Advancing the Economic and Environmental Sustainability of Farms in the Chesapeake Bay Watershed

Commodities

Practices

Our proposed project follows from a two-year participatory research and relationship building process with specialty crop producer and key related organizations in the Mid-Atlantic region. Our community of farmers identified farm viability as a significant concern, and a desire to expand their use of profitable conservation practices. To address these needs, we will pilot a project that engages 10 farmers across the Mid-Atlantic and offer free farm business planning services that incorporate a set of conservation management practices' potential financial impact within 5-year projection models. These plans will be paired with a flexible, $3,000 incentive aimed at reducing capital barriers to acting on plan recommendations or associated needs. We will follow with a social science evaluation-farmer interviews-to understand the project's impact per farmers' experiences, and farmer-to-farmer learning activities that will expand the impact of this project beyond our focal set of participants. Our project leverages existing relationships with Mid-Atlantic farmers, key organizations that serve as trusted advisors and brings together a new partnership of agriculture experts that will demonstrate the benefits of improved farm viability with a select cohort of farmers, while growing a wider network of influence to improve food systems in the long-term.

We aim to achieve our goals through an integrated approach. We will offer free farm business planning services that incorporate a set of conservation management practices' potential financial impact within 5-year projection models to 10 farmers across the Mid-Atlantic. These plans will be paired with a flexible incentive to reduce capital barriers to acting on plan recommendations. We will follow this with an evaluation to understand the project's impact per farmers' experiences. A diverse project advisory committee of representative farmers and advisors will review project progress annually and assess implementation funding decisions ad hoc. We describe this work below in more detail. See Figure 1 for workflow depiction. See Table 1 for our project timeline.

Figure 1: Workflow diagram

Table 1: Project Timeline

Objective 1: Provide 10 HU farmers across PA, MD, and DE, with a business plan tailored to their farm, that incorporates conservation management practice potentials.

Beginning in Year 1 of the project and continuing throughout our project duration (See Table 1 below), our project team will develop and deliver tailored farm business plans to participating producers. Specifically, we focus on engaging 10 HU specialty crop farmers across the Mid-Atlantic region (Maryland (MD), Delaware (DE), and Pennsylvania (PA)). Below we describe our engagement process.

Initial Outreach

Initial farmer outreach will leverage existing HU farmer contacts (over 25 HU specialty crop producers) and draw on our partner networks. University of Maryland Easter Shore (UMES)--an HBCU with a leading small-farms Extension program--and Around the Bay Farmers Alliance (ATBFA)--a non-profit organization focused on supporting community and local food system objectives through food production, aggregation, and access to markets--will together leverage existing HU farmer relationships, distribute a recruitment flier and hold informational meetings with their farmer-connections, who are primarily HU.

Business Planning Development

Once we have secured a participation agreement, our team will engage farmers in developing a business plan for their specific farming operation. Business planning will be a rolling process, where plan development begins as each new farmer agrees to participate. Project partner Horizon Farm Credit will lead farm business planning. Horizon Farm Credit is a leader in agricultural lending and agriculture business consulting, with specific expertise in small-farm business planning.

The business plans emerge from a detailed on-farm assessment of current practices, historical financial analysis, setting short- and long-term goals for the operation, an analysis of their strengths, weaknesses, opportunities, and threats, and financial projections for the operation. Projections will include (but not be limited to) future plans for conservation practice implementation, reduction/increase in costs related to these conservation practices, and any potential increases in yield due to improved soil health. Projections also incorporate financial statements for the next 5 years. Our project will cover the cost of business plan development through Farm Credit, which will also include connecting HU farmers with additional opportunities such as a Young Beginning and Small Farm lending specialist, funding opportunities, and potential grant resources in the future.

Assess Farm's Conservation Management Practice Adoption Potential

Running concurrently with business plan development, TNC will lead the implementation of on-farm assessments to establish each farm's potential for additional conservation practice adoption. We focus on assessing practices that are well established to provide economic and environmental benefits, matching farmers' expressed needs and ethical motivations. Based on our knowledge of local farm systems, we focus on the following three practices:

• Agroforestry, including silvopasture, windbreaks, and alley cropping.

• Nutrient Management Planning

• Cover crops

Farmers will select 1-3 conservation practices that they are interested in for their operation to incorporate into business plan projections (see below).

Business Plan and CMP Potential Projection Delivery

As a key deliverable resulting from CMP and business assessments, participating farmers will receive a custom business plan report that identifies areas for improvement on their farm, high-level market research, and 5-year projection scenarios that incorporate the hypothesized financial impact of adopting focal CMPs, as well as other farm-specific scenarios based on individual farmer's interests. These plans will be developed with farmers on a rolling basis and delivered as they are completed throughout the project duration. A Horizon Farm Credit staff member will conduct a facilitated review of the business plan with the primary operators on each farm, joined by a members of the project team and technical support experts as needed.

Objective 2: Support trial of business plan recommendation through $3,000 incentive

To support the implementation of business plan-identified opportunities, we provide each participating producer with a $3,000 "incentive" payment. The payment is intended to mitigate capital barriers to adoption. The payment must be directed at a plan-identified opportunity (infrastructure, equipment, etc.) or an associated need (e.g., accounting software) approved by the project advisory team, but otherwise can be used flexibly.

Anticipated Impacts

Our project activities are targeted at increasing the financial viability and environmental sustainability of specialty crop HU farms. These impacts--farm viability, management efficiency, and conservation--are community needs identified through our recent participatory research.

More specifically, business plans help farmers establish a clear understanding of their financial situation and identify potential ways to increase profits in the short and long term, in addition to other benefits (Camerson and Chamala 2004). Business plans are often required by major lending services and grant organizations, such as USDA FSA. Through supporting access to capital loans and the development of more profitable management approaches, business plans address key viability barriers identified by our population of HU producers.

Related to CMP adoption, our research suggests HU farmers in our region are motivated to increase CMP use but may be limited by financial concerns. Our intentional integration of CMP potential with business plan projection helps illuminate financial opportunities (or risks) associated with adoption, enabling farmers to make wise decisions.

Finally, our $3,000 flexible incentive supports farmers' efforts to implement plan-identified opportunities. By mitigating capital barriers in the short term, our project makes business planning and conservation assessments immediately beneficial.

Through our partners, UMES and ATBFA, we will develop and communicate key project success stories to broaden participation and the impact of our funding through farmer-to-farmer engagement.