If you are looking to get started with a new lease, re-negotiate one that has expired, or review lease rates, Montana State University Extension has resources to assist you whether you are the landlord or the tenant.
There are four main types of ag leases, including cash leases, flexible cash leases, crop share leases, and pasture leases. A cash lease tends to be the simplest option, as the tenant pays a flat fee for the use of the land for a specific period. A flexible cash lease is an agreement that is drafted to vary depending on prices and yields. A crop share lease is where both parties share the profits and the expenses. Pasture leases have many methods for determining their rate, including rate per acre, rate per animal unit month (AUM), rate per pound of gain, and a rate based on a contributions approach, among others.
There are no legal requirements for an agricultural lease to be in writing, however, if a lease term is longer than one year, it must be in writing in order to be enforceable. It is recommended to have leases in writing in any situation, as this can lead to less disagreement and misunderstanding between parties.
The Richland County Extension office has resources for you as you navigate lease considerations, as well as resources to assist in establishing a lease rate. These resources include MontGuides on different types of leases, access to example lease agreements and wording, a contributions approach to pasture leasing calculator, and access to data such as the average cash rental rate for the county and average grazing fees for the state.
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