December 05, 2007
Equalizing the Economic Playing and Farming Fields
by Anne Moore Odell
Equity Trust invests in farms, non-profits and communities, helping people take charge of their
Equity Trust wants to change the way that
you think about what it means to own and use land. Started in 1991, Equity Trust believes that
poverty in low-income communities is created, in part, from market forces and the absentee
ownership of property that sucks income out of these communities.
Equity Trust's staff and board recognize that when people in low-income communities are given
ownership over local resources, the cycle of poverty can be broken.
"Equity Trust wishes
to bring local control back to local resources," said Ellie Kastanopolous, President of Equity
Trust. "We believe that lasting economic change must involve all parts of our society, including
those who have the capacity to act as investors, and those who have traditionally been excluded
from many aspects of our economy."
Equity Trust, with headquarters in Turners Falls, MA,
helps communities all over the US hold onto farmland for future generations while respecting the
voices of the farmers whose lands are their biggest investments. Equity Trust also provides ideas,
the exchanges of information, and financing to community development and conservation projects. The
Trust offers individual and institutional investors a platform to invest in US communities and
organizations that embrace alternative land tenure models.
Relationships are basic to
economics in Equity Trust's model. Equity Trust's website explains that "economics is fundamentally
a web of relationships, the relationship of individuals to one another, the communities that we
live within, and the earth that sustains us. Economics is a material manifestation of the spirit,
character, and the quality of those relationships, a reflection of basic moral principles."
The Equity Trust Fund was created to support the work of grassroots groups trying out creative
community development ideas, with a particular focus on supporting innovative models relating to
the control, use and stewardship of land, mainly in the form of community land trusts. In addition
to financial help, Equity Trust provides borrowers with technical assistance as needed.
community land trust removes land from the market and holds the land in common, while individuals
own the buildings on the land. Unlike conservation land trusts, which acquire land to protect it
as open space, a community land trust is interested in preserving land for active community use,
including affordable housing, farms, schools, community centers, and/or businesses.
Equity Trust uses its Property & Values Program to talk about its mission and is key to the
other programs offered by Equity Trust. Speaking at conferences and workshops all over the US,
Equity Trust works to create dialogues towards greater economic equity. It also publishes on the
The Land Tenure Program invests in organizations that create affordable housing
and helps preserve farmland from being sold to developers and large factory farms, helping small
farmers to create "sustainable local food systems." To date, Equity Trust has received over $1.2
million from more than 1700 donations, ranging from $10 - $50,000, to permanently protect eight
community supported agriculture (CSA) farms.
"We have been able to save small farms that
do not qualify for state or federal agricultural preservation funds--these usually have a minimum
requirement for 40-50 acres--but who are producing large quantities of food for their communities,"
Kastanopolous told SocialFunds.com. "This gives us a chance to talk about all of the issues that we
care about to an audience that, while they sympathize with the need for affordable housing, really
begin to feel the impact when we are talking about their access to food.
The Land Tenure
Program helped the Caretaker Farm stay farmland when its previous owners' Sam and Elizabeth Smith
were ready to retire. Located in Williamstown MA, the Caretaker Farm is a CSA with 230 families
buying shares of its organic vegetables, fruit, and flowers. The 32 acres of farmland around
Caretaker Farm was designated as farmland by the Williamstown Rural Lands Foundation (WRLF), yet
the houses, barns and other outbuildings of the farm were unprotected and very expensive for
someone who wished to live and work the farm.
Equity Trust bought the entire farm from
the Smiths and then returned the deed to one of the houses and a 99-year lease on the land the
house sits on to the Smiths. Equity Trust then sold the other farmhouse and outbuildings and a
99-year lease on the under lying land to Don and Bridget Smith who are Caretaker Farm's new
farmers. The rest of the farmland was sold to WRLF.
"We advocate two 'whole farm'
protection models, both of which enable the farmer to establish an ownership structure for their
farm that permanently removes the farm from the real estate market, protects the affordability of
the whole farm (including the house and barns), and places restrictions requiring the farm be used
to produce food for the local community," explained Kastanopolous.
One new project in the
works for Equity Trust is "Gaining Ground in Maine," that will provide training for small farmers
and conservation land trusts in Maine interested in using the small farm protection models that
Equity Trust promotes. Equity Trust is collaborating with Maine's Department of Agriculture and the
Maine Farmland Trust for this prospective project.
Another new project called The Equity
Trust Fund is exploring new ways to stimulate community reinvestment. Working with a community in
New London, CT, Equity Trust hopes to create the "Fund for Southeastern Connecticut" as a sub-fund
of the Equity Trust Fund. Equity Trust will create a local committee that will be responsible for
outreach to both potential investors and borrowers in their community. It also will provide
technical assistance and its money management skills.
Investors can become involved with
Equity Trust through loans, land gifts, capital contributions, and equity pledges. Loans are made
on flexible terms set by the investor, who chooses the amount, time, rate, and repayment schedule,
within parameters set by the Equity Trust. Investors may even indicate preferences regarding the
use of their funds.
Individuals can also make Equity Pledges, which are donations
promised to the Equity Trust and are based on a designated percentage of any "social appreciation"
realized upon the sale of their property. The percentage can range from 1 to 100% of the
appreciation and is determined by the donor.
Kastanopolous explained about Equity
Pledges: "The pledge itself is an important statement, but no contribution is required until the
property is sold. The gift comes from the increase in value above the amount of your own investment
in the property."