PERMANENT PLANTINGS 12 TULARE COLLEGE CENTER
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1 COLLEGE OF THE SEQUOIAS COMMUNITY COLLEGE DISTRICT Board of Trustees Meeting April 11, 2016 PERMANENT PLANTINGS 12 TULARE COLLEGE CENTER Status: Presented by: Action C. Louann Waldner Provost, Tulare College Center Issue The Farming Operations Committee, as part of the Agriculture Advisory Executive Committee, is recommending planting of permanent crops. The Ag Advisory Committee is seeking funding from the Special Farm Reserves fund for the implementation of the recommendation. Background The Tulare College Center manages the farming portion of the TCC campus to aid the COS District in providing the financial resources to support the agriculture instructional programs for the College. The Farming Operations Committee has analyzed the crop revenue for the past five years as well as the potential revenue from different cropping patterns. Factors considered include commodity prices, both surface and groundwater availability and the instructional needs of the educational programs. With those factors considered, the Committee is recommending the College go forward with permanent plantings. The Committee believes that the permanent plantings are the best cropping pattern choice to maximize the revenue and net profit of the 320 acre farming operation, efficiently manage both surface and groundwater resources and provide a cropping pattern to enhance the ag instructional program, specifically Plant Science. The factors considered when choosing the permanent planting were outlined in the March 14 Board Meeting Information Item. The Agriculture Advisory Executive Committee met on March 9, 2016 and voted to recommend to the COS Board of Trustees to use the Special Farm Reserves fund in the amount of $852, to: 1) purchase the trees and related irrigation infrastructure, 2) plant, install and maintain the planted crop and irrigation system and, 3) provide operation funds for the farm and Ag Instructional Unit until the permanent crop is profitable. It is also recommended that the profits be used to re-pay the Special Farm reserves fund over a period of 7-10 years (depending on profits) once the trees are profitable. Recommended Action It is recommended that COS Board of Trustees approve use of the $852,992 from the Special Farm Reserves fund to purchase, plant and maintain a permanent tree crop and
2 related infrastructure which will include a payback of the fund once the trees are profitable.
3 TCC/Ag Div-Farming Operations Farming Operations Committee Charlie Pitigliano, Pitigliano Farms, Chair Joey Airosa, Airosa Dairies Craig Bergman, Bergman Ranches David DeGroot, 4Creeks Engineering Rob and Greg Fletcher, GR Farms Chris Lange, Beresford Ranches David Sharp, Stifel Nicolaus Investments Vince Sola, Sola Farming Brian Watte, Watte Farming Larry Dutto, Ph.D., Consulting Louann Waldner, Ph.D., TCC Provost
4 TCC/Ag Div-Farming Operations Goals of the Farming Operations Committee Maximize revenue and net profit on the 320 acre farming operation. Reduce water usage by efficiently managing both surface and groundwater resources. Provide a cropping pattern that enhances the agriculture instructional program.
5 TCC/Ag Div-Farming Operations Why Permanent Plantings? Diversification of crops spreads out risks in the farming operation Considering Groundwater Sustainability Act (GSA) this is the best water management plan with our current water resources. Provide diversification of opportunities in instruction related to trees, water management, irrigation. Investment today provides consistent long-term earnings for the Ag Instructional Unit (the District) for years (maximize revenue and net profit on 320 acre farming operations).
6 Permanent Plantings Why Almonds? Productive Life Span years Productivity at 3 years Highest Production Year: Years With proper production techniques will have lower net water use per acre than alfalfa and comparable to corn and other field crops. Almond Trees: Initial Investment: $8630/acre (average) 70 acres=$604,100
7 Comparison: Almond vs Row Crop 70 acres Year Almonds Net Profit/Loss Double Crop ($363,919.50) $36, ($120,298.50) $70, ($121,740.50) $70, ($1,816.50) $70, $98, $70, $141, $70, $229, $70, $281, $70, $316, $70, $351, $70, $281, $70, $316, $70, $273, $70, $334, $70, $316, $70, Cumulative Net Profit/Loss $2,338, $1,026, Difference over 15 years: $1,311,789
8 Funding Scenario: Farm Reserves 70 acres Year Almonds Net Profit/Loss Operation Loan Annual Draw from Reserves ($363,919.50) $36, ($400,669.50) ($120,298.50) $70, ($190,998.50) ($121,740.50) $70, ($192,440.50) ($1,816.50) $70, ($72,516.50) Payback Schedule to Reserves $98, $27, $141, $71, $229, $158, $281, $211, $316, $246, $351, $138, $281, $316, $273, $334, $316, TOTAL: 2,338, $248, $852, $852,992.00
9 TCC/Ag Div-Farming Operations QUESTIONS
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