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Minnesota is cracking down on the increasing number of microfarmers, saying the agricultural tax rate break is being abused.
Susan Mecredy raises raspberries, pumpkins, tomatoes and other fruits and vegetables on a 10-acre, pick-your-own spread she calls Cherith Farms, near the Minnesota River Valley south of Belle Plaine.
So she was puzzled to get a letter this fall informing her that because her operation is so small, the state no longer considers her farm a farm -- and will raise her taxes accordingly.
"There are people with a lot more land than we have and don't do anything agricultural," she said. "We use every inch we have for some agricultural purpose."
Mecredy is caught up in a slow-motion state crackdown on people with small acreages who claim to be farming but aren't -- or who do so little of it that the tax break plainly wasn't meant for them. And that could be a lot of folks. The biggest Minnesota news to emerge from the most recent U.S. Census of agriculture was a sudden explosion in the number of microfarms -- usually 50 or fewer acres. With what one expert calls "non-farm farms" proliferating, county tax assessors have been striking back.
"There has been an abuse of the 'ag' class for a long period of time," said Scott County Auditor Cindy Geis.
In just five years, the numbers of Minnesota microfarms have spiked by 4,500 at a time when the number of farms in most size categories is shrinking.
The surge was especially notable in fast-growing metro-fringe counties such as Sherburne and Chisago, which saw substantial portions of land converted into microfarms.
"In this county and in others across the metro, we're seeing some pretty substantial executive homes worth half a million dollars to well over a million that are sitting on 10 acres, with two of them tilled, and a horse in a pen -- and they're going, 'Now we're a farmer,'" Geis said.
"When they get the letter, they call us and say, 'Do we have to get a cow? Because we will.' It's amazing."
Who is a farmer?
Technically, the new clampdown has arisen because some counties haven't been strictly enforcing the state law that says you need to have 10 contiguous acres farmed to get the tax break -- and must deduct the farmstead from the total.
While few disagree that some abuse is taking place, many microfarmers are outraged on two grounds:
In an era of farmers markets and chef-driven restaurants priding themselves on small, local and often organic providers, they say, a person can do meaningful farming on small plots of land.
For instance, a handful of acres supports entire immigrant families and others with supplemental income.
Even where the "ag" claim is dicier, they say, it's unfair for the government to pull a sudden switcheroo.
"When we moved out here, our Realtor told us we needed to have 10 acres to be 'ag,'" said Russ Balamut of Zimmerman, who admits his farming claim isn't as strong as some. "All of a sudden it's 'Poof!' They're pulling the rug out. They are devaluing my property."
Balamut contacted his legislator, Sen. Betsy Wergin, R-Princeton. Having been a county commissioner in the area for many years, Wergin sees it from both sides but does agree that legislators may need to take a second look.
"People hate to get these notices and I don't blame them," she said. "But the intent of the tax break is for rural ag. If you have a family tilling a 3-acre garden and taking it to a farmers market every spring, that's a substantial part of their living and that's ag. But if your barn is being used to house your collection of antique cars, that's not ag."
The problem in designing a law, she's quick to agree, is that it's not always clear what is ag and what isn't. Few hobby farmers make a living from it, but few "real" farmers rely on it entirely, either.
Of the state's nearly 81,000 properties whose owners consider them farms, the most recent federal farm census found that owners of 51,000 say that farming is their primary occupation and that just 11,000 earn all their income from farming.
For more than half -- 42,342 -- the farm accounts for less than a quarter of their income.
Taking small farms seriously
Then there's the matter of whether metro-fringe microfarms should be taken more seriously these days.
Geis, the Scott County auditor, says that in an era when conventional farmers are bulking up to enormous size, it's "almost laughable" to consider a 10-acre farm as real agriculture.
But Laura Kieser, a University of Minnesota extension agent in Scott County, said that ag extension agents are beginning to take small acreages more seriously.
"In fact I'm part of a group within extension, in counties around the Twin Cities area, who've been getting together and talking about that phenomenon and about how best to address the needs of small-acreage owners," she said.
"There are a whole bunch of clients out there looking for information on how best to utilize small acreage. The resources we have now are all for large production, and it shouldn't be that way."
In the end, the number of acres is no way to determine what makes a farm and what doesn't, said Leonard Anderson of Elk River, who also received a recent notice even though the bulk of his 10-acre property is in hay.
He said that he sees entire Hmong families making a living on 10 acres.
"Ten acres isn't any dividing line," he said. "It's a convenience for government bureaucrats, if they can get by with it. And if we don't protest, they're definitely going to get by with it."
David Peterson 612-673-4440
David Peterson dapeterson@startribune.com
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