Agricultural Security Bill Passes Committee, Strengthens National Security
A bill aimed at bolstering U.S. national security by assessing the risk of agricultural transactions has cleared the House Financial Services Committee with bipartisan support. This significant step paves the way for a floor vote in the House.
The bill, known as the “Agricultural Security Risk Review Act,” proposes granting the U.S. secretary of agriculture a permanent seat on the federal national security review panel, the Committee on Foreign Investment in the United States (CFIUS). This inclusion would cover agricultural transactions, including the acquisition of farmland and agricultural biotechnology.
“Safeguarding America’s agricultural security is crucial for our national well-being,” emphasized Rep. Frank Lucas (R-Okla.) in a statement released on Sept. 21. “Given the increasing foreign investment in U.S. agriculture, it is long overdue to have the Secretary of Agriculture as a member of CFIUS.”
“Having witnessed firsthand the importance of securing our agricultural industry, I commend my colleagues on the House Financial Services Committee for taking this crucial step towards enshrining my long-standing priority into law,” added Rep. Lucas.
During a White House press briefing, U.S. Agriculture Secretary Tom Vilsack echoed the necessity of having his department represented on CFIUS to ensure a foolproof system that leaves no room for oversight.
“Legitimate concerns exist in this domain,” stated Secretary Vilsack when asked about potential exaggeration of Chinese farmland purchases’ impact on national security.
Secretary Vilsack cited a case in North Dakota where a Chinese firm acquired farmland near a military installation as one of the reasons his department advocates for increased involvement in the CFIUS process.
In 2021, a Chinese company, through its subsidiary Fufeng USA, purchased 370 acres of farmland in Grand Forks, North Dakota, to establish a corn-milling plant. This land lies within 15 miles of Grand Forks Air Force Base, which houses sensitive drone, satellite, and surveillance technology. In December 2022, CFIUS determined that the land sale for the Fufeng project did not fall under its jurisdiction.
However, at the end of January, the Department of the Air Force (pdf) expressed an “unambiguous” view that the proposed project poses a significant threat to national security, with both immediate and long-term risks to operations in the area.
On July 25, the U.S. Senate passed an amendment proposed by Sen. Mike Rounds (R-S.D.) that prohibits China and other foreign adversaries from acquiring U.S. farmland and agricultural businesses. This amendment is included in the Senate version of the National Defense Authorization Act (NDAA) for fiscal 2024, which passed at the end of July.
Sen. Rounds’s amendment, approved by a 91–7 vote, also adds the secretary of agriculture as a nonvoting member of CFIUS. Rep. Lucas’s bill goes further by offering the secretary permanent membership. The 2024 NDAA is currently under review by the conference committee before it reaches the president’s desk for signature.
CFIUS, led by the Department of Treasury, is an interagency commission comprising members from various government departments. Its current members include the secretaries of Homeland Security, Commerce, Defense, State, Energy, and Labor, as well as the attorney general and the director of national intelligence. Currently, the agriculture secretary’s involvement is determined on a case-by-case basis by the U.S. president.
Secretary of Agriculture Tom Vilsack speaks during the daily press briefing at the White House in Washington on Sept. 25, 2023. (Madalina Vasiliu/The Epoch Times)
Secretary Vilsack also emphasized the need to enhance information collection regarding Chinese farmland purchasers.
“We must equip ourselves with the necessary tools to better track these transactions,” he added.
The Agricultural Foreign Investment Disclosure Act (AFIDA) of 1978 mandates that foreign individuals disclose any acquisition or disposal of U.S. agricultural land. Within 90 days of the transaction, the foreign individual must submit filings to the Farm Service Agency. Failure to report incurs a civil penalty of 0.1 percent of the land’s fair market value per week, up to 25 percent for late filings.
However, the USDA often significantly reduces penalty amounts (source) to avoid discouraging reporting. For instance, in April 2021, the department reduced the fine for a Chinese billionaire who failed to report the purchase of 140,000 acres of agricultural land in Texas in 2016 from $21 million to $120,000.
As of Dec. 31, 2021, China owned 383,935 acres of U.S. agricultural land, according to a USDA report (pdf). Although this acreage represents less than 1 percent of all foreign-held agricultural land, it marks a nearly 30-fold increase from 13,720 acres in 2010.
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Agricultural Security Bill Passes Committee, Strengthens National Security
A bill aimed at bolstering U.S. national security by assessing the risk of agricultural transactions has cleared the House Financial Services Committee with bipartisan support. This significant step paves the way for a floor vote in the House.
The bill, known as the “Agricultural Security Risk Review Act,” proposes granting the
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