A century ago, wind mills pumped water on Iowa farms. Today, sophisticated wind turbines are a significant source of income for some rural landowners. Roger McEowen, an extension specialist at Iowa State University, says wind energy farming presents legal issues landowners need to carefully consider before entering into an agreement with developers.
McEowen says landowners are often concerned only with how soon the turbines will be put up and how soon they’ll get paid. He says, “and they don’t really pay much attention to the detail of these agreements and frankly, they should.” McEowen, who’s a professor of agricultural economics at I-S-U, says in many cases, the agreements need a lot of work and negotiation. He says some of the wind energy lease agreements being “peddled” around southwest Iowa are for up to 50-years, which could be detrimental to future generations of family farmers.
McEowen says, “You’re tying, in many respects, the hands of your heirs for quite some time out into the future and you really need to give good thought to just exactly what it is you’re signing.” He says before you sign anything, look at the property description, especially where it describes how much of the land is actually subject to the agreement.
McEowen says landowners should avoid a broad, legal property description. Instead, it should be as narrow as possible to allow the developer the bare minimum of space needed to erect a wind turbine. If more space is needed in the future, he says, that should be negotiated – for more money. He also says you need to have a firm grasp on how long the land that is subject to the agreement will be affected. He says there are several other issues that need to be addressed as well, before any contract is signed, especially for farmers involved in F-S-A and other federal programs.
They need to make sure their payments and benefits are not jeopardized by the installation of wind turbines. He says to find out about termination rights and what happens to the structures and facilities on your property once the agreement is terminated.
McEowen says above all, the agreement should never be entered into without having been reviewed by your attorney. A complete list of legal issues for landowners to consider can be found on the ISU Center for Agricultural Law and Taxation’s website: www.calt.iastate.edu.
18 September 2007
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