Entrepreneurial Urban Agriculture

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Enterprise-driven agriculture in urban settings offers communities the potential to develop strong local economies and create more resilient food systems. Farms represent the most well-recognized form of urban agriculture, but there are many other micro-enterprises that constitute urban agriculture. Urban beekeeping, aquaculture, vermicomposting, edible landscaping, and orcharding are just some of the other activities that can provide community members with a livelihood based on urban agriculture. Each of the topics below addresses legal considerations that urban agriculture entrepreneurs should be aware of.

 Employment

Taxes

  • Pay business property tax on equipment and assets
  • Property: urban farmland should not be taxed according to real estate assessment value. Tax-exempt nonprofit organizations are often eligible for a property tax welfare exemption.
Tax Credits
  • Urban Farm Tax Credit: Maryland: Urban agricultural property; tax credits, Md. Code Ann., Tax-Prop. § 9-253 (2010) (Allows Baltimore City and County to give tax credits.

Sales

Regulation

Licensing
Permitting
  • Register with the department of agriculture, where applicable
  • Obtain a sellers permit
Zoning

 (See Planning & Zoning section)

“Among the zoning and land use changes the [Detroit City Planning Commission] suggests:

• Small farming operations and community gardens should be sold city land at reduced rates, and taxed at a reduced rate.

• “Large farming operations that want to purchase reduced-rate land and receive a lower tax rate must commit to tangible and measurable benefits to the community and/or small farm operations.”

• City-owned land sold for agricultural projects will revert back to the city if not used for agriculture.

• Soil testing and remediation standards should be set; policy should dictate what types of agricultural chemicals would be allowed.

• Ordinances should be developed that allow for farmers’ markets and farm stands.

• Ordinance should allow the keeping of bees, rabbits, chickens and other farm animals under set conditions.

• Farming projects should have a sustainability plan.”

(See, Nancy Kaffer, Detroit officials work to create zoning code for urban farming, Crain’s Detroit Business, Mar. 23, 2010. See http://www.sfuaa.org/urban-ag-zoning-proposal.html)

Nuisance

Entity Structure

Intro: Ownership Structure: http://foodshedguide.org/decisions/structure/

  • Choice of entity
  • Obtaining a business license
LLC
Cooperative
L3C
Social Benefit Corporation

Financing

Private Equity
Grants
Credit
Scrip & Alternative Shareholder Dividends

Liability

Environmental Concerns

Soil Safety

For information on Soil Testing, Soil Remediation, and Related Guidelines, see the comprehensive UrbanAgLaw Soil Section.

Irrigation
  • Landscaping Irrigation Rate (with separate meter)

Procurement

Municipal and State Laws
  • Cleveland, OH: New legislation allows the city to offer a 5% discount to local food businesses bidding for city contracts.
Federal

USDA: Farm to School

Preemption

Examples of Urban Ag Enterprises

Urban Farms
Rooftop Farms
  • BrightFarms:  Assists grocery retailers, restraunts with financing, set-up and management of “ultra-local” roof-top gardens growing salad greens and tomatoes.
Vertical Farming
Specialty Crops
Aquaculture
Apiculture
Poultry
Urban Forestry
Growers Cooperatives
Processing/Distribution
Value Added Products
  • Common Market (nonprofit)
Farmers Markets
Community Supported Agriculture
  • How are community supported agriculture programs in urban areas structured?
  • What legal issues do they encounter related to labor law, vegetable delivery, etc?
Distribution Co-Ops
Edible Landscaping

Miscellaneous Information

Definition of Terms
  • Growing and Harvesting: “Urban agriculture activities include growing and harvesting vegetables, fruits, and herbs, and non-food crops such as flowers and trees. These activities can take place outdoors, directly in the soil, or in greenhouses and buildings utilizing soil, water, and other growing media.” (From EPA’s Urban Farm Business Plan)
  • Value Added: “Agricultural activities also include the processing of raw foods into value-added agricultural products, such as jams and cheeses, the targeted distribution of various types of agricultural products to consumers, and the reinvestment of revenue generated from such activities.” (Id.)

Recommended Resources

Background:  Grower to Grower: Creating a Livelihood on a Fresh Market Vegetable Farm. Though not specific to urban farms, many of the same principles apply.