Noem and some legislators want a board vetting foreign ownership of ag land

Governor Kristi Noem and some legislators plan to introduce a bill to establish a vetting process for foreign purchases of agricultural land in South Dakota. 

The plan includes creating a board to investigate proposed purchases of ag land by foreign interests, and to make recommendations of approval or denial.

“With this new process, we will be able to prevent nations who hate us – like Communist China – from buying up our state’s agriculture land,” Noem said in a news release.

The board would be called the Committee on Foreign Investment in the United States – South Dakota.

The prime sponsors of the legislation will be Sen. Erin Tobin, R-Winner, and Rep.-elect Gary Cammack, R-Union Center, according to a news release from the governor.

“With vital national security resources like Ellsworth Air Force Base, we cannot afford for our enemies to purchase land in South Dakota,” Cammack said in the release.

The news release said the board’s jurisdiction would cover transactions of any number of acres involving any foreign person, foreign government, foreign business, or any organization controlled by a foreign person, government or business.

Cammack said the group working on the bill is determining how the proposed committee might be alerted to potential purchases of land by foreigners.

A state law exists

The Legislature passed a bill in 1979 that was designed to prevent some foreign individuals and governments from owning more than 160 acres of farmland.

Despite the existence of that state law, a Chinese firm owns a meatpacking plant in the state’s largest city. And records revealed in 2016 by the Midwest Center for Investigative Reporting showed multiple examples of foreigners owning more than 160 acres in the state – more than 350,000 acres of South Dakota farmland in total.

Jon Van Patten is an assistant attorney general for the state. He told South Dakota Public Broadcasting in August that the 1979 law has a loophole because it only addresses foreign residents and governments.

“Who else besides an alien and a foreign government could own property? And the answer would be a corporation,” Van Patten said.

But Cammack said the legislation will not attempt to close that loophole. He said the state wants to be careful not to sideline all foreigners with a blanket approach. 

“For example, we have our neighbors to the north up in Canada that we do business with,” Cammack said. “We want to be careful not to ruin those relationships.” 

According to data from the U.S. Department of Agriculture, foreign residents or entities now own over 350,000 acres of ag land in South Dakota — that’s about 1% of all South Dakota agricultural land, but a greater than 3,000% increase from 1979. The largest foreign owners of South Dakota farmland are from Europe.

Cammack declined to release the legislation and said it’s still a draft. This year’s legislative session begins Jan. 10 at the Capitol in Pierre.

Similar efforts are already underway in other states such as Missouri, where legislators have filed several bills that would restrict foreign ownership of agricultural land.

South Dakota’s ag-land proposal is the continuation of a string of actions by Gov. Noem taking aim at the Chinese government. She recently issued an executive order banning the use of the TikTok app or website on state devices. TikTok is owned by a Chinese company, which Noem said is a security concern for the United States. And Noem also recently called on the South Dakota Investment Council to review all state investments for potential ties to countries including China.