Western states gauge foreign ownership of agricultural land with eye toward national security

LAY OF THE LAND

I’m guessing you’ve seen the headlines about Western states crafting legislation aimed at limiting foreign ownership of agricultural land. And I’m betting, like me, you’ve wondered what’s behind this trend. So I’ve done a little digging.


Legislation and Foreign Ownership

First of all, foreign ownership is no secret. The Agricultural Foreign Investment Disclosure Act requires foreign investors in U.S. agricultural land to report their transactions to the Department of Agriculture (USDA), which publishes an annual report about the purchases.

Second, foreign ownership isn’t that significant: the 40 million acres of foreign-owned land accounts for just 2.5% of the 1.3 billion acres of private agricultural land in the U.S. As of 2021, the top foreign owners of land are from Canada (12.8 million), the Netherlands (4.8 million), Italy (2.7 million), the United Kingdom (2.5 million), and Germany (2.2 million).

So why the headlines? Think “national security.” Certainly, that was the case for the North Dakota Legislature, which in April passed a law banning foreign governments, and businesses they control, from buying ag land in that state. (Canada is not considered a “foreign government” in the bill.)

The genesis of that legislation was a land purchase by the Chinese-owned Fufeng Group. The self-described “internationalized bio-fermentation products manufacturer” paid $2.3 million to purchase 300 acres just 12 miles from Grand Forks Air Force Base, home to top-secret drone technology. After local and federal authorities expressed concerns about the firm’s connections to China’s ruling government, the project was halted by the state, owing to national security concerns, and the legislation followed.

What’s happening in other states?

Similar legislation is being considered in other states, but not all of it is meeting with approval. For example:

  • A supermajority of senators in South Dakota rejected a panel, proposed by Gov. Kristi Noem, to oversee foreign purchases of agricultural land.
  • Proposed bills in the Wyoming legislature that would have prevented any foreign government, business or person from buying state ag land died in committee.
  • Legislators in Washington state have legislation in committee that would bar foreign companies, governments and foreign-controlled subsidiaries from purchasing land in the state used for farming, ranching or timber production.

Congress Ponders Federal Law

Federal legislation has been considered in recent years to limit purchases with origins in China, Russia, Iran, and North Korea. In April, Colorado U.S. Senator Michael Bennet and other senators introduced the bipartisan Security and Oversight of International Landholdings (SOIL) Act to “provide oversight and transparency over purchases of American agricultural land that threaten our national security.” To date, no bills have been approved.


WHAT ELSE?

BIG GAME, BIG NUMBERS: High interest in Colorado’s hunting season has created so much demand that there aren’t enough licenses to go around. For example, the Denver Post reports that Colorado Parks and Wildlife received nearly 218,000 applications last year for deer-hunting licenses, but the agency only had about 102,000 available. In addition to being a bonanza for the state, it’s good news for outfitters.

IT’S A (CONTROLLED) FLOOD: It turns out this season’s huge snowpack is having another positive impact on the West. All that snowmelt, according to a report from KUNC, is enabling the Bureau of Reclamation to orchestrate a big release of water at Glen Canyon Dam in Arizona. The action is designed to mimic natural floods of the past that moved sediment downstream to naturally rebuild beaches and sandbars, which in turn provide habitat for wildlife in the Grand Canyon.

BY THE NUMBERS: There are 99 million Americans who live in a wildland-urban interface (WUI). Why is that important? Because residential and commercial developments in the WUI are right next to land that’s filled with wildfire fuel, and as a result could be in great peril in the event of a wildfire. Learn about wildfire mitigation in a piece I wrote last year.

TAKE THE DIVE: Last month I caught up with Amber Smith, the Executive Director of Women in Ranching. We had a fascinating conversation on the role of women on ranches over the years and how it continues to evolve. Read more

Lay of the Land is a monthly column by Ken Mirr, the Founder and Managing Broker of Mirr Ranch Group, that highlights news of the West impacting the ranch lifestyle. Have a question about the West? Email him at Ken@MirrRanchGroup.com.


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