For generations, area farmers have taken pride in working the land and creating a business to one day pass down to their children. With tough economic times and bad weather, some men and women are facing the reality that the family farm may die with them. A local attorney says he’s seeing more farmers file for bankruptcy than a typical year. Chapter 12 bankruptcy is a relatively new addition to bankruptcy laws. It allows family farmers to restructure their finances and avoid liquidation or foreclosure.
Sometimes it takes quick and steady fingers to make a piece of equipment work.
“Why can’t you just take this part?” Jonathan Hagena’s son asked him.
“I could, but then I’d spill fuel all over the place,” Hagena responded, while he was tinkering with a tractor.
Hagena hopes to take these lessons of hard work and perseverance and hand them down to his two sons, and, if they want, maybe pass down a family tradition.
“I think I’m the fifth, 1, 2, 3, 4, yeah, I’m the fifth generation,” Hagena said.
Hagena is well-aware farming has its ups and downs. He says with all of the rain, he’s only been able to plant 15% of his crop.
“It’s too late to plant corn and soybeans,” Hagena said.
While Hagena says this year isn’t easy, he considers himself lucky and says this year isn’t going to ruin him. Other farmers in the region are filing for bankruptcy.
“Last year was difficult. This year’s been devastating,” Clair Gerry, attorney, said.
Gerry handles restructuring and chapter 12 bankruptcy filings for farmers. He says typically he may see two or three per year. This year, he’s seen nearly 50 cases.
“It’s usually the family farms. It’s usually their dads, their grandpas and you’re looking at generations,” Gerry said.
Gerry says that last part takes a heavy emotional toll on the people who come to his office.
“They feel like the failure. I mean, their grandfather made it, their father made it. Why can’t they, you know? They’d always hoped to pass it on to the next generation. So, that’s probably the most difficult,” Gerry said.
While many in the area are hoping for some relief, Gerry says what we’re seeing now is similar to the farm crisis in the ’80s.
“It doesn’t look good for the near future,” Gerry said.
There are a few reasons why things are so bad. First of all, there’s the weather.
“You drive around the country, and all you see is water,” Gerry said.
Gerry says crop prices are down, inputs are up, land and rent prices are still maintaining. Opinions are split on President Trump’s tariffs. Supporters believe they’ll help farmers in the long run, but Gerry says the trade war isn’t helping farmers’ bottom lines right now.
“Makes the whole thing more difficult when all your costs stay up and the sale of crop prices are down,” Gerry said.
Restructuring farms may provide some farmers protection, but even then Gerry says filing chapter 12 has to first be a feasible option.
“If you restructure your debt, you still have to pay the restructured debt. If you take the equipment load that’s due in a three-year term and you stretch that out to a five, or six, or seven-year term, you still have to be able to make the payments,” Gerry said.
As for Hagena, he’s optimistic. He says prices are getting better.
“That gives us a better chance at next year being a good year. If we get it planted, and prices are good, that’s a good thing for us,” Hagena said.
Come what may, Hagena will have a few helping hands right there with him.