multiple year farm transition & estate planning: program outcomes & impacts through...
DESCRIPTION
Multiple Year Farm Transition & Estate Planning: Program Outcomes & Impacts Through Evaluation . Gary A. Hachfeld Extension Educator - Ag Business Management Triennial Conference Overland Park, KS. June 9-13, 2013. Program Goals. - PowerPoint PPT PresentationTRANSCRIPT
Copyright © 2013 University of Minnesota. All Rights Reserved
Multiple Year Farm Transition &
Estate Planning: Program Outcomes & Impacts
Through Evaluation Gary A. Hachfeld
Extension Educator - Ag Business ManagementTriennial ConferenceOverland Park, KS.
June 9-13, 2013
Copyright © 2013 University of Minnesota. All Rights Reserved
Program Goals
• Introduce farm/ranch families to business transition & personal estate planning laws, rules, terminology, risk management issues, etc.
• Outline strategies & procedures they might consider using when developing & implementing a business transition & personal estate plan.
• Farm/ranch family take new knowledge and confidence and develop & implement a business transition and personal estate plan.
Copyright © 2013 University of Minnesota. All Rights Reserved
Delivery, Materials & Marketing• Face-to-Face workshop setting – PowerPoint slides• Workbook:
- PowerPoint slides- 27 detailed information sheets- Participant worksheets- Internet resources
• “Sponsorship Model”- Market to local business sponsors- Sponsor pays U of MN a program fee. Sponsor selects date, time, location, recruits participants, pays all
additional costs.
Copyright © 2013 University of Minnesota. All Rights Reserved
Program Outline• Topics discussed:
- Preparing to transition the farm/ranch business (goals)- Tax considerations & risk management issues- Overview of business transition strategies- Financial considerations- Estate planning issues- Treatment of heirs and intergenerational communications- Financial assistance- Developing a written transition plan
Copyright © 2013 University of Minnesota. All Rights Reserved
Evaluative Methodology• Stage 1: End-of-Meeting evaluations:
- Each participant is asked to complete a one page evaluation following each workshop:
♦ Focus on increased understanding of key educational points.
♦ Status of business transition & estate planning.
• Stage 2: Follow-up evaluation six months following last workshop:
- Mailed to participants with return envelope: ♦ Focus on progress toward developing & implementing business transition and personal estate plan. ♦ Obstacles and challenges encountered.
Copyright © 2013 University of Minnesota. All Rights Reserved
Participant Demographics2004 - 2012
• Programs delivered in MN, ND, IA, & WI.• 5,069 total attendees• 2,503 farms/ranches represented• 1,381 local communities
represented• 222 local program sponsors
involved• Total number of workshops - 134• 84.9% had no business transition plan• 69.3% had no personal estate plan• Age range: 22 to 89 yrs., 56.3% over age 55• 60.6% male and 39.4% female
Copyright © 2013 University of Minnesota. All Rights Reserved
End-of-Meeting EvaluationCumulative Results
2004 - 2012
Participant’s Self-Reporting Whether Their Understanding of Educational Points Increased Due to
Attending a Workshop (2004 – 2012)*
* Used Likert Scale with 1 = “Strongly Disagree’ to 5 = “Strongly Agree”
Educational Points MedianScore
AverageScore
StandardDeviation
% Indicating“Strongly
Agree”Or “Agree”
N
Understanding of the need for clear goals & communication in the transition process.
5
4.52
0.53
98.9% 2755
Greater understanding of strategies available for use in the transition process.
4
4.25
0.55
93.8% 2755
Importance of assessing the financial strength of the business before the transition.
4
4.37
0.58
96.3%
2755
Greater understanding of tax issues related to the transition process.
4
4.20
0.63
89.8% 2755
Greater understanding of personal estate planning issues.
4
4.29
0.59
91.8% 2755
Copyright © 2013 University of Minnesota. All Rights Reserved
Follow-up EvaluationCumulative Results
2004 - 2012
Number/Percentage of Farm/Ranch Units Starting/Completing Business Transition & Personal
Estate Plan (2004 – 2012)*
Years/States Task
2004-06(MN)
2006-07(MN)
2007-08(MN, ND,WI, IA)
2008-09(MN,
ND, IA)
2009-10(MN,
ND, IA)2010-11
(MN)2011-12
(MN)Total
NumberBusinesses
Started BusinessTransition Plan
94(59.1%)
84(61.8%)
77(72.9%)
65(67.2%)
63(68.5%)
85(78.0%)
204(70.6%) 672
Completed & Implemented Business Transition Plan
19(12.1%)
16(12.2%)
16(15.7%)
21(22.2%)
17(27.0%)
27(31.8%)
63(30.9%) 179
Started Personal Estate Plan
90(57.1%)
92(67.2%)
83(79.2%)
68(70.2%)
60(65.2%)
83(76.1%)
226(78.2%) 702
Completed & Implemented Personal Estate Plan
11
(6.9%)
19
(14.4%)
18
(17.1%)
22
(23.4%)
16
(26.7%)
26
(31.3%)83
(38.1%)195
* Number & Percentage of Those Returning Follow-Up Evaluations Only.
Copyright © 2013 University of Minnesota. All Rights Reserved
Asset Valuesfor
Economic ImpactCumulative Results
2004 - 2012
Average Asset Values Farm/Ranch & Non-Farm/Ranch Assets by Year
(2004 – 2012)
Data Source: 1- FINBIN Data Base, Center for Farm Financial Management, U of M , St. Paul, MN. 2- Iowa State University Farm Business Summary
AverageAsset Values
2004-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
BusinessAssets
$1,136,249
$1,232,898
$1,373,612
$1,723,537
$1,689,609
$1,970,866 $2,139,431
Non-BusinessAssets
$160,859 $173,344 $197,068 $177,904 $187,714 $205,131 $211,845
Copyright © 2013 University of Minnesota. All Rights Reserved
Economic ImpactCumulative Results by Year
2004 - 2012
Economic Impact Due to Having an Orderly Process for the
Transition of Farm/Ranch & Non-Farm/Ranch Assets
Asset Type & Totals
2004-06
2006-07
2007-08
2008-09
2009-10
2010-11 2011-12
Business Assets
$21.6 mil
$19.7 mil
$22.0 mil
$36.2 mil
$28.7 mil
$53.2 mil $134.8 mil
Non-Business Assets
$1.8 mil
$3.3 mil
$3.6 mil
$3.9 mil
$3.0 mil
$5.3 mil $17.6 mil
Total Business& Non-Business Assets
$23.4 mil $23.0 mil $25.6 mil $40.1 mil $31.7 mil $58.5 mil $152.4 mil
$354.7 Million DollarsProgram Impact
Based Upon Having ImplementedAn Orderly Process For
Asset Transition To The Next Generation
Copyright © 2013 University of Minnesota. All Rights Reserved
Cost – Benefit Analysis
• Total program cost 8 year period = $224,099• Includes staff salary & benefits (prep, travel, presentation, & evaluation time), mileage expense, lodging expense and participant materials.
• Total program revenue 8 year period = $172,099• Includes $93,656 sponsorship fees. • Includes $78,443 of grant funds.
• Net program cost 8 year period = $52,000.
Copyright © 2013 University of Minnesota. All Rights Reserved
Cost – Benefit Analysis
• For every net dollar of program cost spent, we generated $6,821 in financial impact !
• Rate of Return on Investment was equal to 608,015 %
Copyright © 2013 University of Minnesota. All Rights Reserved
Cost – Benefit Analysis
• My next “So What” Question?
“What is the public value of this program?”
Copyright © 2013 University of Minnesota. All Rights Reserved
What Have We Learned?◘ Is a universal issue regardless of business, location, age, etc.◘ Program demand continues to grow.◘ “Sponsorship Model” has strengthened our working
relationships with local businesses leading to other opportunities plus enabling us to generate revenue.
◘ Works very well not having attorneys present material.◘ Participants state the workbook is a valuable resource.◘ Evaluative data shows participant behavioral change based
upon knowledge increase of subject matter (outcomes).◘ Evaluative data shows significant economic impact resulting
from the program effort (impacts).
Copyright © 2013 University of Minnesota. All Rights Reserved
Contact Information
Gary A. HachfeldExtension Educator
Agricultural Business ManagementUniversity of Minnesota Extension
Copyright © 2013 University of Minnesota. All Rights Reserved
Questions ? ? ?
Comments ! ! !