Senate rejects Noem’s bill to vet ag-land purchases by foreigners

PIERRE – The state Senate rejected a bill Tuesday that Gov. Kristi Noem had proposed as a way to protect South Dakota’s agricultural land from purchases by hostile foreigners.

The vote was 23-11, and it wasn’t the only legislative rebuke of the day for Noem. Earlier Tuesday, a House committee rejected her bill to repeal the state sales tax on food.

The ag land bill would have established a seven-member board responsible for reviewing applications from foreigners and foreign entities seeking to purchase land in the state. The board would have made recommendations to the governor.

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Noem and other Republicans have said they want to protect South Dakota ag land from coming under the ownership of countries like China. They also fear hostile foreign governments could obtain land near sensitive areas like Ellsworth Air Force Base in Rapid City. 

“Make no mistake, this is a national security issue,” said Sen. Jessica Castleberry, R-Rapid City.

The board’s jurisdiction would have covered 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.

The bill could have a chilling effect on foreign investment in the state, which would be detrimental to South Dakota’s banking and agricultural industries, according to Sen. Lee Schoenbeck, R-Watertown. 

The bill would have required foreigners to apply to the committee before buying ag land. That language was an amendment to the bill, to take the vetting onus off county registers of deeds. 

That language means “this bill is also a self-reporting system,” Schoenbeck said. “There’s nobody going around, checking every deed, investigating if the law has been complied with.”

Opposition to the bill in an earlier committee hearing came from many state agriculture associations, including the South Dakota Farm Bureau, Farmers Union, Stockgrowers Association, Dairy Producers, Wheat Growers, and the Pork, Soybean, Corn, and Cattlemen’s associations. Some took issue with a provision in the bill that would have given the governor the final say over the board’s recommendations.

After the Senate vote, Sen. Erin Tobin, R-Winner, announced her intent to try to have the bill reconsidered. She has until Wednesday to convince a majority of the Senate to cancel the original vote and consider the bill again.

Related bill passes

The Senate passed a bill that would prohibit the state from doing business with companies in countries considered hostile to the United States.

The bill, which is similar to an executive order recently issued by Noem, would bar the state from buying products from businesses based in, or with ties to, China, Russia, Iran, Venezuela and North Korea. 

Supporters of the bill argued it’s necessary to protect South Dakota’s economy and ensure the state is not helping to fund enemies of the nation. 

“A lot of what it does is codify what the governor did earlier,” said Sen. Jim Stalzer, R-Sioux Falls.

The bill now heads to the House of Representatives.