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.
The non-profit 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.
A 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.
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 topic.
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."
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