Holistic financial planning, we figured, costs about $20,000 in labor to complete (assuming farmers and ranchers are valuing their time and paying themselves a salary, which doesn’t happen enough) and about 11 days total out of the year to complete. It is well worth the investment. It could save the ranch. It could mean peace of mind instead of more debt. For two days of the intensive training, we focused on holistic financial planning for our wholes under management. The first step–which builds on the foundations of holistic management–is to define the whole under management and build the financial plan for this entity. Spencer and I did our financial plan as a couple and included all our enterprises: the hub, horses and cattle. Each enterprise is looked at individually and must stand on its own. If the horses, for example, were putting us in the red, we don’t slide profit over from the cattle, for example, to patch up the horse enterprise. This muddies the water. Each enterprise on a ranch or farm must be evaluated based on its own income and expenses. The other piece of holistic financial planning (and it is quite a process, I am summarizing greatly here) that really makes it stand out is that income and profit are planned first and then set aside in an untouchable category. How many people ask themselves first how much profit they want to make in a year? Or do we (I’m guilty) usually look at our expenses, figure out what income we need to cover them and stash away or reinvest whatever we have left over? Once planned profit and income are set aside the expenses are scrutinized. There is a column in the annual plan for allowed expenses (how you need to cap your expenses in order to achieve the profit you planned) and total expenses (Total expenses is all enterprises plus overhead–which must be carefully calculated in the spreadsheet. It is an enormous spreadsheet.). The work becomes aligning allowed expenses to total expenses and then managing the budget throughout the year to this. What a different exercise this is than shuffling around profit to cover enterprises that aren’t pulling their own weight and trying to make ends meet. Financial decisions that go into building the budget are tested against a ranch or businesses or family’s holistic context to make sure they are leading toward sustainability.
After two days of pouring over spreadsheets and the self-reflection holistic financial planning requires, we were ready to get out to Dr. Cyndi Daley’s ranch near Oroville and spend the day examining the land. We learned about basic and comprehensive biological monitoring at Guidici Ranch. And it din’t rain! Although the storm from earlier this week started the annual creeks running again and made some parts of the ranch inaccessible. Biological monitoring takes place at the soil surface because this is going to show the first signs of change–the effects of management changes. While counting wildlife numbers, production capacity and even grass species is important, to get the quickest feedback on the effects of a management decision, look at the soil surface. So we spent all day in the field learning how the soil surface can tell us about the status of the ecosystem processes there. For example, while standing water and fast running creeks may be a welcome sight after last year’s drought, it also can be a sign of compacted soil that is lacking the organic matter to absorb and hold water. This means the water cycle and mineral cycle (the process of plants growing and decaying) are compromised, it also means the community dynamics (the microbes and small organisms in the soil) are weak.
Biological monitoring is about learning to understand what the land is telling us, not rank it as “good,” “bad,” etc. It is about the potential of the land. The data collected from biological monitoring is for feedback on management decisions. And it is really fun. At Guidici Ranch, we noticed the depth of organic matter (plant litter) to be much higher under a stand of oak trees in one field. As we stood back and looked across the field it was a noticeable difference. And the health of the soil under the trees translated into larger plants and more small organisms in that area. This could be from the increased animal impact under the trees as the cattle like to spend time in the shade of these giant oaks in the summer. The canopy of the trees also slows evaporation and the leaves provide litter to cover the soil. Once I started seeing the land in terms of healthy ecosystem processes or interrupted ecosystem processes, every player in the cast became an amazing source of wonder, from the towering old oaks in the field, to the tiny spiders crawling across a blade of grass, to the herd of Cyndi’s cattle moving as one across the field. A day spent on hands and knees combing through the soil surface was well worth this new way to see the world.