With spring planting around the corner, it is a good idea to review the terms and conditions of any land rental agreements in addition to getting field equipment ready for the upcoming planting season. According to Michigan State University specialists, there are nine conditions that should be included in every cropland lease:
- Correct legal names of all parties - Be sure legal names of corporations are on rental agreements. For sole proprietors, be sure to list spouses . . . by doing so, as the renter or landlord, your spouse or other family member can take over the rental agreement should the primary party become incapacitated.
- Correct legal description of the farm and a map - Use the land's legal description and include maps, if possible. If any part of a tract will not be farmed, be sure to document that, as well.
- Start and end dates - Clearly indicate the start and end dates of the lease. If warranted, also indicate the absolute final harvest date.
- Rental payments - When and how will rent be paid? Be sure both are indicated in the contract. Include exact payment date(s) and how funds will be transferred.
- Conflict resolution - If the lease is silent on this matter, then it will be up to attorneys should a dispute arise between the renter and landlord.
- Facilities the landlord will provide in the rental agreement - If buildings, wells or irrigation equipment is involved, be sure it is detailed. Include who pays for utilities, maintenance or other related costs.
- Installation of capital improvements - As landlords age, renters might have a greater interest in updating land by tiling it or adding irrigation equipment. Be sure the rental agreements detail how those costs would be covered and reimbursed.
- Water use reporting - Some states such as Michigan and Virginia require that water use reports be filed with the state. A good lease agreement should cover who (landlord or renter) will complete and turn in the reports to the state.
- Hunting rights - For many people in rural America, hunting is an honored, family tradition. If the owner is going to retain hunting rights, be sure it's spelled out in the lease.
