By Michael Roberts
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By Patricia Calhoun
By William Breathes
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By Melanie Asmar
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By Michael Roberts
Robert Sanderman admits he is probably not what people have in mind when they think "family farmer." "I've always had a love of the land," he says. "But I'm really just an investor."
Most recently, Sanderman earned his real paycheck as a right-hand man to Phil Anschutz, running several of the Denver billionaire's more high-profile businesses, including professional soccer teams in Los Angeles, Chicago and New York. Now in semi-retirement, he watches over personal investments from his Cherry Hills Village home.
One of those is about 2,000 acres of irrigated and dry land in Kit Carson County that he purchased about fifteen years ago. "It's not been a very good investment," he says. "I've had a modest return, but nothing like the stock market." In fact, he adds, "Without federal assistance, there would have been no return. We are totally dependent on supports to keep it going."
Taxpayers have paid a fair amount of money to keep this particular investment of Sanderman's profitable. Over the past five years, he has collected just over $300,000 -- about $60,000 a year in federal subsidies.
In certain areas of the state, farms are less about what they can produce than what they can be sold for. Particularly along the Front Range, a farmer who doesn't sell to a developer is crazy. And forget about new farmers buying land for actual crop production.
"There is virtually no land in Larimer County that is sold at agricultural prices," says Wayne Rieger, executive director of the Larimer County Farm Service Agency. He adds that with real-estate prices hovering around $20,000 to $30,000 an acre, "there's not a farmer that buys just to farm."
Another result: Not many farmers own their own land. Rieger estimates that about three-quarters of the people who receive federal subsidies from Larimer County land do not live on their farms. Even in traditional farming hubs such as Yuma County, along the Nebraska border, non-local owners have left a big footprint.
"We have quite a bit of absentee ownership -- families who owned the ground and then passed away and then left the land to their kids," says Ronald Ohlson, Yuma County's FSA boss. "I got a lady who lives in Boston who owns land here." Another large Yuma County landowner/investor lives in Florida. "I don't know what he does," says Ohlson, who has held his job for two decades. "I've never seen the man." Naturally, high land prices attract people who have no intention of farming past the point at which it becomes more profitable to develop the property. In Adams County, for example, where property values have exploded since Denver International Airport was built, "a lot of our landowners are speculators who are waiting for the price to go up," admits the Farm Services Agency's Reeves.
Federal farm programs are based on who owns the land, not necessarily who works it. So while many recipients of federal agricultural subsidies are bona fide farmers with deep roots in the community -- longtime Bennett planters Kalcevic Sons cashes about $233,000 worth of government checks every year -- not everyone appears to be in it for the long haul.
Real-estate giant L.C. Fulenwider, for instance, has earned more than $166,000 since 1996 in farm price supports. And Van Schaack Holdings of Greeley, another land baron, has taken home about $176,000 worth of subsidies in recent years from farming land it owns around the new airport.
You could even make the case that the City and County of Denver is a speculator of sorts. After purchasing land for DIA, the city began leasing parcels back to area farmers; the agreements call for the city to collect a portion of the crop grown on the ground, which it then sells on the open market.
Still, Reeves notes that most of the subsidy checks go directly to City Hall -- about $317,000 in all since 1996. In one sense, that makes Wellington Webb the fourth-largest recipient of federal farm subsidies in the city.
The current farm bill will expire next year. Reformers seeking to adjust the unwieldy collection of federal giveaways in the next version have proposed several changes to the current system. Until several months ago, for example, when the measures were mostly negotiated out, it appeared as though greater conservation measures, such as paying farmers to take unsuitable land out of production, would play a larger role in a new farm bill.
Another subject lawmakers are toying with is subsidy caps -- that is, limiting the amount of taxpayer money a single farmer, or a single farm, can collect in a year. These would be aimed at producers who game the system for more money than they are entitled to. In recent weeks, the House and Senate have proposed different ceilings.
One tactic that hasn't been proposed for reform of farm-subsidy payments, however, is an income test. It's an idea that has occurred to many. "There's got to be some way to get this money to the people it's supposed to help," says Yuma County's Ohlson. And, in fact, it is a criterion used in some other federal agricultural-assistance programs.
For baseball owner/farmer Jerry McMorris, the question of whether a person as wealthy as he should get taxpayer handouts was already addressed once by such a program. In 1995, according to Laramie County's Rieger, McMorris applied for a federal disaster relief grant for his cattle operation after drought depleted the grazing land on his spread.