CHEYENNE — Two bills that would restrict foreign businesses, governments and individuals from owning land in Wyoming came out of the House Agriculture, State and Public Lands and Water Committee on Thursday.
Members of the committee passed the bills after debating, amending and working through them for nearly three hours. Despite conversations of unconstitutionality, infringing upon property rights and risk of estranging foreign investors, the bills will head to the House floor.
A bill prohibiting ownership of land in the state by certain countries was approved 8-1, and a second bill restricting all foreign ownership of agricultural land split the committee but passed 5-4.
Rep. Barry Crago, R-Buffalo, was the only committee member to vote no on both. Not only was he concerned with the enforcement of the bills, but he said they go against the Wyoming Constitution under Article 1, Section 29 and the “rights of aliens.”
“No distinction shall ever be made by law between resident aliens and citizens as to the possession, taxation, enjoyment and descent of property,” he said, quoting the constitution.
“I think both of these bills have facially unconstitutional provisions built into them because of Section 29.”
That didn’t stop the committee from working the bills to find compromise, even as there were calls for further study in the interim session.
Foreign property ownership
Freshman Rep. Bill Allemand, R-Midwest, was the sponsor for the first bill considered and said the issue couldn’t wait any longer. He said he believes it is best for the state and a matter of safety.
He introduced House Bill 116 to the committee that he sits on, which would restrict foreign businesses, governments and people from Russia, China or a country that has been designated as a state sponsor of terrorism from owning property in Wyoming. He first considered all countries but said he didn’t know where to stop, and the committee “could put in here something like ‘a communist country.’”
The U.S. State Department currently recognizes Syria, Iran, North Korea and Cuba as state sponsors of terrorism. Allemand was asked what would happen to assets if a country was added to the recognized list, and he said they would be held to the same standards within the bill.
“If these countries are good to us, we have no problem. We’ll be good to them,” he said. “We cannot buy land in China. We cannot buy industry in Russia. We cannot buy — I don’t even think we want to get off the plane in Iran. So, this is just limited to people who hate us.”
Under Allemand’s legislation, the definition of land is “real property or real estate in any surface, subsurface, airspace or mineral interest in Wyoming.” This means the listed foreign governments, businesses and persons — including agents, trustees or a fiduciary — wouldn’t be able to buy or otherwise acquire land, except for a personal residence that doesn’t exceed one acre.
If they did own land in Wyoming as of July 1, the listed groups in the bill would have two years to divest all rights, titles and interest in the land. Property that they purchased for a personal residence would have to be registered with the Secretary of State’s Office, and anyone who failed to do so would be liable for a civil penalty of $5,000 for each day they failed to comply with the law.
County clerks would also be responsible for reporting to the Secretary of State’s Office if a foreign entity, government or person bought or acquired land in their county, or if the clerk suspects there has been a violation. The Secretary of State’s Office would then report it to the Attorney General’s Office for action.
Secretary of State Chuck Gray spoke in support of both bills, which have nearly identical language when it comes to reporting and registration. He said there would be no fiscal impact on his office, and he was confident existing filing capabilities will be able to handle the registration procedures.
Gray also noted that six states have banned foreign ownership of U.S. farmland and said many more are examining similar legislation.
“House Bill 88 ensures one of Wyoming’s most important assets maintains its protection,” he testified during the House Bill 116 discussion. “In the last decade, foreign ownership of agricultural land in the United States has increased exponentially, with the latest data from the U.S. Department of Agriculture estimating that approximately 38 million acres of the country’s agriculture and timberland are owned by foreign investors.”
The main sponsor of HB 88 was fellow newly elected Rep. Dalton Banks, R-Cowley, who also is a member of the House Agriculture Committee.
Foreign governments and businesses that already own agricultural land in Wyoming would be grandfathered in if the land was held before July 1. Restrictions included in the legislation would still not allow them to sell or otherwise dispose of the land to another foreign government or business, and they would need to register the property.
Banks originally had the same language for “foreign person” included in HB 88, but it was amended out of the bill by the committee before the final vote. The same was not done for HB 116.
“At the end of 2021, foreign investors owned over 426,000 acres of agricultural land in Wyoming, according to the U.S. Department of Ag Economic Research Service, and that number doubled from 2021 to 2020,” testified Banks. “And while Wyoming acreage is a small amount of more than 40 million acres owned by foreign interests in the United States, it is a rising concern.”
He said he had spoken with many agricultural producers and organizations from across the state who expressed opposition to foreign ownership, some of which appeared before the committee.
Wyoming Farm Bureau Federation Director of Public and Governmental Affairs Brett Moline said his group passed a policy at its annual meeting in November to not have foreign government ownership of land in Wyoming. He said he appreciated both bills, even if they weren’t perfect.
Testimony was also heard from Wyoming Stock Growers Association Executive Vice President Jim Magagna, but only in support of Allemand’s foreign ownership bill. He said he liked all land being included and the specified countries, but he was concerned with language directed at foreign persons.
Allemand said his intent with including individuals was he was afraid they may be representing the Chinese government or Russian government, and no one knows they were being directed by the government. He said he wasn’t trying to “deprive anyone of the American dream,” and that’s why he included that they could own one acre and build a residence.
“I’m just concerned that they may be a person who is very capable of going beyond owning an acre for a home, and establishing a very viable business in our country,” Magnana responded. “Perhaps they brought technology and knowledge with them from one of these foreign countries, but they want to use it on our behalf, not on behalf of the country they’ve escaped from.”
Other stakeholders, including Wyoming Association of Realtors Government Affairs Director Laurie Urbigkit, expressed their concern when it came to discerning who would not be allowed to purchase property. She testified on HB 88 and clarified the association didn’t take a position on either bill preceding her comments.
Urbigkit said they were governed by the Federal Fair Housing Act and aren’t able to discriminate based on national origin. She said there may be wiggle room if it is only agricultural land and there is no house, but their code of ethics also prohibits discrimination.
“We had a lengthy discussion about this at our recent state meeting. And everybody appreciates and understands and supports that we don’t want foreign governments owning our ag land, we get that,” she said. “But we don’t want to be the police that figures out who’s foreign and who’s not.”
She told lawmakers they will most likely continue to sell real estate in Wyoming the same way as they always had. Urbigkit also said she hoped if someone from a foreign nation bought property and they didn’t know, they wouldn’t be liable for violating the law.
Representatives from the mineral industry whose companies are owned by other foreign entities were also worried their investments may be at risk, whether that be their grazing leases or expanding mining projects in the region.
The testimonies influenced different amendments to HB 88 before it passed, such as only impacting property ownership and not other forms of land acquisition, as well as the removal of “foreign persons.”
However, the greatest change to both bills was an appropriation of $5 million to each for the Secretary of State’s Office and county clerks. Crago was greatly concerned with the clerks’ ability to research and investigate each purchase filing and said he knew it may take extra manpower, hours and technology. He also recognized a criminal penalty for clerks who don’t uphold their responsibilities.
County Clerks Association of Wyoming lobbyist Mary Lankford emphasized the difficulty with enforcement altogether. She said county clerks have no authority to investigate foreign ownership, and it would need to be built into any legislation that moves forward.
“This bill says that it’s going to restrict foreign ownership of property, (but) by the time that document gets to the County Clerk’s Office, the property has been transferred. The cow’s out of the barn. The deal’s done,” she said. “It would seem to me that it would make sense to put that investigation ahead of that, at a place before the purchase, or at the purchase, to determine if that really is a foreign entity that’s purchasing the property, as opposed to when the done deal is being recorded and reported to the public.”
The closing mechanism for transferring real estate is also different in Wyoming than many other states. A lawyer doesn’t have to be involved, and any piece of property can be handed over with the deed. Crago said the state didn’t have the statutory framework to flag foreign ownership in advance.
Allemand recommended removing the clerks’ responsibility from the bill in a fight against the $5 million appropriation, but many said it would have no teeth without it.
Both bills moved on, with enforcement in question and an interim topic on the table.
“I do think an interim study would be warranted. And if we took this to the floor, it would kill a good many bills,” said House Agriculture Committee Chairman John Eklund, R-Cheyenne, before his no vote. “I don’t know whether our leadership wants to do that, because this took more time than I anticipated.”