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Business and Financial Policies and Procedures

Investment and Management of Farm Properties

The University of Illinois System acquires farms either through endowment or purchase. The endowment farms are gifts of farm property provided by donors to support the System and managed in accordance with the donor's goals, objectives, and interests. Agricultural Property Services Office (APS) manages these farms in accordance with the Board of Trustees' Policy for Management of University Endowment Farms.

Gifts of Farmland

The Office of Business and Financial Services and the University Counsel process gifts of real property. If a gift contains farm properties the Treasury Operations, Agricultural Property Services Office (APS) reviews the property to determine its value to the System. When gifts of farmland are accepted, APS manages those properties in accordance with the Board of Trustees' Policy for Management of University Endowment Farms and  the donor's bequest.

Selection of Farm Operators

APS is responsible for overseeing the selection of farm operators for System farmland and establishing procedures to govern risk management.  To ensure market-based practices and terms, farm operators are selected through a competitive process unless the donor specifies otherwise. The competitive process is open to the public and is advertised in publications of general circulation in the county or counties where the property is located. The successful respondent will be given the  opportunity to enter into an agreement with the System that specifies the responsibilities of both parties.  For more information about the competitive process, contact APS at obfsaps@uillinois.edu.

Management and Oversight of the Farms

The farms are operated as quasi-commercial enterprises. This is accomplished by focusing  on achieving optimal net income and maintaining and improving the farm property while pursuing environmental stewardship, positive local community relations, and the educational and research missions of the System. Farm managers closely monitor soil fertility and conservation to optimize returns while ensuring long-term productivity.

Rent for an endowment farm residence is typically part of the overall farm operator agreement. The farm operator agreements do not allow subleasing of residences or farmland without the prior written approval of APS.

Reporting and Performance Evaluation

APS prepares an annual report of endowment farms for the Comptroller. This report contains an estimate of the market value of each endowment farm. The performance of System farms is computed on a total return basis (income added to appreciation) and compared with relevant farmland indexes.

Additional Resources

Policy for Management of University Endowment Farms

Last Updated: March 17, 2011 | Approved: Senior Associate Vice President for Business and Finance | Effective: November 2010

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