Does the tenant or landlord pay for power source for field irrigator?

Asked December 9, 2013, 4:12 PM EST

We the landlords purchased a new irrigator for 75 acres of farm land in Emmet County. We know the tenant will supply the fuel to run the power, but who pays for the power source? The tenant used his tractor in 2013 but wants to make changes. Who supplies the power -- the tenant or the landlord?

Emmet County Iowa cropland leasing

4 Responses

Thank-you for contacting ISU Extension and Outreach with your question. There is not just one standard answer to this question because any lease terms are negotiated, and it is our recommendation that farmland leases be in writing. We would advise seeking the assistance of an attorney in drafting a lease to avoid future disagreements. There is a great deal of information on the Ag Decision Maker website related to leasing: http://www.extension.iastate.edu/agdm/wdleasing.html There is also a good publication from Purdue & Michigan State Extension regarding common provisions for farm land leases where the land is irrigated: http://www.msue.msu.edu/objects/content_revision/download.cfm/item_id.513306/workspace_id.-30/LandRent.pdf/ While it references a CALIFORNIA farm land lease, attached as a Jpeg document is a lease that has a provision in it regarding irrigation equipment. There are variations on how tenants and landlords negotiate these provisions. If you would like to learn more about farm land leasing, there will be leasing workshops in the Emmet County area in July 2014. Please keep in touch with the Emmet County Extension office and they can let you know the dates and times of these leasing workshops. I hope this information is of assistance to you.

You don't mention what type of lease arrangement you have but it would appear that this is a crop share arrangement. I would suggest that you review all of the costs associated with raising the crop to see how the landlord/tenant split the input costs. You would use a "cash rental rate value" for your contribution of the land and see how close to a 50/50 the contributions of all inputs are. If you are splitting the crop 50/50 you should be splitting the inputs 50/50 perhaps.

We are strictly a fixed cash rent basis per acre.

If you are a fixed cash rent landlord I don't see you paying to operate a power supply. An exception to my rule would be if you decided to put in an electrically powered station. You would pay for the installation and recapture your costs in the rents. However, the cost of getting an electrical supply has often gone up dramatically. If you were looking at three phase power and trying to run it 10 miles you will probably be shocked by the cost of installing. That is why I assume that you were using diesel fuel to run the irrigation pump. Generally, having the tenant provide a tractor is more cost effective than buying an engine that you leave in place. Just wondering if you had a price on the cost of putting together a system.