Iowa Farmer Today 03-31-07 Development embraced by some By Hannah Fletcher, Iowa Farmer Today NORTH LIBERTY -- Clair Mekota has farmed on the fringes of North Liberty his whole life. Portions of his farm are in prime territory for expanded development in a city located between Cedar Rapids and Iowa City. Mekota took note as the city took an increasing interest in growth and more urbanites started living outside of metropolitan areas. “I served on the (City) Council in the late ’80s, early ’90s, so I kind of knew what was going on,” he says. Working for the city council, Mekota realized it would be a matter of time before some of his farmland would be eyed by developers. Mekota and his son, Jeff, decided to work with the city to develop 110 acres of their farm into a single-family housing project. The Mekotas worked with partners to help with initial costs and planning. “It wasn’t a hard decision,” he says. “The thing is you know it won’t be long because you’re attached to town and soon or later someone is going to take interest in that. “Either you do it or someone else down the road will reap the benefits.” This was not a get-rich design for Mekota, who later became mayor for 11⁄2 terms. He wanted a respectable development project, complete with larger lots, brickfront homes, high-pitched roofs and two trees in every yard. The results exceeded Mekota’s expectations. “I was really impressed with how it turned out. They really did a good job. I just provided the land,” he says. Mekota gained knowledge from the experience. “I taught myself as I went along,” he says. While continuing to farm a 1,100-acre corn and soybean operation and maintain a 70-head cow-calf herd, Mekota has more development plans. He hopes to develop farmland adjacent to the first project. In 2000, Mekota bought 115 acres near a neighboring city experiencing the similar development trends — Solon. That area will be used for commercial lots and single-family and multi-family housing. Lately, it is not uncommon for farmers to take advantage of development opportunities in their area, says Mark Edelman, director of the Community Vitality Center at Iowa State University “Not everybody would use the term encroaching development because a lot of people would love to see some economic development,” he says. Traveling through town, Mekota can point out projects he oversaw as mayor. Projects, such as a new day care center and medical center, add to the appeal of the community and provide tax money to city. While these new centers, housing developments and similar projects are on ground that was once farmland, he says the city should not discourage such progress. Not all farmers have to be intertwined with city government to recognize the need for land to be used for development near metropolitan areas. Similar to Mekota, many farmers see opportunity in developing their land or selling to developers. As mayor, Mekota says he witnessed little opposition from farmers neighboring city limits when new projects were purposed. Edelman says some farmers recognized the benefits of selling land at premium prices and jump at the opportunities. “Not all farmers are against development,” Edelman says. “Some farmers in the path of development will sell their land to be used as retirement at some point.” Older landowners may be particularly interested in selling land to developers, he says. The average age of landowners in Iowa is increasing. According to “Farmland Ownership and Tenure in Iowa 1982-2002: A TwentyYear Perspective,’’ an ISU study, 24 percent of farmland was owned by people over age 74 in 2002, which is double the amount reported in 1982. Nearly half of Iowa’s farmland is owned by people over the age of 65. But, others wishing to reap the benefits of development opportunities and continue farming comparable acres may want to consider a 1031 exchange, Edelman says. The 1031 exchanges allow landowners to exchange their farm for one of equivalent worth. In this case, farmers might be able to find land that is well outside the course of development but is worth less per acre. “You’ll find sharp business people who take a 1031 exchange and move outside the path of development and increase the size of their farm significantly,” Edelman says. “It is my understanding that a number of people have and continue to take advantage of 1031 exchanges,” he says. Some housing projects are stretching beyond city limits because of increasing interest in “living in the country,” Edelman says. In rural areas surrounding larger metropolitan areas, more people are interested living in the country because they are still able to commute to the city for work. “Our constitution guarantees us the right to the pursuit of happiness and people want to live in the country,” he says. “You’ll find housing developments that pop up in the countryside. In fact, you’ll find quite a few of them.” Edelman says farmers outside the fringes of city limits may also see interest from developers. Mekota has contributed only his land near the city for development. The rest of his farm, though still close to the city, remains designated for farming — his priority. Some of the profits from Mekota’s development projects have been used to add to his farming operation. He added a 160-acre farm his operation, which made up for the 110 acres sold for the project. “There has never been any interest in quitting farming. That is our No. 1 thing, and development always comes second,” he says.