Senate Judiciary debates limits on foreign land ownership

On May 12, the Senate Judiciary Committee considered a Proposed Committee Substitute (PCS), to the NC Farmland and Military Protection Act (HB 133), a companion bill to SB 394, which was passed unanimously by the Senate last year. A PCS is an amendment to or a new version of the original bill. No action was taken on the bill, but there was an extended discussion on its merits.

State Sen. Bob Brinson, R-Craven, a retired Army aviator, who authored SB 394, presented the PCS to the committee. Brinson worked with Rep. Jennifer Balkcom, R-Henderson, who authored HB 133, to combine the two bills. 

Proponents say this bill would protect American farmland and land around military sites from foreign adversaries, establishing a 50-mile buffer around military installations, according to Brinson. Rather than pinpointing specific countries, “foreign adversaries” are tied to the International Traffic in Arms Regulations, updated by the federal government.

In the PCS, National Guard facilities are now included among the military installations, stated Brinson.

“Divestiture requirements only apply to newly acquired property, a divestiture within three years, enforced by the attorney general through receivership,” said Brinson.

Those who are interested in land must register with the secretary of state and the attorney general, and “any future purchase requirements require an affidavit from the buyer attesting that the buyer is not a prohibited party,” said Brinson, with “the affidavit attached to the deed upon filing.” 

State Sen. Lisa Grafstein, D-Wake, raised concerns about the federal government’s tracking of foreign adversaries prohibited from owning land, the frequency of federal government updates, and potential complications that could arise.

Balkcom joined the committee to offer comments on the PCS, starting with the definition of adversary. 

“It’s restricting because the federal government has already identified that they are presenting a significant concern,” said Balkcom. “So if your small business is actually teaming up with one of these, then we need to be concerned, no matter where you are in the state of North Carolina. So it would not bother a small business from that as long as they are not part of the embargo of national security restrictions.”  

Grafstein raised concerns with the breadth of the word “entity.” Balkcom directed her back to the definition outlined in the International Traffic in Arms Regulations.  

State Sen. Sophia Chitlik, D-Durham, raised concerns about companies such as Smithfield Foods, a subsidiary of a Chinese-owned company, and how that would impact economic development. While there is no evidence that these companies are tied to wrongdoers, they are supported by foreign governments, according to Chitlik. She also pointed out that many agricultural companies, such as seed and chemical manufacturers, are foreign-owned. Balkcom indicated that Smithfield Foods is exempt under the CFIUS Exempted Foreign States by the US Treasury Department. Brinson also indicated that no companies have reached out to him with concerns. 

Chitlik and Grafstein raised concerns that the 50-mile radius could incentivize legitimate economic actors to go out of state for their needs, implying that the radius could be reduced to a 5-10-mile radius, similar to states like Montana and Florida. 

The original Senate Bill had a 25-mile radius, while the House Bill had a 75-mile radius, so the chambers compromised on a 50-mile radius, according to Brinson.

“At what cost to our national security do we protect our economy and growth?” said Brinson. “I think there is enough growth in the state of North Carolina that I am not concerned about foreign entities and allowing foreign entities to come. This is not just areas around military bases, but this is our agricultural farmland as well. Food security is national security for me.”

North Carolina is the fourth-fastest-growing state in the nation and the first in in-migration, according to Brinson. 

“We are a great state based on the policies we have in place, so excluding countries that are on this list that are a threat to our nation, I’m not concerned about their growth or the jobs that they bring to the state of North Carolina, because we don’t need them,” said Brinson. 

Balkcom emphasized that foreign adversaries subject to the International Traffic in Arms Regulations are bad actors and that adhering to this list protects the state of North Carolina from them.  

“If we cover the entire state due to the fact that we are using the federal government International Traffic in Arms Regulations, it is protecting from bad apples,” said Balkcom. “You could cover the entire state, and because of that definition, it is protecting us from bad actors. In my opinion, I would be fine with no boundaries because they have already committed something to be a bad actor, with the definition we are using.” 

Sen. Michael Lazarro, R-Onslow, expressed his agreement with Rep. Balkcom: “No boundary, I would support that all day long here in North Carolina.” 

The committee took no action on this bill and will consider it at a later date yet to be determined. 

“Senate Judiciary debates limits on foreign land ownership” was originally published on www.carolinajournal.com.