On March 16, 2017

Farm to fundraising: Family fights to keep cows

Milky Way Farm hopes to continue operating the last dairy farm in Ira
By Alan J. Keays, VTDigger
IRA — Robbie Clark Jr. cares most about the cows — even Periwinkle, a Jersey who is a little too rambunctious in the farm’s milking parlor.
Clark prefers to see the upside: Periwinkle, he says, is just being overly friendly.
“The biggest thing I worry about is where (the cows) are going to end up,” Clark said in a recent interview, taking a break from the many chores he must do each day as part of his one-man operation in Ira. “I raised all of them from birth to where they are today.”
The 30-year-old dairy farmer wonders what’s going to happen to the animals. He goes to work each morning, milking the cows at the Milky Way Farm on Route 133 in this tiny Rutland County town (population 432) hoping that it won’t be that day.
The cows, and the farm’s machinery, could hit the auction block any time now.
Clark doesn’t know when that day will be. It could be today after he walks into the barn. It may be the next day, or the one after that.
Four years of legal action through federal bankruptcy court came to an end last month. That’s when a judge dismissed the farmer’s case, doing away with any protection Clark had against a creditor selling off the cows and the farm’s machinery and equipment to the highest bidders.
Clark and his mother, Mary Saceric-Clark, kept the operation going as his father, who ran the farm, battled cancer. Robert Clark Sr. purchased the land for the Milky Way Farm in 1984, and when Robbie turned 18 he joined his father in the operation.
The father and son worked together for 11 years, until Robbie Clark Sr. died at 69 last year of metastatic prostate cancer, leaving his son to work alone on the small dairy farm for almost a year. The illness and death pushed the family and the farm further into debt.
For Clark, it’s still about the cows, each with a name, a tradition started when his family took over the farm. Playing off the outer space theme that a farm called Milky Way connotes, the animals have had names such as Aurora and Andromeda.
The dairy farm, the last still operating in Ira, milks about 60 cows, from a herd of about 100. The milk from the farm doesn’t end up in gallon containers on shelves in a grocery store. After a company trucks it away, the milk is turned into Cabot cheese, a signature Vermont brand.
Visiting the roughly 125-acre farm is like walking into a postcard scene. There are open fields, a red barn that occasionally has cows peeking out (sometimes batting their big brown eyes), and a green John Deere mud-splattered tractor parked nearby.
Working on the farm is the only job Clark has ever had.
“I don’t know anything else,” said Clark, a wiry man with a dark beard and an easy smile. “ It’s scary thinking it could all be gone in the blink of an eye.”
Vermont Agriculture Secretary Anson Tebbetts said he has talked a couple of times with Saceric-Clark, Clark’s mother and bookkeeper, and is looking into what options might be out there to help. The agriculture secretary said he is not aware of an auction date yet.
Patrick Freeman, FSA loan service director in Vermont, said last week there was little he could say about the specific loan or case due to confidentially and legal provisions. The U.S. attorney’s office in Vermont, which represented the federal farm agency in court, declined to comment, referring questions to Freeman.
“It’s a really nice farm. They’re really nice cows, and they’re really nice people,” Freeman added. “It’s a really challenging situation.”
He said there are options prior to FSA having an auction: The loan could be paid off in full, or the debtor, in this case, Clark, could voluntarily hold a public sale.
Asked if Clark’s loan could be refinanced in any way or the terms extended, Freeman said, “I would never say never, but it would be highly unlikely.”
The best case scenario, Freeman said, is for a debtor to hold the sale. However, in some cases, Freeman said, FSA has to conduct auctions if a debtor doesn’t act voluntarily. He said he couldn’t remember the last time such an auction took place in Vermont.
Jan Sensenich, the bankruptcy trustee appointed by the court to oversee and administer the farm’s reorganization plan, said he would have liked to see the judge approve a last-ditch effort to modify the farm’s plan, which didn’t happen. “I supported it with every fiber of my being,” Sensenich said.
That plan called for reducing the size of the herd, having Clark try to supplement the operation by taking off-farm employment, and opening up the farmhouse to overnight guests seeking a real Vermont experience as they travel.
Saving the Milky Way
Clark and his mother, a retired elementary teacher who tracks the finances, have started a page on the online fundraising website gofundme.com.
The goal is to raise $200,000 to stave off the creditors and a possible auction. They are asking for $1 donations, telling those who give to spread the word. “The Power of One” they call the campaign. “If you are able to donate more, we and our ‘brown-eyed girls’ would greatly appreciate it,” the site reads. “Together we can Save the Milky Way Farm.”
In the more than two weeks the page has been up, nearly $5,000 has been raised from 96 donors, including some from faraway places.
“We are a small family farm in CO,” one poster to the site who donated $5 wrote. “I pray that you can keep your MILKY WAY FARM and all those beautiful brown eyed girls!”
Another, who pitched in $100, is much closer than Colorado.
“We always wave hi to your lovely cows whenever we drive by on our way to Rutland,” that donor wrote. “We so want your farm to succeed!”
A $5 donor added, “Wish we could do more! We own a country store and are in similar straits. Best of luck — we love small farms!”
If the gofundme campaign is successful at raising the $200,000, the Clarks said they will use about $150,000 to pay off the FSA and the remainder to cover other bills. “So we can get them out of here and decide what we can do with the rest of our lives, Saceric-Clark said.
Should the Gofundme effort raise only some of the money and an auction is held, she said one option would be to have someone bid on at least 25 of the cows so the farm could continue to operate, but smaller.
Debts, payments and plans
The bankruptcy proceeding started in 2012 when the farm filed for Chapter 12, which allows a small farm to reorganize and restructure debt.
Creditors included the Farm Service Agency, People’s United Bank and the Vermont Agricultural Credit Corp.
Saceric-Clark said it was creditors who first pitched her the idea of filing Chapter 12, telling her it was made for situations just like the one they were in, a small farm dealing with uncertain conditions year to year, from weather to milk prices.
At first her son, whose name would be on the filing as operator of the business, balked at the idea, but he eventually agreed.
A short time later her husband was diagnosed with cancer. His doctor, Saceric-Clark said, told her that keeping him on the farm was among the best prescriptions for his physical health and mental well-being.
“Farming, for my husband, was never his job, farming for him was truly a calling,” she said, stopping to wipe away tears. “If he was going to lose that, we pretty much thought he wouldn’t have any kind of a will to fight the cancer.”
The farm emerged with a reorganization plan, which included restructuring loans and paying off a debt to the FSA of $287,040 over five years, with monthly payments averaging $4,784. That debt was critical because it covered the cows, the machinery and the equipment, she said.
However, her husband’s health was not getting better. And she was responsible for making payments and filing monthly reports with the bankruptcy court on the progress of the farm. They fell behind on payments.
“In my mind, it was prioritizing,” she said. “And I certainly thought that his health was more important than these monthly reports.”
In January 2016, the cancer claimed her husband’s life, adding to the stress and despair she felt at a time the farm already had its share of both.
In the summer, the family held a fundraising event through an organization they formed, Our Little Candle, to help other small farms in honor of Clark Sr. Also around that time, a part-time worker at the farm quit.
They tried to modify their reorganization plan in November, but People’s United and the FSA argued against it. If the case were dismissed, it would allow for the enforcement of a stipulation in the plan that called for the “liquidation” of assets: the cows, the machinery and the equipment, to cover the debt.
The Clarks’ last attempt to modify their plan called for downsizing the herd to a more manageable operation for one person, around 25 cows, which would allow the son to also work off the farm to earn money.
Money raised from the sale of the other cows would go to pay down the debt. Also, Saceric-Clark said, by handling the cows’ sale themselves, rather than at auction, they could guarantee the animals were going to good farms.
And, she said, she would turn her home into an Airbnb, renting rooms to guests seeking to take in life on a working farm. The creditors, according to court filings, didn’t find that plan “feasible” and said the financial projections were “speculative.”
“Best effort” not enough
Bankruptcy court Judge Colleen Brown ordered an evidentiary hearing, which stretched over two days, in January and February. On Feb. 14, Brown issued her decision, siding with the creditors.
The judge wrote that despite the Clarks’ “indefatigable desire, commitment and intent to do all they can to save the family farm,” it didn’t overcome the legal arguments regarding the “breach” of the reorganization.
The judge pointed to benchmarks, or steps that the Clarks had to take over the years to comply with the restructuring plan, that had been missed, including the prompt filing of monthly reports. And, Brown wrote, the Clarks had sold 10 cows without first checking with the creditors.
Saceric-Clark said she didn’t know she needed permission to sell the 10 cows, adding that they raised $17,000 from the sale. Of that money, she said, $14,000 was paid to the FSA and $3,000 went to the town of Ira to pay property taxes.
She said the offer to buy the cows came from a man in New York who was starting up an operation. “We knew they were going to a really nice home, they were going to be cared for,” Saceric-Clark said. “No one ever said not to sell them.”
Sensenich, the bankruptcy trustee, said the “tragedy” of the case is that the family had paid down about 60 percent of the debt in the initial approved reorganization plan.
The selling of the 10 cows, even though the family believed they had good reason and got a fair price, created a stumbling block, he said. “That sort of tripped one of the triggers,” Sensenich said. “That made it really hard to keep the Chapter 12 going.”
Sensenich has been a bankruptcy trustee since 1991 and said such cases involving farmers filing Chapter 12 are successful about 75 percent of the time. Chapter 12 was created, Sensenich said, in the late 1980s, as a response by Congress to a record number of farms going out business.
Sensenich said it’s difficult for a small dairy farm to survive primarily on wholesale milk sales. “The conventional market for liquid milk is extremely volatile and will dip well below the cost of product for long periods of time,” he said. “Unless you are really well-heeled, and not very leveraged, surviving the downside is very tough.”
Saceric-Clark said she is continually told the operation is too small and not “viable,” a word she kept hearing about her proposed restructuring plan that was shot down.
“If anything sets me off,” she said, “it’s that, how many times do you hear, ‘We have to save small Vermont farms, they’re the fabric of our being.’”
She then asked, “Why would you want to get rid of this farm? Why wouldn’t you do everything in your power to save it?

Submitted photo
The Clark family farm in Ira milks about 60 cows.It is the last operational dairy farm in the town of Ira, Vt.

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