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Cash rents for land owners SECTION 2 - PAGE It - PLAINDEALEF. - WEDNESDAY, DECEMBER 14. 1983 Over time, land owners cannot expect to receive as much in­ come from a cash lease as from a crop share ledse Rightly so, because the tenant assumes all of the risk in growing the crops, and that risk must ultimately be paid for. . In the short run, however, land owners may enjoy higher cash rent incomes. This is possible when there is com­ petition for land and a suc­ cession of tenants are willing to pay more than a cash lease is really worth. What is a reasonable cash rent? Simply, it is a rate that will allow both tenant and landlord to earn a fair return. This may or may not be the "going rate." It must be based upon the land's ability to produce and the expected prices for products. t EXTENSION) People AMml A workable cash lease for­ mula is to take the gross dollar corn value, multiply it by 35 to 38 percent, add per acre tax costs, and subtract a logical amount for risk. To plug into this for­ mula, begin with a five year corn average. This is easy to determine if appropriate records are kept. Taxes are as easily obtained as they are a known factor. Unfortunately, the corn price and a value for risk are not as easily determined and, therefore, present some variables. Let's assume that a particular piece of land has a five-year corn yield average of 125 bushels per acre and that the price of corn is $2.50 a bushel. When multiplied, we have a gross dollar value of $312.50 per acre. Thirty-six percent of this figure is $112.50. If we add $21.50 for taxes and deduct $18.50 for risk, we arrive at a cash rent of $115.50 per acre for land at the 125 bushel average yield level. If yield capability is higher, the cash rent wold be higher; if lower, the rent would be lower. Of course, a higher or lower corn price would also affect the rental rate, as would a variation in taxes. A cash rent of $115.50 may seem to be a low cash rent to many. Based upon known grain prices, however, it is realistic. Of course, different producers can pay different rates for cash rent. An established grower, with a lot of owned or rented land on a crop share basis can spread the risk over that acreage and would be in a better position to pay a higher rate. A beginning farmer with limited assets could not pay as much. There is no doubt that cash rents have a definite place in today's production agriculture. The task is to apply them as equitably as possible. Un­ fortunately, that is not always easy. general News utre Santa holds party at zoo RESTAURANTS Santa Claus and his elves, sugarplum fairies, and a real reindeer will host the merriment of Chicago's Brookfield Zoo Christmas party in the Children's Zoo Sunday, Dec. 18. At 10 a.m., the party will begin in Safari Lodge with a brunch with Santa Claus. Santa will lead the parade to Children's Zoo when it opens at 11 a.m. Once there, children may give their list to Santa in the barn loft, see the reindeer and other animals, take a look at Santa's Workshop, and visit the sugarplum fairies for treats. Children should bring a stocking or sack to carrv the goodies that will be given away. All prizes and treats are generously donated by Chicago-area con­ fectioners and retailers. v A tree in the Children's Zoo is decorated with treats for the birds. Any child who wishes to bring a seed ornament or sue ball can contribute to the tre^ Also, the zoo will halve" Marine's Toys-for-Tots .station near the south entrance. Toys should be in good condition; no used stuffed toys or puzzles can be accepted. For more details about the Christmas party or Holiday Magic at Brookfield Zoo, call 242-2630. M SOFT WATER RENTAL 97 5 p . ™ •NO installation charge •NEW fully automatic softeners •TWO y#Qf Option to buy with •FULL rental fee deducted . *ONE phone call can answer any questions O^r-V 312-259-3393 lht "Villar.p Sffl "A GOOD PLACE TO BE Christmas Parties up to 50 people In a comfortable warm Squire Setting. Special menu and prices. Complete dinners. • Very reasonable prices for a special Christmas Party For reservations 385-0900 ask for Denise, Becki or Lauren Merry Christmas The Village Squire McHenry RTE. 120 M c H E N R Y softN ARLINGTON SOFT WATER CO CentiP®**®. phoeni*. a , Vangu^ Selection** g 1999 Coleco. 0 Holds 24 Odyssey ATARI CARTRIDGES b 6^. ^ Save now at Montgomery Ward. Charge it 3 ways! Advertised prices good in retail stores through Saturday. December 17. 1983. 105 Northwest Highway, Crystal Lake (815) 459-3120 Spruce up your family's tree with a special Christmas ornament from Spring Hill Mall. We've got something that'll add a special touch to your Christmas tree this year. It's an original ceramic tree ornament designed exclusively tor Spring Hill Mall by Haeger Potteries, Inc. This collector s item is yours tor only $2 with $100 worth of Spring Hill Mall shopping receipts dated from November 2S through December 24. This limited edition Christmas ornament will be available at Center Court beginning in December. So come to Spring Hill Mall and make your family's tree lix^k lovely this Christmas. Spring Hill Mall? Uncomplicated Shopping. Apart from the Crowd. Routes 31 & 72. West Dundee. Sears, Marshall Fields, Bergners, JCPenney and more than 11S other fine shops. Special Christmas Hours: November 2 5-December 11. Monday-Salt irda\ 10:00-l>:00, Sunda\ 10:00-6:00 December 12-December 2 Moiul.iv-Satiird.lv >0-l>: >0, Sunday 10:00-6:00 , Christinas live, December 24. Saturdav c): >0-^:00 Closed C hristmas Day. December 26 Monda\ 10:00-0:00