and Leona’s daughter, Donna Armacost, lives nearby, but has no ownership in the current farm operation.

The third generation of farmers is made up of Greg’s children. Gary and his wife, Crystal, operate the dairy and are interested in buying the cowherd and renting the barns and equipment. Middle son Tommy manages the crop operation. He’s not interested in the dairy, but he raises a few beef cattle and is interested in selling seed corn.

The youngest, Douglas, worked full-time on the farm, but as the economy tightened and opportunity presented itself, he become a full-time firefighter. He works on the farm on an hourly basis on his days off and still has a passionate interest in the farm.

"All of us want the operation to continue, we just don’t know how or where to start," Greg wrote. "Because of the complicated setup, we have found it is hard to find help that isn’t as confused as we are. Oh, yeah … we have nine grandchildren (six of them grandsons) that are already interested in farming."

SITTING DOWN. While the family frequently eats together and even plays together, they found themselves a bit chagrined to realize they have never taken the time to sit down as a group to honestly express their hopes and dreams for themselves and the farm.

"We really like each other," Tommy says. "Our kids go to school together, and we’re able to put the work aside to enjoy each other in the off hours."

Still, underneath, currents of concern about the future have been eating away at this resilient family.

"If we have a fight, it might last five minutes," Roger says of his relationship with his brother, Greg.

"Now, we have a lot more people with a lot of different personalities, coupled with urban encroachment and a dicey economy. I’ll admit I was dreading this part of the process. I wasn’t sure I wanted to open the wound because I feared how bloody it might get."

With Spafford’s encouragement, pent-up emotions came tumbling forth—both in the group setting and in private individual sessions. "This has to happen," Spafford says. "The more things we get on the table, the better we can plan. Hope is not a plan."

HEIGH-HO. In the Dells’ case, the dairy stands alone as the most contentious issue. Not only is the enterprise bleeding red during this tumultuous period of milk surpluses, but it also turns out that of the current active partners, only Gary and Crystal genuinely like working with the cows. Like true dairymen, they know their cows as well as their own children and the thought of letting them go is wrenching. They’ve worked hard to build the genetics of this herd into one of the best in the nation.

No one slept well the night following the venting, Greg admits. In the days following the initial meeting, each family member completed the necessary homework, which dealt with financial numbers and personal data, to give Spafford insight on how the family should move forward.

"The thing the Dells must remember is not to get trapped by what they can’t do. They have to start with what they can do," Spafford says.

"There will have to be sacrifices by all concerned," he adds. "I’m not sure what they will look like yet, but we always plan using three basic assumptions:

"The family operation must remain a viable business. We cannot compromise the integrity of the operation. Succession planning must enhance the family’s financial security, and the operation must continue to grow and develop as the next generation assumes an ownership role."


Primary Issues facing the Dells:

Kevin Spafford, Farm Journal succession planning expert, sees these five issues facing the Dell family as they move toward transition:

1. Is the next generation (Gary, Tommy and Douglas) prepared for the responsibilities of ownership? Do they have the skills and abilities to grow the operation?

2. Is the operation viable and in a position that will enable it to continue to grow?

3. Families are composites of many individuals, and succession is predicated on common goals and objectives. Can they define and agree on common family goals and objectives?

4. Will the operation support the income needs of retiring family members (Donald, Leona and Roger) and provide capital for growth and financial security for the active family members who plan to continue farming?

5. Can they manage change in the face of a challenging and dynamic economy?


What the Legacy Project Means to the Dell Family

Greg Dell had read all the statistics. Less than 10% of the family farms in the U.S. successfully pass to the third generation. The three leading causes: inadequate estate planning, insufficient capitalization and failure to prepare the next generation. He vowed his family would make it past the third-generation curse. It would endure.

"We kept trying to sort things out, but the issues just kept growing as more family came into the operation. The whole thought of transition and succession had become an overwhelming chore. We were lost and knew it but didn’t know where to turn. "

"Writing a letter asking for help wasn’t easy. We’re not the type to seek out national attention. Still, FARM JOURNAL’s offer to provide professional help to sort through the many details of passing down the farm seemed tailormade. Perhaps other families will read of our situation and it will help them too. That is one of the real side benefits of this project for us. "

"Tackling the issues in steps has been a huge help. Before, we often fell into ‘chicken-and-egg’ scenarios. We couldn’t seem to find an answer to one problem without it influencing another. "

"The Legacy Project has helped organize us. We have most of the first- and second-generation transfers resolved and are now moving onto the third generation. We’re on our way. "

 

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