Green Horizons

Regardless of the primary reason we own our woodlands (i.e. timber production, hunting, recreation) we soon learn they provide us much more in return. Managing and nurturing our forests quickly becomes part of who we are. There will come a time, however, that we will need to transfer the management and/or ownership to a new generation of woodland owners. For many of us, the intent is to transfer that property to our children and their families.

Planning for that succession of the family forest is as important, if not more so, than the timber stand improvement we do today. Statistically, most family-owned businesses of any type do not successfully make it to the second generation. Often, this is due to poor planning, and a poor understanding of the differences between the facts and circumstances surrounding the .rst and second generation of owners.

Understanding the Generation Gap
What makes you and your spouse tick may not be the same things that motivate your kids. They might not feel the same inherent attachment to the land as you do.

What allowed you to be successful as a tree farmer may not be present in the lives of your heirs. They may live far away from the woodland. With today’s hectic lifestyles, they may not have as much "free" time to spend working and recreating on the property.

Distance and varying lifestyles among the children may also lead to different perspectives and them not always seeing "eye-to-eye" with their siblings and fellow heirs on management matters. They might have differing recollections or interpretations of what mom and dad wanted.

Your children could be facing .nancial turbulence you never encountered. Divorce, college loans, healthcare issues, even extravagant lifestyles, might make that offer from a developer too tempting to pass up.

Finally, let’s not forget fear. Your kids might be harboring "silent" concerns or apprehensions about owning the woodland, especially if you never let them in on all the "fun."

Understanding and anticipating what pitfalls may challenge your plans to transfer ownership may be a little painful, but it may help to keep the family tree farm intact, and in the family.

An honest assessment of the strengths and weaknesses of your children, their lives and the world they live in may help you to craft a successful succession plan. Once you have done this assessment and built your plan, the fun part is communicating your plans and dreams to your loved ones.

Bridging the Communication Gap
When we think of estate planning, most of us see lawyers and financial advisers - we see stacks of complex documents and insurance policies. As important as these tools are, they only provide the framework for your transition to the next generation. They do not speak to your legacy. That can only be provided by you, the current owner. Without your vision and enthusiasm, the woodland may be nothing more than a .nancial asset to be liquidated when your heirs need cash.

Hold a Family Meeting. Arrange a date/time with all heirs (and spouses) to discuss the details of your vision statement, wills/trusts and timber management plan. Discuss why you made the plans you did, why this is important to you and what your dreams are for the woodland. Be honest. This is an important meeting, so minimize distractions by turning off the television and arranging for young children to spend the time with a friend or neighbor. Try to avoid having different meetings with different heirs. It is important for all heirs to hear the same things, in the same manner, at the same time.

Introduce Your Advisers to Your Heirs. Having some "face time" with your attorney, CPA, .nancial adviser, and your consulting forester will make everyone more comfortable with the plans you have laid out. Your heirs may be working with them in the future.

Encourage Questions and Concerns To Be Voiced. Whether it is during the family meeting, or in the weeks and months afterward, encourage open discussion of your heirs’ thoughts and feelings. It is important to have a two-way conversation about the woodland, and what the future holds.

Involve Your Heirs in the Tree Farm. Spending time with your heirs and their families is the best way to increase their understanding of the management of the woodland, as well as your passion for the woods. Remember, your excitement is contagious! Give them an opportunity to experience what you love and why you love it.

Talk About the "Business" Side of Owning a Woodland. Discuss with your heirs the costs and challenges of owning and managing timberland. Talk about future costs and management issues and how you will deal with them. Remember, someone in the future will have to be responsible for the business side of the woodland and not everyone is comfortable with these responsibilities.

Keep Your Heirs Up-to-date with Changes to Your Plans. Just because you made the plans does not necessarily mean you are going anywhere soon. You will probably own and control the woodland for years to come. Over that time, your family situation may change, and your plans may need to change too. Keep your heirs informed of your wishes. You may need to repeat some of the above steps, from time to time.

Communication is the "grease to the gears" of your estate plans. The investment of time and energy to doing good communication will pay off. This is your opportunity to leave a meaningful legacy to your family, and to safeguard the family forestland you love. You owe this to your woodland and you owe it to your family.

To successfully prepare heirs for the transfer of ownership, you must have your affairs in order. This includes:

• A written "vision" statement for the woodland
• Properly executed estate-planning documents (wills, trusts, healthcare directives,etc.)
• Adequate life insurance in place and funded
• An up-to-date Forest Management Plan

It takes a fair amount of time and effort to get these things in place. However, the above steps will not be worth a stand of honeylocust timber if your dreams, desires and passion are not clearly communicated to your heirs.