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Published April 26, 2013, 09:11 AM

AGRITOURISM: Getting Back to the Farm

Agritourism offers opportunity to visit rural roots

By: Kris Bevill, Prairie Business Magazine

As more young people move from farm communities to population centers and small family farms are sold to larger operators, the opportunity for agritourism — a term broadly used to describe any type of farm or ranch-related activity — is growing. The North Dakota Tourism Division began emphasizing agritourism’s niche market in the state a few years ago after recognizing demand from young families and curious urbanites seeking to explore rural life.

Dean Ihla, tourism development manager, says the segment has grown recently, but there continues to be a need for ag-based tourist businesses in the state. “People expect to have more places in North Dakota because of our strong agricultural base,” he says. “That’s changing. We are getting more operators all the time.”

One factor that has allowed North Dakota’s agritourism sector to expand is a bill passed during the 2011 state legislative session that provides agritourism operators with liability protection. The bill establishes that participants assume risk by taking part in agritourism and, therefore, the operator is not liable for injuries incurred on property. To be covered under the law, agritourism operators must register with the tourism division and provide a notice to participants that the operator is not liable for participant injury from inherent risk. There is no fee to register with the tourism division and registrations are effective for five years. In exchange, the tourism division supplies operators with signage relaying the state law. The division also provides marketing support for operators. This month, it is unveiling a redesigned website, www.ndtourism.com, complete with a section devoted to agritourism, which Ihla says will help connect interested parties with the state’s agritourism providers.

Of the 81 identified existing or potential agritourism businesses within the state, 25 operators are currently registered with the division, Ihla says. Seven of the registered operators are new businesses. It’s not clear whether the liability law was the deciding factor in the creation of all the new businesses, but Ihla says many operators have said the law provides them a level of comfort. “The other thing we hope happens is that as time goes on, companies are more comfortable with insuring these types of operations so that over time this may open up the marketplace and lower the cost [of insurance],” he says.

The tourism division maintains a presence in the agritourism industry by regularly collaborating with agritourism-related groups, including the North Dakota Grape and Wine Association, Pride of Dakota and the North Dakota Farmers Market and Growers Association. The department participates in cross marketing with the groups and actively recruits group members for the state program. “We’re still a new segment of tourism so a lot of it right now is about development and growth,” Ihla says.

Currently, agritourism businesses in North Dakota are spread fairly evenly through the state, including ranches in the west, vineyards in the east and variety of other offerings scattered throughout. The tourism division would like to expand the number of large-scale grain farm tours because it is a unique aspect of the state. However, because agriculture is experiencing a period of increased profitability, interest from potential operators has dropped compared to when commodity prices were low. “We’re in a cycle where things are pretty good and everybody’s kind of happy with the way things are,” Ihla says. “We’re seeing more hobby farms and crops such as fruit and vegetables that are getting involved in agritourism as opposed to large-scale grain operations.”

The Breker family of Havana, N.D., is an exception to the situation. The family has farmed in southeast North Dakota for five generations and currently grows corn, winter wheat, soybeans and specialty crops such as radish for seed on 3,000 acres in addition to raising about 100 head of Angus beef cattle. Last October, after two years of planning and building, the family added lodging and farm tours to its list of duties with the opening of Coteau des Prairies Lodge LLC (www.cdplodge.com).

“It’s been a long-time dream of our family to build a lodge in this pasture that we own for grazing our cattle,” says Phillip Breker, who serves as website and social media administrator for the family venture. “Seldom do folks get out this way because it’s off the beaten path, but it’s such a beautiful part of the state.”

The lodge was built using Ponderosa pine from western North Dakota and consists of nine bedrooms and a three-room suite as well as an impressive great room and kitchen designed to accommodate large gatherings, a wrap-around porch and a look-out perch for visitors to soak in the landscape. The entire project was a labor of love, with family members including Phillip’s parents, Joe and Patty, and sister, Olivia, investing sweat equity into the building of the lodge nearly every day for two years. The financial cost of the project was more than $1 million, most of which was funded through investments made by family and friends, Breker says. A PACE (Partnership in Assisting Community Expansion) loan from the Bank of North Dakota, with participation by the Sargent County Bank and the local Jobs Development Authority, covered the remaining portion of the costs. “That was huge for us,” Breker says. “Having that low-interest loan in these early years when there’s a lot of unknowns about how much revenue will be generated to pay back the loan … that’s huge.”

While the overall project cost was quite large, Breker says the business plan was designed to minimize risk for investors. “No single investor is counting on a profit to make a living, but if it does take off it’s going to be a lot of fun and a great adventure,” he says. “We have no guarantee that this is going to work. We’re just working hard and planning for the best.”

The lodge has already hosted a number of gatherings since opening last fall and has several weddings booked for the summer, according to Breker. The family will gradually expand the business as dictated by demand, including first-hand farm and ranch experiences and tours, and horse-drawn buggy and sleigh rides. They are also developing a unique dining experience which may feature dry-aged “story beef” from the family’s herd.

Breker says the state’s liability protection was the deciding factor in the family’s decision to move forward with the agritourism side of the business. “If you want guests to have an authentic experience, there’s potentially a lot of liability in bringing people out on a working farm,” he says. “I think [the legislation] was a great idea and it definitely gave us a lot of confidence.”

The Brekers’ desire to share their scenic views and rural North Dakota experience with people who otherwise may never have the opportunity fits perfectly with the tourism division’s desire to focus on agritourism businesses that play up the state’s unique offerings. The division awarded Coteau des Prairies Lodge with a grant to assist in marketing efforts and has been actively promoting the lodge and the geographic region of the state in its publications this year. “One thing we like most about the tourism department is how excited they have been for us,” Breker says. “We feel like they will be a great partner.”

Ihla says many agritourism providers start slow, offering tours or services by appointment to test the waters and determine whether demand will support a full-fledged venture. The tourism division allows providers to list their services on its website, including contact information so that potential customers can arrange appointments. The division is doing what it can to encourage growth from both sides of agritourism — operators and public participants — and Ihla suggests that potential operators consider what they may have to offer that can be developed into an agritourism destination. “Agritourism is kind of a broad category,” he says. “It can be ranching, it can be a vineyard, it can be a bed and breakfast in the middle of the country. It can be whatever you want it to be.” PB

Kris Bevill

Editor, Prairie Business

701-306-8561, kbevill@prairiebizmag.com

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