Can family farms in the Pacific Northwest be saved?

With residential and commercial development taking over, it’s an uphill battle to preserve working orchards and ag land

Here comes the neighborhood: Houses on former orchard and agricultural lands, like this one under construction in Oregon’s Hood River Valley, are displacing a legacy. Photo: Jurgen Hess

By Andrew Engelson. March 20. 2025. Mike McCarthy, a pear orchardist who has been farming in Oregon’s Hood River Valley since 1980, says skyrocketing land prices and challenging economics are causing an unprecedented loss of farmland in the state.

“Low incomes are the real issue. Many farmers don’t want to farm anymore. Or your kids don’t want to take over because there’s no money—and it’s hard work, says McCarthy. “Plus, there’s a lot of people with money that would like to own rural properties.”

With land values in rural Hood River Valley reaching as high as $40,000 an acre, the pressure to sell to developers building vacation homes is rapidly increasing.

According to Oregon Agricultural Trust, the average age of ranchers and farmers in Oregon is 60 years old. The organization estimates that about two-thirds of all farmland in Oregon will change hands within the next 20 years.

“Land that is now over $40,000 an acre is almost impossible to float a mortgage on with agricultural income alone, so it becomes almost impossible for farmers to compete with the second home market,” says Nellie McAdams, executive director of Oregon Agricultural Trust.

McAdams says that in the 50 years since passage of the Oregon Land Conservation and Development Act in 1973, which set out robust protections for agricultural land, the state has nevertheless lost millions of acres of farmland to other uses.

“We’ve also lost 43,000 acres to land being brought into urban growth boundaries,” she says.

A 2024 analysis by Oregon State University assistant professor Dan Bigelow found that farm prices in Oregon rose 23% between 2017 and 2022, putting additional burdens on small- to medium-sized farms.

McCarthy says factors in addition to land prices—especially labor costs and competition from imported produce—are making it harder for medium-sized farms to stay in business.

He says that an orchardist or farmer needs to gross at least $500,000 a year to make a living. For most medium-size farms, profits above 10% are rare.

“So, that’s it for the owner’s salary and any additional capital they may need to continue. Ten percent of $500,000 is $50,000,” he says. “That’s what you’re going to live on. And that’s what you’re going to buy a new tractor with.”

Succession is tricky business

McCarthy’s son has taken over managing his orchard—on which pears account for about 90% of the crop, with cherries and apples making up the remainder.

But this sort of transition of the business and land to a family member is increasingly rare in the Hood River Valley.

Addie Candib, Pacific Northwest director for American Farmland Trust, says the intergenerational transfer of farmland is a top concern for her organization.

“Many of our current farm and ranch operators are getting on in years, and many of them don’t have family members who are poised or interested to take over the businesses,” says Candib. “If someone passes away and there’s not a plan in place, there’s a high likelihood the land will be sold off for some more financially valuable use.”

Taking a stand: Historically fueled by family farms like Draper Girls Country Farm, a U-pick orchard and farm in Oregon’s Hood River Fruit Loop, Hood River County is the nation’s largest exporter of pears. Photo: Visit Hood River

American Farmland Trust has a program that assists farmers with creating a transition plan, but admits the process is cumbersome, can take years and demand for these services is high.

McAdams, who’s a third generation farmer who focuses on growing hazelnuts, says that she remembers the moment when her father subdivided part of the family’s farmland to help him afford the costs of inheriting the farm from his parents.

“It got me thinking about how others are planning for succession. These are extremely complex and expensive decisions and plans to make,” she says. “How can we set folks up for success, where, instead of selling off the golden goose, they can be protecting it and be compensated for doing so?”

Oregon Agricultural Trust works with attorneys and accountants to help farmers and ranchers create succession plans and improve their business viability. The goal, she says, is to protect agricultural land by protecting the business of farming for the next generation.

“That next generation might be a family member, but they might not be,” says McAdams. “It’s less than likely it’s going to go to your son. It might go to your niece. It might go to your farm manager. It might go to someone you’ve never met before who has a passion for this work.”

Keeping that new generation in farming is a daunting task, and both Oregon Agricultural Trust and American Farmland Trust support working lands conservation easements to create incentives designed to keep farmland in production rather than being sold off for luxury homes.

Renewables create pressure

Though Candib says that American Farmland Trust does protect around 2,000 acres of farmland through direct land trusts it manages, most of its work in Oregon and Washington is to connect farmland owners with other land trusts or conservation easement programs.

Candib’s organization is pushing in this Washington legislative session for $4 million in renewed funding of the Farm Protection and Affordability Investment program run by the Washington State Housing Finance Commission.

“The program is designed to be very nimble,” she says, noting that conservation organizations can get a loan from the program, place an easement on the land and then sell the land at a reduced rate to a farmer to keep the land in production.

Land use up in the air: Dave Pinkerton, a wheat farmer in Oregon’s Sherman County, has leased some of his land to wind power operations. Photo: Jurgen Hess

McAdams says Oregon Agricultural Trust works with farmers to provide funds to put in place what are known as working lands conservation easements on land.

The goal make the property more affordable so it can continue producing pears, for instance, rather than being converted to a second home or other use.

Renewable energy projects, including solar and wind, are putting additional pressures on agricultural land, says Candib.

American Farmland Trust is supportive of renewable energy, and has a team dedicated to what she calls “smart solar principles.”

“We’re really thinking about the need to site renewable energy in ways that leave a minimal impact on agriculture,” she says.

Resistance to government involvement

In addition to the Regional Conservation Partnership Program (a grant program the U.S. Department of Agriculture funds to protect working farmland), McAdams’ organization helps farmers access the Oregon Agricultural Heritage Program. The statewide grant program is designed to help farmers put conservation easements on their land and still make a profit when they eventually sell the land.

Her organization is pushing the Oregon legislature to pass HB 3131, which would provide $17.3 million in funding to the program.

“Most of the funds will go to working lands conservation easements,” says McAdams, “but it’s really a match program to draw on federal dollars and landowner donations. It leverages millions of additional dollars.”

Change of seasons: Pear orchardist Mike McCarthy says kids don’t want to take over family farms “because there’s no money in it.” Photo: Andrew Engelson

Though Mike McCarthy sits on the board of a 200-acre land trust near Parkdale in Oregon’s Hood River Valley, he’s skeptical that conservation easements and land trusts are the best solution to preventing the transfer of farmland to other uses in the area, where pears have long been the primary crop.

He notes that many growers in the valley don’t understand land trusts and easements and that they’re skeptical of the economics of these programs, even when funded by grants or nonprofits.

“People don’t want to commit to tying their land up to a losing deal,” says McCarthy.

“Farmers in this valley and in this state, overall, are very independent. They don’t want government intervention, and they feel a conservation easement is a government intervention,” he says.

McAdams counters that some farmers are also resistant to succession planning, which can also open them up to losing the farm to estate taxes—preventing the current farmer from inheriting the land.

“If you don’t have a will or a trust, don’t worry,” she says. “The state is going to tell you who should inherit your property.”

She urges farmers to create a succession plan regardless if they want to involve a land trust or put an easement on the land.

Large operations taking over

Convinced that tighter regulation is the solution, McCarthy has been lobbying the Oregon legislature for years to reduce the number of loopholes added to the Oregon Land Conservation and Development Act over five decades.

He says that allowances for farm stands, wineries and other business uses have diluted the act and made it easy for landowners to skirt the intent of the law, which is to preserve working farmland.

“It’s really a wealth-test system,” he says. “A lot of the time, you can get almost anything you want if you hire an expensive attorney, a land use expert, a soil scientist and forestry expert. You can prove that it’s not farmland and that you should be allowed to do something else with it.”

In addition to pushing for reforms to Oregon’s land use system, he’s urging lawmakers to support HB 2166, which would fund a study of agricultural competitiveness in Oregon.

“Oregon doesn’t give a damn about agriculture,” McCarthy said. “They think they do, but they don’t. They have no idea what agriculture is. Agriculture, to them, is a small farm where somebody takes a few vegetables to the farmers market. They have no understanding of the economics of it.”

He points to recent passage of a farmworker overtime bill that he believes is well intended but will end up hurting mid-level farmers.

“It’s a great theory, but there’s no money in farming to pay additional wages,” he says.

McCarthy predicts the ongoing consolidation of agriculture to larger corporate-owned farms in Washington and Oregon will continue.

When he first started farming over four decades ago, he says the average farm size was 40 to 50 acres. Now, his guess is the average is between 100 and 200, with some operations as large as 700 acres.

McCarthy says fruit packing and shipping companies such as Mount Adams Fruit, based in Bingen on the Washington side of the Columbia River, have been buying and consolidating thousands of acres of orchard lands of their own.

Candib says this shift in scale is an additional threat to small- to mid-sized farms.

“There’s a reason that we’re seeing so much consolidation of farmland and agricultural businesses,” she said. “Because the system is set up to support its building of efficiency at a very large scale.”

McCarthy, who is rare among his peers because he identifies as a Democrat, says he’ll continue to lobby legislators to pay attention to the issues facing family farmers in Oregon.

“I’m a pragmatist,” he says. “Because I try to make a living off the land, I’m as progressive as I can afford to be.”

Columbia Insight’s reporting on environmental issues in Oregon’s Hood River Valley is supported by the Jubitz Family Foundation.