Green Horizons

As many long time Green Horizons readers know, we have been discussing the many issues involved with successfully transferring the family woodland to a new generation of owners. For some families, this could mean transferring it to one child, for others it could mean dealing with multiple heirs. For some families, it means transferring the farm outright, for other families, it may mean splitting some of the management roles between heirs, or donating a conservation easement on some or all of the ground. No matter what the specific objectives are, it always involves a host of somewhat complex legal and financial issues, as well as difficult inter-personal issues that are always present within successful families. We have been referring to this whole area of planning as “Succession Planning.”

In the last issue, Kirk Fine (the co-author of this column) began to detail an actual case study involving a Missouri family who is going through the succession planning process. This provides an excellent opportunity for Green Horizons readers to see how those family members are dealing with the specific financial, legal and emotional issues related to transferring this “heirloom” asset. In addition, it allows other Missouri timberland families to begin to think about their situation, their property, their objectives, and their heirs, and to make comparisons with the case study family.

Before Kirk resumes the case study in the next issue, I wanted to suggest a publication that may be useful to readers who are contemplating succession planning. Larry Godsey, an economist with the MU Center for Agroforestry, and I have written a guide, “Succession Planning for Woodland Owners”. This publication is meant to provide a thorough, but readable discussion of the “tools and techniques” of modern day timberland succession planning.

Timberland properties are unique assets – part financial, part legacy and part recreational. They are private assets, but have great societal benefits. Therefore, families have their hands full when trying to transfer the timberland to their heirs, while not sacrificing the specific aspects of the woodland that have become so vital to their lives, their families and their legacies. This guide addresses the various financial, legal and relationship issues, leading up to, and surrounding, a successful transition of timberland.

We hope this guide will make you more comfortable with the basics of succession planning, and will help to facilitate a conversation with your spouse, your heirs and/or your advisors. Hopefully, it will be a “stepping stone” for more in depth planning for your family timberland. We all know Missouri is blessed with a wonderful resource in its timberland. This resource provides wood, jobs, wildlife habitats, water filtration, carbon sequestration and recreation.

Succession planning is essential if families want to avoid forced sales, sub-divided property, development or mismanagement of the forestland. Hopefully, this guide will help to further true inter-generational stewardship of this great resource.

Material discussed herewith is meant for general illustration and/or informational purposes only, please note that individual situations can vary. This information is not intended to be a substitute for specific individual tax, legal or investment planning advice. Please consult a qualified professional for legal advice/ services.

David Watson is a financial advisor specializing in working with rural landowners, sportsmen and conservation-minded families. Securities offered through Royal Alliance Associates, Inc., Member FINRA & SIPC.

Advisory Services offered through Pines Wealth Management, LLC, a Registered Investment Advisor, and is not affiliated with Royal Alliance Associates.

For a FREE copy of Succession Planning for Woodland Owners, go to the MU Center of Agroforestry Web site: http://www.centerforagroforestry.org/pubs/index.asp#Planning The publication can be downloaded and printed as a PDF document or you can request a hard copy from Michelle Hall at 573-882-9866 or hallmich@missouri.edu.