A bill aimed at preventing foreign governments and "state-controlled" businesses from purchasing agricultural land is nearing passage in North Dakota's state legislature.
House Bill 1135, which would prohibit foreign governments from acquiring agricultural land in North Dakota, passed the state senate 47-0 on Tuesday. It now goes back to the House, which passed the original version 93-0 in February.
The bill is, in part, the result of increased attention on land ownership brought by the Fufeng Group's purchase of 370 acres of land to build a wet corn milling plant. The property bought by the Chinese company is located 12 miles from the Grand Forks Air Force Base, which the Air Force said presented a "significant threat to national security."
The Committee on Foreign Investment in the U.S., which analyzes foreign acquisitions for national security threats, said in December it did not have the jurisdiction to review the purchase. However, the city of Grand Forks said it would deny building permits for the project, according to The Center Square.
North Dakota currently has laws restricting the purchase of agricultural land by individuals who are not citizens or permanent resident aliens of the United States. The state also has corporate farming restrictions, which prevents business organizations from acquiring any interest in agricultural land unless "the ultimate beneficial interest is held by citizens of the United States or by permanent resident aliens of the United States."
State Rep. Lawrence Klemin argued earlier this year that there is nothing in North Dakota law prohibiting the acquisition of land by a foreign government or "state-controlled enterprise" of a foreign government. This bill, he said, would fix that.
The bill was amended in the Senate to exclude leasehold interests, land used for research or experiment purposes, or acquisitions of less than 320 acres. It also does not apply to interests held by foreign governments before July 1, 2023.
North Dakota Agriculture Commissioner Doug Goehring pushed for research land to be excluded from the measure. In testimony earlier this year, he said limiting ownership of these land types would hinder seed and chemical development and business opportunities within the state.
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"Research and development of new seed and chemical products has to happen in the United States and must be done where the crops are managed, produced, registered and licensed," Goehring said. "The majority of developing, testing, evaluation, seed breeding, and seed proliferation are performed by multinational companies that may likely not be owned or headquartered in the United States."
The bill received support from the Independent Beef Association of North Dakota, the Dakota Resource Council, the North Dakota Stockmen's Association and the North Dakota Farmers Union.
The North Dakota measure is just one of several being considered by states, amid increasing nationwide concerns about foreign investment. Arkansas, Idaho and Utah have passed measures this year with land ownership restrictions for foreign governments or "adversaries." Bills in Montana and Virginia are nearing approval, but have not been passed yet.
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