Classroom BY SUZANNE KEENE CONESTOGA Fourth graders from Lancaster City Schools left their classrooms, textbooks and chalkboards behind this week and escaped to the farm’s barns, hay bales, and animals. State Rep. John Barley hosted 140 of the students at his dairy farm in Conestoga, where the children enjoyed a tour and a short presentation about dairying. Other Lancaster city students toured the Jay Landis farm in Lancaster. The students had plenty of questions for the farmers who donated their time to give the tour "How does and cow have a baby 9 When cows have a calf, do they live with the mother 9 How do cows sleep 9 ” Patiently, the farmers answered all the questions and explained the daily operation of a dairy farm. They encouraged the children to % V A Tanya Roark and Marisol Rivera would like to feed the cow, but are just a bit in timidated by her long neck. Local credit situation no ‘crisis,’ bankers say (Continued from Page Al) outright sale to a tract or sub decade, when compared to land in division developer simply do not other states. In Ohio, for instance, exist in the Midwest to the extent land prices climbed 37.5 percent that they do here, bankers say. from 1977 to 1981, then dropped 28 And though farmers may percent from 1981 to 1984, losing grumble that those forces have almost all the ground that had been pushed land prices upward (which, gained in the earlier run. of course, they have), those same Midwestern farmers who bought pressures have kept the land at the height of the land rush are * values from dropping suddenly, as now holding land worth 20 to 30 they did in the Midwest. And thus, percent less than they paid for it. they create a safety net, of sorts, And many don’t have enough for the equity stake local farmers capital invested to prevent have in their property, themselves from technical in- And even if they don’t sell the solvency, or owing more than their farm to a housing or shopping holdings are worth. center developer, eastern farmers still have the opportunity to work off the farm in industrial or service jobs that can produce income to supplement their farming efforts. That outside income can well make the difference between success and failure, especially in hard times, local bankers told Lancaster Farming. The farm income and credit squeeze of the past few years, both bankers and farmers insist, has made both lender and borrower much more careful about taking on additional credit. “Farmers are much better educated now in farm financial management,” explains Jerry Ogline of Lancaster Farm Credit. And, adds Damn Boyd, vice president and director of the Agn- Finance Department of Hamilton Bank, bankers are working much In Pennsylvania, however, prices increased at the more moderate clip of 30.6 percent in the end of the 70s, then dropped only about four percent in the first part of this decade, according to the USDA survey. And in the Nor theast, as a whole, land prices increased 30 percent from 1977-81, and then increased again although at a more moderate 13 percent rate from 1981-4. Part of the reason farmland here has not been subject to such tremendous variation is the pressure of non-farm uses, which, in many cases, has raised the value of farm property beyond the range justified by fanning ac tivities alone. Alternatives like sale of hard road frontage for housing lots, or moves to the farm for Lancaster City students help the dairy farmer by eating dairy products and keeping litter in its proper place not in far mers’ fields. The farm tour was part of a larger program aimed at educating the students about agriculture. Earlier in the week, local farmers traveled to the city elementary schools to tell the fourth-graders about their farms and the products they produce. Project coordinator Jane Eshleman said the program was based on a pilot project in the Penn Manor School District last Oc tober. Eshleman, a former Penn Manor school board member, is Lancaster's coordinator of the "Ag in the Classroom" project, which was developed through the com bined efforts of the Department of Education, the Department of Agriculture and the Pennsylvania Farmers Association Jose Rosario and Ronaldo Rivera are fascinated with this tiny calf *. * sf\ •** more closely with their tarmer clients to make sure they aren’t getting in over their heads. “I’d like to think the worst is over,” Boyd said, adding that the CoreStates-affihated bank saw its problem loans peak in 1983 and 1984. Pennsylvania Farmers Association financial analyst Dick Denison noted that the banking industry has taken a positive step in using a farm’s cash flow rather than its equity value in determining whether to grant a loan. ’’They’re lending on the ability of the farm to produce income,” he said, not assuming that constantly increasing land values will cover up any mistakes that are made in evaluating the farm’s income producing capacity. As one analyst noted, when a bank begins to base its lending decisions on equity value rather than cash flow, it starts in motion the process that results in the bank eventually taking over the farm. The USDA report, for instance, estimates that, in general, farms with debt-to-asset ratios of over 40 percent may well experience serious financial difficulty because of the heavy burden of servicing the debt at today’s interest rates. And farms with debt ratios above 70 percent, it said, face (Turn to Page A 37) At the end of an informative presentation about dairying, the students got to sample chocolate milk. Dairy farmer Ray Reitz tells the students about the dif ferent products that come from dairy cows.
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