A number of farmers are using creative ways to acquire capital for land acquisition, start-up and operation. At the same time, increasing numbers of individuals are exploring alternative investment vehicles and ways to help finance small businesses within communities.
The Guide to Financing the Community Supported Farm, published in 2012, details options and considerations for crafting unconventional financial arrangements that have been used in other sectors of the economy, but might be new to the agricultural sector. It addresses legal, accounting, environmental and social considerations relevant to pursuing customized financial agreements. It includes examples of farms who have used alternative financing.
Guide to Financing the Community Supported Farm
Please note: Since the guide’s publication, US tax law has changed as have some Vermont regulations. The guide is intended for educational purposes only, and does not constitute legal advice. Individuals remain fully responsible for their own management decisions and for compliance with all applicable laws and regulations, and are encouraged to consult independent legal and business counsel.
You can also download chapter by chapter below.
Chapter 1: Federal Securities Laws
Chapter 2: State Securities Laws
Chapter 3: Owner Financed Sales and Land Contracts
Chapter 4: Considerations for Dealing with Farmland Investors
Chapter 5: The Promissory Note
Chapter 6: Demystifying Equity Financing
Chapter 7: Revenue-Based Financing
Chapter 8: The “Multi-Year CSA” Financing Model
Chapter 9: The Share Lease Agreement
Appendices: Community Financing Theory, Profit vs Non-Profit and Different Ways of Raising Capital, Contract Basics and Sample Promissory Notes
Farm Case Studies: Bloomfield Farm, Highlighting Cohousing and Cooperative Land Ownership; Fair Food Farm, Highlighting Creative use of Promissory Notes; Bread and Butter Farm, Highlighting Purchasing the Farm and Community Financial Support; Sugar Mountain Farm, Highlighting Bootstrapping, Vendor Financing, Pre-buys and the Quest to Build On-Farm Slaughter Infrastructure.