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We Put Our Profits in Your Pockets®

Management Discipline in Economic Moderation

USDA’s Rural Energy for America Program

Leaderis published quarterly for stockholders, directors and friends of Farm Credit of the Virginias.

PresidentDave Lawrence

BOArd OF direCtOrsBarry W. Shelor, ChairmanCharles B. Leech IV, Vice ChairmanRonald L. BennettDonna M. Brooke-AltWilliam J. Franklin, Jr. Bobby C. GrayPaul M. HouseMelody S. JonesJames F. KinseyMilton L. McPikeDonald W. ReeseW.W. Sanford IIIRaymond L. SimmsAlfred W. Stephens, Jr.Joseph W. WamplerJohn E. Wells

editOrJenna Mullins

PUBlisherAgFirst Farm Credit Bank

PUBlishing direCtOrAmanda Krok

designersAthina EargleDarren HillAmanda SimpsonTravis Taylor

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CirCUlAtiOnKathi DeFlorio

Address changes, questions, comments or requests for copies of our financial reports should be directed to Farm Credit of the Virginias, ACA by writing P.O. Box 899, Staunton, VA 24402 or calling 800-559-1016. Our quarterly financial report can also be obtained on our website: www.farmcreditofvirginias.com, or by email: [email protected].

Farm Credit of the Virginias furnishes data to credit reporting agencies. The association’s reporting efforts are important for aiding consumers in obtaining credit, assisting businesses in credit approval, providing consumers with timely and accurate personal credit information, reducing fraud and abuse, helping prevent identity theft and minimizing errors in credit reporting. If you have questions regarding this process, please contact our Credit Desk at 540-886-3435 ext. 5037.

800.919.3276FarmCreditofVirginias.com

NMLS# 456965

Customer Appreciation

Events

Branch Date Time Location

Halifax 8/8 5 p.m. - 7 p.m. Edmunds Memorial Park

Oakland 8/21 2 p.m. - 5 p.m. Oakland Office

Charlottesville 9/15 5:30 p.m. - 7 p.m. Wood Grill

Bedford 9/18 5 p.m. - 8 p.m. Spring Valley Auction Barn

Clarksburg 9/23 5 p.m. - 8 p.m. Lambert’s Winery, Weston

In This IssueASSOCIATIOn nEWSMessage from the President 4

Farm Credit of the Virginias Recognizes Top Team Members 5

InDUSTRY nEWSManagement Discipline in Economic Moderation 6

ASSOCIATIOn nEWSDairy Management Institute 8

We Put Our Profits in Your Pockets® 9

The Knowledge Center Website is Up and Running! 11

InDUSTRY nEWSUSDA’s Rural Energy for America Program 12

FEATURECole Nurseries, Inc: Where Going Out on the Limb is Normal! 14

EDUCATIOnAg Biz Planner Program Participants Graduate 16

Young Farmer Institute 17

DIRECTOR nEWS

Director Tom Thacker Steps Down to Pass Farm Credit Tradition to a New Generation 17

YOUng FARMER PROFIlE

David and Carrie See 18

ASSOCIATIOn nEWSNational Cattlemen’s Beef Association Convention 20

Virginia Agribusiness Council Banquet 20

CAP News 21

FInAnCIAl REPORTFirst Quarter 2014 23

leader Summer 2014 3

Holiday ScheduleJuly 4— Independence Day (Friday)

September 1—Labor Day (Monday)

November 27–28—Thanksgiving (Thursday & Friday)

December 24–25—Christmas (Thursday & Friday)

for AccountAccess

Introducing mobileRoots™—the new free and secure mobile app for AccountAccess! mobileRoots for iPhone® and Android™ allows you to view your Farm Credit account details, balances and recent transactions. Plus, you can make payments and transfer funds to an external checking or savings account.

In order to use the mobileRoots app, you must first sign up for AccountAccess online at farmcreditofvirginias.com.mobileRoots is a trademark of AgFirst Farm Credit Bank. Android is a trademark of Google Inc. Apple and iPhone are trademarks of Apple Inc.

Manage your accounts on the go!

The 2014 year is off to a good run.

The lending team is experiencing

an increased level of loan inquiry

compared to previous years, and we continue

to anticipate a two to three percent net loan

volume growth for the year. We’re on target to

meet the earnings budget, our capital position

remains strong and credit quality is on an

increasing trend.

We already sent out patronage checks to our customers based on

the 2013 year. The Board of Directors approved paying $21 million in

patronage refunds (cash rebate), or approximately twice the amount of

patronage paid in previous years. The extra amount of patronage paid

to our customer-owners is primarily due to a patronage payment the

Association received from AgFirst Farm Credit Bank. Customer-owners

with loan balances during 2013 received two patronage checks. The first

patronage check was mailed out in April and the extra patronage check

was mailed June 2. The total patronage paid to our customer-owners

equals approximately 25 percent of the interest paid during 2013. It

truly pays to be a customer-owner of Farm Credit of the Virginias!

Your Association remains in a strong position and stands ready

to meet the lending needs of farmers and producers in rural America.

Customer Appreciation DaysYour lending team is busy hosting customer appreciation events

in all of our branch location areas. We always look forward to customer

appreciation days because it’s a time for us to say thanks to our VIPs—our

customer-owners—for doing business with Farm Credit. The directors

and I try to attend as many of the events as possible because it’s a time

for us to visit with customer-owners, hear how the Farm Credit of the

Virginias team is doing and learn how we can do a better job taking

care of your financial lending needs.

The Board Honors loan Officers at the Circle of Excellence April 2014The Circle of Excellence is a way to recognize the best of the best Farm

Credit of the Virginias lending officers. Top producing loan officers are

the rainmakers for Farm Credit. A rainmaker is a loan officer who is

responsible for getting new detaining business and maintains a high

level of customer service.

2013 Overall Top & Key Producers for Farm Credit of the

Virginias

• Association Top Producer: Brian Repass, team leader in the

Wytheville lending location

• Association Key Producer: Rick King, team leader for the

Roanoke Valley Team

Team Top Producers

• Mark Haddix, our Association’s timber specialist

• Joey Cornwell, team leader in the Roanoke and Rocky Mount

lending location

• Patti Craun, our Association’s dairy specialist

• Ed Blevins, team leader for the Three Rivers Valley Team

• Marilyn Adams, team leader in the Leesburg lending location

• Rodney Dellis, team leader in the Bedford lending location

• Andy Puckett, loan officer in the Abingdon lending location who

leads the Association origination of Country Mortgage loans

• Ashlie Howell, team leader for the Shenandoah Valley Team

• Trey Keyser, loan officer in the Potomac Valley Team who leads

the Association’s Resource Team

We added a category this year for Leadership Winners. We have

two groups that provided exceptional leadership for tasks tied directly

to our 2013 business plan initiatives.

Leadership Winners

• Special Asset Team: Team leader Patty Botkin and team

members Manny Schabel, Steve Cavender, John Brickey and Teresa Anson

• Standards of Conduct (SOC): SOC Officer Carolyn Hite

Please join me in saying thank you to all Circle of Excellence

winners. They not only set a high bar for results, but deliver outstanding

customer service.

Your cooperative has money to lend and we are ready to meet your

financing needs. Please tell your friends and neighbors about Farm

Credit of the Virginias, or give us a name and one of our loan officers

will make contact. Your support strengthens your Association, and we

thank you for your business!

Message from the PresidentDave lawrence

Farm Credit of the Virginias 4

ASSOCIATIOn nEWS

Dave lawrence


T he overwhelming success of Farm Credit is a result of both

a loyal customer base and the team effort put forth by each

and every employee. The dedication and commitment that

each individual employee of Farm Credit of the Virginias contributes

to the business is key, but their willingness to work together is what

makes it all happen.

In an effort to recognize some of the top employees for their

production and leadership, Farm Credit recently held a Circle of

Excellence celebration in Harrisonburg, Virginia. New income

production during the 2013 fiscal year was the primary selection

criteria for being awarded as one of the Circle of Excellence’s

production winners. Additionally, the loan officers selected had a

satisfactory rated loan servicing and credit administration history by

both outside auditors and management. These individuals generated

new customers and business in 2013, while still fulfilling the needs of

returning customers.

In addition to the awards presentation, the guests were treated

to an uplifting presentation by Mitch Wallace, Virginia State FFA

President; Brett Speakman, Virginia State FFA Vice President; and

Whitney Bowman, Virginia State FFA Secretary. The enthusiasm of

these three proud FFA members ensured the group that the future of

agriculture is bright.

The Association Board members and management truly appreciate

their employees and find that the Circle of Excellence celebration is a

simple way for them to recognize those who push themselves the hardest.

Without individuals like those recognized, Farm Credit of the Virginias

would not be what it is today. These individuals put countless hours

into making everything happen for not only their team, but for each and

every one of their customers. Their efforts did not go unappreciated.

Farm Credit Recognizes

Top Team MembersBy: Jennifer Showalter

Pictured above are those who were recognized as the Top Team Members for 2013. From the left: Marilyn Adams, Carolyn Hite, Ashlie Howell, Mark Haddix, Patti Craun, Ed Blevins, Rick King, Brian Repass, Andy Puckett, Teresa Anson, Rodney Dellis, Joey Cornwell, Patty Botkin, Trey Keyser, Manny Schabel and John Brickey. not Pictured: Steve Cavender

Virginia State FFA officers Brett Speakman (Vice President), Whitney Bowman (Secretary) and Mitch Wallace (President) gave a very enthusiastic presentation during the Circle of Excellence Celebration.

Former Farm Credit director Tom Thacker receiving an award for his 12 years of service from director Barry Shelor.


InDUSTRY nEWS


Management Discipline in Economic Moderation

By: Dr. David M. Kohl

T he great commodity super cycle has brought high levels of

prosperity, particularly to the grain sector of agriculture. Yes,

economic moderation is now in motion and few analysts can

predict its extent and duration. Emerging nations’ economies, biofuel

and ethanol mandates, Federal Reserve policy and weather are several

of the catalysts for change. While economics is uncertain, one fact

remains constant: Those who plan, develop strategies, execute them,

monitor results and tweak the business as field conditions change have

the odds in their favor. Now let’s examine some of the top priorities for

every producer’s game plan.

Cost of ProductionStarting off, it is critical to know the cost of production. This cannot be

stressed enough because it is the foundation beneath any successful

game plan. In today’s world of multiple farm enterprises, costs need

to be examined by enterprise. This ensures that capital, resources and

management can be allocated to their highest and best use. The key

is to examine different levels of returns using various cost, price and

yield assumptions. In the next two years, examining land cost and

rents will be a critical variable for success. The good times created

some bad habits, such as putting aside budgeting basics. Budgeting

will not be an option, but a requirement going forward. Approximately

one in ten producers nationwide knows their cost of production. Even

amongst the elite managers at the Executive Program for Agricultural

Producers (TEPAP), fewer than 50 percent conduct this critical

management analysis.

Resource AssessmentSecond, conduct a resource assessment including land, machinery,

livestock and, yes, human resources. Moderating economic times will

require focus and shedding unproductive assets. A flight to quality land

with reasonable landlord expectations will become a theme, particularly

if the economic moderation lasts multiple years. Analogous to an athletic

team that goes through a rough patch, focus, discipline and “back to

basics” will be the mantras of the day.

Variance AnalysisThird, utilize variance analysis as a tool for monitoring financial results.

That is, compare your projected cash budgets to actual results on a

monthly or quarterly basis. Focus on the five largest expenses and top

components of revenue. If you have a relationship lender or advisory

team, ask them to provide alternatives, counsel and ideas of how to

tweak your business for a high level of performance. Do not fall into

the trap that many investors experienced in the stock market decline.

With the market going downward, monthly and quarterly statements

were put into a file and never opened, compared to the eagerly awaited

statements in a bull market. Whether it is a bull or bear market,

monitoring and tweaking strategies and actions should be a very

high priority.

liquidity, liquidity, liquidity! The top half of the balance sheet will be an important focus in financial

analysis. Know your current ratio, net working capital and working

capital to expense or revenue ratio. Link your risk management plan (i.e.

grain in the bin or livestock for sale) to your working capital strategy.

While economics is uncertain, one fact remains constant: Those who plan, develop strategies, execute them, monitor results and tweak the

business as field conditions change have the odds in their favor.


What is the true amount of working capital that can be generated

within 60 to 180 days without disrupting normal operations? How

does true working capital match debt service requirements throughout

the year? Maintain a cash reserve of one year’s debt payments, or two

months of average expenses, as a rainy day fund of cash in the bank.

This quick, convertible cash will allow you to navigate the white waters

of profitability and cash flow, and also position the business to take

advantage of discount buying opportunities. The proof in the pudding

will be a manager’s ability to keep this mental discipline in liquidity

and cash management regardless of the economic cycle.

Debt Coverage RatioThe time-tested debt coverage ratio will need to be monitored. Simply

put, it is cash available for debt service divided by the actual debt

service requirement. Good managers attempt to maintain 150 percent

coverage ratio, or a 50 percent fudge factor. The key is to examine

the various growth, budgeting and capital expenditure strategies

using price, cost and production scenarios. Another factor impacting

the ability to pay will be increased income tax obligations as a

result of reduced incentives on depreciation, along with surtaxes on

many items.

living CostsMonitor living costs and withdrawals from the business. Good times

created bad habits in family living consumption and nonfarm capital

expenditures. Farm family living data finds the difference between the

highest and lowest one third of family living expenses is approximately

$60,000. That is a considerable amount of money that could be used

for debt service and financial reserves should the worst-case scenario

play out. Family living budgets from Nebraska Farm Business, Inc.

and the FINBIN database can be excellent models to help develop your

game plan in this area.

good PeopleFinally, part of management discipline is surrounding yourself with

good people. That is, suppliers, lenders, employees, other managers

and mentors will be an essential sounding board. Do not get sucked in

with the lowest interest rate from a Johnny-come-lately lender in the

marketplace. Select a lender that is not just a “yes” or “no” lender, but

a “what if” lender who will confirm what you do well, and also suggest

areas for improvement.

Let the record speak for itself. FINBIN data since 1995 for

crop and livestock enterprises suggests that the top 20 percent

of producers earned 10 percent or greater return on assets, while

the bottom 20 percent earned one percent or negative returns.

The group you will be included in is your choice. The protocols

outlined above move the odds in your favor in this moderating

economic climate.

David Kohl received his M.S. and Ph.D. degrees in agricultural economics from Cornell University. For 25 years, Kohl was Professor of Agricultural Finance and Small Business Management and Entrepreneurship in the Department of Agricultural and Applied Economics at Virginia Tech, Blacksburg, Va. He was on special leave with the Royal Bank of Canada working on advanced initiatives for two years, and also assisted in the launch

of the successful entrepreneurship program at Cornell University. Kohl is Professor Emeritus in the AAEC Department at Virginia Tech.


ASSOCIATIOn nEWS

Dairy Management InstituteEncourages Dairymen to Know Their numbers

and to Utilize Them to Make Sound Business DecisionsBy: Jennifer Showalter

P aper work, or these days computer work, is one of

those things many farmers are guilty of continuously

pushing farther down their “to do” list. It is not hard to

fall into that rut when there are only so many hours in a day to get

everything done. With this in mind, Farm Credit has organized and

sponsored the Dairy Management Institute (DMI) each year since

2000, to give dairymen an in-depth look at the financial side of

their business.

This year 72 farms participated in the DMI program by submitting

their income, expenses, and some other key data from 2013. The

140 attendees participated in a meeting in either Harrisonburg

or Rocky Mount, Virginia for the DMI where each farm received

their income and expenses in comparison to the group averages.

They also received key measures for their operation, such as their

net income per cow, cost per cwt., debt payments per cow, pounds

shipped per worker, break-even milk price, and debt-to-asset ratio.

The presentation of this material made it easy for producers to see

where they rank in comparison to benchmarks and to the other

participating dairies.

“Participating in DMI is useful because the Farm Credit employees

break down data for you beyond what an accountant does and it is

specific to dairy farms. We have been participating for about five years,

so each year we can compare ourselves to how we have done in the

past and also to other farms that participate. This helps give us goals

and makes us want to be better managers,” says Jennifer Leech with

Ingleside Dairy in Lexington, Virginia.

With average net income per cow up $407 over 2012, 2013 was

a better year for dairymen as a direct result of lower feed prices and

increasing milk prices. While dairy profits are currently strong, speakers

encouraged participants to prepare for lower milk prices by building

liquidity through increasing cash reserves and reducing balances on

lines of credit, even if it means paying some taxes. Gary Monroe, Farm

Credit data specialist, told the group that spending money just to avoid

paying income taxes can be risky business. “Don’t throw away a dollar

to avoid giving the government a quarter,” said Monroe. He also shared

a quote from Dr. Dave Kohl at this year’s Farm Credit Young Farmers

Institute, “You’ll never go broke paying income taxes, but many go broke

trying to avoid them.” Along the same lines, Farm Credit Agri-Business

Specialist Scott Lilly encouraged producers to keep ample cash on hand

Attendees of the 2014 Dairy Management Institute met in Harrisonburg, VA to listen to industry professionals discuss better dairy management practices

“We continue to be committed to the program as a means of providing a value added service to our dairy clients and ensuring that our dairy

industry remains a strong and viable industry,” said Farm Credit of the Virginias Dairy Specialist Patti Craun.


in today’s volatile market. “Fifteen or 20 years ago the net cash income

per cow was pretty consistent. Now we go from boom to bust. Cash is

crucial to survival during lean years, like in 2009, so you can continue

operating without having to take out an emergency loan. It is also a

good idea to have a prearranged revolving line of credit available with

a lender who understands the cycles in the dairy industry.“

During the afternoon session, participants enjoyed a producer

panel discussion focusing on new technologies and precision farming.

Four farms shared how they have implemented and are using new

technology to enhance the management of their dairies.

“Through DMI, Farm Credit seeks to provide participating farms

with a consistent set of financial data for their dairy operation as well

as education on how to interpret the data. When producers leave the

meeting, we hope they know more about the financial condition of their

operation and what areas they need to focus on in order to increase overall

farm profitability. DMI stresses the need for dairymen to know their

numbers, including cost of production, net income per cow, debt payments

per cow, etc. as a means of making better decisions that will ensure

their long term viability. “We continue to be committed to the program

as a means of providing a value added service to our dairy clients and

ensuring that our dairy industry remains a strong and viable industry,”

said Farm Credit of the Virginias Dairy Specialist Patti Craun.

We Put Our Profits in Your Pockets!®

A s a cooperative, Farm Credit distributes a portion of our

profits to our customers. Due to record earnings for 2013,

the Board of Directors declared that in addition to the regular

patronage dividend, which typically represents 12 percent of the amount

of interest paid on loans in a given year, a second “special” patronage

dividend would also be paid totaling another 12 percent. That bringing

the total patronage dividend to just over $21 million. Farm Credit is

the only lender in the area that returns profits to its borrowers. We put

money back into your pockets!

Teresa Fullen from Abingdon is happy to receive her patronage refund from Farm Credit loan officer Andy Puckett.

Patti Craun, Dairy Specialist and Relationship Manager for Farm Credit.

contInueD on neXt PAGe

For more information on how the Farm Credit patronage works, visit

FarmCreditofVirginias.com/patronage-refunds.

Farm Credit of the Virginias 10 leader Summer 2014 10

Susie Johnson and Paul Eberly make a visit to director Paul House and family to deliver their patronage refund check.

Customer Carl Bachtel stops for a quick pose while receiving patronage from FJ grady, loan officer in Oakland, Md.

Rocky Mount loan Officer Rick King with James M. Cook.

Farm Credit of the Virginias has distributed more than $161 Million

in cash refunds since 2001!

As profits are returned to you, your cost of borrowing is reduced. You get a competitive rate from Farm Credit and we reduce your effective interest rate with our profit sharing refunds.

Year % of Interest Accrued

CashAmount

2001 12% $8,036,0002002 13% $8,449,0002003 12% $7,456,0002004 16% $10,425,0002005 20% $15,146,0002006 20% $18,050,0002007 18% $18,500,0002008 12% $12,800,0002009 10% $10,000,0002010 12% $11,000,0002011 12% $10,700,0002012 12% $10,600,0002013 12% $10,500,0002013 Special Distribution $10,500,000

Farm Credit is the only lender in the area that returns profits to its borrowers. Our unique

cooperative structure puts money in your pockets.

ASSOCIATIOn nEWS


Y ou may have heard some talk recently about an exciting new

program developed by Farm Credit of the Virginias called

the “Knowledge Center.” Although the concept has been

in the works for several years, the full implementation of this service

is just now coming to fruition. Centered around the newly launched

website – www.farmcreditknowledgecenter.com, the Knowledge

Center team stands ready to help its customers become a successful

part of their agricultural operation.

So what exactly is the Knowledge Center? Several years ago

during a brainstorming session by the board of directors, the idea was

created to offer a “one stop shop” for producers needing information

and resources to be even more successful. It was from that original

discussion that the Knowledge Center was first developed. Their goal is

to serve as “network agents” for the agricultural community. They help

facilitate the sharing of knowledge and resources among all types of

producers with a goal of improving knowledge, increasing profitability

and elevating productivity.

The anchor of our Knowledge Center is the website – www.

farmcreditknowledgecenter.com. This site holds a wealth of information

available for all of those interested in agriculture. Tabs at the top

allow viewers to find recent news and announcements, information

and resources, market reports, information for youth and a wealth

of education and outreach resources. The home page offers access to

commodity information, blog posts from different industry leaders, bios

on the team, a calendar of upcoming events and an Ask the Experts

Forum. This interactive feature allows viewers to submit questions

pertaining to agriculture or Farm Credit. The team will then work with

experts in the field to provide specific and timely answers. Information,

events, news articles and resources are added and updated several times

each week, making this a site that you will want to book mark to view

regularly. They also welcome suggestions from you, so please feel free to

email them if you know of an event or resource that may be beneficial!

While the website serves as the central location for online resources,

the Knowledge Center team is the heart of the program. Since the

team has been assembled, they have been on the road coordinating

and assisting numerous types of activities ranging from workshops on

Cattle Price Protection to One Page Business Plans. They have partnered

with extension agents, colleges and universities, state and federal

governmental agencies, elected officials, and commodity organizations.

Bette Brand, Matt Lohr, Kyley Clevenger and Rebecca Webert

continue to work diligently to develop relationships with all types of

groups involved in agriculture. Together they motivate, teach, share

and facilitate ideas and opportunities to all those interested in our

industry. They are ready and willing to help in any way possible, so

don’t hesitate to contact them if they can serve you.

Be sure to visit www.farmcreditknowledgecenter.com often to

stay up-to-date on all things agriculture. The Knowledge Center team

looks forward to being a trusted name just as Farm Credit has been

for nearly 100 years!

The Knowledge Center Websiteis Up and Running!

Matt lohr, Director [email protected]

Kyley Clevenger, Specialist [email protected]

Matt lohr, Director of the Knowledge Center, and Kyley Clevenger, Knowledge Center Specialist, sat down for an interview with VA Farming TV earlier this year.

Rebecca Webert, generalist [email protected]


InDUSTRY nEWS

USDA’s Rural Energy for America Program

Produced by: USDA Rural Development

L ocated midway between Richmond and Charlottesville in

Louisa County, Cooper Vineyards is nestled in a traditional

farming community. The goal of the winery founders and

current owners Jeff Cooper, MD and Jacquelyn P. Hogge, MD was to

create small lots of unique wines that expressed varietal character and

would be recognized as quality wines.

Now the question: What do wine making and an energy program

have in common? In addition to producing award winning wine, Cooper

Winery and their owners wanted a green building with the intent to

maximize renewable energy with sustainable building design and

create a unique atmosphere for the winery visitor unlike any other.

“We believe that there is no better place than a vineyard and winery to

design and build a green building where the goal of the entire operation

is to transform sunlight into wine.”

With the assistance of architect Michael Pellis, LEED AP of

Baskerville and some assistance from USDA’s Rural Energy for America

Program, their dream has come true. The LEED Certified facility funded

partially through the USDA-REAP Program features:

• Rainwater harvesting system that filters rainwater for irrigation

and toilet facilities

• Solar power panels that provide more than 15 percent of the

electricity for the wine tasting facility

• An ultra-efficient geothermal HVAC system

• Energy efficient lighting fixtures and Solar Tubes

• Natural stone and native cypress siding

• Structurally insulated panel system providing greater than

70 percent insulation value over traditional stick frame

construction

• Energy efficient windows

• Use of recycled and/or rapidly renewable resources in the

construction

In addition to all of the renewable and sustainable features, the

architectural design of the main tasting room has two complete walls

of glass that extend up for two stories, making visitors feel as though

the surrounding vineyard is part of the tasting room. The best of both

worlds, beauty and energy efficiency have very much been created at

Cooper Vineyards.

A second great example of how a farm business can benefit from the

REAP Program is True and Essential Meats (T&E Meats). T&E Meat’s

mission statement reads, “We are in the health business: creating healthy

customers, healthy regional farmers, healthy workers and a healthy

food community by connecting local farmers to local eaters; retaining

food dollars in our local communities; providing a safe, healthy and

affordable food supply; and healing the earth by promoting ecologically

sound farming practices.”

The owners of Cooper Vineyards, Jeff Cooper and Jacquelyn P. Hogge are proud of their green building that is capable of using the energy from the sun and ultimately transform it into wine.

Inside the green building at Cooper Vineyards, the open feel with windows stretching two stories high gives visitors the feel that they are surrounded by the vineyard which enhances their overall experience.

T&E Meats is a USDA-inspected processor located in Harrisonburg,

Virginia that works closely with farmers throughout Virginia to deliver

exceptional local meats to local tables, farmers markets, restaurants

and retail establishments. Co-owned and operated by Joel Salatin and

Joe Cloud, T&E Meats enable farmers in Virginia to raise and direct

market quality livestock by providing excellent processing services

under USDA inspection.

Like all small businesses, they were looking for creative ways to

cut operating expenses and increase their profits and the Rural Energy

for America Program offered them a great opportunity to accomplish

that goal. In May 2013 the 10,000 square foot brick and concrete block

building was in need of a new water-heating system to replace the 40

plus year-old oil fired boiler system.

After completing their due diligence from the choices available,

T&E Meats decided to purchase and install two A.O. Smith Cyclone

boilers to provide all of the hot water for the facility. “These two new

199,000 BTU water heaters will provide many years of trouble free

service to the facility and provides for an energy saving more than

30 percent each year,” said Cloud. He went on to say, “I could not be

happier with the upgrades and the resulting cost savings annually for

T&E Meats will be approximately $10,000.”

As these projects illustrate, the Rural Energy for America Program

(REAP) is a diverse program. Whether it is your goal to establish a

cutting edge energy efficient facility or just simply reduce energy costs

to optimize your bottom line, the REAP program can be instrumental

in both objectives.

The REAP Program was first implemented in the 2002 Farm Bill

and subsequently funded with successor farm bills. This program has

positively impacted the small businesses and agricultural producers in

Virginia significantly. Many of the improvements made by recipients

were necessary for preservation and survivorship. Twenty-five percent

of total eligible project costs (up to $500,000 for renewable energy

projects and $250,000 for energy efficiency projects) can be absorbed

through the grant piece of the program, and that certainly adds icing to

the cake, so to speak, for those making the improvements. In addition

to the grants, the program makes available guaranteed loans. For the

loans, applicants will pursue funding from a commercial lender with

the REAP program providing a guarantee to the lender.

The REAP guaranteed loan combined with the grant can fund no

more than 75 percent of the cost of the project. Virginia gets an annual

allocation for both grants and guaranteed loans.

While the REAP program can provide funding for energy efficiency

improvements and renewable energy systems, Virginia’s program has

evolved over the years. In the early years of the program the majority of

our awards were allocated to energy efficiency improvement projects.

We participated with agricultural producers who made improvements

to tobacco, swine and poultry houses, installed more efficient grain

dryers and upgraded irrigation systems with new motors, to name

a few. Replacing doors, windows, heating units, freezers, chillers,

air conditioning units and installing insulation were some of the

improvements we saw made to existing businesses. Last funding cycle

we approved 16 awards and 10 of those were for solar-photovoltaic

systems, to both business and agricultural producers. According to

Kent Ware, director for the REAP program, “We believe the increase

in solar projects are due in part to the tax incentives available and the

decline in the cost of the systems. However, we welcome any and all

projects that meet our program’s criteria.”

For more information on this program including eligibility

requirements or application packages, please contact the Virginia Rural

Development Office at 804-287-1557 for Kent Ware or at 434-392-4906,

extension 125 for Laurette Tucker.

T&E Meats is a USDA-inspected processor located in Harrisonburg, VA. They work closely with farmers throughout Virginia to deliver exceptional local meat products.

These two new 199,000 BTU water heaters at T&E Meats will provide many years of trouble free service to the facility and provides for an energy saving of over 30% each year.


S ticking with the ordinary is a safe bet for many, but over the

years the owners and operators of Cole Nurseries in Pipestem,

West Virginia have stayed on the cutting edge of the nursery

business by constantly going out on the limb and trying new things. Today,

this 200-acre farm consists primarily of wooded ornamentals and trees

that are unique to the area and are surely not to be found in stores such as

Wal-Mart or Lowes. By marketing such unique varieties of ornamentals

and trees, they are able to fill a specific segment of the market that tends to

be more rewarding and profitable to them than following the same track as

other nurseries.

growing from deep rootsIn 1937, Norman’s grandfather ventured into the nursery business.

He started Cole Nurseries in Springville, Virginia before the family

expanded to a second location in Pipestem, West Virginia. Norman’s

grandfather grew for a national corporation known as the Landscape

Nursery Council, LANCO. Being the strong willed man he was, he did

not like being told what to grow. He cut his ties with LANCO and started

doing his own thing. Not having much luck finding good materials,

there was only one thing for him to do and that was roll his sleeves up

a little farther and start growing what he wanted instead of relying to

purchase it from others. That is exactly what he did with much success.

Always looking up to his grandfather and being the only one in the

family to have a real interest in the business, Norman III was next in

line to carry on the operation. In recent years, Norman III’s nephew, Lee

Wynes, has stepped in and helped out. Norman has two sons, Norman

IV and Calvin. Although they help with the operation at times, it is

still uncertain if they will have a passion for it as strongly as their dad.

From 1937 until 2010, Cole Nurseries was strictly a wholesale

business, but with impacts from the economical crash, Norman planted

the next seed for the business and opened a garden center in 2010 as

a means of other income and a way to move material out. Year after

year this segment of the business continues to grow. Norman had a

propagation house before venturing into the retail market, but then

had to add a greenhouse and holding area for customers to shop. He

had no interests in the retail market, but quickly changed his mind

with the surge in the demand he saw.

Staying on the cutting edgeNorman received a bachelor of science degree in horticulture from

Virginia Tech in 1990. He contributes much of his success to an internship

he participated in with Don Shadow after he graduated from college.

Shadow provided Norman with many contacts he still uses today to

help bring in new products. Norman’s plant explorer friends travel to

China, Japan and all over the rest of the world looking for new plants

to introduce to the United States. He often looks to Europe for nursery

trends since it is about 10 to 12 years ahead of the United States in that

aspect. New plants also occur on the farm as point mutations from

plants already being grown.

Once a plant is selected as a new possibility to be sold at Cole

Nurseries from another country, Norman studies the plant’s growth

for four to five years. If it appears to adjust to the climate well and

Cole Nurseries, Inc.: Where going Out on the limb is normal!

By: Jennifer Showalter


FEATURE

is hardy enough, he will take a chance and ramp up production by

the hundreds and sometimes thousands to see if it will be a hit with

customers. Sometimes the public doesn’t care for the new plants, and

other times the plants are a huge hit from the get-go.

“When you are on the cutting edge and ahead of the market by

four to five years, you normally have to throw away your first year’s

crop because it takes people a bit longer to catch on to the new trend,”

says Norman. Norman started growing Western Arborvitae trees in

the 1990s because they are hardy and deer won’t eat them. He had to

practically give away his first few crops because no one wanted to give

them a try. With a little time, they are now an industry standard and

Norman cannot keep his orders filled.

In addition to bringing new plants to the United States, Norman

enjoys developing new plants. This is not a simple or quick process by

any means. He studies his new creations for stability and hardiness

for several years before increasing production to see how they will

sell. Owing his interest in this particular practice to his grandfather,

Norman recently named one of his patented boxwood “Highlander”

after a patented holly of his grandfather’s named Highlander. Norman’s

Highlander boxwood is being introduced in Europe this year.

Talk about cutting edge, Norman doesn’t just bring in plants from

around the world, he has actually patented two of his own varieties

of boxwood: Highlander and Little Missy. As for the other boxwood

patented, Little Missy’s name is derived from his wife, Missy Cole.

Although she doesn’t come from a horticultural background, Missy

has had a great impact on the success of Cole Nurseries. Her primary

responsibility involves all paper work and documentations that keep

the nursery in working order.

Today, primarily woody ornamentals and occasionally some trees

are grown at Cole Nurseries. With no annuals or perennials being

grown, boxwoods are Norman’s top selling item. By supplying materials

to resorts such as the Homestead and to other small businesses that

have landscape oriented garden centers, Cole Nurseries has developed

a name for itself over the years. Norman has participated in speaking

engagements, purchased billboard advertisements and run ads in local

papers, but finds that word of mouth is his best form of advertisement.

One speaking engagement Norman never misses is a chance to talk to

the local middle school. Norman said, “I think it is important to tell

kids to get outside and play. In a world where agricultural businesses

are few and far between, kids today need to be aware of the importance

of getting outside. And I always like to throw in there that what their

parents have been telling them is not true. Money really does go on trees.”

Making the most of every challengeCoping with unfavorable weather and any downward economy has always

been a challenge for Cole Nurseries. When those two things work against

him, he tends to have a hard time finding enough reliable employees.

He is considering housing for migrant labor to help with this issue.

Norman and Missy rely on the help of eight to 10 seasonal workers

and three full-time employees to get everything done. Even with this

help, Norman still puts in many long hours. In hopes of gaining more

family time, Norman and Missy just recently sold a farm they were

running 25 miles from Cole Nurseries’ main headquarters. The increase

in both their retail and wholesale markets over the last few years made

this decision possible.

Each year, the soils at Cole Nurseries are amended because of

the large root balls that are taken during harvest. A winter rye and

Sudan grass mix are planted and plowed under as a sustainable way of

getting nutrients back in the soil. Two crops are planted and then the

soils go through a two-year resting period before new young plants,

known as liners, are planted. With this practice in mind, Norman was

interested in buying an Italian digging machine back in 2003 to help

with the process. He visited with his local bank first about borrowing

money to purchase the machine. With their lack of knowledge of what

the equipment really was for and how much it was worth, Norman

did not have any luck. He then went to Farm Credit’s Lewisburg, West

Virginia office and has been a pleased customer ever since. Missy said,

“We love our loan officer, Keith Diem, he is like a part of the family.”

With every challenge there is an opportunity, and Norman III

has the drive behind him to take charge and plow onward. Just like his

grandfather did, Norman III has a real passion for the nursery business

and finds joy in offering things other than the ordinary.

For more information on Cole Nurseries, call: (304) 466-1970.


norman Cole demonstrates how to use the Italian digging machine, the first piece of equipment financed by Farm Credit, by digging up an arborvitae.


EDUCATIOn

Ag Biz Planner Program Participants GraduateBy: Kyley Clevenger

R aleigh, North Carolina hosted the graduation ceremony

for the 2013-2014 Ag Biz Planner Program in March. The

partnering Associations involved in the program, five in

total, invited their participants along with their mentors to the two-

day event. The ceremony concluded the course which encompassed

10 online modules, development and completion of their business

plan and one-on-one mentorship with a loan officer. The course took

place over a six-month time frame, which allowed the participants

to move through and complete at their own pace. Dr. Kohl, emeritus

professor at Virginia Tech and professor of Farm Credit University,

which hosts the Ag Biz Planner Program, was in attendance to discuss

megatrends in agriculture, business management skills, record

keeping methods and much, much more. The two-day event was

filled with networking opportunities, knowledge building and business

plan discussions.

The participants ranged in interest from a cut flower operation

to a farrow-finish operation and a cattle back grounding business to

agritourism. The diversity of agriculture was represented well as a

wide variety of interest and specialties were present in the program.

The size of the operations and businesses also varied throughout the

group, which allowed them to come together with their experiences to

discuss their business plans and goals for the future.

Farm Credit of the Virginias had a total of eight participants

complete the Ag Biz Planner, with a majority attending the graduation

ceremony in March. The opportunity to network and engage with other

producers will prove to be invaluable to the success of individuals and

their operations. The 2013-2014 graduates were impressive to work

with. We were fortunate to witness growth and development from the

beginning of the program until the conclusion of the course. “We are

excited to see this progress as they continue to grow,” says one mentor.

Congratulations to the 2013-2014 Ag Biz Planner Program

participants!

If you are interested in participating in the next Ag Biz Planner,

please contact the Kyley Clevenger, Knowledge Center Specialist, at

[email protected].

Participants of the 2013-2014 Ag Biz Planner during their graduation ceremony held in Raleigh, nC.

After several intense months the 2013-2014 participants of the Ag Biz Planner program graduate!

The course took place over a six-month time frame which allowed the participants to move through and

complete at their own pace.


Young Farmer Institute

During the months of March and April, Farm Credit

held three Young Farmer Institutes (YFI) which took

place in Harrisonburg and Abingdon, Virginia and in

Lewisburg, West Virginia. This year’s lineup of institutes started

off with a full house at the Traditions Restaurant in Harrisonburg.

Even on a clear, warm, sunny morning farmers still pulled in with

loads of cattle to ensure they wouldn’t miss an opportunity to hear

what Dr. Kohl had to say about the future farming economy. The

following day yielded another successful turnout in Abingdon at the

Southwest Virginia Higher Education Center and more than 60 people

attended. Lewisburg, West Virginia wrapped up the YFI’s for 2014

at the West Virginia State Fairgrounds. The group celebrated with

Dr. Kohl’s very own ice cream from Homestead Creamery.

Dr. Kohl engages the group of participants during the YFI held at the Southwest Virginia Higher Education Center in Abingdon, Va.

Cattle wait in trailers as farmers take in all they can during the Young Farmer Institute in Harrisonburg, Va.

Regional lending Manager, Joe Casto, takes a break from serving ice cream from Homestead Creamery during the lewisburg YFI.

Director tom thacker Steps Down to Pass Farm credit tradition to a new Generation

F arm Credit of the Virginias Director, Tom

Thacker, announced earlier this year that he

would be stepping down from the Board of

Directors. After nearly twelve years of dedicated service,

Tom decided that May 28th was going to be his final

day. Thacker has enjoyed his time with Farm Credit

and serving our customer-owners, but he is excited

to make room for other generations. Thacker said,

“Due to Farm Credit’s standards and regulations, I can

no longer serve on the Board of Directors since my son-in-law has

accepted a commercial loan officer position with the association. He

is a very experienced agricultural loan officer and I am happy to see

him continue working for Farm Credit customers. I

have enjoyed my twelve years serving as a director, and

I wish Farm Credit of the Virginias all the best.” CEO

Dave Lawrence shared, “Tom Thacker has been an asset

to the board as well as to our customer-owners. He has

demonstrated an in-depth understanding of the industry

and has been a tremendous spokesperson and advocate

for the association and agriculture. We are sad to lose

Tom as a board member. Being a previous loan officer

and a poultry producer, he has shown such a great perspective as the

board has drafted and rewritten policies. He has a vast understanding

of the customers’ needs that will be hard to replace.”.

YOUng FARMER PROFIlE


Tell us about yourselves.My name is Carrie and I am married to David See. We have two small

children. Our daughter, Lena, is 4 and our son, Owen, who just turned a

year old. They are often out with us on the farm. It’s an interesting thing

to answer our daughter’s million questions and explain why we do things

a certain way. Seeing things through their eyes gives us perspective.

David is originally from Hampshire County, and I grew up in Preston

County- very near where we live now. David raised hogs throughout

high school and college, and I grew up on a beef farm. I had a handful

of brood cows on my parents’ farm before we began farming together.

David and I met as college seniors, in an Ag Business class at WVU.

He and I both hold BS degrees in Agribusiness and Rural Development.

Upon graduation, he was hired as the Assistant Manager at the Oakland

Cooperative of Southern States. I went on to complete an MS in Ag

Education and Extension, and then I was hired by the WVU Extension

Service. David was promoted to Manager of the Oakland Coop in 2012

and I recently transitioned from WVU Extension to opening my own

Farm Family Insurance office in Terra Alta, West Virginia.

What youth organizations were you involved in that influenced you?I belonged to 4-H and FFA in Preston County and David was very active

in FFA in Hampshire County. We both exhibited market animal projects

at our county fairs. He showed swine and I showed beef cattle. 4-H

and FFA were a tremendous influence in our lives and helped shape

our futures in the field of agriculture. Through these experiences, we

see the value in being open to new ideas, we also became better public

speakers. We are grateful for the contacts we made in those years that

followed us through college and into our careers. I still serve on the

youth agriculture board in Preston County because I see great value in

giving back to those organizations that guided me in my younger years.

When I was a youth exhibitor, there were amazing people who gave

their time and energy to allow me the opportunities to learn. I want to

be that for others. We also belong to the WV Cattlemen’s Association

and WV Farm Bureau, and attend Extension meetings regularly.

David and Carrie SeeOakland, Maryland

By: Jenna Mullins

We farm about 300 acres, some owned and some leased. We calve about 25 cows right now. We definitely plan to expand but we are conscious of our resources and try to avoid overgrazing so we are slowly growing as

we can manage it. With two small children and time-consuming off-farm jobs, it’s a trick to make it all balance.

David and Carrie See pictured above with their two children-daughter lena and son Owen.


What kind of farming operations are you currently involved in?We purchased our own small farm in 2009, in Cranesville (Preston

County). We raise beef cattle and hay crops. We have also raised

chickens, hogs, small grains and produce at various times. We anticipate

becoming involved in those again, when resources became available. We

farm about 300 acres, some owned and some leased. We calve about

25 cows right now. We definitely plan to expand but we are conscious

of our resources and try to avoid overgrazing so we are slowly growing

as we can manage it. With two small children and time-consuming off

farm jobs, it’s a trick to make it all balance.

What have been your biggest obstacles?The most obvious obstacles to us are time management, the same

challenge that faces any young farm couple who is starting from

scratch. It’s a difficult task to start farming these days- to purchase land,

equipment and animals, and properly care for them- is not something

just anyone can do. Our farm was a rental farm before we bought it,

so lime and fertilizer are a priority for us. Soil amendments are key to

grass production, and grass production is key to beef cattle production.

Proper forage growth and supplements are key to cattle production,

it’s an ongoing circle. We want to do things the responsible way, and

that sometimes means slow growth.

We love where we live, but the climate can sometimes be an

obstacle. Summers are beautiful and temperate which is good for cattle

grazing, but winters can be a bit rough.

What is your greatest accomplishment?If we can instill a love of land and agriculture in our children that,

without a doubt, will be our greatest accomplishment. And, we’re both

the first in or families to attend and graduate from college.

What would you say have been your keys to success?Keys to our success include the incredible amount of people we have

been able to make contact with, through WVU, our workplaces, and

our friends and neighbors. Between our parents and grandparents,

neighbors and friends, we have drawn on vast amounts of experience

to help us make our decisions.

What is your ultimate goal?Our “ultimate goal” is similar to our mission statement, which reads:

To perform as a sustainable, profitable business, producing a quality,

safe product with pride in an environmentally sound manner while

educating those who are less aware of agricultural issues.

How has Farm Credit assisted you in getting started and what type of relationship do you have with them? Our first loan as a married couple was through Farm Credit. David had

financed some equipment through them before we were married. We

had been married almost a month and we went to Ag Progress Days in

Pennsylvania to look at stock trailers. We picked out the one we wanted

and dialed up our Farm Credit loan office, and pulled the trailer home

that day! We’ve always found them to be straightforward and efficient in

our transactions, and we’ve built on our relationship from that first loan.

This past year we also took advantage of Farm Credit’s Ag Biz Planner

program. The online course took six months to complete. It covered

everything from agricultural megatrends, business management skills

to record keeping methods and much more. The program was a great

experience and very beneficial. We enjoy seeing Farm Credit folks at

the ag events we attend, they’re really a big part of the community.

If we can instill a love of land and agriculture in our children that, without a doubt, will be our greatest accomplishment.

Pictured above are a few of the cows from the See’s beef herd.


ASSOCIATIOn nEWS

National Cattlemen’s Beef Association Convention

A group of Farm Credit employees

attended the National Cattlemen’s

Beef Association Convention that

was held in Nashville, Tennessee at the Gaylord

Opryland Resort and Convention Center. The

Cattle Industry Convention is the oldest and

largest convention for the cattle business. The

convention and trade show created a unique,

fun environment for cattle industry members

to come together to network, create policy for

the industry and to have some fun!

Pictured are Farm Credit employees representing Virginia and West Virginia while attending the nCBA Convention in nashville, Tenn. Pictured l to R : Ed Blevins, Katelyn Burner, Brian Repass, Kyley Clevenger, Bobby Williams, Cheyenne Cline, Vinson Snuffer, Jenna Mullins, David Walker, Andy Cumberland and Trey Keyser.

Virginia Agribusiness Council Banquet

The Virginia Agribusiness Council

Banquet was held in Richmond,

Virginia at the Richmond Raceway

Complex this year. The industry’s premiere

event is attended by more than 900 people

annually. Attendees include the governor,

lieutenant governor, attorney general,

members of the general assembly, and our

Congressional delegation. An elegant dinner

is served featuring the finest products from

Virginia. Farm Credit looks forward to

sponsoring and participating in this gathering

year after year.

Pictured are Kyley Clevenger and Matt lohr from the Farm Credit Knowledge Center, as well as Bette Brand, Chief of Sales Officer while attending the Virginia Agribusiness Council Banquet


cAP news(Communications Advocacy Program)

The Farm Credit team and the

Board of Directors understand the

importance of building strong, lasting

relationships with members of Congress who

were responsible for the establishment of the

Farm Credit cooperative in 1916. Since then,

our team strives to maintain those relationships

in order to keep members of Congress aware of

the needs of those in the agricultural industry,

as well as the positive impact Farm Credit

has on the industry. Farm Credit remains

successful in maintaining those relationships

by attending such events as listed below.

JAnUARYJanuary 9: More than one thousand

people including agriculturalists, members

of the Governor’s cabinet, the Virginia

Assembly and Congress attended the Virginia

Agribusiness Banquet in Richmond, Virginia.

January 24: Joe Casto, Regional

Lending Manager for Farm Credit, participated

in an open house hosted by Senator Joe

Manchin at the Greenbrier in White Sulphur

Springs, West Virginia.

January 30–31: Bette Brand, Chief

Sales Officer for Farm Credit, participated

in the Virginia Horse Council’s Legislative

event with the Virginia General Assembly. An

equine-themed gift was given to each senator

and delegate and members of the Governor’s

cabinet along with the equine industry policy

booklet. Bette also participated in the VHC

Legislative reception which was sponsored by

Farm Credit of the Virginias.

FEBRUARYFebruary 10: A Welcome Back

Luncheon for West Virginia Legislators took

place in Charleston, West Virginia. Farm

Credit of the Virginias and Mid Atlantic Farm

Credit directors and employees teamed up

with West Virginia Farm Bureau to deliver

boxed lunches to all of the legislators. Later

on they met with several key members to

discuss issues important to agriculture and

rural communities.

February 20: Joe Casto participated in

Senator Joe Manchin’s Meet and Greet that

was held in Ripley, West Virginia.

MARCHMarch 11: Farm Credit sponsored

and participated in WV Ag & Forestry Day

in Charleston, West Virginia. Farm Credit

employees manned a booth that was set

up in the rotunda while staff and directors

participated in the reception later that evening.

March 25: Farm Credit Knowledge

Center Director Matt Lohr, Bette Brand, and

Director for Farm Credit of the Virginias Ray

Simms attended a breakfast for Congressman

Eric Cantor in Richmond, Virginia.

Dave Lawrence, CEO of Farm Credit of

the Virginias, sent a letter to Congressman

Frank Wolf, a member of the Appropriations

Committee, requesting support for the

Community Facilities Guarantee Program.

APRIlApril 13–14: Joe Casto participated in

Sen. Joe Manchin’s Country Roads Leadership

PAC at the Greenbrier.

Matt Lohr and Bette Brand met with

Congressman Morgan Griffith in Salem,

Virginia to discuss the Knowledge Center.

Susan Belford, Branch Manager for Farm

Credit of the Virginias, participated in an Ag

Roundtable discussion with Congressman

Robert Hurt in Warrenton, Virginia.

April 28–30: Farm Credit sent some

of their seasoned and experienced employees

to Washington DC to participate in a tour on

and around the Capitol.


Joe Casto, Regional lending Manger for Farm Credit, and governor Joe Manchin pause for a quick photo during the Senator’s Meet and greet in Ripley, W.Va.

contInueD on neXt PAGe

Matt lohr, Director of the Knowledge Center, and Bette Brand, Chief Sales Officer for Farm Credit of the Virginias, met with Congressman Morgan griffith to discuss the Knowledge Center.


ASSOCIATIOn nEWS


MAYMay 8: Farm Credit of the Virginias

and Colonial Farm Credit participated in the

Wittman Annual Fish Fry that was held in

Washington, D.C. Farm Credit Directors Ray

Simms and Paul House attended, as well as

Matt Lohr.

May 9–11: Farm Credit sponsored the

VA Horse Council Legislative Trail Ride, that

took place at Douthat State Park.

May 13: Farm Credit participated in a

farm tour with Congressman David McKinley

along with the West Virginia Farm Bureau.

The tour consisted of three visits to farms

in McKinley’s district: Flying W Farms in

Burlington, West Virginia; Eight is Enough

Farm in Old Fields, West Virginia; and Cottage

Hill Farm in Petersburg, West Virginia.

JUnE June: Farm Credit of the Virginias,

Colonial Farm Credit, MidAtlantic Farm

Credit and AgChoice Farm Credit hosted the

Blue Ribbon Tastes event from Farm Credit

on Capitol Hill for members of Congress

and the Senate. This event showcased

agricultural products from farmers throughout

the region.

Congressman David McKinley took time to listen to each of the farmers’ concerns from EPA issues to the need for balancing humane treatment of animals and food safety issues.

Farm Credit of the Virginias employees Jashaun Carter, Manuela Schabel, Scott Howerton, and Marilyn Adams participated in a tour around Washington DC.

Calvin Riggleman, owner and operator of Bigg Riggs Farm and gourmet Central in Romney, WV catered the Blue Ribbon Tastes event. He proudly displayed his value-added products with the new Homegrown by Heroes label which is a new initiative recently launched by the Farmer Veteran Coalition that supports veterans in agricultural production.

Members of the Farm Credit team are pictured above with Congressman goodlatte with a check totaling the amount of patronage given back to Farm Credit customers in his district.

Attendees of the Farm Credit Blue Ribbon Tastes event visited the ‘Farmers Market’ held on the patio during the event and were able to take away homemade items produced by our very own customers.

March 31, December 31,

(dollars in thousands) 2014 2013

(unaudited) (audited)

AssetsCash 3,829$ 5,617$

Loans 1,494,177 1,483,454 Allowance for loan losses (11,944) (11,878)

Net loans 1,482,233 1,471,576

Loans held for sale 249 722 Other investments — 2,989 Accrued interest receivable 10,083 7,508 Investments in other Farm Credit institutions 25,537 25,707 Premises and equipment, net 7,702 7,754 Other property owned 2,706 2,337 Accounts receivable 3,373 31,362 Other assets 4,460 5,209

Total assets 1,540,172$ 1,560,781$

LiabilitiesNotes payable to AgFirst Farm Credit Bank 1,183,553$ 1,209,905$ Accrued interest payable 2,512 2,858 Patronage refunds payable 1,085 21,161 Accounts payable 1,248 3,617 Other liabilities 32,620 12,630

Total liabilities 1,221,018 1,250,171

Commitments and contingencies

Members' EquityCapital stock and participation certificates 17,317 17,313 Retained earnings Allocated 92,568 92,568 Unallocated 209,279 200,739 Accumulated other comprehensive income (loss) (10) (10)

Total members' equity 319,154 310,610

Total liabilities and members' equity 1,540,172$ 1,560,781$


Interest IncomeLoans 19,562$ 19,168$ Investment securities 5 63

Total interest income 19,567 19,231

Interest ExpenseNotes payable to AgFirst Farm Credit Bank 7,674 8,498

Net interest income 11,893 10,733 Provision for loan losses — 500

Net interest income after provision for loan losses 11,893 10,233

Noninterest IncomeLoan fees 168 129 Fees for financially related services 5 6 Patronage refunds from other Farm Credit institutions 3,092 3,225 Gains (losses) on sales of rural home loans, net 82 197 Gains (losses) on sales of premises and equipment, net 20 25 Gains (losses) on other transactions 1 18 Other noninterest income 126 146

Total noninterest income 3,494 3,746

Noninterest ExpenseSalaries and employee benefits 4,429 4,051 Occupancy and equipment 291 303 Insurance Fund premiums 346 301 (Gains) losses on other property owned, net 17 (207) Other operating expenses 1,737 1,539

Total noninterest expense 6,820 5,987

Income before income taxes 8,567 7,992 Provision for income taxes 27 15

Net income 8,540 7,977

Other comprehensive income — —

Comprehensive income 8,540$ 7,977$

ended March 31,

(unaudited)

Farm Credit of the Virginias, ACA

Consolidated Balance Sheets

Consolidated Statements ofComprehensive Income

For the three months


Consolidated Statements of Income

The shareholders’ investment in the Association is materially affected by the financial condition and results of operations of AgFirst Farm Credit Bank. Copies of AgFirst’s quarterly and annual financial reports to shareholders are available free of charge at www.agfirst.com, or by writing to AgFirst Farm Credit Bank, Financial Reporting Department, P.O. Box 1499, Columbia, SC 29202. Farm Credit of the Virginias complete quarterly and annual financial reports are available online at www.farmcreditofvirginias.com

F InAnCIAl REPORT

March 31, December 31,


(unaudited) (audited)

AssetsCash 3,829$ 5,617$

Loans 1,494,177 1,483,454 Allowance for loan losses (11,944) (11,878)

Net loans 1,482,233 1,471,576

Loans held for sale 249 722 Other investments — 2,989 Accrued interest receivable 10,083 7,508 Investments in other Farm Credit institutions 25,537 25,707 Premises and equipment, net 7,702 7,754 Other property owned 2,706 2,337 Accounts receivable 3,373 31,362 Other assets 4,460 5,209

Total assets 1,540,172$ 1,560,781$

LiabilitiesNotes payable to AgFirst Farm Credit Bank 1,183,553$ 1,209,905$ Accrued interest payable 2,512 2,858 Patronage refunds payable 1,085 21,161 Accounts payable 1,248 3,617 Other liabilities 32,620 12,630

Total liabilities 1,221,018 1,250,171

Commitments and contingencies

Members' EquityCapital stock and participation certificates 17,317 17,313 Retained earnings Allocated 92,568 92,568 Unallocated 209,279 200,739 Accumulated other comprehensive income (loss) (10) (10)

Total members' equity 319,154 310,610

Total liabilities and members' equity 1,540,172$ 1,560,781$


Interest IncomeLoans 19,562$ 19,168$ Investment securities 5 63

Total interest income 19,567 19,231

Interest ExpenseNotes payable to AgFirst Farm Credit Bank 7,674 8,498

Net interest income 11,893 10,733 Provision for loan losses — 500

Net interest income after provision for loan losses 11,893 10,233

Noninterest IncomeLoan fees 168 129 Fees for financially related services 5 6 Patronage refunds from other Farm Credit institutions 3,092 3,225 Gains (losses) on sales of rural home loans, net 82 197 Gains (losses) on sales of premises and equipment, net 20 25 Gains (losses) on other transactions 1 18 Other noninterest income 126 146

Total noninterest income 3,494 3,746

Noninterest ExpenseSalaries and employee benefits 4,429 4,051 Occupancy and equipment 291 303 Insurance Fund premiums 346 301 (Gains) losses on other property owned, net 17 (207) Other operating expenses 1,737 1,539

Total noninterest expense 6,820 5,987

Income before income taxes 8,567 7,992 Provision for income taxes 27 15

Net income 8,540 7,977

Other comprehensive income — —

Comprehensive income 8,540$ 7,977$

ended March 31,

(unaudited)

Farm Credit of the Virginias, ACA


Consolidated Statements ofComprehensive Income

For the three months


Farm Credit of the VirginiasP.O. Box 899Staunton, Virginia 24402

NMLS #456965

PRSRT STDU.S. POSTAgE

P A I DCOlUMBIA SCPERMIT 1160

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