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Marin Ranchers Struggle to Pass Legacy to Next Generation
Rob Rogers, Marin Independent Journal
January 6, 2007

It's nearly the end of school vacation week, and Brigid Lunny's two brothers are skiing in Lake Tahoe. Lunny, however, is managing the little retail store at her family's cattle ranch and oyster farm in Inverness.

It's hard work, but the 19-year-old Santa Rosa Junior College student doesn't mind. After all, she says, someone has to stay home to mind the farm.

"Patrick, one of my brothers, and I like ranch work, although he's more interested in the construction company," said Lunny, a triplet. "Sean doesn't like the ranch. He's hoping to work in electronics. I'm hoping to work here, on the ranch, doing whatever needs to be taken care of. It's nice here. And I want to do it for my dad."

Lunny's father, Kevin, owns the Drake's Bay Family Farms on land his family has managed for four generations. He's hoping that one or more of his children will continue that tradition.

"You want to keep the land in agriculture for the next generation," Lunny said. "But providing food in Marin County is very, very expensive. You have to live with increasing land value, while the capital you need for land use continues to rise. The choice that's left for ranchers with large pieces of property is, does the next generation want to stay and produce food in Marin, or do they decide to sell the property to develop houses?"

The problem of intergenerational transfer - passing the farm from one family member to another - is as old as agriculture itself. But farmers and ranchers on the 169,000 acres of agricultural land in Marin County face problems that are unique to the area.

In their lifetimes, most of Marin's farmers have watched development transform an isolated rural community into an area that's practically a suburb of San Francisco. Demand for land has driven their property values sky-high, while the rising costs of feed and other farm supplies - and the falling price of milk, beef and other agricultural products - have made it impossible for local farmers to compete with those in other parts of the country.

"We're competing with large farms from areas that have a low cost of living and a low cost of land," Kevin Lunny said. "We're trying to make it work in Marin, where we have family farms of three and four generations with a high cost of living and a high cost of land. So we're looking for ways to add value to the product."

And while 60 percent of Marin farmers are working on a succession plan, more than a quarter - 29 percent - do not have a single family member interested in continuing to work on the farm, according to a 2002 University of California survey.

"There's a risk that a farm might sell out to movie stars," said Steve Quirt, sustainable agriculture coordinator for the University of California Cooperative Extension in Novato. "When that happens, it takes the land completely out of agriculture."

County officials want to keep Marin's family farms in business, and they've taken steps to ensure the county's historic ranches don't become estates for the rich and famous. The county's zoning laws, for example, allow the construction of only one house for every 60 acres of agricultural land. A proposed change to the countywide plan would go even further, limiting the size of agricultural homes to 2,500 square feet.

Environmental groups say the change is needed to keep wealthy landowners from thwarting the intent of agricultural zoning.

"There has been a tendency to allow houses of excessive size, which we think is really not consistent with agricultural use," said Marjorie Macris, an executive committee member of the Sierra Club's Marin Group.

But Quirt and other farming advocates worry that the county's strict zoning laws and environmental regulations could prevent farmers from making the kinds of changes to their property that will allow them to stay in business, and pass the farm along to the next generation.

"Regulation keeps development out of the county, which we like," Quirt said. "But we have such strict environmental and regulatory systems that most of our farmers don't have the money, the political guile, or the skills to be able to get what they want."

County officials and other organizations are doing what they can to keep those farms in business. The Marin Agricultural Land Trust purchases development rights from farmers, allowing them to continue farming while reducing their tax burden.

"My mother was one of the founders of the land trust," said Albert Straus, owner of the Straus Family Creamery in Point Reyes Station. "We were able to sell the development rights to MALT, and I was able to inherit the farm and pay less in taxes."

The county also offers estate planning seminars to help farming families avoid the crushing financial costs that can come with the death of a property owner.

"One issue is the estate tax," county Supervisor Steve Kinsey said. "The other issue is internal pressure within families to sell out. There might be three or four kids, and only one of them wants to stay on the ranch. That one child has to pay out to the others, who also want their part of the inheritance, and also pay taxes. He or she is really stuck."

Those kinds of financial disputes can divide families, placing the future of the farm in jeopardy.

"It's never easy," Straus said. "But we made it through, and we're all still together."

Historically, Marin's agricultural lands have been dairy farms. The county's 29 dairies still generate about 65 percent of Marin's agricultural output, which totaled $53 million in 2005.

But years of rock-bottom milk prices have convinced many ranchers that they need to try something different to stay in business.

"We interviewed 15 large land operators last spring," Quirt said. "Of the 15, only two were making a living from their cattle alone. The others were doing a range of other things - construction, working for insurance companies, hauling - to be able to keep their land. The answer for some has been to make changes to their agriculture."

At least 29 percent of Marin's agricultural properties have added a new enterprise to their operation, according to the 2002 University of California survey. Even when the financial future of a farm isn't at stake, many farmers feel compelled to diversify their operations to keep their children interested in the business.

"These kids come in, after spending $100,000 on an education, and they're supposed to make $30,000 a year helping dad? Forget about it," Quirt said.

Working on a dairy farm, for example, had little appeal to the four daughters of Point Reyes rancher Bob Giacomini.

"None of us live here. We all went to college; we all had sales careers," Karen Giacomini said. "I don't think any of us expected to come back."

What convinced Karen, Lynn, Jill and Diana Giacomini to return to the family's 100-year-old farming business was the opportunity to reinvent it as a producer of gourmet cheese.

"We wanted to develop and sell a value-added product to the customer," Karen Giacomini said. "We talked to chefs and restaurants about what they were missing from their cheese table, in terms of locally made products. It turns out that there's no blue cheese made in California."

Today, Point Reyes Original Blue Cheese has made the Giacomini family famous in gourmet food circles - and made the family ranch a model for other farmers looking for ways to make their business viable. The county has offered its support to ventures like the Giacominis', as has the University of California Extension, which will host a workshop on innovative marketing for agricultural producers on Feb. 15 in Point Reyes.

But those options aren't available to all farmers. At Drake's Bay Family Farms, for example, Kevin Lunny said he'd never be able to build a cheese processing plant, even if he wanted to.

"We'd be told no," Lunny said. "I'm confident of that."

That's because Lunny's family farm has been a part of the Point Reyes National Seashore since the late 1970s.

"It would be nice for us to be able to rebuild our infrastructure, to give the kids a place to stay and get their help on the ranch," Lunny said. "But we only have a five-year land-use permit for agriculture, and there are no guarantees of renewal."

So Lunny made one of the only major changes to his business the federal government would allow: he became the first cattle rancher in Marin County to operate an organic herd.

"It's a challenge, but it's not impossible," Lunny said. "It takes three years for your pasture to become organic. And even then, your beef cattle don't become organic overnight. It's not until your next generation of calves."

As of September 2006, almost 14,000 of Marin's 169,000 agricultural acres and 47 of its 254 farmers were certified organic, according to county reports.

"It's better for the environment, better in terms of biodiversity," Lunny said. "And it's good for making the next generation want to be here."

Organic milk, beef and other products can provide ranches with as much as twice the profits as those that are conventionally raised. But "going organic" can be a long, difficult process requiring patience, capital and a lot of paperwork. Many ranchers aren't sure if it's worth the effort.

"I think that's something the young people are doing," said rancher Al Ponchia. "And by the young people, I mean people in their 40s and 50s, as opposed to those in their 70s and 80s."

The average age of a Marin farmer was 54 in 2002, according to a University of California Extension survey. For many of those farmers, with an average 33 years of experience in the field, the most difficult part of turning the farm over to the next generation is turning the farm over to the next generation.

"My son, Warren, was living in Sacramento about two years ago," Ponchia said. "He and his wife made the expensive decision to move back to Marin County. They were willing to make the commitment if he could get into the business out here.

"We met midway, in Napa. Spent two hours talking about it," Ponchia continued. "At the time, I felt I wasn't ready. But I thought, what if my wife and I have to do this by ourselves? But we made the commitment, and he made the move from Sacramento."

Today, Ponchia and his son are co-owners of a portion of his ranch. The younger Ponchia makes regular visits to the ranch - sometimes for an hour or two every other day, sometimes for several days at a time - depending on the needs of the business.

"He has another job, in San Luis Obispo, and I don't want him to sacrifice it for this, because that's how he makes the majority of his family's money," Ponchia said. "But I think his heart is in this. I think he always loved being out here, being a rancher.

"It was my dream for him to do that," he added.

For Ponchia, as for many of Marin's ranchers, the desire to preserve the kind of lifestyle in which they grew up is what makes the struggle to keep the farm going worthwhile.

"I'm sure there are a lot of good kids raised in Manhattan," he said. "But I loved being brought up in the country. It was a wonderful life. Things have changed. The demographics, the culture have changed. But it's still a great place to raise kids."

Brigid Lunny agrees. Traveling from her home to Santa Rosa for school every day takes a long time, she said, but she wouldn't have it any other way.

"I definitely want to live in the country," she said. "I go to the city sometimes, but it's not my cup of tea. I'm not used to the traffic. There's a lot going on. It's really confusing."

And if she's lonely, sometimes, or if she wishes she could spend her afternoons hiking or playing or talking with her friends instead of working, Lunny can always listen to what the tourists and customers she serves have to say about her home.

"A lot of people come in, say how beautiful it is," said Lunny, looking out over the bay. "I grew up around it. I guess I don't see it."

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