The Kentucky House has advanced a bill to block non-U.S. interests with government ties to China, Russia and a handful of other countries from buying or leasing farmland in the commonwealth.
House Bill 575 would specifically prohibit foreign businesses and agents tied to countries banned from U.S. defense trade under ITAR (federal International Traffic in Arms Regulations) from buying or leasing public or private farmland in Kentucky with few exceptions. Those counties include China, Russia, Afghanistan, Belarus, Cuba, Iran, Iraq, Libya, North Korea, Syria, Burma, Haiti, Sudan and Venezuela.
The U.S. added Russia to ITAR in 2021 following the poisoning of Putin adversary and Russia opposition leader Alexei Navalny, who died under suspicious circumstances in a Russian prison last month.
Affected foreign interests with farm holdings in Kentucky now would be able to keep those holdings and expand existing operations onto adjacent land, but could go no further. Exceptions would be made for purchases of Kentucky farm land for ag research and development use only, limited to 350 acres per purchase.
HB 575 passed the House 83-14 Thursday. It is similar to HB 500 which passed the House last year before stalling in the Senate. All Northern Kentucky lawmakers voted for HB 575 Thursday except Rep. Rachel Roberts (D-Newport).
HB 575 sponsor and House Agriculture chair Rep. Richard Heath (R-Mayfield) linked the bill to ITAR to keep the state enforcement list current, he told the House before the Thursday vote. Enforcement of the act – which could include forced sale of the land – would be handled by the state Attorney General’s office, the bill says.
The legislation is part of a growing movement among states to ban or restrict investment in U.S. real estate by certain nations.
In 2023, Florida passed a law banning “certain individuals and entities associated with foreign countries of concern” from buying farm land and other types of real estate. Countries specified in the law include China, Russia, Iran, North Korea, Cuba, Venezuela and Syria. That law is currently being challenged in federal court.
At least 20 other states have laws in place limiting foreign ownership of farm land and other types of real estate as concerns with foreign acquisition of U.S. land rise.
Congress may also act this year on foreign ownership and investment in U.S. real estate, with a focus on agricultural land.
Congressman Dan Newhouse (R-WA) said in a March 5 op-ed in Newsweek that foreign interests now have a stake in about 40 million acres of U.S. farmland – about the same amount of farmland found in the state of Nebraska. A member of the U.S. House Appropriations committee, Newhouse said in the editorial that he expects Congress to address the issue of foreign investment in U.S. farmland in its fiscal year 2024 agricultural spending bill, now pending.
“The issue of our foreign adversaries’ influence has remained a hot topic in negotiations,” Newhouse wrote. “Cyberattacks and foreign intelligence gathering that were once only issues under the purview of the Departments of State or Defense now seep into every aspect of our institutions and infrastructure. As a member of the powerful House Appropriations Committee, I, along with my committee colleagues, have fought to include critical provisions to bring these actors into the light and empower our agencies to fight back against this malicious influence.”
Newhouse’s op-ed came two weeks before a March 20 Newsweek report warned of U.S. drinking water threats connected to potential foreign cyberattacks, specifically from Iran and China. White House National Security Adviser Jake Sullivan and Environmental Protection Agency (EPA) officials reportedly issued the warning in a letter to governors across the country.
“Disabling cyberattacks are striking water and wastewater systems throughout the United States. These attacks have the potential to disrupt the critical lifeline of clean and safe drinking water, as well as impose significant costs on affected communities,” the letter said according to Newsweek. “We are writing to describe the nature of these threats and request your partnership on important actions to secure water systems against the increasing risks from and consequences of these attacks.”
As to HB 575, Heath on Thursday said the bill “addresses an issue of paramount importance safeguarding both our agricultural economy and national security. This is not an effort to isolate ourselves but rather to ensure the interests of our farmers and the security of our agricultural sector is protected.”
Rep. Nima Kulkarni (D-Louisville) was among the 14 lawmakers voting against the bill. She questioned the impact of the legislation on Kentucky refugees from Burma, Haiti, Venezuela and other countries on the ITAR list.
“How is this going to help them feel welcome?” Kulkarni asked Heath before the floor vote. Many U.S. refugees, she said, are “nonresident aliens” who would be impacted by the legislation as now written.
In his comments Thursday, Heath said “Kentucky has benefited greatly from foreign investment and we welcome those that have no ulterior motives. This bill sets reasonable restrictions on the acquisition of agricultural land by those limited nations, ensuring that the expansion of foreign owned agricultural operations align with Kentucky’s interest.”
HB 575 now goes to the Senate for its consideration. The 2024 Kentucky General Assembly will conclude the current legislative session no later than April 15.