farms | Cameron & Cameron

Literally millions of folks participate annually in some form of agritourism in the state of California alone. The farms and ranches that perpetuate this increasingly popular tourism niche provide a plethora of agricultural activities for visitors to enjoy, and that is exactly what keeps them coming back for more.

Agricultural tourism is defined as a commercial endeavor at a farm, ranch, or other agricultural institution that is intended not only for the enjoyment and/or education of visitors, but also for the gain of additional income for the owner.

A romantic getaway at a secluded ranch, a bed and breakfast at one of California’s famous vineyards, and a destination wedding in the mountains or on the coast are just some of the things bringing people into California from all around the globe. Kid-friendly activities such as corn mazes, hay rides, and fields full of farm fresh produce just waiting to be picked and enjoyed are great ways to include the entire family on an unforgettable agritourism adventure.

Agritourism also includes roadside farm stands, farmers markets, tours, classes, workshops, fairs, festivals, pumpkin patches, Christmas tree farms, “U-pick” activities (fruits, vegetables, herbs, and flowers), winery weddings, orchard dinners, historic buildings/museums, youth camps/retreats, barn dances, hunting, fishing, horseback riding, bird watching, camping/RV accommodations, guest ranches, and more.

In addition to the fruits, vegetables, and herbs commonly found at roadside stands and in farmers markets, other popular items sold by farms and ranches include jams, oils (olive, garlic, peanut, hazelnut, etc.), grass-fed beef, soap, and goat’s milk.

Moreover, on top of the profits this agritourism brings into the state, there are also many new jobs and a substantial opportunity for growth that come along with this seemingly ever-increasing trend, too. Farms and ranches see this as a way to increase both visibility and profitability. And one of the most exciting realities of agritourism is that there is literally no limit to the possibilities.

In fact, the more innovative these agritourism contributors become with their endeavors, the more unique and potentially profitable they will become. Basically, there is no recipe for success or fixed manner of creating a successful agritourism operation. Further advancement in agritourism translates to the state of California becoming more alluring as a whole.

According to the research article “California agritourism operations and their economic potential are growing”—authored by Rilla, Hardesty, Getz, and George—if you’re searching for a unique agritourism experience, then word of mouth is arguably the best way to find what you’re looking for. In addition to asking the locals what activities they suggest, you can also search for roadside signs, websites, and regional brochures—the next most popular forms of marketing according to the article.

In terms of the non-monetary benefits of agritourism, the future is something that the majority of the farmers and ranchers are considering heavily. Many contributors to the agritourism industry believe that their endeavors will greatly affect future generations in positive ways by preserving family traditions and maintaining natural wonders.

The “pay-or-play” mandate is a key element of the Patient Protection and Affordable Care Act, often called “Obamacare”. It is a new law aimed at expanding health care coverage by requiring certain employers to make a choice: pay or play.

The mandate applies to “large employers” only, meaning farms, ranches, vineyards and the like who employed an average of 50 or more full-time employees – or full-time equivalent employees – per month in the calendar year prior, or for new employers who intend to employ that many in the current calendar year. The choice these large employers must make is simple: offer minimum essential coverage to all full-time employees, or pay an excise tax.

Below is some useful information for farmers and ranchers concerning the “pay-or-play” mandate and the health insurance requirements going into effect on January 1, 2014.

The Difference Between Full-Time Employees and Full-Time Equivalent Employees

The “full-time equivalent,” or FTE, concept is intended to dissuade employers from replacing full-time employees with additional part-time employees in an effort to side step the “pay-or-play” mandate.
A full-time employee is anyone who works at least 30 hours per week, or 130 hours per month. So, the FTE is calculated by adding together all of the hours worked by part-time employees in one month and then dividing that number by 120. This means an employer who has 12 part-time employees working a total of 1,200 hours per month between them (100 hours per month per employee) is considered to have 10 full-time employees, and thus is using 20 percent of the 50 full-time employee total.

The Rules Regarding Seasonal Employees

Seasonal employees do not count toward the 50 full-time employee total.
Seasonal employees are employees who worked 120 days or fewer in one year.

Time Constraints and Requirements

Hiring and firing decisions made in 2013 by applicable large employers may affect the necessary coverage required on January 1, 2014.
The IRS allows large employers to use a measurement period of 3 to 12 months of employment history to determine whether or not a certain employee is full-time.
Any new employees are subject to an administrative period. This allows applicable large employers up to 90 days to determine whether or not the new employee is eligible for coverage.
After January 1, 2014, all eligible employees must be provided coverage.

If a large employer chooses not to provide health insurance coverage to any or all of their full-time employees, fines could total $2,000 or $3,000 for each full-time employee. However, there are many factors and situational differences that can affect a large employer’s decision to “pay” or to “play”. For example, the first 30 employees are excluded from the total when penalties are calculated, so it may be economically beneficial for a large employer to choose to “pay”. This is because sometimes the health insurance coverage for the year totals more than the fine itself.

If you fall into the large employer category, seek the advice of a tax professional or insurance broker for specific details on your unique situation.

Tag Archives: farms

Agricultural Tourism And Its Effects

Farm Employers and the “Pay-or-Play” Mandate