Farmland values in the United States represent a major component of the farm sector balance sheet. The linkage between farmland values and agricultural debt has typically been ignored in the literature. This paper attempts to make two contributions to our understanding of farmland prices. First, building on established literature, this study examines the role of debt solvency and government payments in farmland valuation. Second, from a methodological standpoint, this study incorporates both the nonstationarity dimension of farmland prices and the panel structure of the data relying on recent advances in econometric literature.